Research Briefing

Obama’s Economic Experiment Receives Failing Grades In Every Subject

Today, U.S. Bureau Of Labor Statistics Reported Unemployment Increased In 29 States Last Month. (U.S. Bureau of Labor Statistics, www.bls.gov, Accessed 11/20/09)

STIMULUS FAILS TO GET ANY GRADE BESIDES “F”

MATH:  F

OBAMA’S ADMINISTRATION HAS TROUBLE COUNTING STIMULUS JOBS

Earl Devaney, Chairman Of Stimulus Accountability And Transparency Board Says “There Are Too Many Errors” To Know How Many Jobs Stimulus Created. “But Earl Devaney, whose agency collected and released the data, said Thursday there are too many errors to know how many jobs have been created. Under questioning on Capitol Hill, he agreed the White House should have acknowledged the doubt surrounding the numbers.” (“Stimulus Watchdog: Job Creation Data Flawed,” The Associated Press, 11/19/09)

Ten Percent Of Jobs White House Claims Were Created By Stimulus Were From Projects That Have Yet To Receive Stimulus Funds. “More than 50,000 jobs, or one out of every 10 jobs the White House says were ‘saved or created’ by their economic stimulus plan, came from projects that reported spending no money yet, according to a government report obtained by ABC News.”  (Jonathan Karl and Matthew Jaffe, “GAO Says More Than 50,000 Jobs Claimed From Stimulus Projects That Have Spent No Money,” ABC News, 11/18/09)

The Wall Street Journal Reports White House’s Second Stimulus Job Count “Overstated By At Least 20,000.” “The number of jobs the Obama administration credits to federal stimulus money could be overstated by at least 20,000 of the 640,000 claimed, a Wall Street Journal analysis found.”  (Louis Radnofsky and Mauria Tamman, “White House Appears To Overstate Stimulus Jobs,” The Wall Street Journal, 11/4/09)

GEOGRAPHY: F

STIMULUS CREATES JOBS IN CONGRESSIONAL DISTRICTS THAT DO NOT EXIST

Recovery.gov Created 400 “Phantom” Districts.  “Until Wednesday night, the Web site, recovery.gov, listed more than 400 ‘phantom’ districts across the United States. In Texas alone, it shows $15 million spent and 98 jobs created or saved in districts that don't exist.” (Tom Benning, “Errors On Government Web Site Make It Difficult To Track Stimulus Money,” The Dallas Morning News, 11/19/09)

Stimulus Creates 30 Jobs In Arizona’s 15^th Congressional District, No District Exists.  “Here's a stimulus success story: In Arizona's 15th congressional district, 30 jobs have been saved or created with just $761,420 in federal stimulus spending. At least that's what the Web site set up by the Obama administration to track the $787 billion stimulus says. There's one problem, though: There is no 15th congressional district in Arizona; the state has only eight districts. And ABC News has found many more entries for projects like this in places that are incorrectly identified.” (Jonathan Karl, “Exclusive: Jobs ‘Saved or Create’ In Congressional DistrictsThat Don’t Exist,” ABC News, 11/16/09)

Stimulus Creates Jobs In Other Fictitious Congressional Districts. “In Oklahoma, recovery.gov lists more than $19 million in spending -- and 15 jobs created -- in yet more congressional districts that don't exist. In Iowa, it shows $10.6 million spent and 39 jobs created -- in nonexistent districts. In Connecticut's 42nd district (which also does not exist), the Web site claims 25 jobs created with zero stimulus dollars.” (Jonathan Karl, “Exclusive: Jobs ‘Saved or Create’ In Congressional Districts That Don’t Exist,” ABC News, 11/16/09)

HISTORY: F

APPARENTLY FORGETTING STIMULUS’ FAILED HISTORY, OBAMA PUSHES FOR “SECOND STIMULUS”

In October, Unemployment In U.S. Hit Double Digits. “The jump in the unemployment rate to 10.2 percent, reported Friday ... The jobless rate crossed into double digits last month, from 9.8 percent in September, the Labor Department reported. That is the highest level since 1983 and evidence that the economy, though expanding, has not yet grown enough to end the brutal conditions facing American workers.” (Neil Irwin and Michael A. Fletcher, “Nation’s Jobless Rate Tops 10 Percent,” The Washington Post, 11/7/09)

• Since The Stimulus Was Passed, The U.S. Has Lost Over 2.8 Million Jobs. (U.S. Bureau of Labor Statistics, www.bls.gov, Accessed 11/19/09)

Obama Said His Economic Team Is Looking At “Investments In Our Aging Roads And Bridges.” “We will also build on the measure I signed today with further steps to grow our economy in the future.  To that end my economic team is looking at ideas such as additional investments in our aging roads and bridges, incentives to encourage families and businesses to make buildings more energy-efficient, additional tax cuts for businesses to create jobs, additional steps to increase the flow of credit to small businesses, and an aggressive agenda to promote exports and help American manufacturers sell their products around the world.” (President Obama, Remarks By The President In The Rose Garden, The White House, 11/6/09)

