The American Spectator : The Preposterous Stimulus Bill

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The Preposterous Stimulus Bill

By Andrew Cline on 2.18.10 @ 6:08AM

At best it funded jobs -- government jobs -- which government can no longer afford.

Only 6 percent of Americans believe the stimulus bill passed a year ago this week has created jobs, a CBS News/New York Times poll reported last week. Six percent. Nearly six times as many Americans believe in ghosts as believe President Obama's jobs claims. It isn't hard to see why. All you have to do is go to the government's own website, www.recovery.gov, and look at the numbers. The site reports 1.2 million jobs funded by the stimulus bill by the end of 2009. Note the terminology. That's jobs funded, not created. The administration switched from jobs "created or saved" to jobs "funded" for accuracy's sake. Or maybe to stop the mockery. Either way, it's a telling methodology.

President Obama would have us believe that the stimulus is working because the government spent a bunch of money, and that money funded 1.2 million jobs. And he has the nerve to complain that dividing the number of jobs funded into the amount spent to come up with a price per job is simplistic.

If creating jobs were that easy, the government could simply tax the country into endless prosperity. But the money has to come from somewhere. For the stimulus bill, it was borrowed. That borrowing, combined with the rest of the massive government debt-taking in the past year, has left less money available for investors. Which means fewer jobs funded by the private sector than otherwise would have been.

The question is not: How many jobs were funded by the stimulus bill? The question is: How many jobs would have been funded if that same money had been put to other uses? The American people seem to think, not unreasonably, that more jobs would have been created without the stimulus bill than with it.

They also seem to understand that there is a big difference between a permanent private-sector job and a temporary stimulus job. Recovery.gov reports that of the 634,000 stimulus jobs funded from Feb. 17 to Oct. 1, 2009, 601,000 were funded by grants. The largest grant recipient was the Governor's Office of Planning and Research in Sacramento, Calif. The second-largest was the Executive Office of the State of Washington. The third largest was "New York, State of." Go down the list. They're almost all state offices.

The bulk of the stimulus money was given to governors to spend on shoring up their state budgets. That money went primarily to employ government workers. A small fraction went to vendors.

The fraction of stimulus funds that were contracts, not grants, and went to "shovel-ready" projects went, of course, to short-term construction projects. When those projects are done, those jobs will cease to exist. The same can be said for many of the government jobs funded this past year. Many school districts, for instance, have already burned through their stimulus money. A lot of teachers will get pink slips this spring.

Much of the stimulus amounted to a "cash for clunkers" for jobs. "Cash for clunkers" basically moved car purchases from the future to last summer, meaning it delayed many auto industry layoffs. The stimulus bill moved the date of a lot of other layoffs. Instead of coming last year, they'll come this year.

So even though the Obama administration can point to specific jobs and say they were funded by the stimulus spending, it cannot say the jobs are permanent, or that the stimulus was the most effective way to create the largest number of jobs.

If the American people don't believe the stimulus bill created jobs, it's not just because of the inflated numbers in early reports of jobs "created or saved" last year. It's because the very idea of politicians creating lasting economic strength by borrowing $787 billion and doling it out to other politicians is simply preposterous. Even more preposterous than ghosts.

topics:
Unemployment, Job Creation

About the Author

Andrew Cline is editorial page editor of the New Hampshire Union Leader. His Twitter ID is Drewhampshire.

Letter to the Editor View all comments (52) | Leave a comment

Bill Hussein O'Stalin| 2.18.10 @ 6:31AM

One analysis of the Cash for Clunkers indicated that it cost the taxpayers $24,000 for each vehicle sold during that government fiasco. It would have been more cost effective to simply give them away.

The recent GDP of 5.7% which will be revised soon, and most likely downwards, contained 3.39% that was due to restocking, leaving 2.3% that was due to other factors, including massive government spending.

The trick here is to understand the inventory restocking part. Those figures can be played with by the government and the private sector. When they are revised it will most likely be downward. The last GDP figure was revised downward, not once, but twice.

In short, the next jobs report will be a more accurate rendering of the future, and it most likely won't be good.

