Where The Money Went -by Paul Krugman: "So much for “we tried Keynesian policies & they didn’t work"

[kpete]

Where The Money Went
Paul Krugman
New York Times’ Blog
July 10, 2011, 2:54 pm

Somehow I missed the BEA’s very useful page http://www.bea.gov/recovery/ tracking the Recovery Act and how it is translated into taxes and spending. (Thanks to the commenter who mentioned it). It’s especially useful for thinking about what the Obama stimulus really involved — and what it didn’t.

Look at the peak quarter of stimulus http://www.bea.gov/recovery/pdf/arra_table_01b.pdf(pdf), which was the first quarter of 2010. I’m going to rearrange the categories a bit. Here’s how I read it: at annual rates (in other words, actual numbers in the quarter were only 1/4 as large), the total budget impact was $357 billion. Of that, we had:

Tax cuts and refundable tax credits: $151 billion
Aid to individuals (mainly unemployment insurance and food stamps): $70 billion
Aid to state and local governments: $103 billion
Everything else: $33 billion
…

So much for “we tried Keynesian policies and they didn’t work.”

MORE:
http://krugman.blogs.nytimes.com/2011/07/10/where-the-money-went/

[xchrom]

1. recommend

[MannyGoldstein]

2. But the bankers are saved

Let us be thankful.

[Karmadillo]

3. Better them than us because we suck. Hail, Glorious Masters!

nt

[Hydra]

4. The comments on the article are suprisingly interesting

But the one I liked best was:

Based upon the above figures, it could could just as easily be argued that "we tried tax cuts and they didn't work".
But don't worry, no Serious Person is going to argue that