All Keynesians now?

January 8, 2009

My two favorite dailies, the New York Times and the Financial Times, offer divergent takes today on prospects for the Obama administration’s proposed economic stimulus package.

According to the NYT,

To a degree that would have been unimaginable two years ago, economists and politicians from across the political spectrum have put aside calls for fiscal restraint and decided that Congress should spend whatever it takes to rescue the economy.

But with the Congressional Budget Office projecting a federal budget deficit of 8% of GDP in 2009, the FT suggests

The president-elect … will now find it harder to achieve broad bipartisan support for the package. In addition to rising Republican concerns about the size of the stimulus, which has not been factored into the CBO’s 2009 fiscal deficit projection, fiscally conservative “blue dog Democrats” are now more likely to drag their feet on the measure.

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