Today, Washington routinely speaks of trillions, as in: This year's trillion- dollar deficit. And the $9 trillion in projected deficits over 10 years. And the upward of $1.8 trillion that Baucus' "$829 billion plan" would actually cost in the first 10 years (2014-23) in which its provisions would be fully operational. But the number from which Washington flinches is 999,999,999,997 less than a trillion. It is: 3.
Many Democrats believe that rising unemployment means the nation needs a "second" stimulus -- but one they could call something other than a stimulus because it would be the third. The first was passed in February 2008, two months after the recession began. Its $168 billion tax rebate failed to stimulate because overleveraged Americans perversely saved much of it.
Admitting that the first stimulus existed would complicate the task of justifying a third one, given that the second one -- the $787 billion extravaganza that galloped through Congress last February -- has not been the success its advocates said it would be. The administration predicted that if Stimulus II were passed, unemployment would not go above 8.5 percent. On CNN Feb. 9, Summers was asked how soon Americans would "feel results, the creation of jobs." Summers answered, "You'll see the effects begin almost immediately," starting with "layoffs that otherwise would have happened." Summers' formulation resembled various presidential statements, such as his goal "to create or save" 600,000 jobs in 100 days and up to 4 million jobs by 2010, and the statement that as of June, Stimulus II had "created and saved" 150,000 jobs.
Assertions that things would be much worse if Stimulus II had not been passed cannot be refuted because they are based on bald claims about numbers of jobs "saved." Because those cannot be quantified, the assertions are unfalsifiable and analytically unhelpful. They are, perhaps, helpful to the administration by blurring the awkward fact that since Stimulus II was passed, the unemployment rate has risen from 8.1 percent to 9.8 percent, and probably soon will pass 10 percent.
But one-quarter of Stimulus II will be spent this year. Another quarter will be spent in 2011. Half will be spent in 2010, an election year. Which suggests that Stimulus II is, and Stimulus III would be, primarily designed to save a few dozen jobs -- those of Democratic members of the House and Senate.