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Economists’ Letter to Congress in Support of a New Economic Stimulus Package

The Honorable Henry Reid
Senate Majority Leader
Washington, DC 20510
The Honorable Nancy Pelosi
Speaker of the House
Washington, DC 20515
The Honorable Mitch McConnell
Senate Minority Leader
Washington, DC 20510
The Honorable John Boehner
House Minority Leader
Washington, DC 20515

Dear Sen. Reid, Sen. McConnell, Speaker Pelosi, and Rep. Boehner:

We, the undersigned economists, urge Congress to pass a new stimulus package as quickly as possible.  The need to deal with financial turmoil has directed attention away from the “real” economy.  But the latest data clearly show that the economy is entering a serious recession, initiated by the collapse of homebuilding and intensified by the paralysis of credit markets.  Without a fast an effective response by government, the economy could continue to spiral downward, leading to a large increase in unemployment and a sharp decline in GDP.

The potential severity of the downturn suggests that a boost to demand on the order of 2.0-3.0 percent of GDP ($300-$400 billion) would be appropriate, with the goal being to get this money spent quickly.  The list of targets includes:

  1. aid to state and local governments that are being forced to make emergency cutbacks as revenues fall;
  2. extending unemployment insurance and increasing other benefits targeted toward low and moderate income households who are likely to spend quickly;
  3. moving forward infrastructure projects that have already been planned and scheduled; and
  4. providing tax credits and other support for “green” projects that can be done quickly, such as retrofitting homes and businesses for increased energy efficiency.

The sharp falloff in demand resulting from the collapse of the housing bubble and the destruction of financial wealth means that there is little reason to fear that enlarged deficits will raise interest rates and deter private investment.  It is far more likely that an effective stimulus package will promote investment by improving prospects for higher sales and profits.

With little downside risk and much potential gain, it is important that Congress move quickly and decisively.  Delay can only deepen and prolong the recession.

Sincerely,

Organizations listed for identification purposes only.