The government can't confiscate a trillion dollars and use it effectively and that's what you're observing here. The unwinding of that trillion will take a decade or more, ironically becoming the lost decade that Obama tried to pin on Bush. Obama's teleprompter was wrong.

Troyble| 2.19.10 @ 12:36AM

Exactly correct. Spot on. Coupled with the Greek EU collapse maybe we just all call Ollie Ollie Otsen Free. Although, China might have a vested issue; maybe we could sell them Taiwan? I mean on the dl.

Seapuss| 2.18.10 @ 7:46AM

A common talking point I've heard repeated over and over again recently by President Obama, liberal TV talking heads, and left-wing bloggers is that the Stimulus Package "stabilized the financial markets" and "saved the economy from going over the cliff" and into a depression.

Seems to me Obama and the other liberals want the American people to confuse T.A.R.P., enacted by the Bush Administration in the fall of 2008, with the Stimulus Package, enacted by Obama and the Democrats in February 2009. Say what you may about the wisdom of T.A.R.P., but if anything stabilized the financial markets and prevented a free-fall into a depression, it was T.A.R.P. The Stimulus Package didn't do a darned thing, other than to fund some pent-up pork barrel projects for Congressional Democrats.

As with the Surge in Iraq, the Obama Administration's smoke-and-mirror unit is trying to take credit for something George W. Bush did.

Simpleton| 2.21.10 @ 7:40PM

If it didn't do a darned thing, then why are GOP senators and Congressmen claiming credit for the 20,000 jobs here or 10,000 there in their own states created with the stimulus.

As regarding TARP, most Republicans voted against it, you goober!

Jim O'Brien| 2.18.10 @ 7:48AM

The U.S. economy has lost 2.7 million jobs since the "stimulus" passed and 3.4 million since Obama was elected. But Obama says he has created or "saved" jobs --- an outright lie. Government doesn't create jobs, it just spends our tax money or increases the national debt beyond already obscene levels. At the same time, it sucks capital away from private enterprise, which is the real job creator.

Curly Smith| 2.18.10 @ 7:54AM

The article illustrates why the administration is so desperate and why Dems are scurrying for the exits.

"The stimulus bill moved the date of a lot of other layoffs. Instead of coming last year, they'll come this year."

Which means Obama, and the Democrats, will own the coming layoffs. Had they done nothing they could have passed the blame to Bush. But like all bad politicians, they kicked the can down the road and now get to reap the disaster that they created. We can't blame them though, who would have thought that using economic stimulus funds to pay public employee salaries was a bad idea? I mean besides everybody who's worked at least one day in free enterprise...

Simpleton| 2.21.10 @ 7:35PM

Had they done nothing, the economy would have gone further south. Simple metric:

-6% GDP to +6% GDP

And the premise that only six percent believe something is simply ridiculous. It is the argumentum ad populum fallacy.

$280 billion of that went into tax cuts for some 95% of the people.

And yet you have racist tea baggers "tired of being taxed to death".

Mike| 2.18.10 @ 8:11AM

I've always had a problem with stimulus programs like Cash4Clunkers. To me it seems to go against simple supply and demand economics. How can we push all of these new cars into a market already saturated with used and repossessed vehicles (see www.repofinder.com)? Now new cars are worth even less, we have more Amerians in debt, and eventually more repossessions.

ARARAR| 2.18.10 @ 8:51AM

Heard about a newly created job this morning, with "stimulus" funds. A community in central Wisconsin is seeking a new police officer (salary and bene's to be determined) so this new officer can make sure all the un and under-reported domestic abuse in this community of less than 50,000 can start getting reported because they "know" there is a large amount of unreported domestic abuse, especially in the non-English speaking population! See, another job 'created' and probably a couple of HR jobs saved for another day. This is easy, can't you see?

ggoblue| 2.18.10 @ 9:09AM

lets use obama logic on george bush...

george bush 'saved' 300 million americans lives...he must have or our enemies would have killed us all by now...that means george bush 'saved' every single job in america, since dead people are notoriously absent from work....

thank god for george bush

Ellis Wyatt| 2.18.10 @ 9:29AM

I heard it said the most dangerous thing in politics is when people start to laugh at you.

The Obama administration has crossed that line and fewer people are taking anything it says seriously.

