Three years after President Barack Obama signed the American Recovery and Reinvestment Act (ARRA) of 2009–a jury of eminent economists is retrospectively voting its approval of the controversial stimulus measure. Still, a minority of the surveyed economists remain unimpressed with the spending bill’s economic effects.
The proposition that unemployment would be higher at the end of 2010 in the absence of the stimulus garnered the approval of fully 80% of the surveyed economists. Just 4% of the panel disagreed with the proposition, with others uncertain or not commenting.
An Internet-based think tank under the auspices of the University of Chicago Booth School of Business regularly surveys its 40 member economists, from a range of U.S. universities, on economic issues of the day. The current question set, timed for the stimulus measure’s anniversary, also tested a second proposition:
“Taking into account all of the ARRA’s economic consequences–including the economic costs of raising taxes to pay for the spending, its effects on future spending, and any other likely future effects–the benefits of the stimulus will end up exceeding its costs.”
While this second proposition generated greater uncertainty than the first, the response was still lopsided in its approval of the stimulus with 46% of economists agreeing or strongly agreeing compared to 12 percent disagreeing or strongly disagreeing.
Those respondents who offered their comments tended to state their positions in technical terms, some adding links to studies. For example, Stanford Professor Darrell Duffie, who agreed the stimulus lowered unemployment, said: “Subsidizing employment leads employment to go up, other things [being] equal.”