Brendan Nyhan

Political games with fiscal stimulus lags

There’s more than a little irony in Republicans asking “WHERE ARE THE JOBS?” just a few months after the stimulus bill was enacted (via Paul Krugman). Remember, President Bush’s 2001 tax cut was sold as a recession-fighter, but payroll jobs declined steadily until mid-2003 (partly as a result of the economic shock associated with the 9/11 terrorist attacks). The White House solution at the time was to disappear the 2001 tax cut and use a junk chart to falsely attribute the eventual uptick in jobs and employment to Bush’s second tax cut, which was enacted in May 2003 and had not had time to have a significant effect.