Tuesday, December 9, 2008

Terra Nova Critique of Stimulus Package

Terra Nova, the left-leaning think tank, has published a short critique of Sarkozy's stimulus package. It revises the amount of short-term stimulus downward by about half and deplores the lack of effort to stimulate consumption directly, primarily by support of low-income households. It answers the objection that consumption stimulus will go primarily to imports and do nothing for employment at home by arguing that, unlike in 1981, France will not be the only country attempting to stimulate demand. This part of the argument is incomplete, to say the least. Nevertheless, the document is worth perusing, because its talking points will no doubt be taken up by the opposition.

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