Here is a bar chart of three figures. What are they?

Figure 1: Costs, in billions of dollars.

Bar 1, at $920 billion is the latest figure cited for the Senate stimulus bill. Bar 3 at $816 billion is the amount in the House stimulus bill. Bar 2 is the cumulative direct costs (excluding VA, interest payments) for operations in the Iraq Theater of Operation, aka OIF, through FY2010, in constant 2009 dollars.

I think this is all relevant when we think about what we’ve spent money on in the past, searching for those WMDs.

Putting things into perspective (because I keep on hearing that word “massive” over and over again), I divide each bar by two times FY2009 nominal GDP (given that the spending will take place primarily in two fiscal years — see this post).

Figure 2: Cost of Senate stimulus bill, divided by 2 times FY2009 GDP, cumulative cost of direct costs of OIF through FY2010, divided by 2 times FY2009 GDP, and cost of House stimulus bill,divided by 2 times FY2009 GDP. Source: For OIF costs, Belasco/CRS (October 2008), using “low troop level” CBO baseline, and converted to 2009 dollars using calender year CPI in CBO database Table c-1 (January 2009) [xls] and FY 2009 nominal GDP reported in CBO, Budget and Economic Outlook (January 2009) [pdf], and author’s calculations.

Last 5 posts by Menzie Chinn

• Baselines, Counterfactuals and the Stimulus - November 21st, 2009
• China, the Renminbi, and Global Imbalances: A Quantitative View - November 20th, 2009
• GDP: Revisions and Forecasts - November 19th, 2009
• Assessing the Impact of Government Policy on Widget Consumption and Widget Sector Capital Usage - November 16th, 2009
• The Global Surface Temperature Anomaly - November 16th, 2009