Stan Redmond| 2.18.10 @ 9:58AM

This could almost make a joke if it wasn't so frustrating...

What's the difference between a stimulus job and ghosts?
Evidence actually exists for ghosts.

Pete| 2.18.10 @ 11:05AM

"Nearly six times as many Americans believe in ghosts as believe President Obama's jobs claims."

Great stuff, and quite appropriate for the subject at hand. I know how I will react if one of my kids comes home with a D and claims that, but for his extraordinary effort, it would have been an F.

Simpleton| 2.21.10 @ 7:38PM

Indeed, but he would be as clueless in simple logic as you or the author.

The truth of a proposition is not measured by how many people believe it. Citing that only 6% believe it is not the same as saying it is only 6% true.

71% for example believed Iraq had WMDs. They didn't.

It is called argumentum ad populum. Look it up, understand it, and learn something today

H.S.| 2.22.10 @ 4:28PM

I agree with you but look at the expanding war foreign polices. And not standing up for public option with 51%. I give up. I am moving to Canada or Switzerland. :))

Michael| 11.1.10 @ 2:22PM

OK Pete,

How about if a D was one of the highest marks in the class, and the teacher didn't teach most of the material?

The fact of the matter is that most non-partisan analyses of the stimulus bill found that it saved many jobs and that without it, unemployment would have been considerably higher.

Pete| 2.18.10 @ 11:05AM

"Nearly six times as many Americans believe in ghosts as believe President Obama's jobs claims."

Great stuff, and quite appropriate for the subject at hand. I know how I will react if one of my kids comes home with a D and claims that, but for his extraordinary effort, it would have been an F.

MikeBee| 2.18.10 @ 11:09AM

Andrew, good article! You are absolutely correct. A good example of what BO means when he says that he "saved" jobs: the state of Michigan was given a couple billion dollars, or so. Democratic Governor Jenny Granholm has been using the $$$ to keep from laying off government workers. In doing so, she continues a now-eight-year practice of refusing to deal with the structural deficit problem of MI government. The government of MI is too big, and requires the levels of funding that were available to it when the MI Three automakers were the world's Big Three. These levels of funding haven't been available to the MI government for many years, as the auto companies have shrunk, people have been laid off, and folks have left the state for jobs, no longer providing income taxes, property taxes, sales taxes, cigarette taxes, liquor taxes, and gas taxes to the MI government.

But Gov. Jenny's response has been typical of Democrats: she has not wanted to "hurt" anybody, so she continues to use the stimulus $$$$ from BO to pay their salaries. This only delays the inevitable: eventually, the system will come crashing down, causing all of these government workers to lose their jobs, and also causing much more harm to the state of Michigan. In fact, MI may have reached this point already: Jenny needs another bailout, which is the reason that the Government is considering another bailout package for 2010.

jd| 2.18.10 @ 12:45PM

Not to digress from the article, but a good first step towards fiscal responsibility would be for the Michigan state legislature to work on a part time basis. The state of Michigan's decline does not warrant it to even have a full time legislature. The Big 3 just aren't as big as they used to be, even though the union members and union mentality is devoid of reality.

MikeBee| 2.18.10 @ 3:39PM

JD,
Yes, that's an excellent idea! Good luck getting it passed, though, by legislators who are presently full-time. There's a lot that we need to do here in Michigan to right-size the state government, but I don't expect that anything will be accomplished until dealing with the problem(s) is forced, via an entire crash of the state government.

old white guy| 2.18.10 @ 4:23PM

mike bee. yep no profit no tax revenue. socilaists go broke real quick when they don' t have the power of the printing press. just wait until the feds start printing to try, and i say try , to cover the current debt. canada will look like a real capitalist nation to the people of the u.s.

wholesale| 9.8.11 @ 10:43PM

Yes, I agree with you.
xk3y

Pete| 2.18.10 @ 12:17PM

http://news.yahoo.com/s/ap/201.....berg021710

I wonder if the media will ever react this way to their Messiah? The parallels are undeniable.

jd, real world| 2.18.10 @ 1:02PM

6 percent of Americans believe the stimulus created jobs. And 7 percent believe that Elvis is still alive. Do the math.

