The Economists

Buzzword alert! A new vocabulary for a new year. Watch out for the three T’s of economic stimulus. Timely, Targeted and Temporary. Lawrence Summers, Secretary of Treasury under the Clinton administration, testified before the Joint Economic Committee today and specified that any economic stimulus package passed by Congress would have to be passed quickly, have focused objectives, and last for a finite amount of time. Both the Joint Economic Chairman Sen. Charles Schumer (D-NY) and Sen. Edward Kennedy (D- Mass) echoed Summers’ recommendations. Later today House Financial Services Committee Chairman Rep. Barney Frank (D-Mass) will give his input on the subject in a town hall meeting on Capitol Hill.

In a Pen and Pad session with reporters House Majority leader Steny Hoyer (D-MD) “Clearly our country is challenged today with substantial slowdown in our economy,” he said. “We want to address it quickly.” Then he made a reference Lawrence Summers’ testimony and later incorporated the three T’s. Hoyer said that what we do, ought to be short term. He is going to meet with Republican House leadership today to act quickly, and Hoyer believes that they can sign a bill in the next 30 days to create a stimulus. When asked what he would tell the public, “You tell the American people there is a problem and you need to address it.” Though he admitted, “The housing issue is not going to be solved by a stimulus package.”

Hoyer said that the goal is infusion of dollars in people’s hands that need it. The subject of Paygo (Pay As You Go) came up, which prompted Hoyer to say that any economic stimulus should not increase the ever-growing deficit. Hoyer made a reference to the Clinton Administration saying, “People were much better off eight years ago than they are today. The country was much better off eight years ago than it was today.” Hoyer also said he thought simply undoing Bush tax cuts will not have an effect.

But in the bipartisanship that usually blossoms in the beginning of the session (only to wither on the branch by midterm) was evident in Hoyer’s outlook. “We are very hopeful in discussions with administration,” Hoyer said in reference to his meetings with Bush economic advisors. He said that his meeting Rep. Roy Blunt (R-MO) and Rep. John Boehner (R-OH) was an unusual show of bipartisanship. He said that there is general agreement that Congress should act quickly and that there is a “risk” of recession, though it is debated whether or not the U.S. economy is already in or headed toward a recession. For now Hoyer said he will leave everything on the table, “the goal no matter what is to get money to people who need it and will spend it.”