A good column by former Obama administration official Steve Rattner. He concludes "Wasting precious dollars that could be better spent can't possibly be worth the risk of igniting high inflation again." Rattner writes:
the measure's spending far exceeds the extent of the shortfall in economic output caused by the pandemic....
The $510 billion in aid to states and localities (including for education) should also be dramatically reduced; the Committee for a Responsible Federal Budget recently explained how Moody's Analytics estimates only "an additional $86 billion of aid is needed to cover revenue losses."...
And we should take a fine-toothed comb to lesser-known wasteful provisions, like giveaways to the airlines and an indirect bailout (added by the House) of multiemployer pension funds.
We shall see whether the inflation materializes, but for now it appears that Rattner and Larry Summers have upped their credibility as principled rather than partisan analysts by displaying some independence on the inflation threat and the size and composition of the stimulus. On these themes, also worth a look is Washington Post columnist Steven Pearlstein: "To hear it from liberal economists, progressive activists and Democratic politicians, there is no longer any limit to how much money government can borrow and spend and print....We have entered a magical world where borrowing is costless, spending pays for itself, stocks only rise and the dollar never falls."
