Here's the post by Paul Krugman on his NY Times blog:
Click to Enlarge
FRED now makes it easy to compare potential GDP, as estimated by the CBO, with actual GDP; data here. To make it easier to interpret the numbers, I like to compare nominal (current dollar) values rather than stuff in 2005 dollars; that’s what is shown above.
If we believe these estimates — and I see no good reason to believe that CBO is overstating the output gap — we’re now sacrificing output we should be producing, goods and services that we have the capacity to produce but aren’t producing due to insufficient demand, at the rate of more than $900 billion a year. By the way, the cumulative loss since the recession began is almost $2.8 trillion.
So next time someone tells you that it would be irresponsible to engage in more stimulus, monetary, fiscal, or both, ask: in what universe is wasting almost a trillion a year, not to mention the human costs, a responsible thing to do?