Mike Konczal argues pretty persuasively that the Obama-McConnell tax deal should look more like this than the chart the White House was sending around on the Hill:
James Kwak makes a similar case here. The more I read about this, the more I think we should be concerned about the Democrats’ will to let the payroll tax cut expire, the less I think it will have a significant impact on the economy.
It may be the case that this really is the most stimulus we could have gotten at this point, but I find it very unnerving when I see the term “second stimulus” being ascribed to a policy that is just not going to produce results anywhere close to what we need. And when its all spent and we still have 8% unemployment, and economists and the Fed call for more stimulus to close the output gap, we’re going to hear John Boehner say something like: “Democrats got two failed stimulus bills and now they want another one? When are we going to wake up and realize that more government spending isn’t going to put people back to work?” And of course he’ll still be dead wrong, but this will no doubt seem to be a very persuasive political argument to the public.