The reaction doubtless delighted Beijing policymakers, particularly when recalling the limp response in New York to some of US treasurer Hank Paulson's cheques. And, at face value, there is room for cheer. The country responsible for a good slug of global economic growth is spending just shy of $600bn, or a fifth of GDP, to keep its engines firing. It will build more railways, airports and houses, putting laid-off factory and construction labourers back to work and ensuring continued demand for all manner of commodities.
But some perspective is necessary. For starters, the headline number includes plans already on the table. Some projects will simply be accelerated, and most economists reckon that, at best, half the spending relates to completely new projects. Second, there will be a gap – possibly stretching into the second quarter of 2009 – before construction spending kicks in. With factories disgorging workers almost daily, some temporary unemployment at least looks unavoidable. Some of the spending is also to come from provincial governments, whose budgets are no longer swollen by sales of land at frothy prices and which may thus be obliged to raise debt.
Moreover, the package sees the government returning to centre stage. There are no personal tax cuts to whip up private consumption, although the government is giving tax breaks to companies that upgrade their technology. In short, state-directed lending is back. All else being equal, China's stimulus package should be sufficient to absorb the newly unemployed and keep growth above 6 per cent. But don't count on it saving the rest of the world too.