At a Treasury briefing the other day, Alan Krueger, the assistant treasury secretary for economic policy, was happy to argue that the stimulus package was working but declined to specifically predict its future effects. Alan Blinder isn't so reticent. In this defense of the stimulus, he says we can expect a lot during this quarter of the year:

We are now in the third quarter, when the importance of the stimulus is likely to be even greater. In fact, its estimated growth impact (about 3 percentage points) actually exceeds the consensus forecast for third-quarter growth -- meaning that, according to current expert opinion, the stimulus will account for more than 100 percent of GDP growth this quarter.

There is plenty of evidence that the stimulus helped alleviate GDP decline in the previous quarter of this year. But if it actually produces growth this quarter, as Blinder and others predict, than it will be quite an accomplishment.

-- Tim Fernholz

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