Michelle Malkin decries the “stimulation-palooza” commencing in Washington, while the Wall Street Journal observes with dismay that the Chairman of the Federal reserve, the Bush administration, and Congress all seem to be Keynesians now.
The Bush administration is proposing tax rebates of $500-1,000 per taxpayer. By the time people see this money, of course, more than a year will have passed, and economic conditions will be different. Moreover, this essentially takes money from one person and gives it to another, with no net economic effect at all. The only thing to be said for it is that it doesn’t do significant damage.
There is no space for solving our current troubles with monetary policy; inflation is already bubbling. The only thing to do is to use fiscal policy. Shifting money from one hand to the other accomplishes nothing. The only tool that promises positive results is cutting tax rates.
UPDATE: The Republican Study Committee released a statement today that I applaud wholeheartedly.
