Using our astute powers of hindsight, let's turn the clock back to Feb. 2009 when the stimulus package was passed. The New York Times had just reported 598,000 jobs lost the previous month. By contrast last month the economy added 117,000 jobs. In 2009 bank failure rates as well as foreclosures were the highest they had been since the Great Depression. In other words we were in deep shit.
The $787 billion stimulus package was to jump start economic growth, and save between 900,000-2.3 million jobs. The package allocated funds as follows:
$288 billion in tax cuts.
$224 billion in extended unemployment benefits, education and health care.
$275 billion for job creation using federal contracts, grants and loans.
Was the the stimulus package a success? That depends on who you ask.
The CBO estimated that in the fourth quarter of 2010 there were somewhere between 1.3 million and 3.5 million people who were then employed who would not have been had the stimulus not been enacted. To these people it was obviously a success.
Suppose instead of the economic stimulus bill we did as critics suggest. "To improve the economy, policymakers should focus on reforms that remove impediments to work, saving, investment and production. Lower tax rates and a reduction in the
burden of government are the best ways of using fiscal policy to boost growth." In other words, cut assistance to the poor and those hurt most by the recession, give tax breaks to the wealthy, and add to the unemployment by reducing the size of government. I seriously doubt that even a Republican congress would dare to embark on such a program.
Historical Unemployment Rates in the United States
For Job Losses, No Sign That Worst Is Over - NYTimes.com
Bank Failure Rate Quickens Through January 2009
http://www.cato.org/special/stimulus09/cato_stimulus.pdf
CBO: Jobs Created and Saved By Stimulus Cost At Minimum An Average of $228,055 Each | CNSnews.com