During a podcast interview with The Nation editor Christopher Hayes, EPI economist Josh Bivens said that GDP data, like job loss data, offered compelling evidence of the positive impact of the Recovery Act. Bivens said that GDP patterns presented “a stark before and after picture.” During the last quarter of 2008 and the first quarter of 2009, GDP contracted at a 6% annual rate, the worst six-month decline on record. By contrast, in the second quarter of 2009, which included significant Recovery Act spending, GDP contracted by less than 1%. It has grown each quarter since then.
Hayes said Bivens offered “as clear an explanation of the effects of the Recovery Act as I’ve heard.” Asked about the weakness of the Recovery Act, Bivens replied, “It goes away too quickly.” Most Recovery Act spending will be completed by the middle of this year, a time when unemployment is projected to be near 10% and the country will still need 10 million additional jobs to return to pre-recession levels of employment.
Listen to the interview here: