A federal stimulus package is coming. We’re convinced of that. The good news is that Indiana Gov. Mitch Daniels and other state leaders are planning what to do with the funds coming our way. Let’s hope the basic principle of "one-time funds that should not be used for ongoing programs" wins out in the end.
But what form will the stimulus take? The version passed by the U.S. House was heavy on spending and light on actual economic stimulation. Many smart people over the years have studied and reported that the way to generate economic momentum is through putting more money in the hands of the people — indviduals, entrepreneurs and business leaders. Tax cuts, proper incentives and investments in long-term assets are good things.
Senator Jim DeMint (R-South Carolina) seems to have an "American Option" plan that fits that description. Does it have all the answers? Probably not. But it certainly seems to deserve some serious consideration. If bipartisanship is going to come into play in the new administration, blending the best from various stimulus plans would be a good place to start.
The Heritage Foundation offers some analysis.