As those in AP and IB courses on macroeconomics approach the chapters on fiscal policy and influencing aggregate supply and aggregate demand, I want to draw your attention to a couple of posts that you may find helpful. (And who knows, many of you may already be at this point and searching for additional information.)
Likewise, more traditional economics classes will probably transition soon into the macro portion of the course. And when discussing fiscal policy, the stimulus package may be invoked as an example of how government policy may influence aggregate supply and aggregate demand.
The first link is from the always informative Becker-Posner blog. Gary Becker lays out a pretty good explanation of the current stimulus plan and why, in his analysis, it does not meet the criteria for a good Keynesian stimulus. He discusses crowding-out and policy delays, and makes his case for a flawed attempt to kick-start the economy.
Richard Posner presents another viewpoint. Now, this is no counterargument. Posner does concede problems with the package and admit that it could be improved, but he is not ready to throw the package "under the bus."
But what was most interesting, in my opinion, was his invocation of the Barro-Ricardian equivalence. Indeed, it was this discussion on the Wealth of Nations blog about Ricardian equivalence that drew me to the Becker-Posner exchange in the first place. So a HT is in order.
My class had discussed Ricardian equivalence not very long ago and will do so again in the near future. I will be using information from all of these posts to help clarify the concept for my students.
I look forward to your comments.