In the economy, real economic return on investment is not just an important metric. It is crucial. That is why I find it so intellectually dishonest when some economists look at the GDP and employment growth without putting it in the context of the massive increase in debt, spending, and money supply.
A stimulus plan is supposed to generate higher and faster growth than the normal trend would dictate. Furthermore, the definition of a stimulus plan is that it should improve the long-term trend.
Governments have taken the recommendations of Keynes to spend in recession periods and erased from their memory the need to save and cut taxes in growth times. Keynes opened a dangerous door when he placed government as the solution to crisis and subsequent governments have taken it to the extreme with clear diminishing returns. What we have now is a chain of massive debt and monetary stimuli that are devoted to current and entitlement spending with no real economic return only to increase spending even in growth periods, where government never saves.
