Obama has added or talked about adding several new cabinet-level positions, such as chief technology officer, climate czar, and car czar. How about an advisory cabinet of economic thinkers who can offer the president big ideas for a 21st century economy?
A good place to start would be among those who sounded the alarm about our current financial crisis -- all of whom are critical of the short-sighted, ad-hoc nature of the stimulus bill. People like Nouriel Roubini, the New York University economist who was so prescient about the collapse. Lawmakers, he says, are 'injecting populist politics into economics decisions. Companies and sectors that should be left to drown are being floated lifeboats.'
Jeffrey Sachs, the Columbia University economist who was instrumental in transitioning the economic system of the former Soviet Union, is also no fan of the stimulus bill, calling it a 'a fiscal piñata,' an 'astounding mish-mash of tax cuts, public investments, transfer payments and special treats for insiders,' and 'a grab bag of hasty short-run spending.' He warns that 'without a sound medium-term fiscal framework, the stimulus package can easily do more harm than good.' This is especially true, he says, 'if we allow further tax cuts during a timeof fiscal hemorrhage, or give into 'bipartisan' demands to make the Bush tax cuts permanent."
Joseph Stiglitz is equally leery of the tax cuts that have been included in the stimulus package. "We are in uncharted territory in this crisis," he says. "But household tax cuts, except for possibly the poorest, should have no place in the stimulus. Nor should business tax breaks, except when closely linked with additional investment... Increased investments in infrastructure, education and technology, relief to states, and help to the unemployed need pride of place."
Tuesday, February 03, 2009
Great piece by Arianna Huffington on the Stimulus Package