Malaysia's 2nd Fiscal Stimulus?

Our DPM has invited everyone to post suggestions for the country's second fiscal stimulus. But the thing about the phrase 'fiscal stimulus' is the idea that the economy can be 'pumped back to life' if we only but discover the correct set of policies to zap it with.

It's tempting to believe we can revive the nation's wealth if we only we can :

1. get more people spending - preferably on stuff they don't really need (it's a little harsh, but unless there's some greed and vanity, the economy isn't going to grow all that much; capitalism doesn't work very well on food- and necessity-consumption alone, although thank God for the automatic-stabilising these provide)
   
   
   
2. get more people spending faster i.e. entice Ah Kow to pass the cash to Ah Lim who will hand it to Ah Lee in less time than it took previously - why? so all three end up with more within a given duration and the crowd (i.e. the entire economy) becomes on the average more 'excited' about buying buying buying.
   
   
   
3. get more foreign people spending, preferably on new factories or buildings in the country
   
   
4. get producers to NOT raise prices - how? by keeping basic expenditure (that which impacts a majority of the population) low, by setting price-ceilings, by keeping supply high, by offering alternatives to heavily-demanded products, etc.

These four goals (the classical honey-pots of consumption, velocity of money, FDI and inflation - there're probably a few more but it's been awhile...) are sweet and dandy, except they've always struck me as being akin to giving medicine for a sick body i.e. it may restore you back to health but it nevers help you grow (let alone become stronger).

And if the body remains inherently weak, then it's more medicine every now and then(?) That sucks.

In my view the primary way an economy grows for real is by focusing on the 'fundamentals' (ah, so not-postmodern of me to say that). I'm talking about at least five things:

• Environment - the country's lungs
• Education - the country's intellect
• Domestic Unity / Harmony - the country's emotional health
• Foreign Relations - the country's friends
• Political Integrity - the country's spirit

Build these up. Work on these. And over time the country's wallet will take care of itself.