Summers says some smart things...

Yesterday, he acknowledged "deflation a real threat", and "This bill is imperative for our economic security". OK, but then he also said the stimulus package is aimed at helping fill a $2 trillion gap between the economy’s potential growth and its actual performance in 2009 and 2010. OK, but the stimulus bill is now less than $800 billion. How is it going to fill a $2 trillion gap? With real interest rates rising? It's going to be like pissing into the ocean. The sea level just isn't going rise. We need something big... Why does it seem like, in two years, a bunch of conservatives are going to say "See! Fiscal stimulus doesn't work!" Of course, why should an $800 billion fiscal stimulus bill work when we've got a $2 trillion output gap? When much of that $800 billion dollar stimulus is merely offsetting state cuts?

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aLqmR5ZB_RYI