[Bilge_Rat]

Originally Posted by GoldenRivet

fact remains that we are living in a time when our government needs to be reducing the deficit, cutting pet projects from the budget and spending less money - when in fact what they are doing is spending record sums of money.

A case may be made that it was money well spent and the actual cost to taxpayer may be relatively low:

There is a compelling case that Obamanomics has produced results. An economy that was shrinking in size and bleeding more than 700,000 jobs a month is now growing at 2.6 percent and added 1.1 million jobs last year. The American Recovery and Reinvestment Act, known as the stimulus, produced or saved at least 1.9 million jobs and as many as 4.7 million last year, according to the Congressional Budget Office. The much-derided Troubled Asset Relief Program, or TARP, started by George W. Bush and continued by Obama, stabilized the financial sector, and the big banks have repaid the money with interest. According to a Treasury Department report sent to Congress this month, TARP will cost taxpayers $28 billion instead of the $700 billion originally set aside. The nearly $80 billion bailout of the auto industry may cost taxpayers only $15 billion, as the restructured General Motors and Chrysler come back to life with strong sales. The stock market has surged; corporate profits are setting records.

at the same time, there may be an argument that the stimulus spending was just too small to kick start the economy:

Obama’s instinct was to take on everything at once. “I want to pull the band-aid off quickly, not delay the pain,” a senior Obama official remembers him saying. “He didn’t want to muddle through it, Japan-style,” recalled Larry Summers, tapped to be director of Obama’s National Economic Council. Romer calculated how much government spending would be needed to fill the gaping hole of consumer demand and came up with $1.2 trillion, the highest of three options. Summers told her to leave that number out of the memorandum to Obama. Emanuel argued that such an astronomical figure would be politically explosive. Romer left it out but mentioned it to Obama during a briefing. “That’s what you’d need to do to definitively heal the economy,” she said, according to someone in the room. Still, she and Summers agreed on recommending close to $900 billion.

Liberals like the Nobel Prize-winning economists Joseph Stiglitz and Paul Krugman argue that the $800 billion package of infrastructure projects, aid to states and tax breaks that Congress eventually passed was inadequate and poorly targeted. “The stimulus was too small and not well-enough designed,” Stiglitz told me. “Most of my concerns have turned out to be valid.” Romer, who has returned to teach at Berkeley, told me she now agrees about the size. In Washington, she said, “you’re not supposed to say the obvious thing, which is that in retrospect of course it should have been bigger. With unemployment at 10 percent, I don’t know how you could say you wouldn’t have done anything different. Of course you would have made it bigger.”

Given what was known then, however, she said the $800 billion was reasonable and the most that Congress would approve. “In my mind,” she said, “the problem was not in the original package; it was in not adjusting to changed circumstances.” Once it was clear that the situation was deteriorating, she said, the White House should have gone back to Congress for more stimulus money. “That was where we could have been bolder,” she said.

from "The White House looks for work"

http://www.nytimes.com/2011/01/23/ma...nomy-t.html?hp

fairly long article, but which gives a fairly good overview of the economic theories of the Obama team.