"Assessing the Macro Economic Impact of Fiscal Stimulus" vs Stimulus Bill

[Oregone]

I saw posted here back a bit ago here. Its a report on economy.com written by Mark Zandi. Im honestly just getting started reading this all and going through it. Im not sure how much credibility he has thus far and what the methodology is behind the research. But, I was startled at how his suggestions are seemingly a fine contrast to the actual stimulus bill being created, which is comprised of billions of dollars of tax cuts (even if they are middle class tax cuts). I guess the real question Im asking, is if this is primarily a stimulus bill to increase demand/production in the economy and create jobs, are the funds spent most efficiently? Thoughts?

http://www.economy.com/mark-zandi/documents/assissing-the-impact-of-the-fiscal-stimulus.pdf


(From: http://www.epi.org/economic_snapshots/entry/webfeatures_snapshots_20081022)

Added: Stimulus drifting into bad ideas
http://www.epi.org/analysis_and_opinion/entry/stimulus_drifting_into_bad_ideas/

Added: Recovery package falls short of infrastructure needs
http://www.epi.org/economic_snapshots/entry/snapshots_20090204/

As I said, Im just getting started looking at it all, but what are your thoughts? Is this enough? Is it spent on the right things, most efficiently? Are we going to be seeing another bill about next year this time? Will this be a mistake in the long run? Are the links I posted full of crap?

[corruptmewithpower]

1. Makes sense to me.

And I could use some food stamps. It seems though that all these economic websites are very partisan one way or the other and this one is telling me just what I want to hear. Guess I can hardly fault them for agreeing with me.

[Oregone]

2. Regarding food stamps, I think the point is they increase production/demand without requiring...

...consumer spending, and instantly at that.

Grocery stores pay their workers, food is sold, more food is needed, food producer makes it and pays their workers, then it needs to be shipped, etc. There is a large chain of production started.

You give someone a tax rebate on a purchase, they may not use it if they dont have enough money, and if they do use it, they don't get the money back immediately. When they get it back, they spend it on savings and porn.

In the first scenario, you control how the money is spent, and in the second, you hope its spent efficiently to stimulate production (a CNN survey they cited says most consumers bank it). It seems like infrastructure spending and vouchers for goods/services produce instant stimulus and production and taxes are sort of a crapshoot.

Another idea that would be hard to implement, but would probably work better than a tax rebate, is to give someone a $10000 voucher on a home repair/improvement (not rebate). They spend it, the contractor can redeem it (open to fraud), he buys materials, materials are demanded, produced, shipped, etc. That would stimulate the construction/contracting industry immediately, and the homeowner increases the value of home (Wealth all around). But it could probably be abused, big time.

[corruptmewithpower]

3. I see, the food stamp money will be used immediately and not be

wasted. Tis a sin to waste food, or so my mom always said. The home improvement voucher idea may be great in most parts of the country, where middle class folk tend to own their homes. I have the misfortune of living in San Diego where the median price of a home is now 300K, down from almost 500K two years ago. Way out of my reach in either case. Oh well, I like your economics website very much. I'm only a little suspicious because I do like it so much.