Lynn Mo| 2.18.10 @ 1:03PM

What would have happened to this country without the stimulus. I'm one of those little small town people who you hit on in church. But, I don't believe you guys anymore. The stimulus is working and what you are saying is wrong,

odmartin| 2.18.10 @ 3:00PM

God bless you dear! Keep on believing. You've gotta believe in something, even if it is a fairytale.

KMichaels| 2.18.10 @ 1:04PM

Even if you believe the new recent numbers that team Obama are putting out, that they have saved or created 1.7 million jobs, that means at 787 billion paid for the stimulus each average job worth 45,000 dollars cost the US taxpayer a mere 463,000 dollars. Now, can any economist worth his salt really think that this is money well spent or that we got our money's worth or that the return per cost is worth it. That is like paying 200,000 dollars for a 20,000 dollar car. It is completely insane for Obama to continue spending money like a drunken sailor that stole money from his crew mates.

ferd| 2.18.10 @ 1:39PM

Didn't see this addressed anywhere in the article:

...the nonpartisan Congressional Budget Office recently calculated that the recovery package, formally called the American Recovery and Reinvestment Act, had *saved or created* between 900,000 and 2.3 million jobs...

You seriously think we would have been better off, economically, by not having the stimulus.

JD,real world| 2.23.10 @ 5:51PM

Yes, we certainly would be better off. Wait until massive inflation and devaluation of the USD hit as a result of printing trillions of dollars and borrowing from our grandchilren. It won't be long now.

Drew| 2.18.10 @ 1:44PM

Another fine exercise in conservative misinformation.

One fact noticeably left out of this article is the fact that, in addition to the 6% of respondents who said - categorically - that they knew of jobs created by the ARA - another 41% of respondents felt that it would create jobs in the future. How come the author didn't mention this?

Or, for that matter, the finding that 31% of respondents blamed the Bush Administration, and another 23% blamed wall Street and Financial institutions for creating the recession.
Among respondents a mere 7% actually held the Obama administration responsible.

How come you didn't report those facts?

See how American Spectator is lying to you by reading the entire poll results here: http://documents.nytimes.com/n.....-poll#p=12

old white guy| 2.18.10 @ 4:31PM

i don't live in your country but you are clearly stupid or delusional.

WTPBN| 2.18.10 @ 5:49PM

Oh yeah, we can really believe the leftist NY times conducted a "fair" poll - just like we would believe MSNBC, CBS, NBC or ABC who all give Owe-Bama a free pass, never ask any hard questions and are totally deranged as you are.

Tony in Central PA| 2.18.10 @ 1:49PM

I received an email yesterday from Arlen Specter that bragged about the ARRA ( Obamastimulus ) and how the senator boldly risked his political future by voting for it. He went on to claim how " leading economists " agree it prevented a depression.

I replied to the senator that every penny of the $787 billion will have to be repaid with interest. I also pointed out that an increasing number of " leading economists " are now saying the US is likely to default on its debt.

I expect no reply.

PCC| 2.18.10 @ 2:07PM

A friend of mine was recently hired as chief executive of a company with about 100 employees.

Following a review of the organization, he told the chief financial officer that having 15 employees in the accounting department of a money-losing company with 100 employees was too many; he directed the CFO to cut it to 7 employees.

The CFO objected strenuously. Now my friend is looking for a new CFO as well.

This is what we need in government at federal, state, county and municipal level.

The government does not have a revenue problem. It has a spending problem.

Pat| 2.18.10 @ 3:22PM

It's truly amazing that government always employs the same Universal Hammer and every problem troubling us becomes a universal nail and, yet, we Americans never seem to catch on. The formula is simple - you take money from taxpayers, you give it to those who don't pay taxes, to those who have Academy Award winning lobbyists and to your political allies who share the unearned wealth with your supporters as well as theirs. So, it's not surprising no one believes in Obama's claims he has actually "created" real jobs - yet Obama isn't worried.

The Universal Hammer was employed to get folks spending again - government vs. private industry jobs, temporary vs. permanent jobs - what does it matter as long as folks spend us back to economic health?

