The WSJ editorializes on the “stimulus”.
President Bush and Congress are marching arm in arm to pass their economic “stimulus,” but it’s clear that at least one group of observers isn’t impressed: investors. They blew right through all the Beltway happy talk yesterday, selling off the major stock indexes by some 3% or so on an ugly day.
I suppose an alternative possibility is that investors are spooked by the prospect of a Clinton, Obama, or McCain becoming president and are bailing out while they can still cut their losses.
But more likely they’re spooked by the results of bipartisanship.
I’m guessing the reason the Congress and President are acting so quickly on this package is that they need to do it quickly before people learn that it won’t do any good. The important point for them is to expand the size and scope of government while they have a chance.
Yes, the rebates are mostly temporary, but the expansion of government will be permanent. The new spending will have to be paid for, which will create pressure for higher taxes, which will create pressure for more spending.