Comment on Paul Krugman on Obama stimulus on 1-12-09

155.January 12, 2009 11:05 am
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Mr. Obama was elected by waves of enthusiasm, excitement, hopes for change and for new directions. His ability to to lead the country effectively in times of economic crisis depends on keeping those hopes alive. His stimulus plan, however excites nobody. It is as vague as are the bailouts of Mr. Bush. In fact, it looks like a clone of his predecessor.

Investment in infrastructure was a successful remedy of economic downturn in Mussolini's Italy and in Hitler's Germany. Even there the results were slow in comparison to the expectations in United States in the twenty first century. With all the respect to better roads and bridges, infrastructure is not exactly the dream employment of most Americans.

It is widely known that new employment is created by small business. The employment by large companies is shrinking even when the economy is upbeat. Administrations support small business by talking about it; however the government money goes mostly to old failing giants.

A stimulus plan of any hope should emphasize the fact that the US is still the dreamland of new high tech entrepreneurs from all over the world. For a limited period of time such new companies and their employees should not pay any taxes, There should be for them a low interest credit facility that will provide credit equal to equity investment, without lengthy credit checking by failed banks. The only condition for loan should be equal equity. Statistically the loan risk would be much lower than that of “approved” business plans by so called experts. A visa for businessman from abroad should be granted or rejected within 14 days.

At least half of the defense procurement should be allocated directly to small business. In addition to providing new jobs, this will save a lot of money, and make the products innovative.

Such steps are less costly and will provide more jobs in short time.

— Aharon Meytahl, Vestal, NY