There are two things that are starting to make me very worried about the long term health of the American economy ...
- What happens when the US government stops "Stimulating" the economy
- What happens if the US government doesn't stop "Stimulating" the economy
Jobs created in the private sector tend to (after going through an initial "loss" period) generate a product or service of enough value that revenue generated from their work exceeds the cost and they become self sustaining. In contrast, jobs created in the public sector tend to require continued support from the tax-payer in order to exist.
Now, being that the rise in unemployment and decline in GDP has mostly become slower do to an increase in the number of jobs and (so called) "productivity" within the public sector (and the private sector continues to suffer) unless the stimulus has effectively increased the efficiency of private industry when the stimulus is taken away unemployment will rise and GDP will shrink again. At the same time, if the government is forced to maintain this spending taxes will increase in the future which will create a drag on business in the future resulting in increasing unemployment in the private sector and shrinking GDP.