Fiscal stabilizer

The primary objectives of safety nets in times of crisis are to protect incomes and avoid irreversible losses of physical assets and human capital and to help maintain political consensus around the policies needed to resolve the crisis. Permanent and appropriately financed programs can also act as automatic fiscal stabilizers, although programs with permanency, appropriate finance, and guaranteed countercyclical finance are rare (see chapter 3, section 3). 

Countries that have successful fiscal rules include Brazil, where the law has fostered the credibility of the government s policies, and Chile, where fiscal rules had a role in protecting social spending in 2004. Automatic stabilizers tend to be most effective in industrial countries. Failures of fiscal rules in Argentina and elsewhere in Latin America are among the factors that contributed to macroeconomic instability (Singh and others 2005). An example of a fiscal rule that has not been fully enforced is the European Union s Stability and Growth Pact. 

The following section contains descriptions of the fiscal decision making and advocacy efforts tiiat resulted in growth and stability for three strong esmh programs. These programs developed independently in Pittsburgh, Pennsylvania Louisville, Kentucky and Baltimore, Maryland. As demonstrated by these... 

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