Freedom New Mexico
It is almost difficult to parody the incoherence of the Obama stimulus plan and administration statements about the state of the economy in the past couple of days:
Although only 6 percent of the $787 billion stimulus package passed in January has been spent, it has done the trick nicely, and the economy is perking along, and we’re adding jobs by the hundreds of thousands. That’s why we are desperately urging state, local and federal governments to ramp up the spending dramatically. And, by the way, we’re shifting to a “pay as you go” system to make sure we don’t add to the deficit, now estimated at around $1.8 trillion.
The distance from reality could hardly be more dramatic.
Since passage of the stimulus bill the economy has lost almost 1.6 million jobs. Yet the administration claims it has “saved or created” 150,000 new jobs, and its efforts will save or create another 600,000 by the end of the summer.
The key? Those wonderful weasel words “saved or created.” It’s difficult enough to count how many jobs have been created by recent government spending, though presumably some have been. No reputable economist claims to know how many jobs were “saved” by administration action. But as long as most of the news media parrot the words “saved or created” the administration can claim numbers literally made up from thin air. So a net loss of 1.6 million jobs in the real world is spun into 150,000 “saved or created” in Obamaspeak.
The problem is complicated by the fact that White House economic advisers Jared Bernstein and Christina Romer estimated in January that passage of the stimulus bill would assure that unemployment would rise no higher than 8 percent this year. It now stands at 9.4 percent. That may account for the spend-it-fast panic.
And after getting a budget with deficits that dwarf the monstrous deficits created under George W. Bush, the Obama administration has had an attack of faux fiscal responsibility and is decreeing a pay-as-you-go regimen, meaning any new spending (presumably other than the “stimulus” already passed) will have to be offset by cuts in other programs or new revenue (read “taxes”)?
Whom does he think he is kidding?
Pay-go sounds nice but has never worked in practice. When it was actually mandated by statute in the 1990s most programs were exempted, and Congress routinely voted to waive pay-go requirements. As an administrative decree it is nothing more than a fig leaf.
If Obama really wanted to jump-start the economy he would cancel the stimulus spending, cut marginal tax rates, stabilize the dollar, reduce business regulations and cut spending dramatically. Unfortunately, his real goal seems to be to grow the government rather than to grow the economy.