Economy Alarm: Stimulus Even Less Stimulating than White House Claimed

Stimulus Even Less Stimulating than White House Claimed
Outside Review Reveals Administration’s Unimpressive Numbers Overstated by Thousands

White House Says ‘Trust Us’ to Spend Nearly a Trillion Dollars Wisely, Get Economy Back on Track
“We cannot overstate the importance of this effort. We are asking the American people to trust their government with an unprecedented level of funding to address the economic emergency. In return, we must prove to them that their dollars are being invested in initiatives and strategies that make a difference in their communities and across the country.” (“Memorandum to Head of Departments and Agencies,” www.Recovery.gov, February 9, 2009)

Credibility Crash: AP Review Shows White House Can’t Even Be Trusted to Deliver Accurate Numbers on Failed Spending Spree
An early progress report on President Barack Obama’s economic recovery plan overstates by thousands the number of jobs created or saved through the stimulus program, a mistake that White House officials promise will be corrected in future reports.

The government’s first accounting of jobs tied to the $787 billion stimulus program claimed more than 30,000 positions paid for with recovery money. But that figure is overstated by least 5,000 jobs, according to an Associated Press review of a sample of stimulus contracts.

The AP review found some counts were more than 10 times as high as the actual number of jobs; some jobs credited to the stimulus program were counted two and sometimes more than four times; and other jobs were credited to stimulus spending when none was produced.

For example:

– A company working with the Federal Communications Commission reported that stimulus money paid for 4,231 jobs, when about 1,000 were produced.

– A Georgia community college reported creating 280 jobs with recovery money, but none was created from stimulus spending.

– A Florida child care center said its stimulus money saved 129 jobs but used the money on raises for existing employees.

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The reporting problem could be magnified Friday when a much larger round of reports is expected to show hundreds of thousands of jobs repairing public housing, building schools, repaving highways and keeping teachers on local payrolls.

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While the thousands of overstated jobs represent a tiny sliver of the overall economy, they represent a significant percentage of the initial employment count credited to the stimulus program. (Brett J. Blackledge and Matt Apuzzo, “Stimulus Jobs Overstates by Thousands,” Associated Press, 10/29/09)

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