Or, A Stimulus for Tomorrow, Part 8
As discussed in my prior posts, very little of President Obama's stimulus package has entered the economy at the moment: the stimulus doesn't really kick in until 2010 and then the stimulus spending continues through 2015. For instance, tying Obama's stimulus for tomorrow to my recent posts regarding the looming deficit crisis, Obama's stimulus package accounts for about $400 billion of the 2010 deficit and $134 billion of the deficit in 2011. Or, if you'd rather, peruse those same numbers in handy-dandy chart form:
Blue is the impact of the stimulus spending on the yearly budget deficit. The chart is from Ross Perot, by the bye. (It's 1992 all over again!)
This is not to say that backloading the stimulus was entirely stupid; as the CBO reported in March of this year, it projects that the 2010-2015 payments do ease the recovery somewhat (although, under some projections, at the cost of long term growth). But I previously argued -- and still believe -- enacting a stimulus for tomorrow rather than for today* was a costly error. We should have passed a larger 2009 stimulus, which would have included more direct payments and tax cuts, and held back on most** of the rest of the package (2010-2015). That would have given us space in 2010 and 2011 to enact additional alternative stimulus measures, or adjust our allocations, without worrying about (as) large of deficits.
Ah well. It was not meant to be.
So, let's see how we're doing -- and exactly how right or wrong my thinking was. Obama's team made specific projections regarding the purported effect of the stimulus on jobs. Here is Obama's projection:
And now, from Innocent Bystanders, the same projection with the real unemployment figures through May 2009:
*So we're clear, I am assigning blame for the failings of the stimulus package and that blame falls on both Democrats and Republicans. Democrats proposed something bloated and stupid; yet, had Republicans seriously engaged the issue -- instead of seriously engaging their own idiocracy -- the package might have been improved.
**I favored some long term spending for targeted, game-changing infrastructure projects like Rep. Mica's high-speed rail proposal. That would have been a bold move, in my view. Unfortunately, however, we did big instead of bold.