Whoa! Wash Times reports economy would have been far worse without government spending

Even before the passage of the economic recovery act, the Washington Times attacked it in articles and editorials. The Times has since referred to the package as "failed," “ruinous” and attacked it in a January 18 editorial headlined, “Obama is killing the economy.”

In a February 11 editorial, the Times wrote that “the result of so much government spending has been anything but stimulating”:

It was a year ago this week that Democrats passed a bloated $787 billion package of pet projects ostensibly to try to stimulate the economy. The price tag has crept steadily higher, and the result of so much government spending has been anything but stimulating. Now, Democrats in Congress and the White House are planning more massive spending bills. If there is any hope of a recovery anytime soon, it's important that the stimulus sequel be derailed.

However, in a February 23 article, the Times' Stephen Dinan wrote that "[t]he stimulus act added at least 1 million new jobs and possibly as many as 2.1 million jobs in the final three months of last year, and lowered the unemployment rate by at least a half a percentage point, according to a new analysis from" the Congressional Budget Office."

And according to an article by the Times' Patrice Hill today, it's a good thing we had that stimulus after all. Otherwise, the economy might have “completely collaps[ed].”

Hill reported:

Without record levels of welfare, unemployment and other government benefits as well as tax cuts last year, the income of U.S. households would have plunged by an astonishing $723 billion - more than four times the record $167 billion drop reported last month by the Commerce Department.

[...]

Economic growth typically depends on consumer spending, which is fed by wages, rents, interest and other forms of income. But the tentative revival of consumer spending in the second half of last year appears to have been fed largely by an extraordinary flood of government spending, as growth in other kinds of income has disappeared.

“Governmental support was critical in keeping the economy, particularly consumer spending, from completely collapsing during the crisis,” said Harm Bandholz, an economist at Unicredit Markets. He said he is concerned that so much of the economic rebound is a result of government spending rather than a revival of private income and jobs. That situation is unsustainable, he said, because the government has had to borrow massively to prop up the economy and cannot continue that binge for long.

Here's hoping columnist Donald Lambro -- the Times chief stimulus critic -- and the other Times editorialists read Hill's piece.