We will see what the president has to say in Cleveland on Wednesday--according to the Washington Post, he will pitch the R&D tax credit but no payroll-tax holiday: all told, a non-proposal, stimulus-wise. His speech on Monday already said, in effect, that he is giving up the effort to pass another stimulus. The Labor Day address called for $50bn of new spending on infrastructure, but over six years, and the plan "will be fully paid for", presumably meaning no increase in the budget deficit. It is a non-starter in any case, of course. But the messaging was revealing. The word "stimulus" was never mentioned.
This is a great mistake, as I argued here. The economy needs another stimulus, and can afford it. But Obama has decided that politics rules it out. He is in campaign mode, praising unions and beating up Republicans, evidently calculating that getting out the base is what matters. Meanwhile, economic policy is on hold.
Is there an alternative? I believe so, and made the case for it in the article I just linked to. A stimulus based on temporary tax cuts--extend all the Bush changes for two more years, and combine it with generous payroll-tax relief--would be difficult for the Republicans to block. Including an extension of the Bush tax cuts for high-income households alongside those for the middle-class might make the package less cost-effective in fiscal terms, though this is not clear. What is clear is that extending all the cuts would deny the Republicans their favorite excuse for saying no: "It's a tax increase."