by Kenneth Thomas
Lost Output Over $3 Trillion And Rising
Still traveling, so just a quick post, but this really can’t be emphasized enough. Andrew Fieldhouse at the Economic Policy Institute reports that the Congressional Budget Office now has cumulatively reduced its estimate of 2017 gross domestic product by 6.6% since the beginning of the recession in December 2007. As Fieldhouse points out, that doesn’t sound like much, but when it’s 6.6% of a $15 trillion economy, we are looking at about $1 trillion (with a “T”) of lost income in 2017. To put it another way, that is well over $3000 of income per person that year. That is on top of $3 trillion in potential GDP already lost since the recession began, according to Fieldhouse.
The culprit, of course, is the lack of further stimulus to the economy. After the totally inadequate $800 billion stimulus package in 2009, we have had essentially nothing. At the end of 2011, Republicans had to be shamed into approving a payroll tax cut they previously favored. Indeed, as Thomas Mann of the Brookings Institute and the Norman Ornstein of the American Enterprise Institute have pointed out, it is not the case that both parties are getting more partisan. As they put it, “Let’s just say it. The Republicans are the problem.” It is the Republicans in Congress who are blocking further stimulus measures. Electing a new Congress that will not pass a stimulus bill will cost Americans thousands of dollars out of their pockets.
We are a long way away from
George Wallace Will Roger’s famous claim that there was not “a dimes’ worth of difference” between the two parties.
crossposted with Middle Class Political Economist