So Much for the Administration's Economic Analysis
Calculated Risk has a great post today that compared the unemployment forecast that the current Administration's economic team issued on January 10th when it was trying to justify the "American Recovery and Reinvestment Plan" to what has really happened since then. In their report on the plan, Christina Romer and Jared Bernstein stated the following:
A package in the range that the President-Elect has discussed is expected to create between three and four million jobs by the end of 2010...
Certain industries, such as construction and manufacturing, are likely to experience particularly strong job growth under a recovery package that includes an emphasis on infrastructure, energy, and school repair. But, the more general stimulative measures, such as a middle class tax cut and fiscal relief to the states, as well as the feedback effects of greater employment in key industries, mean that jobs are likely to be created in all sectors of the economy...
More than 90 percent of the jobs created are likely to be in the private sector. (HAHAHAHAHAH, oh sorry about that)
A package is likely to create jobs paying a range of wages. It is also likely to move many workers from part-time to full-time work.
Almost the exact opposite of what Romer and Bernstein predicted has happened. No jobs are being created. Manufacturing and construction are contracting. Most of the jobs that are being created are government jobs, like the census workers that keep getting added to the jobs number every month. And the part-time jobs market has stabilized while full-time jobs continue to be lost.
How can anyone take anything the President's economic team says seriously? And where in the heck is Paul Volker? Has he been completely squeezed out of the picture in the political cat fight that has been going on within the team? He has a lot more credibility in my book than many of the other buffoons that are on the team.
At the time the package was created, I strongly believed that the Administration's predictions about how effective it would be were way off.
I wrote a series of posts blasting the "stimulus" portion of the plan.
The myth of the coming infrastructure boom
The more I look at the stimulus package, the less I like it
The Stimulus Package Won't Work Part 3: The Congressional Budget Office Study
I'm not saying that some sort of stimulus wasn't necessary, just that in true government fashion when the Obama Administration handed the stimulus ball over to Nanci Pelosi and friends no questions asked they fumbled the ball big time.
I am also not saying that the Republicans would have done a better job, most politicians are idiots, crooked, too worried about getting re-elected to do the right thing, or some combination thereof.
I realize that it takes time for the stimulus to work and that a lot more of the money is going to be put to work this summer. With this much money being thrown at the wall some of it is bound to stick and help the economy some, but the American taxpayer definitely is not getting a lot of bang for their buck here.