Robert Barro, one of my favorite economists, of Harvard in the WSJ about the effects of stimulus. This is the tradeoff that Obama and the government officials do not acknowledge- that they are essentially borrowing from our future to pay for this stimulus, but that it is not an even trade. Overall, we end up worse than we would have been just riding it out. Is such a short term improvement really worth these long term sacrifices, which have also been made every time the government borrows money? I don’t think so. If the barriers to enterprise were reduced and government cut uncertainty about economic conditions instead of increasing it by constantly proposing regulations and mandates, businesses could adjust to the new climate rather quickly. The more we try to force the economy to be what we want, the less it will be the best it can be.

PS- Steven Landsburg points out that Christy Romer is known among economists for research suggesting that the outlook is even worse than Barro’s prediction, which makes the stimulus look very unattractive. Either Obama doesn’t listen to his economic advisers (probable), she changed her statements sinced she joined a Democratic administration (also probable, see: Paul Krugman), or Obama panics in the face of public cries to do something (I hope not).

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