Any Calvin and Hobbes fan knows how much Calvin loves Chocolate Frosted Sugar Bombs--sometimes three (or, say, five) bowls worth. His first bowl is eaten in anticipation of his second, which is then consumed before the first has even been digested.
It's not unlike calls for a second stimulus now, before the effects of the first have been felt. Warren Buffett today called for a meatier second stimulus. Paul Krugman has argued for the same. But a WSJ survey shows the majority of economists are opposed to a second round of spending before the country has seen the fruits of the first. From the WSJ:
"The mother of all jobless recoveries is coming down the pike," said Allen Sinai of Decision Economics. But he doesn't favor more stimulus now, saying "lags in monetary and fiscal policy actions" should be allowed to "work through the system."
Like most respondents, Mr. Sinai said the bulk of the stimulus wouldn't be felt until 2010. When asked how much the stimulus has helped the economy, 53% of respondents said it has provided somewhat of a boost but that the larger effect is still to come.
There are certain considerations that make a second spending package more attractive, such as the fact that the unemployment rate with the stimulus has soared above White House forecasts. June's jobs report showed 4.4 million Americans were out of work for 27 weeks or more, and there are limits on stimulus inclusions like the Cobra subsidy.
One of the concerns among conservative economists is the efficacy of federal spending as a means of job creation--if they weren't in favor of a first, they're not likely going to order a second because the first didn't go down so well. Others like Krugman have said, however, that the first should have been bigger and better constructed.
Talk about a new stimulus seems to have heated up in the wake of disappointing June's jobs report--if July looks much better, it could cool down.