Today, Alan Blinder, a Princeton professor and former vice chairman of the Fed, and Mark Zandi, chief economist at Moody's Analytics, released a new study the New York Times calls “a first stab at comprehensively estimating the effects of the economic policy responses of the last few years.”

The study finds “the government's total policy response” to the Bush Recession “probably averted what could have been called Great Depression 2.0.”

Most Congressional Republicans fought this rescue and recovery–and criticizing it has become a Republican mantra. This report paints a grim picture of what America would look like now if Republicans had been in charge:

America would have lost “16.6 million jobs … about twice as many as actually were lost.”

The “unemployment rate would have peaked at 16.5%.”

“The peak-to-trough decline in GDP is … close to 12%, compared to an actual decline of about 4%.”

America's top three automakers and their suppliers “might have had to liquidate many operations with devastating effects on the American economy, and especially on the Midwest.”

The federal budget deficit would have surged to over $2 trillion in fiscal year 2010, $2.6 trillion in fiscal year 2011, and $2.25 trillion in FY 2012.

The report concludes:

Remember, this is with no policy response … this dark scenario constitutes a 1930s-like depression.

… it is clear that laissez faire was not an option; policymakers had to act. Not responding would have left both the economy and the government's fiscal situation in far graver condition.

Even with the rescue and recovery efforts, the report estimates the Bush Recession cost the American economy $2.35 trillion, about seven times the cost (adjusted for inflation) of the S&L bailout in the 1990s.

Read the full report»