Economic Stimulus; House Democratic Steering & Policy Committee

“Moreover, I think it should be a balance between Tax Cuts and Spending,
but I think it should be directed more toward spending than tax cuts.

Spending has a much larger economic bang for the buck.

[With] aid to state governments and infrastructure spending, for every $1 spent results in an average $1.50 on average GDP, whereas [with] tax cuts, every dollar of tax cuts  results in roughly $1 of GDP. So it’s much more efficient to provide stimulus through spending than tax cuts.

…I do think tax cuts would be helpful though in that that could be provided to the economy relatively quickly, and that’s something the economy needs.”

—Dr. Mark Zandi
Moody’s Economy.com
Chief Economist & Co-Founder