Wednesday, January 28, 2009

The Economy and the Powell Doctrine

$825 Billion? Why is the fiscal stimulus package so big? The economic view: consumers must be convinced that the package is big enough to end the recession in order for consumer confidence to return. If consumers are confident recovery is in the works, they will feel more free to spend. As for as the size, think in terms of the Powell Doctrine:

The "Powell Doctrine" is a journalist-created term, named after General Colin Powell in the run-up to the 1990-1991 Gulf War. ..asserting that when a nation is engaging in war, every resource and tool should be used to achieve decisive force against the enemy, minimizing US casualties and ending the conflict quickly by forcing the weaker force to capitulate.

So, $825 billion is like economic "shock and awe". Thanks to Wikipedia for the definition.


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