Kill the Stimulus Package

Hat tip to a commenter -- what looked like spam turned out to be a link to good commentary at The Motley Fool on why the stimulus package "won't do squat" to revitalize the economy. Why not?

The answer is pretty clear to anyone who's taken Econ 101 -- you can't just pull money out of a hat and not have negative consequences on the economy, such as rampant inflation and a plunging dollar. Nonetheless, that's what we continue to do -- keep the printing presses rolling to fund our spend-happy ways [Morgan Housel, "The Stimulus Package That Won't Be," The Motley Fool, 2008.02.05].

And lest any illusion remains that the stimulus package is about fixing the recession and not simply crass cash-for-votes scheme, check out this chart from Bruce Bartlett, an economist who worked for Reagan and GW Bush:

(Sorry -- see the original post for a clearer view!)

Bartlett's perusal of historical statistics from the National Bureau of Economic Research shows that 13 of the 14 anti-recession plans enacted since World War II have been enacted at the very end or after the end of the recessions they were meant to fight. In other words, as Bartlett puts it, "the enactment of stimulus plans is a fairly accurate indicator that we have hit the bottom of the business cycle, meaning the economy will improve even if the government does nothing" [Bruce Bartlett, "Maybe Too Little, Always Too Late," New York Times, 2008.01.23].

So, to review, the Bush Administration has $140+ billion to throw away in handouts that won't actually do what they are supposed to, but can't find $26 million for the Lewis and Clark pipeline, on which the further economic growth of Sioux Falls and all of southeast South Dakota depend. How's that for a legacy?

Hmm... maybe if 100,000 Sioux Fallsians all hand over their $300 check -- hey, that's $30 million, just enough to keep the Lewis and Clark pipeline going....