Cato: The Govt. Job Creation Myth

[spursncowboys]

http://www.realclearpolitics.com/pri...th_106593.html

Never mind all that, says the administration. The stimulus package prevented a second great depression, it says. Last month, the White House's Council of Economic Advisors released an analysis claiming that the stimulus created or saved between 2.5 million and 3.6 million jobs.

Sounds good, but how did the CEA arrive at this conclusion?

Fuzzy math.

The first analysis used economic modeling to estimate the number of jobs created or saved. The model the CEA used assumed that government spending will have a positive multiplier effect on the economy. Voilà -- the stimulus created jobs!

In the second analysis, the CEA estimated the stimulus bill's effects by comparing real changes in gross domestic product and employment against a baseline forecast. However, even the CEA admits that this approach is subject to "considerable margins of error," and that "the comparison will reflect not just the impact of fiscal policy, but all other unusual influences on the economy following passage of the Act."

That the stimulus did create jobs isn't in question. The real question is whether it created any net jobs after all the negative effects of the spending and debt are taken into account. How many private-sector jobs were lost or not created in the first place because of the resources diverted to the government for its job creation?

[ElNono]

Do you have a YouTube version from the Heritage Foundation?

[admiralsnackbar]

Do you have a YouTube version from the Heritage Foundation?

What are you talking about, Nono? SnC has a Cato subscription and is deep on economics.

[spursncowboys]

I'm sensing sarcasm.

[Nbadan]

There is plenty of money out there for businesses that want to 'create jobs'...the reason the govt. has to 'create jobs' is because the private sector is not 'creating jobs'.....but keep worshiping at the alter of your multinational, globalism God...

[DMX7]

No wonder republicans can't run the economy.

[boutons_deux]

Who finances Cato specifies the noise Cato bleats.

What's Cato's solution for job creation? Don't have one? shocked!!