The salary and pension cuts, plus a two percent increase in sales tax are aimed at reducing the country's deficit by four percent this year.
VOA: standard.2010.03.11
The most important stimulus not included in this approach is tax relief, which comprises over one-third of total spending plustax cuts to date (CEA 2010).
There are only three options: Congress would have to boost the debt ceiling, adopt a massive trillion dollar-plus tax increase, or slash the government by more than one-third.
Mike Niemira, an economist at Bank of Tokyo-Mitsubishi, thinks that another cut in American interest rates, plustax rebates, lower energy costs and less travel, may help to give consumers extra money to spend over Christmas.