The “stimulus” bill hasn’t even been signed into law yet, and there’s already talk of a follow-up:
Despite the enormous size of the $787 billion stimulus plan, some economists worry that it won’t make a big enough dent in unemployment and that lawmakers will have to work on another stimulus in short order — something members of Congress are loathe to discuss.
“That’s possible,” said Alice Rivlin, a former Clinton administration budget director. “I think the economy is getting worse quite rapidly and this may not prove to be enough.”
And why might this be the case, you wonder ?
Well, let’s let Alice tell us:
The stimulus got “less stimulative,” Rivlin said, as it passed through the Senate and some of the things that offered “the biggest bang for the buck” were scaled back, such as more money for food stamps.
To which Bruce McQuain responds:
You mean it was exactly what those mean old Republicans said it was – more relief than stimulus. More social spending than jobs? That, in fact, any stimulative part of the bill was watered down or eliminated in favor of special interest spending on programs which are either years in the future or will provide no immediate jobs with which to help get the economy moving?
You mean, despite all the rhetoric and nonsense to the contrary by Obama and the Dems, we are on the road to repeating the mistakes Japan made that brought them their “lost decade”?
No kidding?
Then, there’s the more immediate question — how will we even know the stimulus is working ?
Keeping track of whether the stimulus meets the administration’s goals — and hence whether another stimulus may be in order — will not be easy because there is no way to know how many jobs were saved, analysts said.
“The point is to lose less than we would otherwise. It’s very hard to measure that,” Rivlin said.
“We’re never going to know because we’re never going to see the world as it would have been without the stimulus,” Gault said. “Ultimately it will boil down to what’s actually happening in the economy and deciding if things are so unbearably bad they have to do more than they have already.”
Quite frankly, there is no way they we’ll ever be able to prove or disprove that the state of the economy in one, two, or four years, is the way it is because of the stimulus package, which is why this is probably the best assessment of what it’s political impact will be:
No matter how bad the economy is when the 2010 elections come, Democrats are going to argue that it would have been much worse had we not passed this $789 billion bill. It’s something that’s entirely non-falsifiable, since we don’t get to know what would have happened without the legislation. That’s why Obama keeps warning of double digit unemployment, 5 million job losses, an irreversible economic death sprial, etc. He wants to be able to say that he saved us from a return to the 1930s.
This was something I noted back in December when the details of Obama’s plan were just starting to come together:
Obama’s not saying that his policies will create 3 million new jobs. Heck, he’s not even really saying that his policies will create a single new job. As long as the Obama Administration can say two years from that they have “created or preserved” three million jobs, they can claim a victory.
Given the numbers that they’re relying upon, that essential means that unemployment can be at exactly the same level it is today, and Obama will be able to claim he’s “preserved” 3 million jobs.
Change you can believe in, or just a massive shell game ?
I think the answer’s obvious.
Indeed.
