Our Monastery of Miscellaneous Musings has a great post about the unemployment rate shooting way above the Obama Administration's predictions. The key chart is this one.
While many correctly suggest that we could have had this kind of unemployment without the $800B price tag, there's a bigger point that is being missed.
The overshoot in the unemployment rate doesn't just show that the Stimuloid Porkgasm™ was a total waste of printed money, it shows that the economic models upon which it and all other macroeconomic decisions are being based is completely wrong. The model isn't even close to predicting reality. It didn't get the slope right, it didn't get the second derivative right, it's missing every metric of curve-fitting you can think of and missing them by a country mile.
In a talk at Google, Mish points out a similar problem with the underlying conventional wisdom that has gotten us to this point. He talks about how the Fed inflated one bubble after another - first the dot com bubble and then the real estate bubble and when each one popped with disastrous results, the economic soothsayers all exclaimed that no one could have seen this coming.
For those of you on the left who claim some kind of prescience, I point you to Barney Frank's and the Congressional Black Caucus' undying defense of the hopelessly bankrupt Fannie Mae and Freddie Mac, both of whom were six-figure jobs factories for retired Democratic political operatives.
In any case, there were those who called these bubbles. Mish and Nouriel Roubini come to mind immediately. It's just that none of them live in the same intellectual world as Paul Krugman, Ben Bernanke, Tim Geithner or Hank Paulson. The folks who are and have been making the macroeconomic decisions live in the world of that graph, minus the real data points.
What the unemployment number shows is that they have no clue at all about how the economy really works.