Question

Did ARRA achieve the stimulus President Obama hoped it would? Explain with references and data

Answer 1

Solution

The American Recovery and Reinvestment Act (ARRA) was a a bill passed in 2009 to create a economic stimulus to help the American Economy to recover from an economic downturn that began in the late 2007

The bill has a size of $787 Billion and was allocated to fund the tax cuts ,to supplement the the existing spending on social welfare and spending on healthcare,education,infrastructure and the energy sector.

Yes,the ARRA achieved the stimulus President Obama hoped it would.With the help of this massive financial package:

1.Taxes were cut by $288 billion

2.$224 Billion was spent  in provided in extended unemployment benefits,healthcare,education and creating infrastructure

3.Jobs were created by allocating $275 billion in federal contracts, grants, and loans.

Due to this :

1.It was estimated in 2009 that this financial package would stimulate the GDP of the United States by 1.4 % to 3.8 % for the fourth quarter in 2009 BUT the GDP improved by 1.5% in the 3 rd QTR  and 4.5 % n the 4 rth QTR

2.The CBO in the year 2009 had predicted that this package would create a whopping 7 million additional full-time jobs by the end of the year 2012. BUT in the year 2015, it was estimated that the stimulus had already created between 2 million and 10.9 million new full-time jobs.

3.With this package by the end of 2014,more than 40,000 miles of roads and 2700 bridges have been upgraded.Also nearly 700 drinking water systems have been upgraded.

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