White House top economist: don't expect growth from the stimulus

In a sober assessment of the impact the federal stimulus plan is having on the U.S. economy, leading White House economist Christina Romer admitted that the plan will not contribute to growth in 2010.

Christina Romer, chair of President Barack Obama's Council of Economic Advisers had a difficult message to deliver to the American people and to the business community in general. We cannot count on the $787 billion federal stimulus program to provide notable growth throughout all of 2010 or to have an impact on unemployment next year. Speaking before a congressional panel on Thursday, Romer said unemployment will likely remain above 9.5 percent through the end of 2010. Romer further explained that the big boost to the economy from the stimulus program has already happened, and that from this point forward its impact will peter out - even though a large percentage of the stimulus money remains to be spent. “Most analysts predict that the fiscal stimulus will have its greatest impact on growth in the second and third quarters of 2009,” she said. “By mid-2010, fiscal stimulus will likely be contributing little to growth.” However, Romer still believes that America should stay the course. “A premature end to stimulus would be misguided,” she said.