Before we get too far away from the 5th anniversary of the 2009 stimulus signed into law on February 17, 2009 (or the 6th anniversary of the 2008 stimulus signed into law on February 13, 2008 ), it’s fun to recall the alliterative mantra associated with these packages. The mantra is often attributed to Larry Summers, who in testimony before the Joint Economic Committee of Congress on January 16, 2008 asserted that “A stimulus program should be timely, targeted and temporary.” (Doug Elmendorf and Jason Furman—now at CBO and CEA—used the same language in a Brookings report).
Larry’s mantra apparently persuaded many who listened, and a stimulus package with exactly these three characteristics was passed a few weeks later. Unfortunately that stimulus did not jump start the economy (see this AER paper). So when the discussion of another stimulus began after the presidential election of 2008, I argued against it. In testimony before the Senate Budget Committee on November 19, 2008 I said, “Going forward, we clearly need a new set of principles and a new mantra. Based on recent and many past experiences as well as much economic theory, and in keeping of course with the need for alliteration, I recommend an alternative stimulus mantra: permanent, pervasive, and predictable,” and then outlined my preferred economic strategy with these characteristics at the hearing and in the WSJ.
The alliteration game then quickly when viral. In a November 25, 2008 blog post, called Competing Alliteration, Greg Mankiw listed his readers’ suggested ways to describe the stimulus then being considered:
big, bloated, and borrowed.
immodest, immoral, and imbecilic.
clumsy, corrupt, and counterproductive.
expansive, extensive, and expensive.
weighty, worrisome, and wayward.
politicized, pandered, and pathetic.
socialized, silly, and sorry.
random, record-setting, and ridiculed.
ultimate utilitarian utopianism.
absolutely abjectly apocalyptic.
Unfortunately, none of these caught on in time. When Christina Romer called me in December to ask about my views, I repeated my Budget Committee recommendation, saying that another “temporary, targeted, and timely” program would be a mistake. Neither Romer nor Summers, now both going into the Obama administration, were persuaded, and the 2009 stimulus package was passed. I discussed the results in my previous blog post.