The Experts Are Catching Up

Someone once said that debt spending doesn’t equal wealth.  That same individual said that stimulus dollars on so-called “shovel ready” projects  was nothing more than short term revolving door jobs that would not result in growth.   Now I don’t claim to be an economic genius or some sort of scholar or market guru, but it is nice when the experts finally catch up to me and I can once again say told ya so.

Allow me to quote: “But AP’s analysis, which was reviewed by independent economists at five universities, showed the strategy of pumping transportation money into counties hasn’t affected local unemployment rates so far.”

“”My bottom line is, I’d be skeptical about putting too much more money into a second stimulus until we’ve seen broader effects from the first stimulus,” said Aaron Jackson, a Bentley University economist who also reviewed AP’s analysis.”

“Even within the construction industry, which stood to benefit most from transportation money, the AP’s analysis found there was nearly no connection between stimulus money and the number of construction workers hired or fired since Congress passed the recovery program. The effect was so small, one economist compared it to trying to move the Empire State Building by pushing against it.”

This last month we were surprised to learn that 85,000 jobs were lost.  It was supposed to be the first month in two years that we had positive job growth.  Now, with the poor economic progress, Obama is planning a second stimulus bill to give the appearance that he is doing something to solve the problem.  Will another stimulus plan bring unemployment below 10%?

Compare the result of the pork stimulus bill to the results of the Bush tax cuts.  In the six months leading up to the 2003 Bush tax cuts we lost 267,000 jobs.  In the six months after the 2003 tax cuts we gained 307,000 jobs.  We went from 1.7% GDP growth to 4.1%.   And before you argue about Bush’s tax cuts increasing the deficit, it took Obama 7 months to increase the deficit more than Bush did in 7 years.

If we want economic growth we need to take more money out of the hands of government and put it in the hands of small businesses and individuals.  How long until the experts figure out that Cap and Trade, mandatory insurance, and more pork bills are not going to fix our economy?