You assert that the federal stimulus plan was a failure with no
supporting evidence other than the statement by the President that
it was needed to keep the unemployment rate from rising to 8%. The
8% was an estimate and it proved to be a bad estimate. The
recession was much worse than almost anyone projected. Even data
that was available at the time has now been revised down. What the
president should have said was that the unemployment rate would
have increased to 12% without federal intervention, which is what
most economic models show would have happened. You can question the
accuracy of economic models but they are based on a rigorous
analysis of the data while your evidence appears to be based on
nothing more than a bias against government.
The stimulus plan was enacted in February 2009 and of course it
took a few months for its effects to be felt. In March 2009,
employment was down by 796,000 jobs and the unemployment rate was
8.6%. Job loses gradually diminished and by March 2010, employment
was increasing. The unemployment rate peaked at 10.1 % in October
2009 and had dropped to 8.8% in March of this year. The rate has
ticked up to 9.1%, due partly to a decline in government
employment. Since May 2009, government employment has dropped by
over 1 million. Over that same period private employment has
increased by 1.9 million. The recent weakness in GDP has also been
significantly influenced by cutbacks in government. In the last
three quarters the government sector has subtracted 0.6%, 1.2%, and
0.2% from real GDP growth. Obviously the withdrawal of stimulus is
dampening economic growth. It is rather disingenuous to call for
cutbacks in government spending and then blame the President for
the slowdown in economic growth.
As for the President's current plan, Mark Zandi, chief economist
for Moody's Analytics, has projected that the plan would add 1.9
million jobs and reduce the unemployment rate by 1%. If everyone
would stop playing politics and look at the facts maybe we could
actually make some progress and start putting more people
back to work..
