Would a Second Stimulus Create Jobs?

Feldstein published a paper in March* that had a different take on the same situation. At that time, he recognized that $12 Trillion of destroyed household wealth and another $250 Billion in demand shortfall would almost certainly require a second stimulus package. If the second package was targeted differently so that demand would not out pace consumer spending, he thought a rise in the national debt would be avoided.

This is why economics is so tough for many of us to grasp. The fundamentals don't seem nearly as dependent on the market as they do on whether the speaker is talking to a reporter or writing for his academic colleagues.

Guess that's why economics is classified as a social science rather than just science.

*http://www.project-syndicate.org/commentary/feldstein7

carolejames of GA 9:52AM July 23, 2009

My Thoughts?...The last stimulus in my opinion was a waste. The average pay increase on a WORKERS check was about $10.00..what a joke..Sorry, but that does nothing to make up for the loss of hours. Most people who's hours have been cut down to a 32hr work week..that covers NOTHING.And I hear the stats say that unemployment benefit claims are down...Duh!!!..Sorry again, but that's just because peoples unemployment benefits have run out.

Oh, and as for this wonderful government helping to pay for schooling..Sorry, another waste...The schools don't care who gets it...They are just competeing for the money. I get calls asking me to go back to school, and the commercials and adds are everywhere..and anyone, and I MEEN ANYONE can get the funding. My girlfriend is in school, and was harrased by another student that ended up in a altercation that turned physycal..both were tested for drugs and alcohol, and the other girl tested positive for cocaine, and alcohol..the argument started because my girlfriend seen her snorting coke on her break in the parking lot. And this is happening everywhere, the schools don't care...Just give them the money.

I have lost all faith in the system. Does anybody care, does anybody see what is going on here. Things are much worse than ever, and are Government is just throwing away money to the wrong people...This has to stop.

Jeff of WI 9:19AM July 23, 2009

They need to give money to the new businesses and small based businesses, help smaller ones grow. To help create jobs. Bring back some of the welfare programs to help them get on their feet. Alot of states are doing there best not give any state asstance to those who need it and or dropping those on it. We can give billions away to other countries or to the rich, who already have money. But what about the average american or extremely poor american. People who are disabled or on a fixed

income. What about people who have middle income who make to much to get any help and are in the highest tax bracket. Unless they have perfect credit cant buy house, can't start a business, and can't afford health insurance unless they have perfect health and the state won't them. So you figure it out. What is the goverment doing with all those tax dollars. You hear thing like they some how lost few billion dollar and they don't where it went. Also taking suplus from Social Security and giving the money to the war, whichever one we are fighting at the time. The give all this money for use to get, yet no one getting, except the one who already have. Remember history, why did those brave men, women and child set out to the new world. To leave a country that was over taxing, controling them and most importantly taking their feedom of religion away, which slowing but surely this country's doing too. In school and other areas. Giving more rights to those who have none or highly disagree about Jesus.

mary of ID 7:58AM July 23, 2009

Let's look at facts: The first stimulus was handed out to corporations with little to no oversight and it was squandered. AIG...need I say more? And it continues; the U.S. auto makers, who don't make a product worth a darn at a price people want to pay are getting a second stimulus with this crappy "Cash for Clunkers" deal. How does this help the average unemployed person? It doesn't, it fattens corporate bank accounts. Ultimately, this whole bailout business is only prolonging the issue because it is fighting debt with debt and we are the ones who have to pay the bill.

Someone mentioned the demise of mom and pop shops due to the way chain stores killed small businesses. Another facet to this is the continual raising of minimum wage. Mom and pop are getting choked by places like Wal-Mart price wise and can't afford to pay higher minimum wage, a double whammy. And then when mom and pop close their doors after 30 years, what do they do when they're 56?

This job market is an employers market, and they aren't giving an inch. In the past 3 months I've applied for over 200 jobs nationwide and I'm actually happy for the 30-some "No's" I've received...I'm usually ignored.

Others have suggested contacting your Congressmen. I've done that and the canned response is very disheartening.

A second stimulus won't create more jobs, it will create more debt for most, fatten the wallets for some (did I mention AIG), and probably make the current situation last longer. Maybe instead of going on his "U.S. Apology Tour of the World" the president should have stayed at home, put that money to better use, and concentrated on the problems of the country he was elected to lead. This leadership by example shows he has no regard for the regular American, which reinforces the failure of another "stimulus" helping the regular American and the unemployment. And I would like to add, to show I'm not an Obama basher, I feel the same way about Congress. Any small group of people that basically vote to give themselves raises while the people they were elected to represent are dealing with financial and employment hardships proves they could care less. Funny thing is, those of us with the hardships are paying them!

J of MO 4:04AM July 23, 2009