The White House has officially confirmed what most of us already suspected: Obama's $787 billion stimulus bill will fail to provide any short-term recovery relief in 2009.
Directly from the horse's mouth: Lawrence Summers, director of the White House National Economic Council...
"I expect the economy will continue to decline," with "sharp declines in employment for quite some time this year," said Summers as seen this Bloomberg article.
The counter-argument from Obamaists is that short-term relief is irrelevant unless a sound long-term foundation is built. My counter-counter is simple: Why didn't Obama create a bill to do both? Why not reserve a portion of the stimulus to provide for a short-term "holiday" (meaning you don't pay tax) on social security, capital gains and/or income taxes for six months? That freed-up money could be immediately injected into the economy. Instant short-term relief. Instant confidence booster for the stock market.
Or are the Democrats who controlled the stimulus bill-writing process not that bright?
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