Ten Nobel laureates, joined by more than 450 other economists, criticized the tax-cut plan proposed by the Bush administration because they say it will not provide a short-term stimulus to buoy the economy and generate jobs.
The announcement came in a joint statement unveiled at the National Press Club by three of the Nobel economists: Joseph Stiglitz (Columbia University), Franco Modigliani
(Massachusetts Institute of Technology), and Lawrence R. Klein (University of Pennsylvania). Stiglitz served on the White House council of economic advisers under President Bill Clinton, according to Reuters.
The Economic Policy Institute, which Reuters calls a liberal think tank, sponsored the statement.
"Economic growth, though positive, has not been sufficient to generate jobs and prevent unemployment from rising,” the statement reads. “In fact, there are now more than two million fewer private sector jobs than at the start of the current recession. Overcapacity, corporate scandals, and uncertainty have and will continue to weigh down the economy. The tax plan proposed by President Bush is not the answer to these problems. Regardless of how one views the specifics of the Bush plan, there is wide agreement that its purpose is a permanent change in the tax structure and not the creation of jobs and growth in the near term. The permanent dividend tax cut, in particular, is not credible as a short-term stimulus.”
To stimulate the economy, the statement says, “a stimulus plan should rely on immediate but temporary spending and tax measures to expand demand, and it should also rely on immediate but temporary incentives for investment.”
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