What is the right size jobs bill?

[Kurt_and_Hunter]

Okay... when the stimulus bill was being debated numbers were thrown around in terms of what size bill ($$$) would have a certain effect on the economy with the goal being the most increase in economic activity for the least money.

The US economy is size X and the drop-off in demand is Y, etc... Charts were published saying, "We think bill X will manifest itself as shown on this graph," and you'd see some sense of what outcome was being sought and what was or was not considered acceptable.

But with the jobs bill I honestly don't know what the objective is so the scale seems completely arbitrary. Are we trying to reach some % level of unemployment within a given time-frame? Why that level and not a different level? Every penny of the bill will be borrowed so it's not like we happen to a certain sum of money, versus a different sum.

Say we end up with an $80 Billion jobs bill. Where did that number come from? It will obviously lower unemployment some and obviously isn't going to lower unemployment a lot. What goal is being pursued?

Here is what I am trying to say:

What is the argument for $80 Billion versus $160 Billion? (Or $40 Billion, for that matter.)

If there is a valid argument for 80 versus 160 (saving 80) then why doesn't that argument apply to not passing a bill at all (saving 80)?

We are talking about a marginal benefit either way. Neither $80 Billion nor $160 Billion would achieve full employment. So what are we shooting at?

Imagine if Gibbs said today: "9.4% unemployment is unacceptable and demands action but 9.0% is acceptable." You'd be puzzled.

But that is the kind of argument being made... or rather, that would be the argument if anyone was making a specific argument at all.

Assuming we don't do things for the sheer hell of it there is a reason for the bill. It is considered important to lower unemployment by some small number and, by implication, not so important to lower it a different small number.

The real impetus behind the bill is we need to "do something" about unemployment and we need to show "we care" about the deficit so $80 Billion seems like a good number politically.

From my perspective that is better than nothing. By all means, pass the bill. Any bill. It's likely to be much better than nothing since we are talking about real individual families.

But the number seems kind of random in terms of real-world effect.

[Kolesar]

1. A trillion

Seriously, spend a trillion on bridges and sewers.

[phantom power]

2. Krugman, et. al. argued early on for about 1.5 trillion -- about 2x what was passed.

So far, events are proving them to be right.

[paulk]

3. well, in the minds of the politicians making the decision

it's probably something along the lines of - "whatever amount I can get away with saying I actually tried to do something"...

knowing full well, of course, that the bill isn't going to do squat.

[Oregone]

4. Its supposed to be a size to replace private capital withdrawn from the market

IOW, it bridges the GDP gap. But everything in between is just arbitrary and what is politically expedient