Stimulus Bill - Article Example

American Recovery and Reinvestment Act of 2009 The American Recovery and Reinvestment Act was introduced by the eleventh United s congress. This act is also known as the Recovery Act. In short form this act is referred to as ARRA. It was an attempt counter consequences of the recession and restore the jobs and offer more opportunities to the people. It was the top most purpose of ARRA. Basically it was an economic package which was created for the betterment of the people who were struggling to survive the recession.

The act also tried to give breathing space to the victims of the recession and it allowed the people to invest in the overall development of the society like in infrastructure, medical treatment issues, education and other basic needs of the people were addressed by this act. Further it took part in recycling of the energy too. The Act is based on a theory of economics which is called Keynesian Macroeconomic Theory. This theory suggests that when a recession strikes, the government should be modest and generous enough to put less money into the projects which are of private nature and likely to benefit the government and the state only, and start investing more on the things which will directly give relief and benefit to the general public.

According to this theory, recession is not the time to secure your business or government, but to keep the public surviving and doing all which will keep them alive, happy and motivated to work or to get back to work. Although the Act seems to be a perfect package for the social welfare of the people, it was also criticized by some in terms of its very limited scope. They say that it covers less than one third of the spending. As it happens with every new thing presented, Some people back it and some argue against it.

Same is he case with this Act. It has made some friends and some not so friends too. The view and recommendations of the economists about the act should also be discussed in order to get a better idea about the weaknesses and strengths. Some economista like Paul Krugman, Joseph Stiglitz, Larry Summers and Martin Feldstein have reservations about this act that it has a very small vision or it is an act with limited scope which does not benefit the sufficient number of people. They suggest that it should have been designed to encompass the larger wider population.

Feldstein is generally in favour of such a package but questions the directness of this act on the investment on consumer spending. He says that this act should have been more direct on addressing the unemployment and the consumer spending. According to him some revision is needed in this act to make it more effective and beneficial. Krugman also says that it includes a lot more tax cuts than it was required. Also that this act does not stand tall in front of the problem that is bigger than it.

Seeing some of the responses from the people of economics field, it can be concluded that this act at least succeeded to make its mark as a little step in the right direction. No one of them said that it is a totally unnecessary step, instead all suggested that it should have been more wider, larger and bigger. This implies that the act has the potential of winning the heart of masses if it is revised. There is no second opinion about the purposefulness of this act and it is believed collectively that this act targets only the social welfare and betterment of the people facing recession, doing jobs, or being fired or have been fired from the jobs.

All in all the American Recovery and Reinvestment Act of 2009 was a good attempt to counter recession and relieve the public most impacted by it. In that regard it deserves some consolation from the economists and other experts. ReferencesThe American Recovery and Reinvestment Act of 2009: Information Center. (n.d.). . Retrieved , from http://www.irs.gov/uac/The-American-Recovery-and-Reinvestment-Act-of-2009:-Information-CenterAmerican Recovery and Reinvestment Act of 2009 . (n.d.). . Retrieved , from http://www.fcc.gov/encyclopedia/american-recovery-and-reinvestment-act-2009