Every now and then the Wall Street Journal will run an op-ed by someone who doesn't fall in line with the Journal's usual opinions (and they have their token liberal(sub probably required) columnist, too).
One such contrary piece was published today (Monday). It's by Alan S. Blinder (no joke) who is described as: "a professor of economics and public affairs at Princeton University and vice chairman of the Promontory Interfinancial Network, is a former vice chairman of the Federal Reserve Board."
In his piece (sub probably required), Mr. Blinder says Obama's economy polices are correct:
While [the Obama Administration] now eschews the phrase "fiscal stimulus," it wants to extend unemployment benefits and initiate or strengthen several other programs to create spending and jobs. But it also wants to let the Bush tax cuts end on schedule for those earning over (roughly) $250,000 a year.
(Actually, if Congress doesn't act, and it doesn't look like they will, those tax cuts will expire for everybody who pays income taxes.)
Mr. Binder agrees with the Obama plan:
Let the upper-income tax cuts expire on schedule at year end. That would save the government an estimated $75 billion over the next two years. However, it would also diminish aggregate demand a bit. So, instead of using the $75 billion to reduce the deficit, spend it on unemployment benefits, food stamps and the like for two years. That would surely put more spending into the economy than the tax hike takes out, thus creating jobs.
Really? Taxing and spending will create more jobs then allowing people to keep, spend, and invest their money as they see fit. This is like saying your car will run better if you take out half the gas, burn half of that on the ground, and then put the remainder into a car that doesn't work. First you take the gas out (taxes), then you burn half of it on the ground (bureaucratic costs of redistributing wealth), then you put it in a car that doesn't work (unemployment payments).
With economic policies like these, who needs recessions? We'll be in a lost-decade depression very quickly.