Truth is, most of the stimulus money hasn't been spent yet. It was always going to take months for the stimulus to produce tangible economic growth -- or "oomph," as Obama economist Christine Romer calls it. By this time next year, we should be able to measure the impact of Obama's economic policies by his own standard.
"My measure of success is creating or saving 4 million jobs," he said in February. In a recession that has already eliminated 6.5 million jobs, that could be a difficult case to prove.
Mark Zandi of Moody's Economy.com, who criticized the stimulus bill Congress passed in February as too small and too slow, says we should start seeing the effects even before next year. This summer, he says, will be "the moment of truth" for Obama's plan. "If the plan is working, retailing will improve soon, and businesses should respond by curtailing layoffs," he said. If that doesn't happen, the administration should "be quietly preparing another round of fiscal stimulus," including more help to strapped state and local governments whose budget cuts are slowing the recovery.
But any new request would present a political dilemma. If Obama goes back to Congress -- even to ask for smaller, specific measures, such as more aid to states or new tax credits to forestall home foreclosures -- it would mean admitting that the first package was too small. And additional spending would get in the way of Obama's other chief goal: bringing the federal deficit under control.
Obama himself is being characteristically cautious. Asked at his news conference last month if another stimulus was needed, he said: "Not yet, because I think it's important to see how the economy evolves and how effective the first stimulus is. ... We've got to make sure that the programs that we put in place are working the way they're supposed to."
Where does this leave us? In the short run, don't expect a new stimulus plan. Obama wants to win his expensive battles over healthcare and energy first. But if the stimulus doesn't deliver some of its promised "oomph," expect a louder debate this fall -- one that could back Obama into a tight corner.
Meanwhile, Zandi is right: Obama's advisors should ready those new proposals in case they're needed.
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doyle.mcmanus@latimes.com. A version of this article appeared in the Saturday edition of Sunday's paper.
