Academics question the virtue of stimulus package

Pipop Udorn, a lecturer of Thammasat University's Faculty of Commerce and Accountancy, said the government launched measures just to cope with the economic condition. Amid instable political conditions, it had no choice in proceeding with populist policies. However, most low-level workers tend to save than spend when they are worried about future employment. The Americans, which enjoyed tax rebates of US$600-$1,200 during the Bush administration, also avoided spending on the reason and led to the further sinking of the economy.

"The government just wanted to solve short-term problems and overlooked long-term problems. It's worrisome that if the plan to boost spending is unsuccessful, the government itself would shoulder debts or other consequences of the measure." He noted that for the long term, the government must inject liquidity into the money market. Financial institutions must be encouraged to lend particularly to companies with growth potential, or the entire economy will collapse.

Pisit Lee-ahtam, former deputy finance minister and dean of Chiang Mai University's Faculty of Economics, questioned the practicality of the scheme and expressed worries that the budget would not spark spending as expected.

"It would greatly help boost spending if the budget is correctly distributed to the needy sectors as planned. For example, on the allocation of Bt2,000 allowance to Social Security Fund's members whose salary is below Bt14,000, there is no use if the recipients use the money to buy mobile phones," he said.

While saying that amid this economic condition, it is necessary to inject money into the system, he noted that the Bt116 billion budget would be indefinitely insufficient. Yet, the government must closely monitor the results of this spending.

To define the benefits of the spending, it depends on the government's objective whether the budget is to stimulate the economy or buy votes, he added.

Udorn Tantisunthorn, chairman of the Foundation for the Promotion of Public Policy, urged the government to review the decision to include Tambon and village chiefs for the Bt2,000 allowance. He noted that though serving as assistants to city clerks, these chiefs do not have specific duties and they should not be entitled to the higher returns without any changes in the law to clarify their duty.

 He also attacked the government for trying to buy up votes through the measure.

 Chaiyaphan Praphasawat, director of the Chiang Mai-based Community Rights Institute, also said that the measure is discriminatory as not all workers are entitled to the allowance. He said that the spending would be concentrated in some groups of people and would not help stimulate the economy as expected.

 He urged the government issue vouchers worth Bt2,000 to eligible citizens.