The Invisible Stimulus

This sounds to me like it’s been filtered through some kind of Obama-transition behavioral economics screen:

The incoming administration is considering tax cuts of $1,000 for couples and $500 for individuals that will be delivered by reducing the tax withheld from paychecks.

The point of a stimulus package, of course, is to boost spending. And hiding a tax rebate in slightly higher take-home paychecks seems like a good way of doing that: even people who save a certain amount of money every month still tend to spend the rest.

The same article has some good news for New York: apparently the mooted stimulus package also includes $20 billion for mass transportation, and since New York City has more transit than anywhere else, it’s likely to get a good $4 billion or so of that money, to be spent on projects including the East Side Access project connecting Long Island trains to Grand Central.

Clearly there’s jockeying in Congress for these funds: New York’s Chuck Schumer and Jerrold Nadler have been "working with Obama’s transition team on details of the stimulus package", which sounds not dissimilar old-school pork-barrel politics-as-usual. But if Obama is successful in setting up a genuinely independent body to apportion funds, maybe even this kind of thing will come to an end.

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