In 2009, the Democratic-controlled Congress and White House authorized $787 billion in stimulus spending, which was intended to rescue the U.S. economy from spiraling into a free fall.
But nearly two and a half years later, unemployment is still hovering near double digits and policymakers are still scratching their heads trying to determine what the proper government response to the economy should be.
During the online “Green Room” segment of ABC’s “This Week” on Sunday, Huffington Post founder Arianna Huffington proposed even more stimulus spending as an answer.
But she also acknowledged to co-panelist, Fox Business Network contributor Charles Gasparino, that the original 2009 stimulus failed.
“When you consider that infrastructure is crumbling and we have 20 percent of construction workers unemployed, surely there is something we can be doing,” Huffington said.
“So you’re saying the stimulus package failed?” Gasparino replied.
“The stimulus package failed because it was all over the map,” she said. “It was not a targeted, clear jobs creation program.”
Former Clinton administration Office of Management and Budget director Alice Rivlin took issue with Huffington’s diagnosis, but also noted that long-term growth is not possible if America’s debt problem is not addressed.
“I think the stimulus program worked in that people would have been in much worse shape if we hadn’t had it,” Rivlin said. “But if you do the infrastructure and you do the payroll tax holiday, you also got to control the long-run debt because the thing that is most inimical to long-run growth is an unsustainable rise in debt. So we go to do both.”
Earlier during the broadcast, Huffington called the debt ceiling crisis “artificial,” but went on to blame the wars in Iraq and Afghanistan and the Bush tax cuts, which were extended by President Barack Obama at the end of 2010, for the government’s debt problem. Gasparino questioned Huffington’s view of the effect of the Bush tax cuts, asking, “If you’re for stimulus why aren’t you for the Bush tax cuts? Isn’t that kind of what we need right now?”
“We’ve had them for so long,” she replied. “Why are we still over 9 percent unemployment if it is such a great stimulus?”