Today marks the three year anniversary of the American Recovery and Reinvestment Act (i.e. the stimulus), signed by President Obama one month after being sworn in, at a time when the economy was hemorrhaging 700,000 jobs per month. Of course, the Republican spin machine has gone into high gear to portray the stimulus as a failure:
RNC CHAIRMAN REINCE PRIEBUS: “Three years ago today, President Obama signed his ‘Stimulus’ into law, and it’s clear, by Obama’s own standards, that his signature economic plan has been an abject failure.”
SPEAKER OF THE HOUSE JOHN BOEHNER (R-OH): “Today, there’s no denying the fact that his ‘stimulus’ policies not only failed, they made things worse.”
HOUSE MAJORITY LEADER ERIC CANTOR (R-VA): “The Obama Stimulus failed to create the jobs that Americans were promised and piled up mountains of debt that our children and their children will have to repay.”
And there are more where those came from. But as Center for American Progress Director of Tax and Budget Policy Michael Linden explained, the stimulus did just what it was supposed to — slow and then reverse the economy’s dramatic decline:
In the second quarter of 2009, the first full quarter after the stimulus was passed, GDP still declines but at a much slower pace—just 0.7 percent—and then begins to grow again in the third quarter of 2009. Job losses also begin to slow down immediately. Leading up to the stimulus, we were losing more and more jobs each month. After the stimulus, fewer and fewer. And eventually we even start gaining jobs. And take a look at this. Private-sector layoffs actually peak in February 2009—the month the stimulus passed—and then begin a dramatic decline. By the one-year anniversary of the stimulus, private-sector layoffs are back down to pre-recession levels.
Watch Linden’s explanation:
As economists Alan Blinder and Mark Zandi wrote in their study “How the Great Recession was Brought to an End,” the effects of the stimulus were “very substantial, raising 2010 real GDP by about 3.4%, holding the unemployment rate about 1½ percentage points lower, and adding almost 2.7 million jobs to U.S. payrolls.” And there is literally no evidence backing up Boehner’s assertion that the stimulus made things worse. Try as they might, Republicans can’t make these numbers disappear down the memory hole.