A good starting point is to ask what we were expecting out of the first stimulus. We wanted to significantly reduce the risk the economy would slip into a very deep and protracted collapse. I'd say mission accomplished. Can we use stimulus to make the economy instantly return to trend growth and stop a rising unemployment rate? I think that's asking too much and I don't think it's needed.
In our estimation the economy will begin to show positive growth in the second half of this year. And that will be sustained over the next couple of years.
People are extrapolating that last employment decline in ways that are totally unrealistic and concluding, largely based on that one number, the stimulus isn't working. Our view is, it's working. You have to judge it against the counterfactual, which is a weaker economy.
Moreover, there is still a lot of the stimulus in the pipeline. So you can't say, the economy right now is only moving sideways, so it didn't work.
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