Tomorrow is the one-year anniversary of the American Recovery and Reinvestment Act, or as it is more accurately described, President Barack Obama’s Failed Stimulus. When President Obama signed the now $862 billion deficit-spending bill into law, the unemployment rate stood at 7.6% and the U.S. economy employed 133.5 million people. At the time President Obama promised the American people that, thanks to his stimulus, unemployment would never go higher than 8.2% and the U.S. economy would support 138.6 million jobs by December 2010.
At the one year mark unemployment is now 9.7%, after rising above 10%, and the U.S. economy has lost 4 million jobs leaving the White House 9 million jobs short of the 138.6 million they promised to deliver by December of this year. By any objective measure President Obama’s $862 billion stimulus must be judged as a complete failure. Undeterred by these facts, the White House Council of Economic Advisers (CEA) published a report on the economic effects of the Administration’s economic stimulus plan claiming that there are 2 million more jobs in the economy than there otherwise would have been had the President’s stimulus not become law. But as Heritage Policy Analyst Karen Campbell has documented, the CEA report relies on completely arbitrary benchmark projections that fail even basic standards of economic analysis. If the Administration had used other economic forecasts, the results would not have been as impressive – in fact, some would have shown that the economy lost more jobs after the stimulus package was implemented.
Armed with their CEA propaganda, President Obama is dispatching his Cabinet officials to 35 communities across the country this week to try and convince the American people that his Failed Stimulus is in fact, a success. The President faces an uphill climb: according to the latest poll from The New York Times only 6% of Americans believe the stimulus has created jobs and 48% of Americans believe it never will.
One might hope that after $862 billion in failed stimulus spending, that liberals in Washington would take a break from spending other people’s borrowed money. No such luck. The House has already passed a new $154 billion stimulus package and Majority Leader Harry Reid (D-NV) is pushing a$15 billion plan in the Senate, $13 billion of which is a temporary Social Security payroll tax exemption for new hires. This temporary tax break will further increase our Social Security system’s existing deficits, will cost $1 million per only eight temporary new jobs according to the Congressional Budget Office, and will do nothing to decrease long-term unemployment.
While this would be President Obama’s second stimulus, it would actually be this recession’s third. In February 2008, President George Bush passed an equally useless mix of temporary tax cuts and mortgage grantees for Fannie Mae and Freddie Mac totaling $168 billion. That stimulus did nothing to stop the recession and neither will President Obama’s second stimulus. Our nation simply can’t afford wasting hundreds of billions of dollars and deficit Keynesian stimulus spending every February. Now is a good time to stop.
Quick Hits:
- In a secret joint operation by Pakistani and American intelligence forces, the Taliban’s top military commander was captured several days ago in Karachi, Pakistan.
- As fighting in Marja carried into its third day, the number of Taliban fighters in the area has dropped by about half.
- Opposition to a European Union bailout of Greece, where the retirement age is 63, is growing among Germans, who can’t retire until age 67.
- Latinos who backed President Barack Obama are frustrated by the lack of amnesty for illegal aliens.
- According to the latest Rasmussen poll, 59% of likely voters say states should have the right to opt out of federal government programs they don’t agree with.
Obama Goes Forward With Jobs Plan, Though Jury Still Out On First One
Author: Allie Winegar Duzett
While the nation suffers an unemployment rate of nearly 10 percent, Barack Obama spent last week talking about job creation with “civil rights” leaders — despite the fact that President Obama’s last job creation ideas haven’t even been properly analyzed, let alone proven to work.
The New York Times reports that President Obama met with Benjamin T. Jealous of the NAACP, Marc H. Morial of the National Urban League, and Reverend Al Sharpton on Wednesday to discuss “how the economic crisis was affecting all manner of poor people.” According to the article, the vast majority of the meeting was spent discussing “how to get Republican leaders to support Mr. Obama’s jobs proposals.”
This is mildly hilarious, considering that on February 9th, President Obama “gave his strongest signal yet that he is willing to compromise on key priorities,” according to Reuters’ report of his Tuesday solo news conference. Yes, on Tuesday, Mr. Obama said he was willing to compromise with Republicans, and on Wednesday, he spent the day trying to figure out how to avoid compromise.
But the most disturbing part of the President’s meeting isn’t merely his lack of desire to truly compromise — the disturbing part is his arrogant assumption that his “jobs proposals” are ready for serious consideration. This is especially true considering the fact that, as the Heritage Foundation’s Dr. J.D. Foster pointed out, President Obama “explicitly” admitted the “failure [of] last year’s $862 billion stimulus program” during this year’s State of the Union address.
As the Heritage Foundation recently reported, there is still no proof that President Obama’s first stimulus bill worked. The study on last year’s stimulus package conducted by the White House Council of Economic Advisors (CEA) “fails basic standards of economic analysis,” according to Heritage expert Dr. Karen Campbell. The Heritage report, titled “Did the Stimulus Create Jobs? White House Economic Report Is Unclear,” clarifies the many logical problems involved with the studies that “prove” that the President’s last proposals worked. As Dr. Campbell said, “the American people deserve to have a true economic analysis done.”
Indeed, President Obama hasn’t even ordered a true economic analysis to be done on the results of his last “proposal”—the expensive economic “stimulus” he argued would create jobs.
Before he bothers focusing on how to gain Republican support to ram through even more expensive legislation, the President might want to take a closer look at the results of his last jobs plan. It would be a travesty if he let his arrogance and the support of “civil rights” leaders take the place of legitimate economic analysis in the quest to find a solution to America’s current economic crisis.
Allie Winegar Duzett currently is a member of the Young Leaders Program at the Heritage Foundation. For more information on interning at Heritage, please visit: http://www.heritage.org/about/departments/ylp.cfm