The mother of all Stimuli

Its official. World governments are being run and advised by people who have escaped from asylums holding the criminally insane. How else can you have a proposal like this

It has been on and off for months, but a key announcement in Alistair Darling’s budget in 10 days’ time looks like being a car “scrappage” scheme. The motor industry is in trouble and thinks the best way to reverse an alarming slide in sales is to give people who trade in old cars for new or nearly-new ones a £2,000 allowance.

As Cynicus Economicus asks, why not bomb cities instead? Why not evacuate, say, New York City and send in a bomber to carpet bomb the whole city? I agree with C.E.’s conclusion-

If ever there were an indication of the absolute bankruptcy of ideas to fight the economic crisis, an indication of the underlying idiocy of government policy, then surely this is it. They are acting to destroy wealth to ‘save the economy’, and doing so at the expense of the future economy. They are spending future wealth in order to destroy present wealth.

Quite simply, the mind boggles.

It does, indeed.

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Comments

  • yet_another_hindu_infidel  On April 14, 2009 at 12:50 am

    the Rs. 10 indian coin is here. the inflation rate is below 0.50. that means they must have did a lot of “quantitative easing” to ease the coming storm for the while. they were discussing about the looming fiscal deficit in india tonight show. BJP wants to raise the personal IT slab to 3lakh – that’s the entire middle class. the way arun jaitley said it suggests that they were committed to that promise. is there a catch?

    • Aristotle The Geek  On April 14, 2009 at 1:17 am

      I don’t think the RBI has printed any money – I haven’t heard of it anyway; they have played around with interest rates and reserve ratios though.

      The combined deficit – center + state will go through the roof, the sixth pay commission, loan waivers etc etc considered. FRBM, my foot!

      As for the IT exemption, I suspect they will withdraw 80C if they raise the exemption limit. Though personal income tax forms a small part of the total tax revenue – its the indirect taxes and corporate taxes that bring in the big bucks. A better alternative (for the govt.) would be to reduce the income tax rates rather than the exemption limit – it keeps tax payers on books. For the businessman, SP has a better IT promise.

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