Economists agree_ Stimulus created nearly 3 million jobs - USATODAY

Economists agree_ Stimulus created nearly 3 million jobs - USATODAY

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Pow ered by SAVE THIS | EMA IL THIS | Close Economists agree: Stimulus created nearly 3 million jobs By David J. Lynch, USA TODAY Amid mounting signs that the economic recovery is faltering, one potential remedy seems out of the question: a booster shot of government spending. The White House says the multiyear $814 billion stimulus program passed by Congress in 2009 boosted employment by 2.5 million to 3.6 million jobs and raised the nation's annual economic output by almost $400 billion. A recent study by two prominent economists generally agrees, crediting the pump-priming with averting "what could have been called Great Depression 2.0." If President Obama expected anyone to say, "Thank you," however, he's been disappointed. In a recent USA TODAY/Gallup Poll, 59% of respondents disapproved of the president's handling of the economy. In the partisan war over the economy's performance, the word "stimulus" has became synonymous with "boondoggle," making the notion of a repeat any time soon highly unlikely — especially if Republicans seize control of one or both houses of Congress in November. MORE FED ACTION?: Could depend on economic reports this week ECONOMIST SURVEY: Backs Fed, growth over deficit reduction INFOMOTION GRAPHIC: A historical look at the national debt INTERACTIVE GRAPHIC: Getting a grip on government debt "We have played our policy hand. Now we've got to hope it's good enough," said Mark Zandi, chief economist for Moody's Analytics and co-author of the recent study. Controversy has dogged the stimulus program since its debut. Formally known as the American Recovery and Reinvestment Plan, the spending effort was designed to fill the hole in the economy left after the housing and credit bubbles imploded. The program was proposed by the president and enacted by Congress at the depths of the post-Lehman-Bros. financial collapse, when the economy was shrinking at an annual rate of 6% and losing 750,000 jobs a month. Politically, the "Recovery Act" — which is divided among tax cuts, financial aid for cash-strapped state governments, emergency unemployment assistance and spending on roads, bridges and other infrastructure — has taken fire from the left and the right. Liberal economists such as New York Times columnist Paul Krugman complained that the massive program should have been larger and was marred by the inclusion of excessive tax cuts that would have a less-immediate impact on job creation. Republicans derided the legislation as wasteful spending that would add to ballooning government debt. Eighteen months later, the consensus among economists is that the stimulus worked in staving off a rerun of the 1930s. But the spending's impact was dwarfed by other crisis-fighting tools deployed by the Bush and Obama administrations, including costly efforts to stabilize crippled banks and the Fed's unconventional monetary policy. "I think it was important for confidence. .
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Economists agree_ Stimulus created nearly 3 million jobs - USATODAY

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