Seven Out of Seven Economists Favor a Fiscal Stimulus Right Now
Greg Mankiw emails me to say that I have misinterpreted him--that he thinks fiscal stimulus is needed right now too, for his opinion is "not far" from that of Alan Viard:
Economists who initially rejected the need for fiscal stimulus have warmed to the idea, too. Several months ago, Alan Viard, a Bush administration economist now at the American Enterprise Institute, thought the right size for a government spending bill was "probably zero." He favored reliance on the Federal Reserve to slash interest rates and existing unemployment benefits to bolster the jobless. Now Viard shares the view that a stimulus package is needed, although he would prefer one limited primarily to tax cuts and direct benefits for victims of the recession, such as increased unemployment benefits. "Things have gotten so bad so quickly," Viard said. "We have now lost 3.6 million jobs, a stunning loss. But what's more horrifying is that half that loss has occurred in the last three months. This is a severe recession. There's no doubt about it"...
