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Thursday, January 22, 2009

CBO: Stimulus Proposal Ineffective

I wonder what Democrats think of the Congressional Budget Office now after the agency said that the proposed stimulus would be ineffective. In fact, the CBO only analyzed the most stimulative aspect of the proposal, which is the infrastructure spending. But Democrats remain clueless:

"The new CBO report does not take into account the fastest spending provisions in the bill, leaving the false impression that the overall spend-out rates are slower than they actually are," said Brendan Daly, a spokesman for House Speaker Nancy Pelosi (D-Calif.). "These provisions will go out quickly to give the economy a jolt while others will represent down payments on crucial priorities for our economic future -- investments in clean energy, health care, education and repairing our nation's infrastructure."

I'm not sure what economics course Pelosi's spokesman took, but it certainly wasn't at any business school I know. As the 2008 "stimulus" rebate checks showed clearly, welfare transfer payments are certainly not stimulative. So essentially, we have Congress's own budget office saying that this proposal is a waste of money. Nice.