Here’s a chart (source) showing private sector job growth and the timing of the stimulus package:
As reported in the Washington Post, the director of the nonpartisan Congressional Budget Office is adamant that the stimulus helped reduce unemployment.
Amusingly, the Post goes on to note:
only 46 percent of economic experts agreed that “the benefits of the stimulus will end up exceeding its costs” — including “the economic costs of raising taxes to pay for the spending.”
So “only” half the economists are certain the stimulus actually pays for itself (12% disagree). Does the stimulus need to pay for itself though? I mean, should we ask those economists whether the economic benefits of last year’s defense budget will exceed the costs?
The question then is not whether stimulus works (it does), and not whether stimulus pays for itself (it might, but who cares). The question is whether we should be spending money now to help the economy. When I read articles like this about the bleak prospects of young people, I become convinced the answer is yes. Stimulating the economy has to be priority #1.
(See also, previous cartoon: Why economic stimulus is needed even though we have budget deficits.)