From Business Week:

An extension of unemployment benefits has one of the highest pass-through rates of any federal spending choice, says Mark Zandi, chief economist and co-founder of Moody's Economy.com, a subsidiary of Moody's Corp. (MCO). The June passage of 13 weeks of additional unemployment benefits, for those who had exhausted the maximum 26 weeks of benefits, cost $20 billion. Now, Zandi says, another $20 billion is needed for a second extension.

In testimony before the U.S. House of Representatives in June, Zandi offered estimates of how much each dollar of government spending in different forms would produce in real GDP each year. He said extending unemployment benefits would yield $1.64 of GDP, a temporary increase in food stamps $1.73, aid to state governments $1.36, and increased infrastructure spending $1.59. "The bang for the buck is very high," Zandi said of extended jobless benefits.

Some economists and politicians would rather debate whether to spend hundreds of billions of taxpayer dollars at all. "The federal government does not have unlimited resources to borrow and spend on whatever," says James Hamilton, professor of economics at the University of California at San Diego. "We need to reflect on what went wrong [to create the financial crisis], and not run off in every direction."

Thankfully Hamilton offers some words of wisdom. Zandi's comments are par for the course for a guy who says (see 1:45 or so of this video; HT: Joe Coletti of The Locker Room) of bailout plans and stimulus packages, "This is capitalism" and "government is always part of capitalism." Sheesh.