One of the things you always heard, back when we were actually talking about stimulus rather than fighting a rearguard action against destructive austerity, was the claim that stimulus spending would inevitably end up becoming a permanent fixture of the economy. This was always said with an air of worldly wisdom — of course that’s how these things work! — even though history said very much the opposite.
But anyway, the invaluable FRED now has a series on exactly that subject, and here’s what it looks like:
By the way, it’s helpful to have a sense of the scale of this thing compared with the economy. So here’s the stimulus calculated as a percentage of the CBO estimate of potential GDP:
So next time someone goes on about how we had this huge stimulus that failed, you can tell him that the “huge” stimulus — in response to the worst financial crisis in three generations — peaked at a whopping 1.6 percent of GDP, and was effectively gone in a bit over two years.