The top line represents actual unemployment

Below is a graph of unemployment. Included are three lines. The middle line represents the Obama Administration forecast of where unemployment would be without the stimulus. The bottom line is where they forecast unemployment to be if the stimulus bill passed. The top line represents actual unemployment. Many projected that the stimulus would actually make matters worse, although this chart does not prove them correct. While the chart proves nothing, it certainly refutes the claims made by the Administration. However, one must be careful concluding that the stimulus “failed” because there are so many other variables in play. The bottom line is that they got what they requested, and results were not as promised. Supporters conclude that conditions were worse than imagined. Detractors say “we told you so.” Neither side can “prove” anything because one does not know where unemployment might be without the stimulus. Clearly, the only thing that might be said definitively is that the Administration either needs to work on its analytical and forecasting tools or be more cautious with projections in the future. Once again the colorful John Kenneth Galbraith’s observation on economic forecasting is worth noting: “The only function of economic forecasting is to make astrology look respectable.”