Following In Obama’s Steps, Congressional Democrats Are Considering Extending Provisions In First Stimulus.  “One way or another, aides say, House Democrats’ message from now to Christmas will be about jobs. ‘We continue to look for opportunities to build on the recovery package and other actions Congress has taken to bolster the economy,’ said Nadeam Elshami, spokesman for Speaker Nancy Pelosi (D-Calif.).” (Mike Soraghan, “Pelosi Switches To Jobs,” The Hill, 11/16/09)

READING COMPREHENSION: F

OBAMA CONTINUES TO PUSH VIRTUES OF STIMULUS IN FACE OF HARSH REVIEWS FROM HIS OWN ADVISORS

Obama's Chief Economist Admits Stimulus Has Already Had Its "Biggest Impact" On Economy, Will Level Off. “A top White House economist says spending from the $787 billion economic stimulus has already had its biggest impact on economic growth and will likely not contribute to significant expansion next year. Christina Romer, the chair of President Barack Obama's Council of Economic Advisers ... told a congressional panel that by the middle of next year, the impact of the stimulus will level off.” (Jim Kuhnhenn, “Romer: Impact Of Stimulus Will Level Off,” The Associated Press, 10/22/09)

Caterpillar CEO Jim Owens, Member Of Obama’s Economic Recovery Advisory Board, Criticizes Stimulus As Light On Infrastructure Investment, Full Of Social Programs Instead. “[T]he stimulus bill that we passed in the United States, I think, was a little more geared to a lot of social programmes ... and it was a little light on hard infrastructure investment.” (“Interview: Jim Owens Of Caterpillar,” Financial Times, 7/30/09)

Harvard Economist Martin Feldstein, Member Of Obama’s Economic Recovery Advisory Board, Says Stimulus Will Do Little To Deal With Root Causes Of Economic Downturn.  “The current outlook for an economic recovery remains precarious. Although the stimulus package will give a temporary boost to growth in the current quarter, it will not be enough to offset the combined effect of lower consumer spending, the decline in residential construction, the weakness of exports, the limited availability of bank credit and the downward spiral of house prices.”  (Martin Feldstein, Op-Ed, “Tax Increases Could Kill The Recovery,” The Wall Street Journal, 5/14/09)

Yale University CIO David Swensen, Member Of Obama’s Economic Recovery Advisory Board, Warns Of Substantial Risk Of Inflation Due To Stimulus. “We've had this massive fiscal stimulus ... and it's hard to see how that doesn't translate into pretty substantial inflation, or at least pretty substantial risk of inflation.” (Gillian Wee, “Yale's Swensen Recommends TIPS To Hedge 'Substantial Inflation,’” Bloomberg, 5/23/09)

“HOME” ECONOMICS: F

OBAMA’S HEALTH CARE EXPERIMENT WILL FURTHER BURDEN AMERICAN WORKERS AND THEIR FAMILIES

Tax Hike In House Health Care Bill On Individuals Who Can’t Afford Insurance Would Hit Many Middle-Class Americans. “You asked about the proposal for the tax on individuals without acceptable health care coverage.  And, it’s a tax on the individual’s wages over an AGI threshold.  And, the AGI threshold says, I pointed out this morning, in 2009, would be $18,700 on a joint return, $9,350 on an individual return.  So, yes, one would have to say that there would be taxes on individuals with adjusted gross income less than $200,000 in that circumstance.” (Thomas Barthold, Deputy Chief Of Staff Of The Joint Committee On Taxation, House Ways And Means Committee, Testimony, 7/16/09)

“Public Option” In House Bill Could Mean Over 88 Million Americans Losing Current Coverage. “Under current law, there will be about 158.1 million people who are covered under an employer plan as workers, dependents or early retirees in 2011. If the act were fully implemented in that year, about 88.1 million workers would shift from private employer insurance to the public plan.” (John Shelis, Vice President, Lewin Group, “Analysis Of The July 15 Draft Of The American Affordable Health Choices Act Of 2009,” 7/17/09)

House Dems’ Bill Taxes On Employers Will Make It More Difficult For Them To Hire Workers They Need. “[E]mployers who do not offer ‘affordable’ coverage to employees would have to help pay the cost of such benefits for their low-income workers ... The Center on Budget and Policy Priorities, a liberal research and advocacy group, said this proposal ‘could unintentionally discourage the hiring of lower-income people,’ by adding a new ‘health surcharge’ to the cost of employing them.” (Jeff Zeleny & Robert Pear, “Obama Says Government Health Coverage Plan Would Not Hurt Private Insurers,” The New York Times, 6/23/09)

House Dems’ Bill Taxes Individuals Who Can’t Afford Insurance 2.5 Percent Of Their Income. “Individuals are required to obtain health insurance coverage or pay a fee equal to lower of 2.5 percent of their adjusted income above the filing threshold or the average premium on the Exchange.” (House Committees On Ways & Means, Energy & Commerce, And Education & Labor, “Detailed Summary Of Affordable Health Care For America Act,” Fact Sheet, 10/29/09)