Monday, February 15, 2010

Erm, About That Stimulus

It's not news that the stimulus was probably way too small, according to numerous economic critics, but that a bigger one was probably not politically possible.
And I haven't seen anything recent that say the Administration and/or Congress will pull something new out of a hat to replace it. It is, after all, an election year.
It's also fairly well agreed upon that FDR made a big mistake in 1937 by pulling back on similar measures to end the Depression in response to political pressure and that it was actually escalated government spending for WWII that saved the economy.
So why do I mention this? Because Krugman went to the trouble of illustrating the stimulus in one of his easy-to-read charts. One look and it's OMG, we f***ked!
 What's so bad, of course, is just conventional wisdom shown in veritable 3-D. Unemployment falls, but not much, stimulus money all gone.

Cheers, Julimac

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