Washington must always believe the economy will eventually recover, the trick is convincing voters the current administrtion was the cause of the recovery. What else could Obama do but fervently believe in eventual recovery and then set forces in motion so he could take the credit. Even Obama can't mess up that simple formula, although he's trying his best to snatch defeat from the jaws of victory.

When the 2012 election rolls around, America will in all probability be better off economically, Obama will warm up his teleprompter and use his vaunted eloquence to tell anyone who will listen how his "Stimulus" programs saved America. Hey, it's worked before, why wouldn't it work this time?

Oldefarte| 2.18.10 @ 4:42PM

As this article states, the only jobs involved are PUBLIC [not PRIVATE] ones, which are nothing essentially but WELFARE workers, whose paychecks are funded by the TAXPAYERS!!!!

Ken (Old Texican)| 2.18.10 @ 6:20PM

Mr. Cline, great article. Thanks.

A couple of toughts:

It is amazing to me that the resiliency of the american people and industry, has managed to hang on to 80 or 90% of our economy/jobs in the face of an all out assault by the communists, (pardon the shorthand), in DC over the last year.

We in business, providing goods and services, need two essential things. We need a clean set of economic ground-rules with a long term assurance of same.
Second, we need customers with some discretionary income to purchase our goods and services .
Hmmm, it wouldn't hurt to have a tax structure on business that allows us to compete in the international markets better as well.

but no, until we successfully geld the present administration, we understand we shall have none of the above.
We are just hangin' in there, waiting for daylight.

Damnation, man, given daylight, I personally could put 3 million folks to productive, fulfilling work in six months building drilling rigs and pipelines and follow on energy infrastructure and development...duh!
We could snatch drug dealers out of ghettos and prisons, and put them to work building 500 square foot cabins for the ignorant ex-ghetto job trainees.
(though, yes they would need some "supervision")

Auntie Federalist| 2.18.10 @ 8:39PM

Be sure to take the time to sharpen your editing skills on the U.S. Department of Agriculture's news release announcing the department's "successes" through the "Stimulus" Plan. Not only is it a mass of misinformation, it's lousy with grammatical errors and poor punctuation and just about everything else that would drive Strunk and White to the couch. Needed words are missing and the subtitle is noun-verb agreement challenged. Our intellectual betters strike again! Here's the lengthy link:

http://www.usda.gov/wps/portal/!ut/p/_s.7_0_A/7_0_1OB/.cmd/ad/.ar/sa.retrievecontent/.c/6_2_1UH/.ce/7_2_5JM/.p/5_2_4TQ/.d/3/_th/J_2_9D/_s.7_0_A/7_0_1OB?PC_7_2_5JM_contentid=2010/02/0065.xml&PC_7_2_5JM_parentnav=LATEST_RELEASES&PC_7_2_5JM_navid=NEWS_RELEASE#7_2_5JM

waterman3| 2.21.10 @ 12:47PM

there are two points i would like to address.

i've seen dozens of shows and articles on the subject of where the stimulus founds are going- i have yet to see any looking at where they come from. 150 million taxpayers in this country (prior to 3.5 million of them losing their jobs) dividing up $787 billion in stimulants (not counting interest) comes to more than $5000 a piece so political ego addicts can give themselves a nice feel good rush. rather stunning, in the same way the hammer blow between the eyes stuns a slaughterhouse steer.

and point no.2, the way they keep talking about how keynesian economics will save the day. the problem is, they can't even do that right. as no doubt every mother has told her children at one time or another, you(they) only hear what you want to hear. as anyone who has actually read keynes with BOTH eyes open can point out, keynes said that in good times, you save surplus funds, or use them to pay down debt, so as to be able to use the excess funds to stimulate the economy during the inevitable downturns. i still believe that to be wishful thinking under real world conditions, but as moral justification for their profligate ways, they still can't even show any actual honesty whatsoever.

to put it simply, their idea is, in good times, spend it all, and then some....and in bad times, spend it all, and then some.

it is a perfect illustration of mark twain's analysis of politics, from his book, " huckleberry finn."

"say, hain't we got all the fools in town on our side? and hain't that always been a big enough majority in any town"

or h.l. mencken's description of american politics: "jackasses worshipping jackals."

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Dani| 2.3.11 @ 3:45PM

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