It is getting harder for the Obama administration to defend its claim that the $787 billion “stimulus” passed by Democrats in Congress has helped the economy.
With strong evidence that the money is expanding government bureaucracy rather than creating promised private-sector jobs, The Associated Press did an analysis of transportation spending in the stimulus. The results are a devastating blow to the administration’s rosy claims.
“(A) surge in spending on roads and bridges has had no effect on local unemployment and only barely helped the beleaguered construction industry,” the AP noted. “Spend a lot or spend nothing at all, it didn’t matter, the AP analysis showed: Local unemployment rates rose and fell regardless of how much stimulus money Washington poured out for transportation … . (T)here was nearly no connection between stimulus money and the number of construction workers hired or fired … .”
Even an Emory University economist who had supported the stimulus admitted, “As a policy tool for creating jobs, this doesn’t seem to have much bite.”
The AP looked at the example of Marshall County in Middle Tennessee. Per capita, it got more stimulus money for road projects than almost any other county in the nation. Yet its unemployment rate is still climbing and is likely to hit 20 percent! In fact, the AP found, “There was no difference in unemployment trends between the group of counties that received the most stimulus money and the group that received none … .”
So our nation borrowed hundreds of billions of dollars — on which we must pay huge amounts of interest — for a “stimulus” that didn’t stimulate much of anything besides debt.
And that’s not even the worst of it. Now, the administration wants — and Democrats in Congress plan to deliver — a second stimulus for tens of billions of dollars more. Once again, the administration says road, bridge and other infrastructure spending will be the focus because it is “at the heart of our effort to accelerate job growth.”
But infrastructure was also the focus the first time around, and that didn’t pan out. Why should taxpayers have to throw good money after bad?
“My bottom line is, I’d be skeptical about putting too much more money into a second stimulus until we’ve seen broader effects from the first stimulus,” Aaron Jackson, a Bentley University economist, told the AP.
That’s a good idea. The stimulus is taking money out of the productive private sector, removing a portion of that money for “administrative costs” and redistributing the rest to projects that aren’t creating jobs. That’s the worst of all possible worlds. The first stimulus never should have been approved. The second should be defeated soundly.