There should be no illusion about the $300-billion “stimulus” plan now being promoted by the Democratic Majority. It will not address the core problems of the current financial crisis and economic weakness. It may even worsen them by adding hundreds of billions of dollars to Federal deficits and debt, which are already reaching historic highs.
The Democratic proposal has several fundamental problems:
- It adds $300 billion to the deficit and the debt, taking both to record levels.
- It does little, if anything, to benefit the economy.
- It adds to U.S. borrowing costs, and weakens the dollar.
- It is a costly and ineffective means of addressing a financial crisis in the economy, as demonstrated by past experience, particularly that of Japan.
- Its spending and deficit increases are already being used to justify job-killing higher taxes.
This paper summarizes the principal flaws in the “stimulus” concept, and the significant hazards of enacting another huge round of government spending in the current economic climate.
Read the full report here.