Jared Bernstein: Moody's Mark Zandi crunches the numbers for the Americans Jobs Act

[flpoljunkie]

That Tireless Cruncher of Numbers…

Sep 09, 2011

…Mark Zandi must have been up late feeding the American Jobs Act into his macromodel, because after too little rest, I wake up to find his analysis of the jobs plan in my inbox.

Here’s his projected impact of GDP and jobs:

“–President Obama’s jobs proposal would help stabilize confidence and keep the U.S. from sliding back into recession.

–The plan would add 2 percentage points to GDP growth next year, add 1.9 million jobs, and cut the unemployment rate by a percentage point.”

Here’s the punchline in a graph. As I’ve stressed, if we, and by “we” at this point, I mean Congress, we should expect unemployment to be where it is a year from now if not worse. If we enact the AJA, it will be something like a point lower than that.



Source: Zandi, Moody’s Analytics

I’m afraid it’s really that simple. The Recovery Act along with monetary stimulus helped move the economy from sharp reverse to slow growth. But the depth of the downturn, the persistent job and paycheck weakness, the still depressed housing market, and the ongoing deleveraging of household and bank balance sheets, meant that as the Recovery Act and assorted Fed actions fade, slow growth downshifted to neutral.

It is not that these measures have not worked. It is that they stopped to soon. The AJA keeps them going and that’s extremely important right now.

http://jaredbernsteinblog.com/that-tireless-cruncher-of-numbers/

[Change Happens]

1. Most excellent!..............nt

[young but wise]

2. K&R.

[Tarheel_Dem]

3. K&R

[tomp]

4. ? long term effect of cuts in payroll taxes.

isn't that what funds social security?

[flpoljunkie]

5. Yes, payroll taxes do fund Social Security and these would be temporary cuts.

[flpoljunkie]

7. Payroll taxes will again be replaced from general revenue funds

[indepat]

8. And the loss of general revenue will be made up by cuts to:

social security, Medicare, and Medicaid 'cause they ain't gonna cut the MIC and they ain't gonna raise taxes on large corporations or the uber-wealthy. Of course, pols will play like the ultimate trillions of dollars of cuts to these programs will be so modest, so small as not to even be noticed. :patriot:

[Cosmocat]

6. Which pretty much ensures ...

that over their dead bodies will the Rs in congress do something ...