Ezra Klein on the stimulus and the what ifs

I’m a big fan of The Washington Post’s Ezra Klein, a columnist who deals primarily with financial matters.

His writings rely on data that he has interpreted clearly. And, unlike some other economics columnists, he understands political realities and takes them clearly into account.

I HIGHLY recommend this long piece: Financial crisis and stimulus: Could this time be different?

He asks a number of valid “what if” questions, and directly confronts perhaps the biggest error of the early Obama presidency: the wildly overly optimistic employment projections that set the administration up for endless questions.

Klein’s piece is so thorough that I’m not going to quote from it, but let me include the graphic that is the centerpiece of it. This is from the Obama team’s projections before taking office:

Those projections were based on the work of a number of major economists and policymakers, none of whom realized just how bad the freefall of late 2008 really was — before Obama even took office. By underestimating the depth of the crisis, the Obama team created a PR nightmare for itself that might mean losing the White House in 2012. And it advocated policies that arguably helped the economy greatly, but that were insufficient to spur the recovery Americans were led to believe was possible.