And while policies such as cash for clunkers didn't give a big boost to the economy, it is necessary to put money back into the system.
When there is a large surge in credit and then a sudden U-turn of it, what do you propose to do? A surge in credit results in the value of homes and stocks to skyrocket, thereby creating a sort of casino like environment. And when the music stops (i.e., credit dries up), a sort of cascading effect occurs where people pull money out of the stock market and home prices collapse. And this is what happened recently.
When that happens, the daily cadence of loans to keep businesses operating begins to fail. So, in order to keep the economy going, the government spends while the free market works its way out, i.e., comes full circle again.
I don't believe in deficit spending for $10 trillion, but a trillion or two, I believe is necessary.
The biggest mistake I believe Obama made was not spending more and quickly spending it on infrastructure projects, such as updating the nations power grid for wind energy.