The Case For More Stimulus: NYT

New York Times:

The consensus among economists is that the recession is over, and, technically, the herd is probably right. Corporate profitability has been boosted by job cuts, pay cuts and a drive to restock depleted inventories. Immense federal stimulus has jolted the economy.

But what happens when those measures run their course? The economy is going to need more government support, or it is bound to be very weak for a very long time -- and vulnerable to a relapse into recession. Unemployment is expected to worsen well into next year, exceeding 10 percent. Foreclosures are expected to rise, which will push home values down further. Hundreds of small and midsize banks are likely to fail in coming years. State and local governments face budget shortfalls in 2010 that are as bad or worse than this year's.

Read the whole story: New York Times

Comments

[Peter007]

The article asks the question of whether the government needs to do more to help the private sector. Since the government can't produce profits, what type of help could the government give? Money? The government hasn't any money. They can only print money and further deflate the wealth of the private sector by printing more. As we all know, the private sector supports the government with tax dollars. The government doesn't support the private sector. It can redistribute the wealth to special interests.

[rollingdivision]

obama and the Democrats are going to keep borrowing and spending until the country is rich or the Chinese cut them off.

[TJCole]

Obama's Stimulus was seriously weak on the Infrastructure side less than 4%...

This after all the work Brookings did to detail and focus on this...instead Obama listened to Geithner and Summer who know or care nothing about the real economy which is the general prosperity...

Those who are concerned with deficits at this time know absolutely nothing of Macro Economics...

[VikingQuest]

Good luck with that, considering the first one was more of a bailout of the states than a stimulus . . . the people didn't want the first one, have fun selling the second one.

[Jefferson78]

We have wasted more than one hundred billion dollars to create roughly 36,000 jobs. Think of all the good and productive things our nation could have done with that money? Instead, we allowed Congress to fund low priority pok barrel projects and incur debt for our children and grandchildren to repay. Cancelling the stimulus bill today would save around seven hundred billion in unnecessary debt and put us on the road to financial solvency.

[sbvpav]

those who say the stimulus is not or has not worked, are being disingenuous about the dire shape the country was in at the time. the help has been significant only unfortunately not enough. the republicans under the last administration almost, and perhaps still has, succeeded in reducing the ability of the government to help the middle class, to almost a size "you could drown it in a bathtub."

while barack is trying to do a little in many different areas to rebuild this economy on a more sound foundation, it is similar to putting pennies in a savings account. yes, over time, pennies will add up, but the growth is so slow you are most likely to die before seeing any true savings.

[Sam1234567]

787 billion dollars of debt, is not like saving pennies. All he will do is create inflation when interest rates rise, all int he name of 36,000 jobs. You have dupped by lib propaganda.

Please take a high school economics class.

[sposton]

We ought not call it stimulus but infrastructure investment. Such investment must be highly targeted to areas which promise to reduce our reliance on fossil fuels. Instead of building road bridges we ought to build a high speed rail infrastructure in this country. Instead of building highways which enable more suburbs and exurbia we ought to encourage different kinds of developments, integrated towns with short connections between home, work and shopping. Most of the stimulus money is not sufficiently targeted for the biggest returns to the country - high level of job creation and long term benefits to the country. Simply put, most of the money could have been used more wisely. Before injecting more "stimulus" we ought to pause and think.

[huff-fan]

I thought only 14% had been spent.

[bzb]

Yes more stimulus money will be needed to help the states.