February 11, 2003

What Alan Greenspan Will Say This Week

The G-7 Group predicts:


Greenspan will do a two-step...

  1. He will say that he opposes the double taxation of dividends on principle, and that ending such policy represents good long-term tax policy.
  2. But he will also concede that eliminating dividends does little to stimulate the economy in the near term and does so at the risk of high deficits. This is what he told moderates behind closed doors and he will not be able to go soft on this point.
  3. He will likely warn against a return to long-term budget deficits while stressing the need to curb spending.
  4. Greenspan will try to avoid endorsing one party's stimulus package over the other's. But anyone paying attention will understand that he believes the Democrats? smaller package aimed at 2003-04 is better for the economy.

Posted by DeLong at February 11, 2003 03:10 PM | TrackBack
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