CALIFORNIA

George Akerlof, Nobel Laureate, University of California, Berkeley

Sylvia A. Allegretto, University of California, Berkeley

Peter Berck, University of California, Berkeley

Clair Brown, University of California, Berkeley

Susan Carter, University of California, Riverside

Carol Chetkovich, Mills College

Mussaddeq Chowdhury, University of Redlands

Cecilia Conrad, Scripps College

Richard Cornwall

James Cypher, California State University, Fresno

Paul A David, Stanford University

James Bradford DeLong, University of California, Berkeley

James Devine, Loyola Marymount University

Gary Dymski, University of California, Riverside

Elena Foshay

Deborah Garvey, Santa Clara University

Lisa Grobar, California State University, Long Beach

Greg Hunter, California State Polytechnic University, Pomona

Michael Intriligator, University of California, Los Angeles

Dorene Isenberg, University of Redlands

Sanford M. Jacoby, University of California, Los Angeles

Lori Kletzer, University of California, Santa Cruz

Tom Larson, California State University, Los Angeles

David Levine, University of California, Berkeley

Yan Liang, University of Redlands

Victor Lippit, University of California, Riverside

Diane Macunovich, University of Redlands

Mark Maier, Glendale College

Eric Nilsson, California State University, San Bernardino

Michael Perelman, California State University, Chico

Steven Raphael, University of California, Berkeley

Michael Reich, University of California, Berkeley

Lynda Rush, California State Polytechnic University, Pomona

Harley Shaiken, University of California, Berkeley

Todd Sorensen, University of California, Riverside

Roger Sparks, Mills College

Frank Stricker, CSU Dominguez Hills and CA Faculty Union

Myra Strober, Stanford University

Richard Sutch, University of California, Riverside

Chris Tilly, University of California, Los Angeles

Gavin Wright, Stanford University

Carol Zabin, University of California, Berkeley

COLORADO

Alexandra Bernasek, Colorado State University

Elissa Braunstein, Colorado State University

P. Sai-wing Ho, University of Denver

Scott Lazerus, Western State College of Colorado

Tom Mayer, University of Colorado

Tracy Mott, University of Denver

Anita Pena, Colorado State University

Charles Revier, Colorado State University

Steven Shulman, Colorado State University

Rudiger von Arnim, University of Denver

Richard Wobbekind, University of Colorado

Yavuz Yasar, University of Denver

Michael Zimmerman, Colorado Public Utilities Commission

CONNECTICUT

Jane D’Arista, Financial Markets Center

Catherine Forman, Quinnipiac University

Candace Howes, Connecticut College

Miguel Ramirez, Trinity College

Rasika Ranasinghe, Connecticut College

DISTRICT OF COLUMBIA

Henry Aaron, Brookings Institution

Dean Baker, Center for Economic and Policy Research

Barbara R. Bergmann, American University

Charles Betsey, University of Michigan

Josh Bivens, Economic Policy Institute

Ron Blackwell, AFL-CIO

Rebecca Blank, Brookings Institution

Gary Burtless, The Brookings Institution

Mary Lou Egan, Bendick and Egan Economic Consultants, Inc.

