Useless Government Stimulus

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By Elli Davis, March 25, 2010

Ordinary Statistics by Jamie Thompson

The Fraser Institute, which is a Canadian research institution dealing with economic issues has released an interesting report analyzing the data of Statistics Canada. The conclusion of the think tank is that the stimulus of $47.2 billion by the Canadian government did not really help our economy.

In the hard times of recession, the government created and implemented the more than $47 billiontwo-year economic action plan.Thus when good news about well recovering economy of our country started to appear, the government “repeatedly claimed credit” for that.the report says. According to it, the data of Statistics Canada data clearly show that government consumption and investment's role in the recovery was “negligible”.

Between the second and third quarter of 2009, the economy grew by 1.1 percent. Out of this, government consumption and government investment both contributed by only 0.1 percent. It was even worse between the third and fourth quarter of 2009, when the economy grew by 1 percent – government consumption and idid not contribute at all. Interesting, isn't it? What do you think? Is the government undeservedly claiming credit?