‘It’s not going to be enough, folks’

‘IT’S NOT GOING TO BE ENOUGH, FOLKS’…. During the debate over the economic stimulus package, there were a few voices raising concerns that the spending wasn’t nearly ambitious enough for the task at hand. Those voices were largely ignored, especially by major news outlets, which focused on how it could be smaller.

The result was a good bill that could have been far better. And now there are growing indications that, as a result of congressional efforts to shrink the bill and the administration’s overly-honest approach to negotiating, policymakers may have to try again.

The nation is losing jobs so quickly that the government, racing to deal with the crisis, is having trouble keeping up…. It also means that the government faces even more pressure to take further action to stabilize the economy and the financial system. […]

The stimulus package was designed to “save or create” 3.5 million jobs, according to the administration. But the nation has already lost 4.4 million jobs since the start of the recession. Many banks and other financial institutions, whose health is critical to the economy, are teetering, and the Treasury Department has yet to finalize the details of its plans to remove from their balance sheets the toxic assets dragging them down.

“It’s premature to say we need another stimulus, but the economy is performing much worse than when [the law] was signed, and the odds are increasing that we’ll need a bigger policy response,” said Mark Zandi of Moody’s Economy.com, who has advised Democratic lawmakers. “What we’ve learned is policy has been a step behind this whole downturn. It’s important to get a step ahead.”

The International Monetary Fund yesterday urged governments worldwide to consider additional fiscal stimulus, noting that the public sector must help prevent a collapse of confidence.

Heather Boushey, senior economist with the Center for American Progress, said, “It’s not going to be enough, folks. I hate to break it to you.”