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Forum Post: Did the stimulus work? A review of the nine best studies on the subject

Posted 2 years ago on Aug. 3, 2012, 11:49 a.m. EST by brightonsage (4494)
This content is user submitted and not an official statement

There are a lot of claims and political ads, opinion columns and water cooler chatter on this subject. It is important to know the answer to this question to make a judgement about the proposed solutions to completing the recovery that we all need. The link presents the results of multiple studies with the analysis of each. I won't give you a bottom line conclusion so you can read the results, analyses and comments and come to your own weighting of their results.

http://www.washingtonpost.com/blogs/ezra-klein/post/did-the-stimulus-work-a-review-of-the-nine-best-studies-on-the-subject/2011/08/16/gIQAThbibJ_blog.html

What is your bottom line? Worked? Didn't work? Too little? Too much? Spent on the wrong things? Need more now? Is the European approach, austerity, the way to go? How has it worked/failed? Evidence?

27 Comments

27 Comments


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[-] 3 points by VQkag2 (16478) 2 years ago

Just had an elevated subway station refurbished. So that worked. Also completed 3 massive tunnels for new train service in manhattan. 1st time in decades.

All with stimulus money. Lotsa jobs there. So I think it worked. I think it needed to be twice as large. Recovery has slowed because republicans cut the stimulus down.

So I vote Yes but needed to be bigger.

[-] 2 points by brightonsage (4494) 2 years ago

If the economy is around $13 trillion and much of the stimulus was spent late (some is being spent now) you would have to conclude that it was small. Another reason to reach that conclusion is the lack of significant inflation.

Some, who were against the TARP and Stimulus, were predicting rampant inflation by now. See any? About like WMD in Iraq.

[-] 3 points by VQkag2 (16478) 2 years ago

I don't believe those critics. Best thing we can do is cut taxes/debt of middle/working class. That would increase consumer demand and hiring.

Stimulus could include something like that or it could be seperate. But it would be very effective.

[-] 2 points by brightonsage (4494) 2 years ago

In the distant past it was theorized that with huge productivity increases which we have been experiencing that we would have prosperity for all by this point. What they didn't anticipate was that all of the benefits (wealth) would be concentrated in the hands of a few who would not spend it on goods and services. So, wealth went up and demand changed little. Prices didn't go down, nor did they go up as if goods were scarce. The wealth of the 99% didn't increase, their standard of living didn't increase (it went down somewhat) and they didn't benefit by working harder, smarter or with better tools (all of which they did).

The wealthy invested in companies who reduced their costs by outsourcing, off shoring and automating and selling fraudulent securities. And they got huge profits (more accurately, plunder).

Being greedy, they rigged the system more and more to make the profits easier to get and higher and higher. Another way to raise their take was avoiding taxes, personally and corporately.

Jobs? What do they care about jobs?

[-] 2 points by VQkag2 (16478) 2 years ago

We want our money back. W/ interest. 29.99% interest, thank you very much.

[-] 2 points by brightonsage (4494) 2 years ago

Don't for forget there were fees on top of the interest.

[-] 2 points by VQkag2 (16478) 2 years ago

LOL

And penalties. Oh boy the penalties are big!

[-] 1 points by brightonsage (4494) 2 years ago

And sheeping and mishandling.

[-] 1 points by VQkag2 (16478) 2 years ago

HA!. very puny!

[-] 1 points by brightonsage (4494) 2 years ago

Dain Brammage. Or Baine Drammage?

[-] 1 points by VQkag2 (16478) 2 years ago

Or Bane Dressage!

[-] 2 points by brightonsage (4494) 2 years ago

Now you are horsing around. Neigh. le Bon Baine

[-] 1 points by VQkag2 (16478) 2 years ago

Did you hear if his horse won? What a hopeless elitist.I can't people would vote for that.

[-] 1 points by brightonsage (4494) 2 years ago

What do you mean won, it got the writeoff. And it didn't get strapped to the roof of the plane. That is winning isn't it?

Weren't the shoes Gucci's?

[-] 2 points by DKAtoday (28242) from Coon Rapids, MN 2 years ago

LOL

[-] 1 points by VQkag2 (16478) 2 years ago

It is. You are 100% correct. $75k For the saddle alone?

Disgusting! Colberts done some good bits on it.

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[-] 0 points by SteveKJR (-497) 2 years ago

Seems lots of consumer products have jumped by at least 50% if not more. What does it say when you have to pay $3.99 for a gallon of milk.

[-] 3 points by brightonsage (4494) 2 years ago

Milk is a case in which government subsidies regulation etc. cause distortion from market prices. Yes, consumer products especially groceries have jumped some, but not nearly as much as CEO salaries.

[-] -1 points by SteveKJR (-497) 2 years ago

What the hell does CEO salaries have to do with inflation? Explain that one away.

[-] 2 points by brightonsage (4494) 2 years ago

About the same as milk? You can look up the inflation, about 1.7%.

[-] 2 points by TommyNYC (730) 1 year ago

Just for a bit of fun with ad hominem, John B. Taylor is a monetarist and friend of Greenspan. No surprise really that he would oppose stimulus in the form of deficit spending.

[-] 2 points by frogmanofborneo (602) from New York, NY 2 years ago

The stimulus worked but not enough. It wasn't enough money and some was well spent some was not. We need more now spent well, targeted to good jobs in this country. The legitimate governments of the world need to pry the 21trillion or more that the .01% is hiding in tax dodge havens like Switzerland and the Caymans. They should consider civil forfeiture. The situation is an emergency. Were rich Greeks paying their taxes for example, we would not be hearing anything about a problem in Greece. What is happening because these vampires get away with murder is hunger, suicide, family dissolution, emigration, and the selling off at fire sale prices of the national patrimony.

[-] 2 points by VQkag2 (16478) 2 years ago

Amen froggie.

Put 'em in jail and take our money back.

Solidarity

[-] 2 points by brightonsage (4494) 2 years ago

Well said. If no taxes for the rich were the answer, wouldn't the Greeks own the world?

[-] 1 points by frogmanofborneo (602) from New York, NY 2 years ago

yep.

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[-] -3 points by hchc (3297) from Tampa, FL 2 years ago

Printing trillions and injecting the money into the system is a guarantee to work, in the short term.

They should have been fixing all the shit that caused the meltdown.

Instead they strengthened them.

A "stimulus" is a temporary thing. ITs not a long term solution. And DC doesnt have what it takes for long term solutions.

[-] 1 points by brightonsage (4494) 2 years ago

It is a temporary thing. Printing money and injecting it indiscriminately is an approach but targeting it is a choice. The suspending the payroll tax was untargeted. Infrastructure is more focused, boosting (or distorting if you prefer) demand in the short term in that sector. Stimulus without fixing structural problems with tax systems, spending priorities and amounts for the long term is stupid. Austerity is also a distortion and choosing it, or to do nothing without a long term plan is also stupid.

The Europeans chose austerity and predictably their economy has been shrinking and they have been unwilling, therefore unable, to agree on a long term plan. Our stimulus was a compromise of untargeted and targeted and total amount. The targeted part had to be smaller that its advocates wanted because not enough projects were ready tp go in the short term. The unfocussed was immediately stimulative but very small and it was neutralized by compensating (or conflicting) state cuts.The current jobs or Transportation bill is more targeted to infrastructure but won't pass because of GOP obstructionism,