Just go and grill some hot dogs, America, and pay no attention to that new report from the Council of Economic Advisors. Weekly Standard: "Obama's economists: 'Stimulus' has cost $278,000 per job."
When the Obama administration releases a report on the Friday before a long weekend, it’s clearly not trying to draw attention to the report’s contents. Sure enough, the “Seventh Quarterly Report” on the economic impact of the “stimulus,” released on Friday, July 1, provides further evidence that President Obama’s economic “stimulus” did very little, if anything, to stimulate the economy, and a whole lot to stimulate the debt.Nice work if you can get it. And you can't.
3 comments:
The premise: stimulus spending hurts economies.
The data:
From... December 2007 through the end of 2010, 24 states have cut government spending by an average of 7.5 percent after adjusting for inflation. Another 25 states have expanded government outlays by an average of 11 percent. (The analysis excludes Alabama due to data problems reported by the National Association of State Budget Offices).
Relative to national economic trends, states that increased spending enjoyed on average:
0.2 percentage point decrease in the unemployment rate
1.4 percent increase in private employment
0.5 percent real economic growth since the start of the recession
In contrast, states that cut spending saw on average
1 percentage point increase in the unemployment rate
2.1 percent loss of private employment
2.9 percent real economic contraction relative to the national economic trend
Well a little digging and I found this came from the unbiased folks at the Center for American Progress and the comparison makes a mockery of statistics including the "liberal" extrapolation of a trendline.
What does it mean that states engaged in "spending cuts". I think for a vast majority it means they ran deep deficits and had to cut back to balance the budget as all states are required to do. Why do you think California is so deep in cuts? Why do you suppose Michigan has such poor unemployment?
A median estimate would be a more accurate representation but the obvious clustering in the center wouldn't make the CAP analysis so dramatic.
As opposed to the "play it fairly down the middle" referees at the nonpartisan Weekly Standard. Here's their evenhanded interpretation:
Furthermore, the council reports that, as of two quarters ago, the “stimulus” had added or saved just under 2.7 million jobs — or 288,000 more than it has now. In other words, over the past six months, the economy would have added or saved more jobs without the “stimulus” than it has with it. In comparison to how things would otherwise have been, the “stimulus” has been working in reverse over the past six months, causing the economy to shed jobs.
Of course, this analysis in no way extrapolates a conservative timeline. As we know, the ultimate effect of the stimulus (pardon me, the "stimulus") screeched to a halt on a particular day.
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