The Obama Stimulus: Just as Nutso as We Thought
The authors of e21, an economics blog, have been examining a new study of the Obama stimulus by Daniel J. Wilson of the Federal Reserve Bank of San Francisco. What has Mr. Wilson found?
[T]hough the program did result in 2 million jobs “created or saved” by March 2010, net job creation was statistically indistinguishable from zero by August of this year. Taken at face value, this would suggest that the stimulus program (with an overall cost of $814 billion) worked only to generate temporary jobs at a cost of over $400,000 per worker. Even if the stimulus had in fact generated this level of employment as a durable outcome, it would still have been an extremely expensive way to generate employment.
We all knew the stimulus was nuts from the get-go. Good to see the professionals catching up with us, no?
(Hat tip to the invaluable Peter Suderman of Reason.)
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Jul '10
Re: The Obama Stimulus: Just as Nutso as We Thought
Actually, what is happening is worse. They are spending $400,000 (8 American jobs) on borrowed money that will need to be serviced until responsible fiscal policy is instituted (i.e., forever). Dedicated to creating this one job, that capital is not available to fund those 8 jobs. (D'oh!) The good news, our lenders are still accepting next to no interest. The bad news, the next rise in the debt ceiling will see us to a debt greater than our GDP, and those interest rates won't hold forever.
How many of you have seen a credit card rate soar once a significant balance was established?
Jul '10
Re: The Obama Stimulus: Just as Nutso as We Thought
Has anyone noticed that no one is defending this atrocity anymore? Even smilin' Joe Biden has gone doggo.
Re: The Obama Stimulus: Just as Nutso as We Thought
The whole thing was a fraud from the start -- meant to benefit public sector workers in the federal government and in the states (where roughly 1/3 of the money went) -- and their expectation was that the economy would bounce back on its own and cover what amounted on their part to theft from the future in order to benefit constituencies supportive of the party. Now the chickens are coming home to roost.
May '10
Re: The Obama Stimulus: Just as Nutso as We Thought
$814b. That's $2,609 for every man, woman and child in America. As a father of four, if they had just given me those shares ($15.6K) how much good could I have done? How may cars would GM and Chrysler sold if the money were in the hands of consumers instead of the wise sages in Washington?
Oct '10
Re: The Obama Stimulus: Just as Nutso as We Thought
The stimulus was a payoff to public sector unions, plain and simple. California, Illinois and New York basically got a 2 year extension on their insanity.
Jul '10
Re: The Obama Stimulus: Just as Nutso as We Thought
$400,000 per job? That's still only half a California teacher.