Free Markets, Free People

Obama claims that stimulus worked when in fact it simply delayed the inevitable with borrowed money

Seriously out of touch:

Three days after the U.S. Department of Labor reported that the national unemployment rate had ticked up from 9.1 percent in May to 9.2 percent in June, President Barack Obama said that the loss of jobs in the public sector is “evidence” that his $830-billion economic stimulus legislation worked.

“Now, without relitigating the past, I’m absolutely convinced, and the vast majority of economists are convinced, that the steps we took in the Recovery Act saved millions of people their jobs or created a whole bunch of jobs,” Obama said at his Monday press conference.

Except he can’t point to anything to prove his point.  What we do know, however, is much of that money went to pay down the debt of the various states, which is hardly likely to create jobs.  We also know it was spent on things like “Operation Fast and Furious” which certainly didn’t lead to any jobs – at least here in the US.

So this is the only place he has to point:

“And part of the evidence of that is as you see what happens with the Recovery Act phasing out,” he said. “When I came into office and budgets were hemorrhaging at the state level, part of the Recovery Act was giving states help so they wouldn’t have to lay off teachers, police officers, firefighters. As we’ve seen that federal support for states diminish, you’ve seen the biggest job losses in the public sector–teachers, police officers, firefighters losing their jobs.”

Or, ”we didn’t save anything, we just delayed, for a short time, the inevitable.”

That makes it hard to claim that the stimulus “worked”.  Public sector jobs don’t contribute to the economy – they’re a drain.  Oh sure we’ve decided they’re a necessary expense, but they don’t contribute to the economy the way a private sector employee does.  What has been said for years is we can’t afford the overall expense of government – that it must cut back to “necessary” and drop the “unnecessary”.   There was the easy way to do it (when the economy was good) and had they done so state governments would have been in better shape when the downturn hit.  But they didn’t.  Government has a tendency to expand when revenues increase, not contract.  So when revenues contract, they are unable to fund the excess.

So the stimulus didn’t create or save jobs, it funded the excess jobs states and localities should have shed long ago as “unnecessary” and, more importantly, “unaffordable.”

Look, this unemployment problem is the beast that will devour Obama and he knows it.  But if this is the best he can come up with, he’s in for a very long and bumpy re-election campaign, at least when it comes to this subject.

~McQ

Twitter: @McQandO

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10 Responses to Obama claims that stimulus worked when in fact it simply delayed the inevitable with borrowed money

  • As we’ve seen that federal support for states diminish, you’ve seen the biggest job losses in the public sector–teachers, police officers, firefighters losing their jobs.

    Sounds to me like he’s proposing that states should reliniquish employing these people to the federal government, since clearly only the feds can “afford” to pay them.

  • “Now, without relitigating the past, I’m absolutely convinced, and the vast majority of economists are convinced, that the steps we took in the Recovery Act saved millions of people their jobs or created a whole bunch of jobs,” Obama said at his Monday press conference.
    What a lie!  Note the classic “appeal to authority” fallacy.  Like Obama knows or gives any accord to “the vast majority of economists”.
    I’ve read several very highly thought of economists who say that there was NOT any net gain, and an apparent NET LOSS in jobs BECAUSE of the “STIMULUS”.  This was both predictable and PREDICTED.
    It is ALSO easily seen in various graphs.

    • Yeah, but he’s not listening to THOSE economists, they’re like climate change deniers, they’re going against the consensus he likes.
       
      And it’s good that he’s absolutely convinced, the real world says, and shows, otherwise.

    • What school of bad management did Obama go to? He starts every paragraph with “I…” and then concludes it with a “we …” as if to challenge those in the “we” to disagree with him. Here he does it to “the vast majority of economists” and “states” who have failed him by laying off staff.

      If this guy was responsible for actual human staff he’d be chewed out by senior managers every week for awful handling of staff and destruction of morale.

      • “Imeme”, “Iwewe” – either way, it sums him up as well as it did 3 years ago.

  • Hey, anyone remember when Erb was crowing about how a 3.8% GDP growth rate reported in one quarter last year was sustainable (because of Obama’s policies)?  The latest projection for next quarter is about 1.5%.  Nice way to “sustain” things.

    • Erp…?!?!?  We know you’re out there…
      Step up.  Eat your peas, like a mensch.

    • How much of that 1.5% growth is solely the portion of government spending and how much is private sector PRODUCTION?

  • What Barack Obama states to be true and what is true are almost mutually exclusive.   Obama is the most uneducated president in our history and his meager education gives him scant understanding of economics, as how things actuall work.  

  • I’m not sure which is more pathetic: that Captain Bullsh*t continues to try to sell the “millions of jobs saved or created” lie or that people are stupid enough to buy it.

    I suppose that I’m overly aggressive, but it seems to me that the GOP is not only missing a political opportunity but also doing the country an outright disservice by not heaping this statement with the riodicule that it deserves.  “President Obama told us that if we spent $800 billion that we didn’t have that unemployment would not go above 8%.  He told us that, even if we DIDN’T spend that money, it wouldn’t go above 8.8%.  Today, unemployment is 9.2%, with millions more Americans underemployed in part-time jobs instead of the good, permanent jobs they had before the democrats’ job-killing policies went into effect.  Why are we listening to him any more?”