Kai Filion, Economic Policy Institute

Jessica Gordon Nembhard, CEJJES Institute and National Economic Association

Heidi Hartmann, Institute for Women’s Policy Research

Ariane Hegewisch, Institute for Women’s Policy Research

Harry Holzer, Georgetown University

Helene Jorgensen, Center for Economic and Policy Research

Hank Leland, Service Employees International Union

Marc Mealy, US ASEAN Business Council

Lawrence Mishel, Economic Policy Institute

Austin Nichols, Urban Institute

Aaron Pacitti, American University

Andrew Reamer, The Brookings Institution

John Schmitt, Center for Economic and Policy Research

Heidi Shierholz, Economic Policy Institute

Mark Weisbrot, Center for Economic and Policy Research

Howard Wial, The Brookings Institution

FLORIDA

Robert Burkhardt, University of Florida

Carmen Diana Deere, University of Florida

Carole Green, University of South Florida

Patrick Mason, Florida State University

Charles Rock, Rollins College

GEORGIA

Tanweer Akram

Sarah Jacobson, Georgia State University

IOWA

Peter Fisher, The Iowa Policy Project

Ismael Hossein-zadeh, Drake University

IDAHO

Martin Orr, Boise State University

Sergio Romero, Boise State University

ILLINOIS

Ron Baiman, DePaul University

Marianne Ferber, University of Illinois at Urbana-Champaign

Mark Johnson, Chicago State University

Paul Lockrd, Black Hawk College

Joseph Persky, University of Illinois at Chicago

Samuel Rosenberg, Roosevelt University

Calvin Trapp, Roosevelt University

INDIANA

Charles Davis, Indiana University – Purdue University Indiana

Amitava Dutt, University of Notre Dame

Lawrence Marsh, University of Notre Dame

Jaime Ros, University of Notre Dame

Martin Wolfson, University of Notre Dame

KANSAS

Jennifer Ball, Washburn University

Philip Mauceri, University of Northern Iowa

Joshua Rosenbloom, University of Kansas

KENTUCKY

Malcolm Robinson, Thomas More College

James Ziliak, University of Kentucky

MASSACHUSETTS

Frank Ackerman, Stockholm Environment Institute and Tufts University

Randy Albelda, University of Massachusetts Boston

M. V. Lee Badgett, University of Massachusetts Amherst

Jim Campen, Americans for Fairness in Lending

Jessica Carrick-Hagenbarth, University of Massachusetts Amherst

Arthur Casimir, Western New England College

Karen Conway, University of New Hampshire

James Crotty, University of Massachusetts Amherst

Anita Dancs, Western New England College

David Danning, University of Massachusetts Boston

Peter Diamond, Massachusetts Institute of Technology

Gerald Epstein, University of Massachusetts Amherst

Colleen Fahy, Assumption College

Ellen Frank, University of Massachusetts Boston

Gerald Friedman, University of Massachusetts Amherst

Heidi Garrett-Peltier, University of Massachusetts

Neva Goodwin, Tufts University

Carol E. Heim, University of Massachusetts Amherst

James Heintz, University of Massachusetts Amherst

Adam Hersh, University of Massachusetts

Arjun Jayadev, University of Massachusetts Boston

J K Kapler, University of Massachusetts Boston

Thomas Kochan, Massachusetts Institute of Technology

Laurence Kotlikoff, Boston University

Supriya Lahiri, University of Massachusetts Lowell

Charles Levenstein, University of Massachusetts Lowell

Catherine Lynde, University of Massachusetts Boston

Arthur MacEwan, University of Massachusetts Boston

Julie Matthaei, Wellesley College

Ellen Meara, Harvard Medical School

Michael Meeropol, Western New England College

Fred Moseley, Mount Holyoke College

Philip Moss, University of Massachusetts Lowell

Julie Nelson, University of Massachusetts Boston

Laurie Nisonoff, Hampshire College

Paul Osterman, Massachusetts Institute of Technology

Karl Petrick, Western New England College

Karen R. Polenske, Massachusetts Institute of Technology

Robert Pollin, University of Massachusetts Amherst

Joseph Ricciardi, Babson College

Helen Scharber, University of Massachusetts

Juliet Schor, Boston College

Mark Silverman, University of Massachusetts Amherst

Peter Skott, University of Massachusetts Amherst

Robert M. Solow, Nobel Laureate, Massachusetts Institute of Technology

Peter Spiegler, University of Massachusetts Boston

Joanne Spitz, University of Massachusetts Boston

Mary Stevenson, University of Massachusetts Boston

Peter Temin, Massachusetts Institute of Technology

David Terkla, University of Massachusetts Boston

Stanley Warner, Hampshire College

Christian Weller, University of Massachusetts Boston

Jeannette Wicks-Lim, University of Massachusetts Amherst

Brenda Wyss, Wheaton College

Ben Zipperer, University of Massachusetts Amherst

MARYLAND

Gar Alperovitz, University of Maryland

Jon Goldstein, GTBEconomics

Robert Lynch, Washington College

Ralph Sonenshine, American University

Richard Wertheimer

Evelyn Wright, International Resources Group

MAINE

Susan Feiner, University of Southern Maine

Barbara Fraumeni, Muskie School of Public Service, University of Southern Maine

Michael Hillard, University of Southern Maine

Bruce Roberts, University of Southern Maine

MICHIGAN

David Arsen, Michigan State University

Michael Belzer, Wayne State University

Sheldon Danziger, University of Michigan

David Doane, Oakland University

Karl D. Gregory, Oakland University

Margaret Levenstein, University of Michigan

Hannah McKinney, Kalamazoo College

