Stimulus to Cost $43 Billion More than Estimated
June 1, 2011
The Congressional Budget Office (CBO) said in a new report that President Obama's economic stimulus law will raise the federal deficit $830 billion over 10 years, $43 billion more than the initially estimated cost of $787 billion. The Joint Committee on Taxation made the initial estimate, says Yahoo! News.
- CBO estimated the law lowered the unemployment rate by between 0.6 and 1.8 percent in the first quarter of 2011 and increased the number of people employed by between 1.2 million and 3.3 million during that same period.
- However, the unemployment rate has continued to remain high since 2009.
- CBO based its estimate on macroeconomic modeling, saying the jobs "created or saved" reports by recipients of stimulus dollars could not provide a full picture of the economic impact.
Obama and congressional Democrats enacted the law, arguing it would provide a quick jolt to the economy. Republicans opposed the law, saying it would increase deficits and wasn't designed to work quickly.
Source: "Stimulus Law Will Cost $43 Billion More than Estimated," Yahoo! News, May 29, 2011. "Estimated Impact of the American Recovery and Reinvestment Act on Employment and Economic Output from January 2011 through March 2011," Congressional Budget Office, May 2011.
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