Wednesday, November 18, 2009

Obama stimulus pachage utter failure????

There was fair reporting in the Detroit Freepress this past weekend ("Billions For State, But here are Jobs?") as the newspaper did a thorough review of reports from those receiving money from the "massive" $787 billion economic stimulus package. The article basically stopped short of noting it has been an utter failure to this point as far as the residents of Michigan are concerned.

Which, mind you, is what many economists had predicted would happen despite Obama claiming it would prevent the unemployment rate from exceeding 8%, although we all know that did not happen, as it is currently greater than 10% nationally, and state high 15.3% in Michigan.

According to the review:
  • The vast majority of grants, contracts and loans in Michigan so far have created or retained virtually no jobs.
  • Others who have been promised or have received stimulus money have overstated the number of jobs created or protected.
  • The biggest impact of the stimulus was spurring or protecting public-sector (government) or summer jobs, and has done nothing to create jobs in the private sector. Michigan has the highest unemployment rate in the nation at 14%.
  • Officials reported that by Sept. 30, some 22,500 Michigan jobs were created or retained thanks to the promise of $5.2 billion of which had arrived.
  • Of that money, less than 700 awards had received some money, and nearly half of those -- 327 -- had created one job or less, at a cost per job of $2.7 million

I suppose to suppose it's too early to decide for sure whether it has been an utter failure. We have to consider that after the Reagan tax cuts it took a while for the economy to turn around. But those tax cuts actually were meant to create an incentive to save and invest, which (according to economics 101 and history) is the best way to recover jobs and grow the economy.

When the government spends money, there is a lot of waste, which this report show. Likewise, most of the jobs created are only temporary, so the economy will only improve "temporarily" and when those jobs expire (which many already have) the economy will tank again.

Obama's economic stimulus package has produced essentially no jobs, and therefore this pretty much proves one of two things:

  • a) that Obama and liberals know nothing about how to boost an economy
  • b) that there purpose in the first place was to tank the economy
  • c) that the whole purpose of this bill was not to save the economy but to spread socialism and gain more control over our lives. (which I believe is the same purpose of Cap and Trade and Obamacare.

For more information please check out which did a very thorough review how Michigan benefited, or has yet to benefit, from the American Recovery and Reinvestment Act. Kudos to Todd Spangler for his great reporting.

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