Sid Mittra, Oakland University

Kevin Murphy, Oakland University

Frank Thompson, University of Michigan

John Tower, Oakland University

Jennifer Ward-Batts, Wayne State University

Thomas Weisskopf, University of Michigan

MINNESOTA

David Karjanen, University of Minnesota

Pareena Lawrence, University of Minnesota, Morris

Ann Markusen, University of Minnesota

MISSOURI

Erik Olsen, University of Missouri Kansas City

MISSISSIPPI

Marianne Hill, Center for Policy Research

NORTH CAROLINA

Charles Becker, Duke University

Victor Schoenbach, University of North Carolina at

Chapel Hill

NEW JERSEY

Eileen Appelbaum, Rutgers University

Oliver Cooke, Richard Stockton College of New Jersey

Reza Ghorashi, Richard Stockton College of New Jersey

Deborah Figart, Richard Stockton College of New Jersey

Douglas Kruse, Rutgers University

Melaku Lakew, Stockton State College

Daniel Lawson, Drew University

Ellen Mutari, Richard Stockton College of New Jersey

Michele Naples, The College of New Jersey

Cordelia Reimers, Hunter College, City University of New York

Yana Rodgers, Rutgers University

Subarna Samanta, The College of New Jersey

Bernard Smith, Drew University

Paula Voos, Rutgers University

NEVADA

S. Charusheela, Univeristy of Nevada, Las Vegas

Bernard Malamud, University of Nevada, Las Vegas

NEW YORK

Marcellus Andrews, Barnard College

Radhika Balakrishan, Marymount Manhattan College

Erol Balkan, Hamilton College

Nesecan Balkan, Hamilton College

Peter Bell, State University of NY

Lourdes Beneria, Cornell University

Howard Botwinick, SUNY Cortland

Howard Chernick, Hunter College, City University of New York

Kimberly Christensen, Sarah Lawrence College

Paul Christensen, Hofstra University

Gregory DeFreitas, Hofstra University

Thomas DelGiudice, SUNY, College at Old Westbury

Rosemary DeRiso, Hofstra University

Ranjit Dighe, SUNY Oswego

Alan Dye, Barnard College

Max Fraad Wolff, New School University

Anthony Gabb, St. John’s University

David Gabel, Queens College, City University of New York

Chris Georges, Hamilton College

Teresa Ghilarducci, The New School

Ulla Grapard, Colgate University

Christopher Gunn, Hobart and William Smith Colleges

Robert Guttmann, Hofstra University

Doug Henwood, Left Business Observer

Conrad Herold, Hofstra University

David Howell, The New School

Jerome Joffe, St. John’s University

Brent Kramer, City University of New York

Laurence Krause, SUNY, College at Old Westbury

Rachel Kreier, Hofstra University

Henry Levin, Columbia University

Mark Levinson, UNITE HERE

Jeff Madrick, New School University and Challenge Magazine

Shane Mage, Collier’s Encyclopedia

Thomas Masterson, Levy Economics Institute of Bard College

Roberto Mazzoleni, Hofstra University

Patrick A. McGuire, Hobart and William Smith Colleges

Judith McKinney, Hobart and William Smith Colleges

Perry Mehrling, Barnard College

Martin Melkonian, Hofstra University

Tom Michl, Colgate University

William Milberg, New School for Social Research

Fatemeh Moghadam, Hofstra University

Jamee Moudud, Sarah Lawrence College

Michael Nuwer, State University of New York at Potsdam

Jose Antonio Ocampo, Columbia University

Pierre Ostiguy, Bard College

Dimitri B. Papadimitriou, Levy Economics Institute of Bard College

James Parrott, Fiscal Policy Institute

Michael Pendleton, Buffalo State College

Marilyn Power, Sarah Lawrence College

Paddy Quick, St. Francis College

John Roche, St. John Fisher College

John Sarich, Cooper Union

Ted Schmidt, SUNY College Buffalo

Amy Schwartz, New York University

Bhaswati (Bonu) Sengupta, Hofstra University

Sumitra Shah, St. John’s University

Anwar Shaikh, New School for Social Research

Myron Sharpe, M.E. Sharpe, Inc.

Perry Singleton, Syracuse University

Joseph E. Stiglitz, Nobel Laureate, Columbia University

Sharon Szymanski, Empire State College/SUNY

Alexander Thompson, Vassar College

Renee Toback

Robert W. Turner, Colgate University

Dale Tussing, Syracuse University

Leanne Ussher, Queens College, City University of New York

Don E. Waldman, Colgate University

William Waller, Hobart and William Smith Colleges

Lucy Law Webster, Economists for Peace and Security

David Weiman, Barnard College

Andrw Wyler-David, SUNY Purchase

June Zaccone, Hofstra University

Ajit Zacharias, Levy Economics Institute of Bard College

OHIO

Robin Bartlett, Denison University

Rudy Fichtenbaum, Wright State University

Susan Helper, Case Western Reserve University

Barbara Hopkins, Wright State University

Ida Mirzaie, The Ohio State University

Sirisha Naidu, Wright State University

Paulette Olson, Wright State University

Edith Rasell, United Church of Christ Justice & Witness Ministries

Jim Rebitzer, Case Western Reserve University

Jeffrey Stewart, University of Cincinnati

OREGON

Patricia A. Atkinson, Portland State University

Alison Butler, Willamette University

Michael Fogarty, Portland State University

Marty Hart-Landsberg, Lewis and Clark College

Mary King, Portland State University

Sheila Martin, Portland State University

Alok Ray, Portland State University

Sarah Tinkler, Portland State University

Linda Wilcox Young, Southern Oregon University

Helen Youngelson-Neal, Portland State University

PENNSYLVANIA

Nina Banks, Bucknell University

Chuck Barone, Dickinson College

Roger Bove, West Chester University (retired)

