Krugman: The Second Coming of the Stimulus?


Paul Krugman makes the argument for a second stimulus in this morning's New York Times. I dunno. I like the idea of sustained stimulus spending. But even if you ignore the big political problem that Paul raises -- passing through the eye of the financial storm is nothing compared to passing another big stimulus bill -- wouldn't this just run up against the natural limits of how quickly the funds can be spent?

A month and a half ago the Times reported that less than six percent of the first bill had been paid out. Obviously that needs updating. (Unfortunately, today counts as a holiday and I feel obligated to spend my time swimming rather than crunching the numbers.) But what I do know is that the amount of available funds from the first stimulus bill still vastly exceeds the money that federal agencies have actually spent. I know this because there's a big chart saying as much on the government's website for tracking stimulus spending:

recovery spending update early july.png
The difference between the blue and yellow lines is the amount of money federal agencies have available but haven't yet spent. So here's a question for Krugman: wouldn't passing another stimulus bill increase this gap rather than inject more spending immediately into the economy?

Presented by

Conor Clarke is the editor, with Michael Kinsley, of Creative Capitalism. He was previously a fellow at The Atlantic and an editor at The Guardian. More

Conor Clarke is the editor, with Michael Kinsley, of Creative Capitalism, an economics blog that was recently published in book form by Simon and Schuster. He was previously a fellow at The Atlantic and an editor at The Guardian. He is also on Twitter.

A New York City Minute, Frozen in Time

This wildly inventive short film takes you on a whirling, spinning tour of the Big Apple

Join the Discussion

After you comment, click Post. If you’re not already logged in you will be asked to log in or register with Disqus.

Please note that The Atlantic's account system is separate from our commenting system. To log in or register with The Atlantic, use the Sign In button at the top of every page.

blog comments powered by Disqus

Video

A New York City Minute, Frozen in Time

This short film takes you on a whirling tour of the Big Apple

Video

What Happened to the Milky Way?

Light pollution has taken away our ability to see the stars. Can we save the night sky?

Video

The Faces of #BlackLivesMatter

Scenes from a recent protest in New York City

Video

Ruth Bader Ginsburg on Life

The Supreme Court justice talks gender equality and marriage.

Video

The Pentagon's $1.5 Trillion Mistake

The F-35 fighter jet was supposed to do everything. Instead, it can barely do anything.

More in Politics

Just In