That depends on who you ask. Some economists, and the White House itself, have concluded that the federal stimulus package passed early in 2009 has been effective, if not in helping the economy recover, at least in making sure it didn’t get worse. For the past month or so various officials, most notably Vice-President Joe Biden, have been going around proclaiming that the stimulus package prevented another Great Depression, and there is some evidence to support that. Others are more criticial, citing particularly the lack of improvement in unemployment figures. However, it may be that unemployment, which exceeded even the most pessimistic predictions in 2009, was at least made less worse by the stimulus than it would have been without it.
What does this mean for 2010? Well, it means that during this year we will be digging ourselves out of a recession, which, as bad as that is, is at least better than trying to recover from a depression. (The Great Depression which began in 1929 was not fully over until the United States got into World War II twelve years later). There are, as the White House likes to remind us, many construction and infrastructure projects going on through 2010 that would not have happened except for the stimulus. And there are some indications that the economy is looking a little better. Unfortunately it’s still likely to be bad for some time to come, but my personal view is that the evidence supports the conclusion that our 2010 would be at least marginally worse if the stimulus had not passed.
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