Stimulus: The Sequel

In the wake of the miserable May jobs report and the even more miserable first-quarter GDP numbers, Hillary Clinton revealed her long-awaited agenda to fix the economy: Raise the minimum wage; hike taxes on the rich; and spend a quarter-trillion dollars more on public works. Clinton is calling for “the biggest infrastructure investment since Dwight Eisenhower’s interstate highway system."

One can be forgiven for experiencing a wave of déjà vu. Doesn’t this sound exactly like President Barack Obama’s $840 billion stimulus plan circa 2009? All that is missing from this spending blitz manifesto is the mythical rhetoric of "shovel-ready" projects.

The left insists on replaying this vinyl record though President Obama’s mega-stimulus failed in every measurable regard. Over the period 2009 to 2013, job creation was significantly below what the White House promised. Unemployment was higher each year than what the White House had projected it would be without the stimulus. If Obama had simply done nothing in 2009, the economy would have produced more jobs.

Even worse was growth much lower than expected. The combined loss of GDP in these years from what was predicted adds up to a growth deficit of over $2 trillion. This is the equivalent of losing a year’s output from the states of Michigan, Ohio, and Pennsylvania.

These are, for the left, embarrassing facts. But they have a response: Things would have been even worse, don’t you know, without all the president’s infrastructure spending. This may have been the weakest recovery since the Great Depression, the left demurs, but given the magnitude of the financial crash in 2008-09 it was the best we could do.