Nothing ‘transparent’ about the stimulus plan
For a president who promised his actions would be the most transparent in U.S. history, key details in Barack Obama’s economic stimulus program have been frustratingly opaque. Some might call them invisible or illusionary, certainly slippery, maybe even tricky.
“Does anyone really know how many jobs the stimulus has ‘saved or created’? Does anyone know how much stimulus money has actually been spent?” House Republicans asked June 8.
Not with any precision. Mr. Obama and his administration throw out a lot of big, impressive numbers: We will spend $800 billion to “save or create” 3.5 million jobs. But it turns out the numbers and goals often come with a lot of mathematical caveats, definitional contingencies and narrowly proscribed, convoluted loopholes and escape hatches.
“The truth is, even the Obama administration isn’t able to say for sure how many jobs the stimulus is saving and/or creating,” ABC News bluntly reported two weeks ago.
“With its promises to ‘save or create’ “ so many jobs, the news network says “the Obama White House has set a fuzzy bar for itself; no one will ever really be able to say whether it’s been cleared.”
Vice President Joseph R. Biden Jr.’s chief economist Jared Bernstein says it’s impossible to say how many projects approved by the administration have really gotten under way because “it’s such a moving target.”
For example, take the jobs number. The White House said at the end of May that the program had saved or created nearly 150,000 jobs. But that’s almost impossible to verify because the jobs calculation is actually based on estimates of how poorly the economy and the jobs picture might have been if the stimulus had not been enacted.
And what about this so-called “saved jobs” concept? That’s a very tricky number open to all kinds of mathematical Ponzi scheme configurations.
“The country has lost 1.3 million jobs since February, a figure the Obama administration says would have been far higher if not for the recovery effort,” writes White House reporter Charles Babington of the Associated Press. Apparently you can save all kinds of jobs with that kind of soft math.
So what about that 150,000 jobs number? It turns out that these are not necessarily longterm, full-time jobs. Many, if not most of them, will end when the public works money runs out and the project is completed.
After the June 5 unemployment numbers showed the jobless rate had jumped to 9.4 percent in May and a Gallup poll found public support for Mr. Obama’s handling of the economy was slipping, the White House said it was going to speed up the stimulus expenditures. told reporters on Monday: “We’re up to about $135 billion in terms of obligations.”
“Obligations” sounded a bit too vague to NBC’s White House reporter Chuck Todd. “Obligated, not necessarily spent yet?” he inquired.
“Right,” Mr. Bernstein finally said. “Spent out is closer to $44 billion.” So here we are at midyear, and the administration has actually spent a little more than 5 percent of its stimulus money — a small fraction of what Mr. Obama said was needed to move the once- stantiate that claim. “No. That would be a very difficult thing for anybody to substantiate,” Mr. Hall replied.
The very nature of spending stimulus programs — and the reason they never work — is that it takes a very long time for the money to make its way through the government’s snail’s-pace bureaucracy to the states and localities and through the bidding process before any jobs are created.
Mr. Obama’s economists warned of this in policy position papers last year. By the time most of the money is “spent,” the recession is long over. Only a fraction of the $800 billion will be spent in this fiscal year, which ends Sept. 30. Seventy percent of the money won’t be spent until the end of the summer in 2010, when the administration says the economy will be growing again.
In the end, despite the administration’s belief that it is really creating net new jobs, each dollar it borrows or taxes out of the economy to create, in Mr. Biden’s words, “make-work jobs,” is one dollar less available to the private sector to invest and spend on real, full-time jobs.
Donald Lambro is chief political correspondent of The Washington Times.