Thanks to a reader-participant-watchdog-community member-content co-creator, we've now obtained the link to the actual paper by economists Alan Blinder and Mark Zandi that was the subject of that weird New York Times article yesterday. It doesn't appear to be in a peer-reviewed economic journal at all, but it's rather a publication that basically touts the Moody's analytics model. Highlights:
Estimating the economic impact of the policies is not an accounting exercise, but an econometric one. It is not feasible to identify and count each job created or saved by these policies. Rather, outcomes for employment and other activity must be estimated using a statistical representation of the economy based on historical relationships, such as the Moody's Analytics model. This model is regularly used for forecasting, scenario analysis, and quantifying the impacts of a wide range of policies on the economy. The Congressional Budget Office and the Obama Administration have derived their impact estimates for policies such as the fiscal stimulus using a similar approach.
So similar, in fact, that the conclusions are similar. Mr. Blinder and Mr. Zandi write, "Because of the fiscal stimulus, real GDP is about $460 billion (more than 6%) higher by 2010, when the impacts are at their maximum; there are 2.7 million more jobs; and the unemployment rate is almost 1.5 percentage points lower." From a news account earlier this month: "In its latest stimulus report released Wednesday, the White House's Council of Economic Advisers said the Recovery Act has already saved or created about 3 million jobs."
My favorite part of the Blinder-Zandi paper is footnote three: "Alan Krueger, the Assistant Treasury Secretary for Economic Policy, estimated that the capital injections into banks alone may have added roughly 900,000 to 1.8 million jobs. See his Remarks to the American Academy of Actuaries, Washington, DC, July 20, 2009 (at www.treasury.gov/offices/economic-policy/AK-Actuaries-07-20-2009.pdf)." Since there are only 1.76 million people employed in the entire "depository credit intermediation" category, according to the Bureau of Labor Statistics, the upper end of this estimate seems to assume that without the government capital injections, there would be not a single bank employing a single individual still operating in America.
Professor Krueger (on leave) is a colleague of Professor Blinder's (and of Paul Krugman's) in the Princeton University economics department.
We're still waiting for the model that shows that without Henry Paulson, Timothy Geithner, and President Obama, every single American would now be unemployed.
