President-elect Barack Obama has promised a stimulus plan for the country that could create or save millions of jobs – but will it work?
Spending is a big part of the plan. Early in the new year, Congress could receive a request to spend between $675 billion and $775 billion in the next two years, Fox News reports. Around $350 billion could be directed at creating infrastructure projects.
Former director of the Congressional Budget Office Douglas Holtz-Eakin told the news provider that although the plan "sounds great on paper" it may be more difficult to achieve.
Part of the problem may be the timing. As the U.S. is already about one year into a recession, by the time the money works its way through the system and new jobs are created, it may no longer be necessary.
"Even if we have a pretty prolonged downturn, it could be the case that the recession is over by the time a lot of this money gets spent," Holtz-Eakin said.
Instead, he suggested that the government could help stimulate spending by suspending Social Security taxes for a year.
Holtz-Eakin, who advised Senator John McCain during his campaign, also said he supports the senator’s idea of purchasing and refinancing bad mortgage debt.
The country is likely to receive more details of the stimulus package when Obama takes office on January 20th.