Economy Alarm: AP Analysis on Stimulus' Effect: "It didn't matter"

AP Analysis on Stimulus’ Effect: “It didn’t matter”
Dem Stimulus Didn’t Work First Time Around, Yet Obama-Pelosi Pushes for Stimulus II

Democrats Claim the Stimulus Has ‘Created or Saved’ Over a Million Jobs

“Vice President Joe Biden on Friday: The stimulus ‘is responsible for over 1 million jobs so far.’

“White House senior advisor Valerie Jarrett on Oct. 18: The stimulus ‘really staved off a disaster and we saved millions of jobs around the country.’

“White House release June 2: ‘Just over 100 days in, over 150,000 jobs have been created or saved.’

“White House senior advisor David Axelrod on June 7: ‘The stimulus itself has produced hundreds of thousands of jobs.'” (“Inconsistent messages on Obama’s stimulus package,” The Los Angeles Times, 10/31/2009)

Credibility Crash: Study Shows Billions of Stimulus Dollars Spent on Roads and Bridges Has Had No Effect on Unemployment

Ten months into President Barack Obama’s first economic stimulus plan, a surge in spending on roads and bridges has had no effect on local unemployment and only barely helped the beleaguered construction industry, an Associated Press analysis has found.

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, raising questions about Obama’s argument that more road money would address an “urgent need to accelerate job growth.”

Obama wants a second stimulus bill from Congress that relies in part on more road and bridge spending, projects the president said are “at the heart of our effort to accelerate job growth.”

Construction spending would be a key part of the Jobs for Main Street Act, a $75 billion second stimulus to revive the nation’s lethargic unemployment rate and improve the dismal job market for construction workers. The House approved the bill 217-212 last month after House Speaker Nancy Pelosi, D-Calif., worked the floor for an hour; the Senate is expected to consider it later in January.

AP’s analysis, which was reviewed by independent economists at five universities, showed that strategy hasn’t affected unemployment rates so far. And there’s concern it won’t work the second time. For its analysis, the AP examined the effects of road and bridge spending in communities on local unemployment; it did not try to measure results of the broader aid that also was in the first stimulus like tax cuts, unemployment benefits or money for states….

Even within the construction industry, which stood to benefit most from transportation money, the AP’s analysis found there was nearly no connection between stimulus money and the number of construction workers hired or fired since Congress passed the recovery program. The effect was so small, one economist compared it to trying to move the Empire State Building by pushing against it. (Matt Apuzzo and Brett J. Blackledge, “AP IMPACT: Road Projects Don’t Help Unemployment,” Associated Press, January 11, 2010)

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