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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: Alighieri who wrote (582636)	8/27/2010 12:48:34 PM
From: TimF	Respond to of 1572384

I am still unable to view that document inline in my browser, but downloading it to my PC and then opening it worked. It confirmed what I had said earlier. It plugs in the stimulus programs in to pre-existing mathematical formulas, which assume government spending helps out the economy. Every type of spending it lists is assumed to have a positive multiplier. Which is another way of saying it increases economic activity. Increased economic activity is assumed to "create or save" jobs. It basically asks "did we increase spending", answers "yes", and so then tells us the job situation is better than it otherwise would have been. It does so in more detail (its a 20 page PDF after all not a few sentences), but the detail doesn't change the fact that no matter what actually happened to jobs, this methodology would show that the stimulus helped. It provides nothing more than the argument "government spending always creates jobs". You could make the same argument yourself, no need to involve the CBO to assert such an assumption. The relevant economic question is not "If you assume specific positive multipliers for various forms of government spending and the government spends various amounts in each of these areas, what does the calculation give you?". It is rather what the multipliers are in the real world, and are they always even positive? The CBO answers that they are positive, and often large, and assumes specific numbers or ranges of numbers for them. Other than giving any specific figure its not a totally unreasonable idea, but its not an idea that is established as correct by either the CBO or anyone else. The CBO doesn't show that their assumptions are correct, they just plug them in and do the calculations.