Falling Short on the Economic Stimulus: Fourteen months ago, just after Barack Hussein Obama's election, most of us would have bet that the U.S. unemployment rate today would be something like 7.5%, that it would be heading down, and that the economy would be growing at about 4% per year.
A 5% unemployment rate as of the end of 2009 would have been seen from a late-2008 perspective as a very good and lucky outcome, and a 10% unemployment rate would have been seen as a very bad and unlucky outcome.
Well, we have been unlucky. Unemployment is not going down but going sideways—we hope that it is still not going up. And the unemployment rate is not 7.5% but 10%. More important, perhaps, is that the expectation is for 3% real GDP growth in 2010.
That leaves us with two major questions: First, why has the outcome thus far been so much worse than what pretty much everyone expected in the late fall of 2008? And second, why is the forecast going forward for growth so much slower than our previous experience with recovery from a deep recession in 1983-84?...