Christina Romer released a defense of the Obama Biden Plan (OB) this Saturday AM. It is a must read. I am personally confused as she has now claimed that the OB as written will provide 3.6MM jobs by 12/10.
Yet she also acknowledges the large difference in tax credits/cuts on GDP growth versus direct public sector spend/investment with a schedule showing tax credits/cuts expand to a multiplier effect or increase in GDP per dollar of .99 while spend or investment form public sector has a obvious multiplier that expands to 1.57 by the second year.
I find it confusing that the effective jobs added keeps expanding as the incoming admin discusses OB and also how this is possible given the non-existent money multiplier for OB.
Romer also provides a very comforting pic which shows unemployment with and without the OB:
Romer also provides a very comforting pic which shows unemployment with and without the OB:
This graph is not the rough, but I think correct view, I hold that if nothing is done unemployment certainly exceeds 10%.
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