Food stamps offer best stimulus - study
Moody's study suggests extending unemployment benefits, increasing food stamps fastest ways to stimulate economy.
WASHINGTON (CNN) -- As Congress and the White House consider a $150 billion stimulus package that includes tax rebates and tax incentives for business, a report released Tuesday suggests that other methods would do a better job of infusing money into the flagging economy and doing it fast.
The industry research firm Moody's Economy.com tracked the potential impact of each stimulus dollar, looking at tax rebates, tax incentives for business, food stamps and expanding unemployment benefits.
The report found that "some provide a lot of bang for the buck to the economy. Others ... don't," said economist Mark Zandi.
In findings echoed by other economists and studies, he said the study shows the fastest way to infuse money into the economy is through expanding the food-stamp program. For every dollar spent on that program $1.73 is generated throughout the economy, he said.
"If someone who is literally living paycheck to paycheck gets an extra dollar, it's very likely that they will spend that dollar immediately on whatever they need - groceries, to pay the telephone bill, to pay the electric bill," he said.
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