After reading a few columns from The Weekly Standard, it should come as no shock when they respond to criticism without the first inkling of why they were criticized. In a recent article from The Weekly Standard, conservative author Jeffrey H. Anderson complained:
Basically, Jeff Anderson acted as though this money was merely spent on wages and benefits, which is made abundantly clear by his suggesting the government could have achieved the same result by just giving "a $100,000 check to everyone whose employment was allegedly made possible by the “stimulus.”" His alternative clearly did not point out the tax breaks, work performed, food to the needy, and research that was accomplished by the stimulus (although these are tough to quantify). The Weekly Standard decided that, instead of engaging in real critical thinking about the efficacy of the stimulus, they would rather create a one-liner based on pure elementary school long division.
Of course, The Weekly Standard somehow didn't get the message, and instead decided to write a rebuttal for the Politifact article. Once again, The Weekly Standard missed the point entirely.
Jeff Anderson:
...the “stimulus” has added or saved just under 2.4 million jobs — whether private or public — at a cost (to date) of $666 billion. That’s a cost to taxpayers of $278,000 per job.This has become a common conservative talking point since 2009. Politifact Texas debunked this claim when it was made by David Dewhurst, correctly pointing out a few things:
In other words, the government could simply have cut a $100,000 check to everyone whose employment was allegedly made possible by the “stimulus,” and taxpayers would have come out $427 billion ahead.
"43 percent was spent on tax cuts for individuals and businesses; 19 percent went to state governments, primarily for education and Medicaid; and 13 percent paid for government benefits to individuals such as unemployment and food stamps. The remainder, about 24 percent, was spent on projects such as infrastructure improvement, health information technology and research on renewable energy."
"Any cost-per-job figure pays not just for the worker, but for the material, supplies and that workers’ output — a portion of a road paved, patients treated in a health clinic, goods shipped from a factory floor, railroad tracks laid," the 2009 Associated Press item noted."
Basically, Jeff Anderson acted as though this money was merely spent on wages and benefits, which is made abundantly clear by his suggesting the government could have achieved the same result by just giving "a $100,000 check to everyone whose employment was allegedly made possible by the “stimulus.”" His alternative clearly did not point out the tax breaks, work performed, food to the needy, and research that was accomplished by the stimulus (although these are tough to quantify). The Weekly Standard decided that, instead of engaging in real critical thinking about the efficacy of the stimulus, they would rather create a one-liner based on pure elementary school long division.
Of course, The Weekly Standard somehow didn't get the message, and instead decided to write a rebuttal for the Politifact article. Once again, The Weekly Standard missed the point entirely.
Jeff Anderson:
Jeff Anderson:
“First, I never said that the $278,000 per job was all spent on salaries or wages. I would never attribute anything close to that degree of efficiency to the federal government.”
It seems as though the Weekly Standard is either purposely ignoring the point of this politifact article, or they are just too hard headed to figure out what appeared to be painfully obvious. First, Politifact already responded to this item: “Then again, this clarification doesn't fit with the blogger's earlier claim that taxpayers would have come out ahead if the government had just cut checks to everyone credited with getting a stimulus-tied job.” So his alternative would make no sense if he meant it covered more than just salary and wages. This would only make sense if the stimulus was just meant to give employers money to hire people to sit around and do nothing. I’m not sure where this guy has worked in the past, but the point of a job is to perform a task and accomplish a goal. And there are costs that go into that. I have a computer, and a cubicle. I work with equipment that cost up to a million dollars apiece. Then there are also administrative costs in training me, not to mention the amount of money spent on materials needed for me to produce goods. That seems to be what he is missing about the stimulus. So if the government had “cut a $100,000 check to everyone whose employment was allegedly made possible by the “stimulus,”” no bridges would have been built, no roads would have been paved, no patients would have been treated, no goods would have been shipped.
“Second, the expenses quoted above were all part of the “economic stimulus,” which, presumably, was intended to stimulate the economy. So either the “stimulus” spurred economic growth or it didn’t. And if it failed to add or save (many) jobs, then it at best stimulated (mostly) jobless growth. It has been a jobless stimulus.”
The mistakes he makes here can be highlighted in his misguided analogy about giving a $100,000 check to everyone whose employment was allegedly made possible by the “stimulus.” More is accomplished than just stimulating the economy, although it is one of the end results.
He also neglects indirect stimulus effects. One of the key components of the stimulus was “Temporary programs to protect the most vulnerable from the deep recession, including increases in food stamps and expansions of unemployment insurance.” This clearly does not directly translate to jobs. However, unemployment insurance and food stamps give people money to spend. This helps slow the decline in the demand for goods and services, which in turn helps slow the decline in the demand for jobs. This is two-fold as it keeps people from starving and also helps avoid job loss. Because this process is indirect, it is very hard to quantify the amount of jobs created or saved as a result of these efforts.
