Obama's $200 Bn bet...

I read with a lot of interest over the weekend that the US president-elect Barack Obama plans to spend nearly $200 Bn on the largest infrastructure project undertaken in the US since the 1950s - when the freeway system was largely constructed. The money will be spent on modernising roads, bridges, parks and building new ones......with no claim to understanding the economics of the whole deal - it has been suggested that each billion spent will create nearly 40,000 new jobs in the US - given the state of the economy there (most job losses in a given month, since 1973) and given the abject failure, thus far of the half hearted attempts of the Bush administration to use the $700 Bn they are already authorized to spend - I think it is a laudable effort. Indeed, conservative economists in the US have already started their hue and cry - employment if created will also be by moving jobs away from other sectors they say, what about the budget deficit they say (expected to cross a $trillion..!).......

Paul Kruger, Nobel prize winner for economics this year, on the other hand is pretty clear - this is not a time to worry about deficits.....this is time to ensure survival - of the american economy (and in some ways the world economy), of society and modern civilization.....lets get those in order, deficits will take care of themselves. What I like about Obama's plan is that a large amount is earmarked to creating a platform to enable American entrepreneurs to focus on what they do best - innovation. By wiring up the entire nation with internet, by providing grants for cutting edge research and ensuring silicon valley (and other such uniquely american hubs of innovation) thrive, he is, in my books doing the right things.

This combined with the impending failure of the American auto giants - means a new order, a new way of doing things, a new economy is in the making - its going to be an exciting four years.....as the oft-qouted chinese proverb goes - May you live in interesting times.....could be a blessing or a disguise - lets make it a blessing...Go Obama.