Obama Advisers May Urge Second Stimulus
Obama advisers are considering a second economic stimulus package, Bloomberg reported this afternoon. In an interview, Commerce Secretary Gary Locke claimed the second stimulus—if it were to be proposed—would be "targeted and specific and … mindful of the deficit as well."
This news comes shortly after House Speaker Nancy Pelosi's comments last Wednesday that there were no plans for a second stimulus package. And she's not the only one to offer that same assurance. Treasury Secretary Tim Geithner didn't seem to think we'd need one either in an interview with CNBC last month. And what with the good news regarding job creation and GDP increases last week, it does come as a bit of a surprise that another stimulus would be considered, especially considering the ample criticism directed toward the first round of spending.
But despite the healthier state of the economy and the general consensus that the recession is over, some analysts do think another stimulus is in order. A New York Times editorial argued last week that while "the herd is probably right" and the recession has technically come to an end, "the economy is going to need more government support, or … [be] vulnerable to a relapse into recession."
The basis of the "free market" has always been dependent on healthy amounts of government intervention, despite what many free market advocates would have you believe. Current events haven't altered this fundamental reality but only throw it into sharper relief. The debate over how close this relationship ought to be should continue to be a source of major debate over the next several months.