Plans A, B, and C for the stimulus

Brad DeLong comments.  I offer one point: had the smart Obama advisors understood how much the economy would deteriorate, and told Obama as much, would Obama have let Congress write so much of the stimulus bill?  I doubt it.  That was a big mistake.

Furthermore the forecasts were wrong (in part) because they were not taking negative real shocks into account.  The Keynesians are loathe to admit that, though they are keen to stress that the forecasts were wrong, which they were.

I am indebted to John Nye for a useful conversation on this topic.