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Politics : View from the Center and Left -- Ignore unavailable to you. Want to Upgrade?

To: Lane3 who wrote (92941)	11/1/2008 5:07:01 PM
From: Alastair McIntosh	Read Replies (2) \| Respond to of 541877

Congress is terrible at setting priorities. Greg Mankiw suggests letting each state decide: If there is going to be another fiscal stimulus, there will likely be a division between those who want tax rebates to households and those who want to help states pay for extra infrastructure spending. I have a compromise, based on the grand U.S. tradition of federalism: Let each state decide. Congress could pass a fiscal stimulus of a certain amount per person but offer two ways to have it paid out. Each state governor could be allowed to determine whether to take the money as state aid or have it paid directly to his or her state's citizens. Those governors who think they have valuable infrastructure projects ready to go would take the money. Those who do not would let their citizens take the extra cash. When designing a fiscal stimulus, there is no compelling reason for one size fits all. Let each governor make a choice and answer to his or her state voters. gregmankiw.blogspot.com

To: Lane3 who wrote (92941)	11/1/2008 5:59:46 PM
From: Paul Kern	Read Replies (1) \| Respond to of 541877

I'm skeptical about infrastructure as stimulus given the time lag but I was interested in his notion of using a commission to determine priorities. Congress is terrible at setting priorities. Revenue sharing, used in the 70s recession, if I remember, worked well to prevent deflation. First, it allowed states, counties, and municipalities to keep people on the payrolls and, hence still purchasing. Then it allowed local initialization and control of infrastructure projects to employ more people and get more money moving around the economy more quickly than big, complicated federal projects. Whether the projects were really needed, intelligent, or well thought out wasn't the point. The purpose was to keep folks employed and to employ the unemployed. Later, a similar, smaller program was called block grants.