The fiscal measures and the monetary commitment to price stability stimulate investment, productivity, and technological change over the long term. The flexible monetary policy and the automatic fiscal stabilizers provide the economy with shock absorbers to smooth out business cycles. The unanswered question then involves the role of discretionary fiscal changes-- are they a valuable addition to this macroeconomic strategy?
To be valuable, the measures should stimulate spending, take effect quickly, and be easily reversible. A number of temporary tax changes might do the job, but if they do not stimulate spending, their enactment is delayed, or if they are not easily reversible, they might do little more than to undermine the long-run fiscal strategy.