The Fiscal Policy Lag

Arnold Kling

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Keith Hennessey has another must-read post.

I believe the Administration made an enormous mistake in its legislative implementation of the stimulus. As a result, the boost to GDP will come six to nine months later than it needed to (maybe more).

Read the whole thing.

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CATEGORIES: Fiscal Policy , Macroeconomics

COMMENTS (3 to date)

Latest Comment

ck writes:

Remind me, when are those mid-term elections scheduled for?

Posted June 4, 2009 10:13 AM

Niccolo writes:

On CK's reply, I wonder if Democrats had thought about that - though I question their intelligence to actually realize there is a lag in fiscal stimulus, if any stimulus exists - and it seems unfortunate for the Republicans that they didn't fight to at least improve the implementation of the fiscal bill to try and hedge their bets against this situation.

Posted June 4, 2009 9:31 PM

John Thacker writes:

and it seems unfortunate for the Republicans that they didn't fight to at least improve the implementation of the fiscal bill to try and hedge their bets against this situation.

Niccolo, they did. The Republican alternative, proposed by McCain, replaced most of the spending with cheaper but immediate payroll tax cuts. It failed. Republicans "fought," but having lost the elections badly, they don't have any actual power.

Posted June 8, 2009 11:46 AM

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