posty Posted July 7, 2009 Share Posted July 7, 2009 http://www.bloomberg.com/apps/news?pid=206...id=ajQbZ.WrAVwQ July 7 (Bloomberg) -- The U.S. should consider drafting a second stimulus package focusing on infrastructure projects because the $787 billion approved in February was “a bit too small,” said Laura Tyson, an adviser to President Barack Obama. The current plan “will have a positive effect, but the real economy is a sicker patient,” Tyson said in a speech in Singapore today. The package will have a more pronounced impact in the third and fourth quarters, she added, stressing that she was speaking for herself and not the administration. Tyson’s comments contrast with remarks made two days ago by Vice President Joe Biden and fellow Obama adviser Austan Goolsbee, who said it was premature to discuss crafting another stimulus because the current measures have yet to fully take effect. The government is facing criticism that the first package was rolled out too slowly and failed to stop unemployment from soaring to the highest in almost 26 years. Obama said last month that a second package isn’t needed yet, though he expects the jobless rate will exceed 10 percent this year. When Obama signed the first stimulus bill in February, his chief economic advisers forecast it would help hold the rate below 8 percent. Unemployment increased to 9.5 percent in June, the highest since August 1983. The world’s largest economy has lost about 6.5 million jobs since December 2007. Worse Than Forecast “The economy is worse than we forecast on which the stimulus program was based,” Tyson, who is a member of Obama’s Economic Recovery Advisory board, told the Nomura Equity Forum. “We probably have already 2.5 million more job losses than anticipated.” Republicans, including House Minority Leader John Boehner of Ohio, seized on the latest labor numbers to attack the Obama administration’s handling of the economy. Even Democrats have bemoaned the pace of the package’s implementation. House Majority Leader Steny Hoyer, a Maryland Democrat, said on “Fox News Sunday” June 5 that congressional Democrats are “disappointed” stimulus funds weren’t distributed faster. “The money is just really starting to come out in more significant amounts now,” Tyson said. “The stimulus is performing close to expectations but not in timing.” Package Affordable Tyson, 62, later told reporters that the U.S. can afford to pay for a second package, even as the fiscal deficit soars. She said the budget shortfall is “likely to be worse” than the equivalent of 12 percent of gross domestic product that the administration forecast for 2009 and the 8 percent to 9 percent it projected for next year. The professor at the University of California’s Walter A. Haas School of Business downplayed worries from China and other countries with dollar reserves that the U.S. will let inflation soar as the deficit expands. “The concern is that the U.S. will have to inflate away its debt. I do not think that is a valid concern,” she said. “The Federal Reserve is not going to let the U.S. government inflate away its debt.” The U.S. needs to communicate its determination to reduce the annual shortfall once the economy recovers, she said. While unemployment is worsening, other data have shown the economy is improving. U.S. manufacturing shrank last month at the slowest rate since August, according to the Institute for Supply Management’s factory index, and a measure of pending home sales advanced in May for a fourth month. Tyson said the U.S. should shift away from its dependence on consumption to grow, and promote expansion through investment and exports. The dollar will need to weaken in the longer term to promote export-led growth, she said. Quote Link to comment Share on other sites More sharing options...
westvirginia Posted July 7, 2009 Share Posted July 7, 2009 Since the first one is working so well... Here's an idea - let the public decide what to spend money on. Quote Link to comment Share on other sites More sharing options...
Caveman_Nick Posted July 9, 2009 Share Posted July 9, 2009 Since the first one is working so well... Here's an idea - let the public decide what to spend money on. Technically, wouldn't this be the third one? Quote Link to comment Share on other sites More sharing options...
Avernus Posted July 9, 2009 Share Posted July 9, 2009 NO Quote Link to comment Share on other sites More sharing options...
Savage Beatings Posted July 9, 2009 Share Posted July 9, 2009 Shouldn't they actually SPEND the first one before they conclude that it isn't working and that we therefore need another one? Gov't: Stimulus 2008 will help a lagging economy somehow on the verge of ultimate collapse. Trust us. Citizens: What? Ok. Gov't: Did I mention that Bailout 2008 is also necessary. Hurry please! Citizens: Um, ok I guess. Gov't: Those weren't nearly enough. Another $800 Billion in Stimulus to clean up Bush's mess please. Quickly people... no need to read the fineprint! Citizens: Listen, I'm not too thrilled with all of this, but what choice do we have now? Gov't: Sure we've only spent 10% of the last Stimulus Bill that will saddle us with debt for many years to come, but clearly it's not enough. Another $800 Billion ought to do it. Subjects: I think we see where this is going. Too bad we are powerless to stop any of it. Some KY this time would be appreciated. Gov't: Oh yeah, here's some Cap & Trade and Nationalized Health Care too. Did I mention we're letting those pesky tax cuts expire? Enjoy! Comrades: Hooray. I was tired of having to think of creative ways to spend all of my disposable income anyway. No more worries! Quote Link to comment Share on other sites More sharing options...
millerx Posted July 9, 2009 Share Posted July 9, 2009 Quote Link to comment Share on other sites More sharing options...
Brentastic Posted July 9, 2009 Share Posted July 9, 2009 NO + a quadrakabillionjillion! Quote Link to comment Share on other sites More sharing options...
Perchoutofwater Posted July 9, 2009 Share Posted July 9, 2009 Shouldn't they actually SPEND the first one before they conclude that it isn't working and that we therefore need another one? Gov't: Stimulus 2008 will help a lagging economy somehow on the verge of ultimate collapse. Trust us. Citizens: What? Ok. Gov't: Did I mention that Bailout 2008 is also necessary. Hurry please! Citizens: Um, ok I guess. Gov't: Those weren't nearly enough. Another $800 Billion in Stimulus to clean up Bush's mess please. Quickly people... no need to read the fineprint! Citizens: Listen, I'm not too thrilled with all of this, but what choice do we have now? Gov't: Sure we've only spent 10% of the last Stimulus Bill that will saddle us with debt for many years to come, but clearly it's not enough. Another $800 Billion ought to do it. Subjects: I think we see where this is going. Too bad we are powerless to stop any of it. Some KY this time would be appreciated. Gov't: Oh yeah, here's some Cap & Trade and Nationalized Health Care too. Did I mention we're letting those pesky tax cuts expire? Enjoy! Comrades: Hooray. I was tired of having to think of creative ways to spend all of my disposable income anyway. No more worries! If our situation wasn't so seriously fudup, that would have made me laugh. As it is, it makes me sad. I'm thinking we should still be mulling over the first stimulus package. Quote Link to comment Share on other sites More sharing options...
Randall Posted July 10, 2009 Share Posted July 10, 2009 Republicans watered down the original bill and most still voted against it. So far only about 10% of the money has been spent. I wonder if they are blocking it at state levels so it fails. I'll have to check into that. Quote Link to comment Share on other sites More sharing options...
westvirginia Posted July 10, 2009 Share Posted July 10, 2009 Republicans watered down the original bill and most still voted against it. So far only about 10% of the money has been spent. I wonder if they are blocking it at state levels so it fails. I'll have to check into that. No - the problem is it's only being spent in districts that voted for the obamessiah. Quote Link to comment Share on other sites More sharing options...
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