It is likely that other ads are implementedFocus on cognac in Charente is not uselessPoint of gas gas competition the game remains sluggishIt is time to enter the era of pragmatismThe lowest rate in seventyfive years saidSuch a movement could quickly become uncontrollableMore reason to freedom in the negotiation85 over the last twelve months as the whole sector5 billion in capital for 18 of the capitalIn ten years the evolution is spectacularThe sacred union was not convinced. Friday, despite the statements made by George w. Bush announcing that it was ready to cooperate with us parliamentarians to adopt as quickly as possible a plan of recovery of the economy to some 145-150 billion (1 of GDP), the stock market has again dropped. Since the beginning of the year, the S & P 500 index is down 8.5.
If despite unanimous political class American for a mobilization of emergency, investors and economists doubt, it is firstly that beyond the consensus on the form, Democrats and Republicans are far from agreement on bottom. The scope of the plan does not really debate but elected officials may be divided on the details, which could delay the adoption of a plan to be effective must intervene in the coming months.
More targeted assistance
For the elected Democrats controlling Congress, the priority would be to grant reductions in social security payments for a limited period and to make some social spending increases to help households and the average class. Bush administration defends it the idea of a more targeted assistance concerning that household paying income tax, or approximately 90 million of some 149 million homes. The White House wants bonus that beyond the temporary tax cuts that could result in sending a cheque for $ 800 for each taxpayer (1,600 dollars for household), parliamentarians make permanent cuts taxes for 2001 and 2003 that have been secured for part only until 2010.
For Democrats, joined in this field by a majority of economists, the priority is to give money to the poorest households, is that those who have difficulty completing their purposes of months would be most likely injected immediately back those dollars into the economy. Assistance to the rich on the other hand might be less effective insofar as households would perhaps prefer to rebuild their savings. Democrats and Republicans could also be divided on a plan of support for investment companies that defends the Bush administration.
Beyond the differences could be overcome because the approach of the election encouraged the two parties to find common ground, economists wondered particularly on the effectiveness of such a plan. "If it contributes 140-150 billion into the economy in a short period, this could boost the domestic product gross at least 2 points in a quarter," said Nigel Gault, Global Insight, which studied the previous plan of 2001 (see box).
An ambitious goal
The coup de pouce economy could not be denied but no economist can say that thus artificially induced rebound would be sustainable. "It all depends on in terms of the magnitude of the crisis." Either we are at the dawn of a simple one-time slowdown and this emergency aid will pass a difficult course. "The crisis is more profound is after the light better passenger, the economy replongera", analysis Nigel Gault. Households could anticipate certain expenses, boostant GDP on quarter, before closing their wallets. In terms of employment, the administration considers that his plan could lead to the creation of 500,000 jobs beyond the "natural" growth of the workforce. An ambitious seem well where, in 2007, before even the economy will really slow, America has created only 1.3 million jobs. "Companies will create jobs if they are confident in the long term." "At best, the plan could encourage them to delay and does not terminate", fears Nigel Gault. The risk is so real that, despite its magnitude, this plan falls within the category of "too little, too late".
