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Research desk responds: How fast has the stimulus rolled out?

By Dylan Matthews

wcdatx asks:

I remember the stimulus bill in '09 being criticized for rolling out over several years, so where are we at in terms of overall stimulus spending to date? Does the administration still have some money at its discretion that was appropriated in '09? Could spending the rest of the stimulus money more quickly improve the unemployment numbers in the short-term or is that even feasible?

To recap, the Recovery act cost $787 billion, of which $288 billion went to tax cuts and the rest to spending. The Council of Economic Advisors' latest report (PDF) breaks down the spending that's occurred by quarters. The CEA uses two measures to track spending in the bill. The first is outlays -- that is, money that the government has spent. The second is obligations, which is money that has either already been spent or has been assigned to be spent. Since the expectation of funding can spur economic activity just as actual funding can, the obligations measure includes some effects of the stimulus that aren't counted in the outlays measure. Here's how outlays and tax cuts have piled up since the stimulus passed, with a measure of the bill's whole effect and spending left to come at the end:

stimulus_outlays_and_tax_breaks,_march_2009-present(3).png

Here's the same graph, but with obligations included:

stimulus_obligations_and_tax_breaks,_march_2009-present.png

To summarize: $65 billion in tax cuts have yet to take effect, and $241.7 billion is yet to be spent, though only $95.2 billion has yet to be assigned to be spent. That's quite a bit less than half of the whole stimulus, but it's not nothing. In fact, with spending going at its current pace, the CEA estimates that the current stimulus growth figure of 3 million is on track to reach 3.5 million at year's end, meaning the next six months' spending is set to create 500,000 jobs. It's hard to know what the impact of speeding up that spending would be. Obviously, many tax cuts can't take effect until the next returns are due, and most of the spending that's yet to come has been promised to its recipients. But to answer wcdatx's initial question, much of the stimulus still has yet to be spent, and that future spending should create substantial -- though given that there are 14.6 million unemployed currently, insufficient -- job growth.

By Ezra Klein  |  July 16, 2010; 4:17 PM ET
Categories:  Stimulus  
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Comments

What's the cost for extending the unemployment benefits? Seems like the best way to pump as much of that $95.2 billion that has yet to be assigned into the economy before November would be to reallocate it to extending unemployment benefits.

Posted by: jnc4p | July 16, 2010 4:26 PM | Report abuse

"To summarize: $65 billion in tax cuts have yet to take effect, and $241.7 billion is yet to be spent, though only $95.2 billion has yet to be assigned to be spent. That's quite a bit less than half of the whole stimulus, but it's not nothing."

No, it's not nothing, but given that there are all sorts of noises (including from Ezra) that the stimulus is inadequate, wouldn't the first thing to do to address in inadequate stimulus is get the money spent and the tax breaks breaking?

Posted by: Kevin_Willis | July 16, 2010 9:29 PM | Report abuse

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