President Barack Obama's $787 billion stimulus package would fund a $2,700 handout to every man, woman and child in the United States. It could pay for 1,000 new aircraft carriers or finance seven trips to the moon and back.
But it's not enough to jolt the country out of recession, economics instructor Jim Franz told an audience of more than 100 Thursday at Lower Columbia College.
"The stimulus alone is not going to bring us back to full employment. It's not going to close that gap," he said.
Franz was the first speaker in the college's latest lunch-hour lecture series, which focuses on Obama's first year in office.
In a talk titled "Stimulus Package: Too Much or Not Enough?", Franz noted that national unemployment has risen to 10 percent and the U.S. gross domestic product (GDP) has fallen 3 percent, to nearly $13 trillion, since the recession began in 2008.
Following an economic model known as Okun's Law, the GDP would need to rise by $1.77 trillion for the country to reach full employment, Franz said. The stimulus package, adjusted for economic multipliers, would inject about $1.1 trillion into the economy, leaving the nation about $670 billion short of full employment, he said.
Picking the right size of stimulus package is not an exact science, Franz said, and economists disagree. New York Times columnist Paul Krugman, a Pulitzer Prize-winning economist, has argued that anything less than a $1 trillion stimulus would not fix the economy. Other economists say the government shouldn't take such an active role in the economy.
Other factors beyond the stimulus package are helping the economy, such as low interest rates, Franz said. Unknown events, such as rising oil prices, could throw his predictions out of whack, but Franz said he sees a positive move forward for the economy, noting the gradual recovery of stock prices.
"I'm hopeful, to be honest," Franz said.
After skipping next week, the Community Conservations series will resume Jan. 21 and continue weekly through March 18. Topics range from health care to race to President Obama's much-ballyhooed rhetorical flair.
All lectures start at noon and are held in LCC's Rose Center.
LCC instructor Jerry Zimmerman, the lecture series' senior coordinator, said it's a good time to discuss what Obama has done in office so far.
"There's been time to look back at the president's first year — what he talked about during the campaign, what his setbacks are — and look back objectively," Zimmerman said.