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Pro-Growth Tax Policy, Not a Transfer of Funds, Will Stimulate the Economy
Posted By Stephen Keen On October 21, 2008 @ 6:03 pm In Economics | Comments Disabled
The House Budget Committee yesterday held a hearing, “Economic Recovery: Options and Challenges.” The headliner of the event, Federal Reserve Chairman Ben Bernanke, caused quite a stir with his near endorsement of a proposed second stimulus bill. However, others who spoke at the hearing, such as Rep. Paul Ryan (R-WI), and Bill Beach, director of Heritage’s Center for Data Analysis (CDA), raised important questions about the need for, and possible elements in a second stimulus bill.
Ranking member Ryan’s opening statement  regarding another stimulus bill appropriately warned against hastily increasing government spending in a misplaced effort to stimulate the economy. He pointed out:
Ryan hit the nail on the head. As we noted in September , without major alterations, a second stimulus bill will fail.
Fortunately, there are alternatives to the current stimulus proposals. Heritage’s Beach, sketched out a few available options in his testimony :
Expanding the federal government is not simulative. Although proposed government spending hikes may be well-intentioned, they will ultimately fail. Congress should follow Beach’s advice and include pro-growth tax policies in the second stimulus bill.
Article printed from The Foundry: Conservative Policy News from The Heritage Foundation: http://blog.heritage.org
URL to article: http://blog.heritage.org/2008/10/21/pro-growth-tax-policy-not-a-transfer-of-funds-will-stimulate-the-economy/
URLs in this post:
 near endorsement : http://online.wsj.com/article/SB122455027730552509.html?mod=googlenews_wsj
 opening statement: http://www.house.gov/budget_republicans/press/2007/pr20081020opening.pdf
 we noted in September: http://www.heritage.org/Research/Budget/bg2186.cfm
 his testimony: http://www.foundry.org/2008/10/20/what-should-congress-do-to-help-the-economy/
 27.2 million small businesses create 60% – 80% of new jobs annually: http://www.sba.gov/advo/stats/sbfaq.pdf
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