Irene Buhalo, Janney Montgomery Scott LLC

Brendan Cushing – Daniels, Gettysburg College

Bob Drago, Penn State University

David Elesh, Temple University

Lonnie Golden, Penn State Abington

William Holmes, Temple University

Benjamin Kohl, Temple University

Ebru Kongar, Dickinson College

Peter Karl Kresl, Bucknell University (emeritus)

Michael Moohr, Bucknell University

Mark Price, Keystone Research Center

Geoffrey Schneider, Bucknell University

Sanford Schram, Bryn Mawr College

Jean Shackelford, Bucknell University

James Stewart, Penn State Greater Allegheny

Ramya Vijaya, Richard Stockton College of New Jersey

John Zink, Franklin and Marshall College

RHODE ISLAND

Barry Shelley, University of Massachusetts, Amherst

SOUTH CAROLINA

Drucilla Barker, University of South Carolina

TENNESSEE

Green Ekadi, Meharry Medical College

TEXAS

James Galbraith, Economists for Peace and Security

Diana Strassmann, Rice University

UTAH

Nursel Aydiner Avsar, University of Utah

Gunseli Berik, University of Utah

Cihan Bilginsoy, University of Utah

Gail Blattenberger, University of Utah

Codrina Rada von Arnim, University of Utah

Stephen Reynolds, University of Utah

James Rock, University of Utah

Hande Togrul, University of Utah

Matias Vernengo, University of Utah

Norman Waitzman, University of Utah

Anne Yeagle, University of Utah

VIRGINIA

John James, University of Virginia

Andrew Kohen, James Madison University

VERMONT

Jane Knodell, University of Vermont

Peter Hans Matthews, Middlebury College

Elaine McCrate, University of Vermont

Robert Prasch, Middlebury College

Stephanie Seguino, University of Vermont

Jim Tober, Marlboro College

WASHINGTON

Peter Bohmer, The Evergreen State College

Jeff Chapman, Washington State Budget & Policy Center

Colin Danby, University of Washington, Bothell

Peter Dorman, Evergreen State College

Robert Francis, Shoreline Community College

Heather Grob, St. Martin’s University

Douglas Orr, Eastern Washington University

Timothy Payne, Shoreline Community College

Diana Pearce, University of Washington

Hector Saez, Washington State University

Marjolein van der Veen, Bellevue Community College

WISCONSIN

James Carpenter, Milwaukee Area Technical College

Martin David, University of Wisconsin-Madison (emeritus)

Laura Dresser, Center on Wisconsin Strategy, University of Wisconsin-Madison

William Holahan, University of Wisconsin-Milwaukee

Marc Levine, University of Wisconsin-Milwaukee

Cheryl Maranto, Marquette University

Marcelo Milan, University of Wisconsin-Parkside

Jack Norman, Institute for Wisconsin’s Future

Andrew Reschovsky, University of Wisconsin-Madison

Michael Rosen, Milwaukee Area Technical College

Timothy Smeeding, Robert M. La Follette School of Public Affairs

WEST VIRGINIA

David Cormier, West Virginia University/ILSR

Saranna Thornton, Hampden-Sydney College

ABROAD

Siobhan McGrath, University of Manchester, United Kingdom

Alejandra Arroyo, UAM-I, Mexico

Silvia Berger, FLACSO, Argentina

Colin Cavell, University of Bahrain

Anthony D’Costa, Asia Research Centre, Copenhagen, Denmark

Togmid Dorjkhand, Ministry of Finance, Mongolia

Robert Scott Gassler, Vesalius College, Belgium

Alicia Giron, Instituto de Investigaciones Economicas UNAM, Mexico

Gustavo Indart, University of Toronto, Canada

Robert Shelburne, United Nations Economic Commission for Europe


This letter was made available on the Web site of the Center for Economic and Policy Research.  Download the letter in PDF at <cepr.net/documents/publications/Economists_letter_2008_11_19.pdf>.



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