Did it Work? The Stimulus
Wednesday, July 27, 2011
Welcome to Politics Bites, where every afternoon at It's A Free Country, we bring you the unmissable quotes from the morning's political conversations on WNYC. Today on the Brian Lehrer Show, Roben Farzad, senior writer for Bloomberg Businessweek, continues his weekly series this month looking at Obama administration economic programs. This week: the stimulus, shovel ready, and our debt.
If you look at the stimulus in terms of how much it turned the unemployment rate around--like in a New Deal type model--there hasn't been much in the way of success, according to Farzad. Of course, the Obama administration would push back and say that the package prevented the crisis from becoming much worse.
But again that's kind of a defensive thing, saying it's not as bad as it could have been, and yet we still have 9.1 percent unemployment and the misery index at a high not seen since 1983, so all of this stuff is not quite comforting.
One of the reasons Republicans in the House say they don't want to increase the debt ceiling is that it follows the huge $787 billion stimulus package, which many opposed. But Farzad reminded listeners that the stimulus price tag is still half the cost of the Bush tax cuts.
Which incidentally were not controversial for Cantor, Ryan, McConnell, some of the tormentors chiefly of the Obama administration.
Farzad said you can cut Obama slack because the country is experiencing the worst economic calamity since the Great Depression, but at the end of the day, the stimulus failed. It's not necessarily because of the spending--Farzad wouldn't refute the concept of Keynesian economics, that the government needs to spend money to get the country out of a serious downturn. On the other hand, he said, there's a whole other take on the failure of the stimulus—that it was too small. For that take, read Paul Krugman.