On Friday afternoon, Grover Norquist posted the following explanation of why the U.S. economy is sliding into the deepest recession since World War II at the National Review Online's group blog, The Corner.

The economy as measured by the market and businesses' willingness to hire does not sound very excited by the Reid/Pelosi/Obama spending spree.

The economy began to collapse when the Democrats captured the House and Senate and we then knew that the lower tax rates on individuals, capital gains, and dividends would end after 2010.

It's not the first time that Norquist, president of the anti-tax lobbying group Americans for Tax Reform, has unburdened himself of such breath-taking imbecility. But to do so in response to the news that the economy lost 600,000 jobs in January is bold, even for him -- (and of course, stunningly wrong, even in the narrowest sense -- at the very moment Norquist wrote those words the stock market was rebounding, on hopes, theorized by none other than that shining beacon of leftwing propaganda, the Wall Street Journal, that the stimulus bill would pass. If Norquist wants to see a real market panic, wait and see what happens if the Senate fails to pass a stimulus bill.)

The cost of this bill, frankly, is high but it's a price for freedom. And I don't think you can put a price on freedom and security in our country.

"We finally cleaned up public housing in New Orleans. We couldn't do it, but God did." –Rep. Richard Baker (R-LA) to lobbyists, as quoted in the Wall Street Journal (Source)

BLITZER: Just a little fact check right now.

Joining us is Mark Zandi.

He's the chief economist at Moody's Economy.com.

Mark, thanks very much for coming in.

What's a better way to deal with this economic crisis -- cut people's taxes or spend government money given to the states to build infrastructure -- roads, bridges?

MARK ZANDI, MOODY'S ECONOMY.COM: Well, I think you need both. The infrastructure spending has a bigger economic bang for the buck. It creates more jobs. But the problem is it can't get into the economy quickly. So I think you do need tax cuts. That doesn't have the same bang for the buck. It's not as efficacious. But you can get that into the economy quickly.

So a plan, like the current plan, that has both tax cuts and spending increases, I think, is the best plan.

WOMAN: The Republicans say they want more tax cuts for the middle class, but only tax cuts for those individuals and families who actually pay federal income tax, not for those who don't pay any federal income tax.

Are the Republicans right?

ZANDI: Well, I think that would reduce the effectiveness of tax cuts because people who are in lower income groups that, in fact, probably don't pay income tax -- look, if they got a tax break, would spend it and would spend it very quickly and that would raise the stimulus.

So, to make it more effective, I think it should go to lower income households, who, in fact, don't pay income tax.

BLITZER: And they would, presumably, spend it very quickly. And that would help to stimulate the economy.

That's the theory right?

ZANDI: That's the idea. And I think it works. I mean people who are in lower income groups, they're under more financial stress. If they get a dollar, they're going to spend that dollar and they're going to spend it very quickly. And that's exactly what we want to see right now.

BLITZER: It passed the House at about -- a little bit more than $800 billion. Now it's ballooned to more than $900 billion in the Senate. And the Republican leader, the minority leader, Mitch McConnell, says, you know what, it's going to cost a whole lot more than that.

Listen to this.

(BEGIN VIDEO CLIP)

SEN. MITCH MCCONNELL (R-KY), MINORITY LEADER: And when you include interest, the bill before us will cost nearly $1.3 trillion. At some point, the taxpayers will have to pay all of this back. And they're worried.

(END VIDEO CLIP)

BLITZER: Is he right? Is his math correct?

ZANDI: Yes, he's right. If you throw in the interest costs from borrowing all the money necessary to finance the stimulus, it will ultimately cost about $1.3 trillion. That's correct.

But another point to consider -- if we don't do stimulus, in my view, I think the economy will weaken very substantively. And that means we're going to lose a lot of tax revenues. If people aren't working, they're not paying taxes. If businesses aren't energy money, they're not going to pay corporate income tax. And we're going to see more spending to help all those people who lose their jobs.

So the deficit is going to rise anyway if we do nothing. So I think it's better to take a shot at it -- and a big shot at it -- and see if we can't make this work and get the economy going again.

BLITZER: What's wrong with just pumping money in that's going to create jobs right away?

Why do you need to put into this legislation money that's going to create jobs two, three, four years down the road?

ZANDI: Well, a fair amount of the money is for jobs now -- helping people who lose their jobs...

BLITZER: But a big chunk is only for two or three years down the road.

ZANDI: Yes, that's right. But I think everyone does realize that in this economy -- it's not coming back quickly. So if it gets help in '09, that would be wonderful and great. But if it gets help in 2010 and 2011, it's going to need it then, as well.

BLITZER: When President Obama says you've got to pass it right now because every day is critical -- we heard David Axelrod say that, his top adviser, in the last hour.

Are they right or is there time to make sure they do it better?

ZANDI: Well, we have to do it right. But time is of essence here. We just got a sense of that today with the jobs numbers. We lost almost 600,000 jobs in one month. We've lost 3.6 million jobs in a little over a year. The unemployment rate is rising very quickly.

We are getting trapped in a very negative cycle and so we need to break it. So we need this stimulus plan and we need it very quickly.

BLITZER: How quickly?

ZANDI: Now, that doesn't mean we should do...

BLITZER: How quickly?

ZANDI: I think we should pass it in the next couple, three weeks. I think it's very therapeutic what we're going through -- the debate. I think the Senate is going to make this a better bill. We're going to get rid of the spending that makes very little sense as stimulus.

But I think, ultimately, we need to get this passed in the next couple, three weeks.

BLITZER: Some economists say this is a waste of money, a waste of time and it could be a disaster. And they point to the Japan model in the '90s, when the Japanese government did a stimulus plan and they pumped tons of money into their economy and they say it was a lost decade for Japan, because it really didn't turn their economy around.

Is there a parallel between what Japan went through in the '90s and what the U.S. is going through now?

ZANDI: Well, there's good lessons from the Japanese experience. What the Japanese did is they did their stimulus over a period of a decade. They took their time about doing it. They didn't try to stem the downturn right up front with a lot of spending.

Moreover, they spent only on bridges and roads. And, ultimately, they built so many roads and bridges that they literally were building bridges to nowhere. And they -- that wasn't very effective.

So I think the lesson is we need to have a plan that includes spending, tax cuts, help for people who are losing their jobs, aid to state and local governments, a diversified set of stimulus and also do it up front and in a big way.

BLITZER: Bottom line, even though you were an adviser to John McCain during the campaign, you say support what Barack Obama is doing right now. You say that to members of the House and Senate.

ZANDI: I absolutely do. I -- you know, I fear that the economy is slipping away. We need to act aggressively and quickly.

This isn't a perfect plan, by any stretch, but it is a good plan -- a good enough plan. It will create jobs and it will make a difference and we need to pass it quickly.

BLITZER: Mark Zandi, thanks very much for coming in.

ZANDI: Thank you.