Private Forecasters Support Claim That Stimulus Worked
Back when the stimulus bill was passed, I have to say that I was opposed to it. When the White House claimed it was working, I pretty much scoffed. So I have to admit that I was taken aback to read this article, which indicates that professional economic forecasters support the claim that the stimulus has made the economy better off than it would have been otherwise.
The legislation, a variety of economists say, is helping an economy in free fall a year ago to grow again and shed fewer jobs than it otherwise would. Mr. Obama’s promise to “save or create” about 3.5 million jobs by the end of 2010 is roughly on track, though far more jobs are being saved than created, especially among states and cities using their money to avoid cutting teachers, police officers and other workers.
“It was worth doing — it’s made a difference,” said Nigel Gault, chief economist at IHS Global Insight, a financial forecasting and analysis group based in Lexington, Mass.
Mr. Gault added: “I don’t think it’s right to look at it by saying, ‘Well, the economy is still doing extremely badly, therefore the stimulus didn’t work.’ I’m afraid the answer is, yes, we did badly but we would have done even worse without the stimulus.”
Here are some charts from three major economic forecasters:
I admit that I am a little flabbergasted by this. As both Matthew Yglesias and Brad Delong point out, these are companies who have every incentive to do accurate forecasting for “people who are trying to exploit macroeconomic information in order to make money.”
I haven’t had an opportunity to review the data underlying the charts or analysis, so I don’t know how much of this I agree with. That said, I thought the data presented here so far was important enough to call attention to.