The Housing Crash Recession and the Case for a Third Stimulus

Dean Baker

CEPR Reports and Issue Briefs from Center for Economic and Policy Research (CEPR)

Abstract: This paper makes the case for a third stimulus package to in the face of economic indicators signaling that the economy is in a deeper downturn than was expected based on previous projections. Specifically, the report calls for an employer tax-credit for extending health care coverage and another per worker employer tax credit for increasing paid time off from work. The author also makes the case for a housing policy centered on the stabilization of prices in non-bubble and deflated markets rather than applying the same efforts on markets that remain at bubble inflated levels. Finally, the paper argues that the dollar must be allowed to fall in order to adjust trade imbalances that are compounding the U.S. economic crisis caused by the collapse of the housing market.

Keywords: housing bubble; economic stimulus; fiscal stimulus; ARRA; recession; dollar policy (search for similar items in EconPapers)
JEL-codes: E E2 E21 E24 E27 E3 E32 E5 E58 E6 E61 E62 E63 E66 H H2 H5 O51 R R2 R21 (search for similar items in EconPapers)
Pages: 21 pages
Date: 2009-03
New Economics Papers: this item is included in nep-mac, nep-mon and nep-pke
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:epo:papers:2009-10

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