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"Calamitous events require calamitous actions". No, that's not it. "Criminal events require criminal actions". Still doesn't sound right. "Extraordinary events require extraordinary actions". That's more like it.

This is Gordon Brown's favourite justification for his fiscal stimulus package. He repeated it during his speech to the CBI on the day before the pre-budget report. I wonder if the assembled businessmen paused to note that it is ludicrous. Even if true - and Mr Brown provided no evidence that it is - this homily cannot guide policy. For it justifies any extraordinary action at all: prancing around chanting "let there be wealth", shooting every banker in London or, Brown's preference, flooding society with borrowed money.

The stimulus package is indeed an extraordinary action. It will impose massive debts on taxpayers, prevent prices from signalling the relative scarcity of resources and change the structure of the economy by increasing the size of the public sector and diminishing the flexibility of the finance industry. That is why it requires a better justification than Mr Brown's nonsense rhyme.

Specifically, it requires a cost:benefit justification. Properly to defend his stimulus package, Mr Brown needs to show us that its benefits from ameliorating the recession will exceed its costs. I doubt any such analysis has been conducted, not only because, if it had been, and if it supported the stimulus package, we would surely be hearing all about it, but also for a more fundamental reason.

If you consider only the costs and benefits to governing politicians, a stimulus package is always a winner. It satisfies the demand that "something must be done" and, more importantly, it delivers benefits today and costs tomorrow. With an election approaching, as one always is, it is not the relative size of costs and benefits that matter to the government, but their temporal order and their "visibility". For them, if not for us, decades of subdued economic activity would be a price worth paying to avoid an immediate shock.

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