Former presidential candidate and Forbes magazine publisher Steve Forbes lambasted the fiscal stimulus program working its way through Congress as a waste of money.
“It’s just a grab bag of every spending proposal that’s been banging around Congress for years,” the chief executive of Forbes Inc. told Bloomberg TV.
“They just threw in everything. There’s no coherence, no real strategy. There are some good parts — stimulus for small businesses to invest, the electric grid. But even there, they didn’t really follow through.”
What does Forbes recommend instead?
“If you want sustained economic growth, you need incentives,” he explains.
“If you want to throw around a lot of money, they should have reduced the payroll tax in half for two years.”
The benefit of that is that it gets money instantly into people’s hands, Forbes said. “If you’re low income, you have to wait until next year before you get money from this thing.”
And a payroll tax would instantly cut hiring expenses, making businesses more eager to expand their workforce.
Forbes also favors a business tax cut. “The U.S. has the second-highest business tax rate in the developed world,” he explains.
“Why not cut that from 35 percent to 20 percent? That’s the way to have businesses plan for the future.”
Forbes isn’t the only one criticizing the stimulus plan.
“The fiscal package now before Congress needs to be thoroughly revised,” Harvard economist Martin Feldstein wrote in The Washington Post.
“In its current form, it does too little to raise national spending and employment.”
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