Time for Washington to make changes in stimulus
Manufacturing and housing have been doing much of the heavy lifting during the early stages of the economic recovery. Home sales are up, housing starts have risen, and the latest surveys on manufacturing (see the Empire and Philly Fed) are signaling a robust recovery among goods producers as companies move to replenish inventories.
Now it's up to the consumer to lend a heavy hand. In my view, it’s time for Washington to provide some assistance by revoking many of the bloated spending measures that were part of the $787 billion stimulus bill and providing tax incentives for businesses and individuals.
If consumer spending does not kick in and the U.S. economy must rely on overseas demand for growth, the recovery will likely take a U-shape and unemployment will remain painfully high.
The first-time home buyer tax credit and cash for clunkers (with all of its problems) have been among the few bright spots of the stimulus package. It’s time to duplicate those measures.
0 comments:
Post a Comment