Stimulus Increased GDP by 4.5 Percent, Not Growth

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Thursday, 26 August 2010 04:24

The copy editors at the NYT are apparently on vacation. The NYT told readers that: "the nonpartisan Congressional Budget Office (CBO) reported that the policies had lifted growth in the second quarter by up to 4.5 percent."

No, that's not quite right. CBO reported that the cumulative gain to GDP due to the stimulus by the second quarter of 2010 might have been as much as 4.5 percent. This does not refer to the growth rate in the second quarter itself.