The Bush administration is said to be considering several new tax cuts, including increasing the deductible amount of capital losses, reducing capital gains tax rates, indexing capital gains for inflation, raising contribution limits for IRAs and 401(k)s, and reducing taxes on dividends. This...

We review the evidence on the practice and effects of discretionary fiscal policy, particularly in the context of recent efforts to stimulate the economy, reaching two main conclusions. First, policy interventions have increased in this decade, pre-dating the 2009 stimulus. Second, despite a...