March 25, 2020
I routinely complain about reporters failing to put numbers in context. Their coverage of the stimulus being pushed through Congress is a huge FAIL. The $2 trillion deal is being compared to Obama’s $800 billion stimulus package. This is an incredibly inadequate comparison.
First, the $800 billion includes a number of tax provisions that would have been passed even if the economy was doing great. The actual stimulus was around $720 billion. Some of this money was designated for later years but most was for 2009 and 2010, so we can say that it was roughly $350 billion a year for those two years.
By contrast, the McConnell bill is $2 trillion for essentially nine months, and possibly as short as two and a half weeks, if anyone takes Trump’s Easter re-opening seriously. We have to adjust for the fact that the economy is 50 percent larger today than in 2009, so that would make Obama’s stimulus $525 billion a year. That compares to McConnell’s $2 trillion over nine months, which is $2.7 trillion on an annual basis.
So, in terms of size, the McConnell package on annual basis is about five times the Obama package. To be clear, that is not an indictment, we have to spend what is necessary to keep people whole through this crisis. But the media should be clear in conveying the enormity of the package being debated.