NCPA - National Center for Policy Analysis

STIMULUS JOB CREATION = BIGGER GOVERNMENT

November 4, 2009

Last Friday, the White House released the list of jobs created or saved with the stimulus funds.  The White House claims that 640,329 were created or saved.  That is way less than what Christina Romer claimed would be created; last week, she mentioned 1.4 million during a Joint Committee hearing, says Veronique de Rugy, a senior research fellow at the Mercatus Center.

Some $159 billion has been spent so far; that's $248,273 per job.  However, when you look at some specific contracts that were awarded you find that some jobs were created or saved at an insane cost to taxpayers, says de Rugy:

  • For instance, $1,359,633,501 were awarded to CH2M-WG Idaho LLC, in Washington to create 2,183 jobs; that's $622,827 per job.
  • That's not as bad as the $258,646,800 awarded to the Brookhaven Science Associates, LLC in New York, to create 25 jobs; that's over $10.3 million per job.

And while the administration is promising good and in time reporting, says de Rugy, we can see that it's far from being the case: Agencies report having spent $207.3 billion and yet only $36,688,660,161 were reported by states.

Some 85 percent of the money went to four agencies: Health and Human Services (HHS), Labor, Education and Social Security.  That money wasn't spent on shovel ready projects, says de Rugy:

  • For instance, some of the HHS funds went to some rural high school and college students from Arkansas, Kentucky and Tennessee to conduct medical research this summer with a team of leading scientists at Vanderbilt University.
  • The Department of Labor spent $11,058,877 in unemployment insurance (UI) modernization incentive funds to the state of West Virginia.
  • And the Department of Education is mainly spending its money to keep union protected school teachers in their jobs.

But the most relevant information on Recovery.gov is that most of the jobs created or saved are in the public sector, says de Rugy:

  • For instance, according to Vice President Biden, out of the 640,329 jobs, 325,000 went to education and 80,000 to construction jobs, with the difference going to other government jobs.
  • Also, 13,080 grants went to the private sector, and 116,625 went to federal agencies.

Source: Veronique de Rugy, "Stimulus Job Creation = Bigger Government," BigGovernment.com, November 2, 2009.

 

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