The American Recovery and Reinvestment Act of 2009 (ARRA) was an economic stimulus package enacted by the 111th United States Congress.
The act was intended to:
1. To preserve and create jobs and promote economic recovery.
2. To assist those most impacted by the recession.
3. To provide investments needed to increase economic efficiency by spurring technological advances in science and health.
4. To invest in transportation, environmental protection, and other infrastructure that will provide long-term economic benefits.
5. To stabilize State and local government budgets, in order to minimize and avoid reductions in essential services and counterproductive state and local tax increases.
The following are details to the different parts of the final bill ($):
- Tax incentives : 288bn
- Healthcare : 155.1bn
- Education : 100bn
- Aid to those with low income : 82.2bn
- Infrastructure : 105.3bn
- Energy investment : 27.2bn
- Housing : 14.7bn
- Scientific research : 7.6bn
- Others : 10.6bn
Economists such as Martin Feldstein, Daron Acemoğlu, Larry Summers, Joseph Stiglitz and Paul Krugman recommended a larger economic stimulus to overcome the economic downturn.
The Congressional Budget Office reports estimated ARRA would positively impact GDP and employment. It projected an increase in the GDP of 1.4~3.8% by 2009, between 1.1~3.3% by 2010, between 0.4~1.1% by 2011, and a decrease of 0~0.2% beyond 2014. The impact to employment would be an increase of 0.8 million to 2.3 million by 2009, an increase of 1.2 million to 3.6 million by 2010, an increase of 0.6 million to 1.9 million by 2011, and declining increases in subsequent years as the U.S. labor market reaches nearly full employment. Decreases in GDP in 2014 and beyond are accounted for by crowding out, where government debt absorbs finances that would otherwise go toward investment. In February 2014, the White House stated in a release that the stimulus measure saved or created an average of 1.6 million jobs a year between 2009 and 2012, thus averting having the recession descend into another Great Depression. So, I think the act was worth.
2. To assist those most impacted by the recession.
3. To provide investments needed to increase economic efficiency by spurring technological advances in science and health.
4. To invest in transportation, environmental protection, and other infrastructure that will provide long-term economic benefits.
5. To stabilize State and local government budgets, in order to minimize and avoid reductions in essential services and counterproductive state and local tax increases.
The following are details to the different parts of the final bill ($):
- Tax incentives : 288bn
- Healthcare : 155.1bn
- Education : 100bn
- Aid to those with low income : 82.2bn
- Infrastructure : 105.3bn
- Energy investment : 27.2bn
- Housing : 14.7bn
- Scientific research : 7.6bn
- Others : 10.6bn
Economists such as Martin Feldstein, Daron Acemoğlu, Larry Summers, Joseph Stiglitz and Paul Krugman recommended a larger economic stimulus to overcome the economic downturn.
The Congressional Budget Office reports estimated ARRA would positively impact GDP and employment. It projected an increase in the GDP of 1.4~3.8% by 2009, between 1.1~3.3% by 2010, between 0.4~1.1% by 2011, and a decrease of 0~0.2% beyond 2014. The impact to employment would be an increase of 0.8 million to 2.3 million by 2009, an increase of 1.2 million to 3.6 million by 2010, an increase of 0.6 million to 1.9 million by 2011, and declining increases in subsequent years as the U.S. labor market reaches nearly full employment. Decreases in GDP in 2014 and beyond are accounted for by crowding out, where government debt absorbs finances that would otherwise go toward investment. In February 2014, the White House stated in a release that the stimulus measure saved or created an average of 1.6 million jobs a year between 2009 and 2012, thus averting having the recession descend into another Great Depression. So, I think the act was worth.