Sunday, March 07, 2010

Sound And Fury, Signifiying Deceit

Does it really matter to some Republicans if what they are saying is true? That's only a rhetorical question as Monica Crowley demonstrated (video via Media Matters immediately below) on the March 7, 2010 edition of the syndicated The McLaughlin Group.

She actually said of President Obama "economically, nothing he has done has worked- the stimulus, the jobs bill, nothing has worked." There is only one problem: the CBO begs to differ. ABC's Jake Tapper quotes colleague Matthew Jaffe noting

During the fourth quarter of 2009, the stimulus added “between 1.0 million and 2.1 million to the number of workers employed in the United States,” the CBO said.

The stimulus also boosted the country’s economic growth by 1.5 to 3.5 percent during the time period and lowered the nation’s unemployment rate by between 0.5 and 1.1 percentage points.

In the report, the CBO noted that economic growth in 2009 was worse than they had predicted at the time that the stimulus was enacted, but that was due to a weaker economy than originally expected, rather than any failings of the stimulus....

The CBO also said that in the fourth quarter the stimulus package increased the number of full-time jobs by between 1.4 and 3 million compared to the number of jobs that would have existed without the package.

(CBO report, in pdf, is here; excerpt on page 8.)

Of course, if Crowley was referring to the insufficiency of the stimulus package she was correct. Economist and New York Times columnist Paul Krugman on December 7, 2008 remarked on CBS' Face The Nation

I'd like to see it bigger. I understand that there's difficulty in actually spending that much money, and I--they're also afraid of the--of the T word. They're afraid of a trillion dollar for the two-year number. But you know, the back of my envelope says it takes roughly 200 billion a year to cut the unemployment rate by 1 percent from what it would otherwise be. In the absence of this program, we could very easily be looking at a 10 percent unemployment rate. So you do the math and you say, you know, even these enormous numbers we're hearing about are probably enough to mitigate but by no means to reverse the slump we're heading into. So this is--you know, I--they're thinking about it straight.

Less than two months later, on February 7, 2009 Krugman would blog "to appease the centrists, a plan that was already too small and too focused on ineffective tax cuts has been made significantly smaller, and even more focused on tax cuts.... The plan should have been at least 50% larger."

Similarly, economist Dean Baker on January 25 2009 wrote

The $825 billion (@ 2.8 percent of GDP) two-year stimulus package that he put together with Congress is a good start.

The main features of the bill are very much on the right track. The biggest problem is that it should be larger. This downturn is so severe that this package may not be sufficient to offset even half of its impact.

Economist James Galbraith also believed the stimulus was too small and commented

The choice is between an active program, running up debt while creating jobs and rebuilding America, or a passive program, running up debt because revenues collapse, because the population has to be maintained on the dole, and because the Treasury wishes, for no constructive reason, to rescue the big bankers and make them whole.

This could be why,as Tapper wrote

“Economic output and employment in 2009 were lower than CBO had projected at the time of enactment,” the CBO stated. “But in CBO’s judgment, that outcome reflects greater-than-projected weakness in the underlying economy rather than lower-than-expected effects” of the stimulus package.

The stimulus package was too small- but its enactment clearly steered the country in the right direction. Unfortunately, the underlying economy was worse than President Obama calculated and far worse than Republicans like Crowley imagined (or were willing to admit).

That is a huge difference from "nothing has worked." But then, to Republicans like Crowley, mouthing a falsehood over and over is infinitely more satisfying than leveling with your audience.

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