A pair of studies analyzing U.S. jobs and the effects of President Obama’s American Reinvestment and Recovery Act suggest the so-called “stimulus” bill has boosted partisan interests far more than employment figures.
White House projections in February claimed the $789 billion in spending would “create or save 3.5 million jobs over the next two years” and that over 90 percent of those jobs would be in the private sector.
One year into the two-year projections, however, the studies show that not only has the money failed thus far to deliver on either of those promises, but it also has been doled out disproportionately to districts with Democrat representation.
The first study, conducted by the Republicans of the House Ways and Means Committee, compares the White House’s projections to actual U.S. Department of Labor statistics on a state-by-state basis.
The numbers show that 49 of the 50 states have actually lost jobs since the stimulus was passed in February, and that the only state to gain jobs, North Dakota, still has more than halfway to go to meet White House projections.
And while calculating how many jobs the stimulus package has “saved” is highly contentious (the administration estimates it has created 640,000 jobs), the Republicans compare the promised 3.5 million jobs the stimulus package was supposed to boost to the net 2.6 million jobs the U.S. has lost since the ARRA was passed.
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“President Obama said, ‘We’ve seen a significant turnaround in the economy overall since the beginning of the year.’ Vice President Biden said, of the 2009 stimulus law, ‘It has created jobs,’” the House Republicans point out in a statement. “Outside of the White House, though, real Americans find it difficult to … see any significant turnaround or real job creation. Instead, they see only millions more jobs eliminated and millions more unemployed American workers.”
The second study, conducted by the Mercatus Center at George Mason University, reviewed the distribution of the $157 billion in stimulus dollars already doled out and found results that further bring up questions as to how and why the money is being spent.
The university study discovered first that there was “no statistical correlation” between the amount of money a district received and its unemployment rate.
The study did discover, however, a correlation between the amount of money spent and the political party representing the district in Congress.
“You would think, right, that if the administration believes in its theory that government money can create jobs, they would spend a lot of money in districts that have high unemployment,” study co-author Veronique de Rugy told Fox News.
Instead, the study found:
- There has been no correlation between unemployment or income and the level of stimulus fund allocation
- In fact, more funding has gone to higher-income areas than lower-income areas
- Democratic congressional districts have received 1.89 times more money than GOP districts, receiving on average $439 million, compared to Republican districts receiving on average $232 million
- In total, Democratic districts have received 73.47 percent of the total stimulus funds awarded.
“During the appropriations process, you’re not surprised to see the Democrats are getting more money, but in this case a lot of the money we’re looking at is going through [the Department of Housing and Urban Development], or Department of Education, Department of Transportation, etc., and they’re following a formula,” de Rugy told the Washington Examiner. “But the correlation exists, and not only does it exist – when you look at how much money we’re talking about, it’s a pretty big deal.”
Furthermore, the study revealed, rather than the White House’s pledge of distributing 90 percent of the funds to the private sector, thus far nearly $88 billion has been spent in the public sector, to only $69 billion in the private, which works out to roughly 44 percent.
The Mercatus study can be read in full on the Center’s website, while the House Committee on Ways and Means Republicans’ report is summarized in the chart below: