Here’s what Christina Romer thinks is necessary to address unemployment:
“One targeted measure that is likely to be very effective is additional fiscal relief to the states,” she said. Another is putting money into smaller banks, as the president has proposed, to get them to lend more to small and medium sized firms. A third is more aggressive actions to open foreign markets to U.S. goods and services.
Instead, even an modest extension of unemployment benefits is filibustered. I understand the short-term politics behind the Obama administration’s decision not to push for another stimulus. But they’re starting to look very shortsighted.