On Tuesday, House Republican Leader John Boehner said “all this stimulus spending has gotten us nowhere.” At a roundtable for reporters sponsored by the Christian Science Monitor, Mark Zandi, chief economist for Moody’s Analytics and former adviser to Sen. John McCain in 2008, said Mr. Boehner is “just wrong” about the impact the American Recovery and Reinvestment Act has had on the economy. From the Christian Science Monitor:
When asked about [Boehner’s] statement at a Monitor-sponsored breakfast for reporters on Wednesday, Mark Zandi, chief economist of Moody’s Analytics and co-founder of Economy.com said, “that is just wrong, the stimulus has been very helpful.”…
In noting his disagreement with the Republican leader, Zandi said “we would be in a measurably worse place if not for the stimulus. I don’t think it is any coincidence that the great recession ended at precisely the same time that the stimulus, and in this case when I say stimulus I am talking about the [American Recovery and Reinvestment Act] ….was providing its maximum economic benefit.” That maximum benefit came in the second and third quarter of 2009, Zandi said.
What would have happened without the Recovery Act’s fiscal stimulus? “If we had not had the stimulus, estimates that are put forward for example by the Congressional Budget Office are exactly right. We would have 2-1/2 to 3 million fewer jobs today than we actually have. So employment – payroll employment – is off 8 million jobs from the peak. If we had not had the stimulus we would be off by about 11 million jobs,” Zandi said.
Rather than a national unemployment rate of 9.5 percent, “we would have an 11.5 percent unemployment rate,” he added.