Thursday, January 29, 2009
Thought Experiment
There is some disagreement about how effective the stimulus package currently winding through Congress will be. Some economists think the government should spend a crapload of money, while others think they should give a crapload of money back to taxpayers.
I don't know. They both sound good to me. How can I figure out what I think they should do?
Imagine if Obama said that if you live west of the Mississippi, you will get $400B of spending on union construction projects, extended welfare and global warming research -- but no tax cut. If you live on the east side of the Mississippi, you will get a big tax cut but no money for the National Endowment for the Arts and all of your bridges will have to go to somewhere.
If you were in a boat going down the river when you heard this announcement, looking for a place to live, which bank would you head towards?
There is some disagreement about how effective the stimulus package currently winding through Congress will be. Some economists think the government should spend a crapload of money, while others think they should give a crapload of money back to taxpayers.
I don't know. They both sound good to me. How can I figure out what I think they should do?
Imagine if Obama said that if you live west of the Mississippi, you will get $400B of spending on union construction projects, extended welfare and global warming research -- but no tax cut. If you live on the east side of the Mississippi, you will get a big tax cut but no money for the National Endowment for the Arts and all of your bridges will have to go to somewhere.
If you were in a boat going down the river when you heard this announcement, looking for a place to live, which bank would you head towards?
