Julian Beltrame, THE CANADIAN PRESS

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OTTAWA - The prospect of a stimulus package large enough to heat up Canada's icebox economy has some economists worried that the long-term pain would be worse than the immediate gain.

Most economists agree the economy is at the front end of a recession, and that a massive, multi-billion-dollar boost of government spending would be needed to materially change that reality.

"Go big or go home," says CIBC senior economist Avery Shenfeld.

"If it's not in the $10 to $15 billion range, it won't make much of a difference in the gross domestic product at the end of the day."

Dale Orr of IHS Global Insight cites one per cent of GDP figure - or about $16 billion number in Canada's $1.6 trillion economy - as a rule of thumb for an effective stimulus package.

A $32-billion spending surge over two years - the duration most economists believe stimulus will be required to return the economy to normal, healthy growth - is not so outlandish compared to the at least $500 billion being discussed in the United States, notes Shenfeld.

But that doesn't mean it's a good idea, Orr added.

He argues that the long-term pain of such deep spending is too great.

The dual danger is that government will make mistakes in trying to spend such large amounts in a short time-frame and that once spent, it will have set the foundations of a structural deficit that will last years after the crisis has vanished.

The principle government should follow, says Orr, is don't do anything in bad times that you wouldn't do in good, just do it faster.

Spending as much as $30 billion in a single gulp, as some have speculated may be the ballpark number under consideration by the Liberal-NDP coalition that's seeking to oust the Conservatives, would be irresponsible, says TD Bank chief economist Don Drummond.

"There's no way there'll be a single-year stimulus anywhere near $30 billion," said Drummond. "That would without any trace of a doubt shift us from a short-term deficit to a long-term structural deficit"

He added that "you can't spend that much money that fast" and suggests $8 billion of stimulus would be a manageable target.

Liberal economic critic John McCallum has disowned the $30 billion estimate, but said the coalition's stimulus package would have to be "significant" in order of the "magnitude" suggested at the G20 summit of world leaders last month - about two per cent of GDP, or $32 million for Canada.

The coalition document signed by the three opposition party leaders does not state a precise figure, but says the package must include a hefty dose of infrastructure spending and aid for manufacturers, particularly the auto and forestry industries. It does not specify a timeframe for the spending.

Economists say how the money is spent is as important as the amount of stimulus provided. Many favour infrastructure investments in roads, bridges, schools, urban transit, and such.

The added benefit is the nation is left with a tangible asset that helps the economy after the money is spent.

Orr would fine tune it further, saying he would green-light only small projects like roads and bridges that can put shovel to the ground quickly.

Large infrastructure projects, such as a new airport, takes too long to get started and complete, he said. That means there would be no stimulus at the time it is needed - right away - and too much when the economy has recovered, adding to inflationary pressures.

Drummond says if tax cuts are considered, they should not be temporary as was done in the U.S. during the spring with minimal impact on the health of the economy because some would be hoarded and some would be spent on imports.

Rather, he said the government should consider cutting taxes on lower income Canadians in a way that would lessen the high marginal rates they pay as they move from welfare to work. Lower income Canadians are also more likely to spend the money than those more affluent who might be tempted to bank it.