Hey, Associated Press: Way to look after the public interest! A month after the Generational Theft Act was rushed through Congress and signed into law, the news service tells us that the jobs projections were basically pulled out of thin air.
The title of the AP’s penetrating, belated analysis: “Bold claims of stimulus jobs can’t be measured.”
If space exploration were conducted like the job forecasts under the government’s new stimulus law, man surely would have missed the moon. But this isn’t rocket science.
No promise from President Barack Obama is more important to the wounded economy than his vow to save or create some 3.5 million jobs in two years. In support of that bottom line, the government even tells states how many jobs they can expect to see from the spending and tax cuts.
But precise trajectories are impossible to plot and even approximations can be wildly off, as the authors of these forecasts acknowledge, usually more readily than the policymakers who use them to promote the plan.
Flip through the stacks of economic analyses underpinning the stimulus plan and you find a lot of throat-clearing qualifications and angst:
_”Difficult to distinguish among alternative estimates.”
_”We confess to considerable uncertainty.”
_”Subject to substantial margins of error.”
In other words, who really knows?
Economic modeling may prove to be a haywire navigational device in this crisis.
“Large fiscal stimulus is rarely attempted,” Douglas Elmendorf, director of the nonpartisan
Congressional Budget Office, told lawmakers. “For those reasons, some economists remain skeptical that there will be any significant effects, while others expect very large ones.” Zero to nirvana? Even for economists, who routinely differ among themselves, that’s a range beyond the norm.
The disconnect between theory and real life became evident when Obama pitched his plan at a Caterpillar factory before its passage and held out hope the federal stimulus money would let the heavy equipment maker rehire some of the thousands being let go. Although that might be the eventual result when money courses through the pipeline, Caterpillar last week announced 2,400 more layoffs.
Hey, we can’t wait until they wake up and realize how much pork is in the bill, how much will go to bloated unions overseeing pie-in-the-sky construction projects, how little will be spent until after the recession is over, and how the true costs will top $3.2 trillion.