Happy Days Are Here Again: Stimulus Jobs Rocket Toward 2 Million?
Updated February 3, 2010
Can't you just feel the economy booming? Thankfully, Washington’s $787 billion stimulus is creating jobs at warp speed.
According to a new White House report, “The economic stimulus passed almost a year ago was responsible for between 1.5 million and 2 million jobs in 2009 and helped boost U.S. economic growth during the year.” The study, released in January 2010 by President Barack Obama’s Council of Economic Advisers, said that by the end of 2009, $263 billion of the $787 billion stimulus package enacted in February of that year had been awarded or given as tax cuts.
Christina Romer, the Council’s chairwoman, called the job figures a “stunning and important effect” of the stimulus. The report said that as of Dec. 31, the package had “raised employment relative to what it otherwise would have been “by the 1.5 to 2 million jobs.”
While the Government Accountability Office termed the Administration’s October 2009 job numbers “inaccurate” when they claimed 640,000 jobs created or saved, Recovery.gov, the official federal government website charged with tracking stimulus spending, maintains those claims. And when new jobs figures for the final quarter of 2009 were released in February, Recovery.gov attributed an additional 544,000 new jobs to stimulus spending, bringing the grand total to 1,184,000.
That's almost one million short of the administration's claims.
In North Carolina, bureaucrats seem to be choking on stimulus cash – unable to spend it fast enough – but accurate numbers regarding actual stimulus job creation seem hard to come by, but nationally, more than 58,000 jobs have been credited to projects that haven’t actually spent any money yet.
State Auditor Beth Wood notes that NCDHHS has only spent half of the $2.2 billion in stimulus funds it has been awarded (most of DHHS funding is allocated for direct aid programs). And the state completely missed the recent deep freeze. Barely 3-percent of $132 million in stimulus funds allocated for home weatherization has been spent.
So where are the jobs? In the minds of White House economists, they seem to be multiplying like rabbits. But in the face of continuing job losses in the real numbers from the US Department of Labor, the administration is resorting to economic models for job claims. Just three months ago, the White House was claiming that the stimulus plan was responsible for “creating or saving” one million jobs. Now that figure has grown to two million, as President Barack Obama confirmed in his State of the Union address on January 28, 2010.
Real people in the real world just don’t see it. According to the administration’s computer model, the stimulus is working. But small businesses, who account for the vast majority of job creation in North Carolina and across the nation – are drowning, according to a survey by the National Federation of Independent Business. "So why hasn't owner optimism soared like it usually does at the end of a recession, especially one that cut so deeply into our economic fabric?" asks William Dunkelberg, NFIB chief economist. "The answer is 'hope and change.' There is little hope and the change that is being delivered is far from encouraging. Washington is offering nothing but higher taxes and fines and fees and more regulation."
Meanwhile, the White House is changing its language. In December 2009, the Office of Management & Budget announced that stimulus recipients will now be asked to report on all jobs funded in any way with Recovery Act spending, rather than trying to figure out which individual positions were directly “created” or “retained” with ARRA funds. It’s a move that may clarify the numbers more accurately, depending on whether it is used accurately, but it also has the potential to muddy the waters further for taxpayers hoping to substantiate stimulus “job creation.” Under the new model, recipients of stimulus funds will be asked to tally all work hours funded by Recovery Act dollars, divide those hours by a full-time work schedule for the quarter, and report that number.
"Confidence in our political leadership has tanked," remarked Dunkelberg. That’s reality, not a fantasyland economic model.
