Tyler Cowen writes:
Yes, 40 percent of the Obama stimulus package will be a tax cut. It’s already a talking point that “the Democrats have lost their nerve” but the reality is not so devious. Obama wishes to deliver on his pledge to cut taxes (always electorally popular) and upon close inspection the economic team probably hasn’t found a lot of first-year stimulus spending it likes. That leads to this obvious policy conclusion and of course it is very good news. No, I do not think these tax cuts will drive recovery but a) less money will be wasted, and b) it shows that the Obama team is willing to flinch and be realistic, not just as a final compromise but indeed as an opening gambit.
So far, all of Obama’s actions — from his excellent economic appointees to the current package — show that he is more a pragmatist than a far-left idealogue. Of course this does not mean his policies, economic or otherwise, will be great; merely that they will be less bad than some had feared.
By the way, the Obama’s stimulus package is giving Paul Krugman “post-partisan depression”. Now that is definitely a great thing.