• Monday, January 19th, 2009
A roundup of economic news from around the Web.
Bank of America’s Deal: Writing on his Basline Scenario blog, Simon Johnson looks at the government’s deal to aid Bank of America and remains critical of the government’s approach. “This is more of the same incoherent Policy By Deal that has failed to stabilize the financial system, while also greatly annoying pretty much everyone on Capitol Hill. Hopefully, it is the last gasp of the Paulson strategy and the Obama team will shortly unveil a more systematic approach to bank recapitalization; it would be a major mistake to continue in the Citi II/BoA II vein.†Separately, the Journal’s David Wessel discusses how well TARP is working on NPR.
Tax Cuts and Stimulus: Writing for the Financial Times, Joseph Stiglitz says tax cuts shouldn’t be part of the stimulus. “We are in uncharted territory in this crisis. But household tax cuts, except for possibly the poorest, should have no place in the stimulus. Nor should business tax breaks, except when closely linked with additional investment. The one tax cut that should be included is a temporary incremental investment tax credit; it provides a big bang for the buck, encouraging companies to invest now when the economy needs the spending. Increased investments in infrastructure, education and technology, relief to states, and help to the unemployed need pride of place.â€
Compiled by Phil Izzo
Category: Economy
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Tags: bank of america, big bang, business tax, david wessel, economic news, financial times, incremental investment, investment tax credit, izzo, joseph stiglitz, last gasp, pride of place, recapitalization, s david, secondary sources, simon johnson, stimulus, systematic approach, uncharted territory, web bank |
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