Reason has some unkind words for Barack Obama's 2009 stimulus plan from Nobel Prize winner Thomas Sargent:
CEA [Council of Economic Advisers]calculations were surprisingly naive for 2009. They were not informed by what we learned after 1945….In early 2009, President Obama’s economic advisers seem to have understated the substantial professional uncertainty and disagreement about the wisdom of implementing a large fiscal stimulus. In early 2009, I recall President Obama as having said that while there was ample disagreement among economists about the appropriate monetary policy and regulatory responses to the financial crisis, there was widespread agreement in favor of a big fiscal stimulus among the vast majority of informed economists. His advisers surely knew that was not an accurate description of the full range of professional opinion. President Obama should have been told that there are respectable reasons for doubting that fiscal stimulus packages promote prosperity, and that there are serious economic researchers who remain unconvinced.
Ouch. Professor Sargent dares to tell the truth about the gold standard:
“what induced one major Western country after another to run a more-or-less balanced budget in the 19th century and early 20th century before World War I was their decision to adhere to the gold standard.”
Imagine that.