"Third, how does one divvy out (or, as PolitiFact says, “spend”) $286 billion in tax cuts (43 percent of $666 billion) yet still fail to spur much job growth? Likewise, how can $160 billion (24 percent of $666 billion) be spent on “infrastructure improvement, health information technology and research on renewable energy” without spurring much job growth? And why was $127 billion of the “stimulus” (19 percent of $666 billion) spent on teachers or Medicaid?”
I’m not sure this really challenges Politifact’s ruling. This has to do with the effectiveness of the stimulus and not his statement about the cost per job of the stimulus. Politifact did not tackle the effectiveness of the stimulus in this article. However, for reference, they have many times before.
Anyway, I’m not sure 2.4-3.6 Million jobs is “not much job growth” This may be subjective. However, if we base this on initial predictions, the stimulus was only projected to create 3 to 4 million Jobs. This means that, at best the stimulus had a 120% success rate. At worst, it had a 60% success rate. So he would either have to create a straw-man claim in which the government projected the creation of more jobs than stated, or he would have to take the worst success rates.
Another way of looking at this is to look at those numbers in context. Current dollar GDP was $13.9 trillion dollars in 2009 and 14.5 trillion dollars in 2010, totaling $28.5 trillion dollars between both years. This $666 billion spent was around 2% of GDP for those years. Given that stimulus spending was so small compared to the total size of the Economy, how much job growth did they expect?
Note: I’m not looking at unemployment because too many factors are involved in this measurement.
“As I wrote in my response to the White House, “This much is clear: Based on an estimate by Obama’s own economists, for every $278,000 in taxpayer-funded “stimulus” money that the Obama administration has spent — whatever it may have spent it on — the “stimulus” has added or saved just one job.” That remains an undeniable fact.”
If he had stuck with just this, then his meaning would be more up to interpretation. It would have been technically true but incredibly misleading. Instead he continues in his original column by saying “the government could simply have cut a $100,000 check to everyone whose employment was allegedly made possible by the “stimulus,”” indicating an essentially equivalent act would merely put money in those people’s hands, just like a salary and benefits would do. Since he added this, it would be very hard for someone to interpret him as meaning job costs and worker output as well.
“A less-widely reported part of my initial post noted that the conclusions of Obama’s economists also showed that the “stimulus” was now shedding jobs. In relation to estimates of what an un-“stimulated” economy would look like, Obama’s economists said that the stimulus had added or saved 2.7 million jobs as of New Year’s Day but only 2.4 million as of July 1, a decline of (to use the report’s exact figure) 288,000 jobs. In other words, over those six months, the economy would have added or saved more jobs without the stimulus than it has with it — according to an estimate from Obama’s economists.
The entire response on this point from PolitiFact (both the Ohio and Texas versions) is to cite Moody’s chief economist Mark Zandi, who told the left-leaning website TPMDC that “the Weekly Standard misinterpreted that data.” That was good enough for PolitiFact… PolitiFact writes, “‘It’s not that ARRA [the stimulus] is now costing the economy jobs, it is that the economy is now creating jobs without ARRA’s help,’ Zandi told TPMDC. ‘This is exactly the objective of fiscal stimulus, namely to end recession and jump-start economic recovery.’”
Zandi’s claim, however, doesn’t square with the numbers provided by Obama’s economists. They show that the gap between the number of jobs with and without the “stimulus” is narrowing. The “stimulated” economy is not “creating jobs without the stimulus’s help” — at least not at the rate that it would have created them had the “stimulus” never been passed.
Put otherwise, if the “stimulus” added or saved 2.7 million jobs through the end of last year versus the number of jobs that would have been added or saved without it — which is exactly what Obama’s economists assert — then it has correspondingly lost, or failed to save, 288,000 jobs since then. In other words, it’s shedding jobs.”
It seems as though he has missed Zandi’s point. As an analogy, let us say I want to buy a new car, but I don’t have the money or credit to do so. Let’s say my father decides to buy me the car by getting the loan and making the payments. At that point I can see he is the reason I have that car. If it weren’t for him, I wouldn’t have that car. Now let’s say I come across some money… for instance let’s say I win the lottery. Now I have the money to officially buy the car from him and make the payments myself. Seeing as how I could at that point have bought one of these cars from the dealership anyway, I can safely say he is no longer the reason I have the car. He is the reason I previously had the car, but not now (although I could still be appreciative of his help). This is essentially the point of what Zandi is saying. It’s not that these jobs went away, it’s that the employers are to the point where the job would have been there anyway at this point. The only difference is that the person with that job would have been a new hire or newly re-hired. They would have been on unemployment this entire time instead of actually holding a job. Now there may be other long term effects from him having a job during that time instead of being unemployed, but there doesn’t seem to be a need to go into that right now. You can argue whether or not the report should present numbers this way, but it is clear the report does not say the Stimulus is "shedding Jobs"
Basically it looks like Jeff Anderson of the Weekly Standard did what many who criticize Politifact do; he missed the whole point of the article. Maybe politifact should have spent more time explaining it. It didn’t seem that hard to figure out. But if you are unwilling to try and understand what someone is saying, no amount of explanation will do…
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