This NY Times article talks about the difficult decision that the Obama administration faces on deciding on the right stimulus to aid the ailing economy:
The unexpectedly deep plunge in home sales this summer is likely to force the Obama administration to choose between future homeowners and current ones, a predicament officials had been eager to avoid.
This is the kind of dilemma that one is bound to face on a discretionary stimulus spending. We know that Keynesian economics dictates increased spending when the economy is depressed but it does not say which is the right stimulus and which is not, especially when such a stimulus while helping one section of the population, hurts the other. At some point, such as now when the elections are closeby, this is likely to become less of a economic decision but more of a political decision.
