Yesterday afternoon I took part in a media and blogger conference call with Jared Bernstein, the chief economist for Vice President Joe Biden. The subject for the briefing and questions which followed was the “impacts of the American Recovery and Reinvestment Plan”.
Our previous coverage of Jared Bernstein’s opening remarks:
The questions from new media in on the call:
Adam Siegel – getenergysmartnow.com: Uh, thank you very much for doing this call. Much appreciated. Uh, looking to [garbled] and focus on energy, global warming, as well as economic issues and the intersection of all of them, uh, when we’re looking at the limited news so far we see that the, uh, deal continues the slashing of a lot of the things that might be considered long term infrastructure such as aid for school construction [garbled] even while looking to try to get this bill passed are you already starting to lay the ground work for trying to recapture many of the good things from the House bill that don’t seem to have made it through the conference committee?
Jared Bernstein: Well, and I, I have to be mindful of the fact that I am, uh, uh, one of the team, uh, some of these folks are on their way back from the, the capitol now. Uh, so let me speak broadly in answer to your question. I can’t tell you we plan to go back to the well tomorrow to, uh, get back some of the things that were our original preferences. But, I, I can tell you that they, they were our original preferences and I can tell you that, you know, my understanding of some of the negotiations were that, that some of the opponents of pieces that were in this legislation were not saying we’re against, uh, school construction, we’re against, uh, uh, fiscal relief to states. uh, we’re, we’re, against, uh, expanding some of the health care. They were saying we’re against putting them in a, uh, stimulus or a recovery package, uh, that is intended to spend out quickly and, uh, um, well, fulfill the kinds of stimulative economic goals I talked about earlier. So, um, uh, my view, uh, is that, uh, no windows are closed when it comes to, uh, these good ideas…
…Matt Copper – Talking Points Memo: Uh yes, hi. Uh, I, I know you’re here primarily to talk about the recovery act but I’m just curious, uh, your sense of, of whether we are really gonna start to see a turnaround in the economy ’til we have a bailout, a bank bailout plan more firmly in place. In other words, how much can this, uh, this one piece of legislation do until we get some of these other components in?
Jared Bernstein: Uh, by the way, I used to write for Talking Points Memo.
Matt Copper: I, I know…[crosstalk]
Jared Bernstein: TPM cafe. Um, I think it’s a good question. And I’m happy to talk about it. I think it’s actually very much on point. Uh, I view the stimulus package and the financial stabilization package as, as extremely complimentary. Um, on its own the stimulus package will absolutely help in the ways I said and, and, and frankly, it’s not rocket science. I mean if you let a contract to fix a bridge, especially in a climate where those jobs aren’t being created otherwise, you’re gonna create some jobs. Uh, the, uh, but for the, for, for the, uh, package to have its full impact, including what economists call the multiplier effects, such that you, you begin to generate some economic activity over here and you get more economic activity over there, i.e. you build that bridge and one of the, uh, uh, uh, formerly un…, unemployed people who’s now working on that bridge construction takes his, uh, or her pay check and goes to, uh, a retailer, a food store, whatever, uh, makes some new purchases that, remember, wouldn’t have occurred otherwise, that starts a chain of economic activity that, uh, uh, uh, helps to, um, get the economy back on track. That chain won’t be able to, uh, uh, function to full effect, uh, if, uh, credit lines remain frozen. So, the way I think that to, to wax, uh, medical on you for a second, is that, uh, the stimulus, uh, plan, the recovery act gets the heart beating again. The stabilization act, uh, uh, cleans out the, uh, the a, uh, carotid veins of the, uh, economy, uh, which has, uh, kind of been gouging on some, uh, pretty bad debt. Um, with the heart beating and the blood flowing, uh, the patient’s, uh, uh, uh, uh, back on track…
…Baratunde Thurston – jackandjillpolitics.com: Uh, good afternoon Mr. Bernstein, thanks so much for, uh, doing this call and, uh, everybody else for being here. I haven’t, you know transparency was marked, as a, as a big hallmark of how this act might be different from those that have come years, decades or even generations before. What can you say would be the, what are the metrics of success, uh, for, if this is actually working? You sort of mentioned two years down the line.
Jared Bernstein: Uh, huh. [crosstalk]
Baratunde Thurston: Jesse in his opening remarks said you will be judged by this. What are those judgments gonna be based on? What are your, what are the quantitative or qualitative goals you have?
Jared Bernstein: Sure, Um, first of all in terms of tran…well, uh, uh, part of the success, at least on the transparency front, will be the extent to which we track the progress of this legislation on, in, in, uh, on the, uh, the web site, uh, that we’ve, uh, announced we’re gonna form. I believe it’s recoveryact dot gov, although, uh, I doubt it’s…
Unidentified voice: It’s recovery dot gov.
Jared Bernstein: Recovery dot gov. So, so, you know, that’s obviously, uh, a level of transparency, uh, we haven’t seen, uh, in a really, uh, I don’t know, uh, uh, I can’t think of any other examples in the past. So, so, you know, I think we should be graded on the extent to which we do what we said we were gonna do in that regard. Um, uh, and I’m confident we will. Uh, this is a, this is something that comes from the very top. This is the President recognizing, uh, the need for, uh, that kind of accountability.
Uh, but the, the kind of quantitative metrics you suggested I also think are important. Um, the unemployment rate, uh, is expected in the absence of, uh, this, uh, uh, package to get up into something close to double digits, uh, um, by, uh, um, the, uh, probably, uh, late, uh, uh, later, uh, sometime a, I, I would guess, uh, around, um, late this year, uh, next year in the absence of, of our package. Um, I think, uh, the package should help to reduce the unemployment rate by about a couple of points. So, instead of being nine, nine and half, ten, ten and a half per cent, uh, the unemployment rate, uh, uh, um, may go, uh, oh a point, a point and a half higher than it is right now. It’s about seven and a half, so we could be looking at eight and a half, you know, maybe, maybe that neighborhood instead of, uh, maybe seven and a half by the end of, uh, two thousand and ten kind of back down to where we are now. Uh, if, uh, if the program is, is, successful. Now, uh, you have to be very careful when you give these quantitative metrics because, uh, they’re kind of, uh, uh, if things go as planned and obviously, uh, there’s lots that could happen between now and then. And no economist can, can, can know the future. That’s one of the reasons why our forecasts have large, um, guess, uh, confidence intervals, but large margins of error around them,
And so, uh, I think we should look for unemployment that, that is lower than it would be otherwise. Uh, um, we think we’re gon…to, as I said, create or save, uh, three, four million jobs. We’ll be tracking that closely. And, uh, I think probably more to the ground, uh, we should be looking for, uh, uh, uh, action that’s really identifiable whether we’re talking about, um, roads, and, and bridges, and repairs made in, in, you know, your, uh, look where you live. Um, uh, the
re’s gonna be, uh, in, in a state like California, obviously a large state, you’ve got, uh, uh, twelve, uh, million people. Twelve million workers who ought to be benefiting from the making work pay tax cut. Where are you from, by the way?
Baratunde Thurston: I’m in New York state.
Jared Bernstein: Okay, so you know, you look at, you look at New York state. Uh, we expect about seven million people, uh, to benefit from the making work pay tax cut. That’s something we ought to be able to know about. Uh, we expect something like three hundred thousand families to benefit from the refundable college credit. Um, there’s a lot of unemployed people up in New York, about a million of them are gonna have, uh, uh, unemployment insurance benefits higher by about a hundred dollars a month. You know those, those are the kinds of things that we ought to be able to quantify…
Approximately eleven minutes (one third) of the phone conference call remains to be transcribed. That will get posted when it gets posted.