As she leaves the White House, Romer says that the country really needs (but is not likely to get) more fiscal stimulus from Congress.
"The only surefire ways for policymakers to substantially increase aggregate demand in the short run are for the government to spend more and tax less," Romer insisted. "I desperately hope that policymakers on both sides of the aisle will find a way to finish the job of economic recovery."
As bad as things are, Romer suggested they could have been worse -- that senior members of the Obama administration would have been content with an even smaller stimulus. In the days before Obama took office, she and other members of the economic team "sent a memo to Rahm Emanuel... laying the groundwork for a larger stimulus package."
"Whereas most analysts and Congressional policymakers had been contemplating a stimulus of $500 billion or less, we urged that it grow substantially because of the severity of the downturn," she said.
Sometimes I wonder what would have happened had Christina Romer or anybody else on President Obama's economic team had gone public with the concerns that the stimulus wasn't big enough. Sure maybe they would have gotten fired, but wouldn't it have been worth it?
Staring at 9.5% unemployment I would have to say yes...