Afternoon Must-Read: Bill McBride: Calculated Risk: The Stimulus Success

Bill McBride: Calculated Risk: The Stimulus Success: “It is important for the future to set aside ideology and recognize that the American Recovery and Reinvestment Act of 2009 helped the economy.

The stimulus could have been structured differently… why have tax incentives for businesses to invest when there is already too much capacity?… Recoveries from financial crisis are slow [so] investment in infrastructure could have been larger and lasted longer (not just “shovel ready” programs)… but overall the program was obviously helpful.  Note: One of the reasons I was able to anticipate the bottom of the recession was that I correctly analyzed the impact of the stimulus. It is sad today that extremist ideologues are arguing the stimulus failed. This is very dangerous for the future…. From the White House:

The Recovery Act, by itself, saved or created about 6 million job-years, where a job-year is defined as one full-time job for one year. This translates to an average of 1.6 million jobs a year for four years through the end of 2012. This estimate is within the range of estimates provided by the Congressional Budget Office and other outside organizations.

This impact is in line with analysis from the CBO and others. We should debate the actual impact of the stimulus. We should debate the effectiveness of each component of the stimulus. But we should also ridicule the ideologues … Rubio’s comments are not just wrong but dangerous (if enough people believe him).