The unemployment rate is higher than the Administration forecast. From a Keynesian perspective, this suggests that the need for a stimulus is even greater than when President Obama took office.
I would score one point for those of us who argued for a stimulus that takes effect in 2009 rather than in 2010 and beyond. We could still do that, by enacting a payroll tax cut, effective immediately.
However,
if a "second stimulus" means piling on more spending in 2011 and
beyond, that might prove counterproductive by raising interest rates
and depressing the economy in the short run.
