CBO: Stimulus hurts economy in the long run

http://www.washingtontimes.com/news/2011/nov/22/cbo-stimulus-hurts-economy-long-run/ ^

[kcvl]

The Congressional Budget Office on Tuesday downgraded its estimate of the benefits of President Obama’s 2009 stimulus package, saying it may have sustained as few as 700,000 jobs at its peak last year and that over the long run it will actually be a net drag on the economy.

CBO said that while the Recovery Act boosted the economy in the short run, the extra debt that the stimulus piled up “crowds out” private investment and “will reduce output slightly in the long run — by between 0 and 0.2 percent after 2016.”

The analysis confirms what CBO predicted before the stimulus passed in February 2009, though the top-end decline of two tenths of a percent is actually deeper than the agency predicted back then.

All told, the stimulus did boost jobs and the economy in the short run, according to CBO’s models. At the peak of spending from July through September 2010 it sustained anywhere from 700,000 to 3.6 million, which lowered the unemployment rate by between four-tenths of a percent to 2 percent.

The Obama administration had promised 3.5 million jobs would be produced at the peak of spending.

For this current quarter CBO said the stimulus is sustaining between 600,000 and 1.8 million jobs, which has improved the unemployment rate by as much as 1 percent versus what it otherwise would have been.

The White House did not return a message seeking comment Tuesday afternoon, but the president has defended the stimulus package as a bulwark against an even weaker economy.

[lowbridge]

bump

[kcvl]

“The White House did not return a message seeking comment”

NO KIDDING!

[BitWielder1]

We told you so.
Any possible upturn (did anyone see it?) was sure to be followed by a much larger downturn when the bill came due (we're certainly seeing that).

Is there any way to claw back stimulus money that obviously did no good?
If there is any stimulus money yet to be paid out, can we get an immediate moratorium on that?
Can we have a congressional hearing on who received stimulus money and ask what the heck they did with it?
I really don't think that's asking too much.

[DustyMoment]

Gee, no sh!t!!!

[mewzilla]

Okay, who’s got The Captain Picard Double Facepalm pic...?

[poverg]

I LOVE that pic! And in this case, it is soooooo appropriate.