New CBO Report Finds Up to 2.9 Million People Owe Their Jobs to the Recovery Act

[daveman]

CBO Admits their Stimulus Jobs Count Ignored the Economy

CBO Confirms Its Methodology

In a recent speech to the National Association of Business Economics, CBO Director Doug Elmendorf confirmed this by stating:

[W]e don't think one can learn much from watching the evolution of particular components of GDP [gross domestic product] over the last few quarters about the effects of the stimulus … so we fall back on repeating the sort of analysis we did before. And we tried to be very explicit about it that it is essentially repeating the same exercise we did rather than an independent check on it.[1]

When asked if this means that any actual underperformance of the stimulus would fail to show up in the CBO's stimulus jobs count, Elmendorf replied "That's right." This means the 1.5 million jobs saved estimate was pre-determined.

Of course, the stimulus was originally promised to create (not just save) more than 3 million jobs.[2] Instead, the economy has since lost more than 3 million additional net jobs.

The abject failure of the stimulus policies recommended by Keynesian economic models should induce some fundamental re-analysis of these models' assumptions. Instead, the CBO is re-releasing the same jobs analysis--with the same economic assumptions--that they had used a year ago.

The "Begging the Question" Fallacy

The CBO's conclusion that the stimulus created jobs is based on an economic model that began with the premise that all stimulus bills create jobs. In other words, the conclusion is already assumed as a premise. Logicians call this the fallacy of begging the question. Mathematicians call it assuming what you are trying to prove.

More specifically, the CBO's model started by automatically assuming that government spending increases GDP by pre-set multipliers, such as:

Every $1 of government spending that directly purchases goods and services ultimately raises the GDP by $1.75;
Every $1 of government spending sent to state and local governments for infrastructure ultimately raises GDP by $1.75;
Every $1 of government spending sent to state and local governments for non-infrastructure spending ultimately raises GDP by $1.25; and
Every $1 of government spending sent to an individual as a transfer payment ultimately raises GDP by $1.45.[3]
(Note that all CBO figures in this paper represent the midpoint between their high and low estimates.)​

Then the CBO plugged the stimulus provisions into the multipliers above, came up with a total increase in GDP of 2.6 percent, and then converted that additional GDP into 1.5 million jobs.

The problem here is obvious. Once the CBO decided to assume that every dollar of government spending increased GDP by the multipliers above, its conclusion that the stimulus saved jobs was pre-ordained. The economy could have lost 30 million jobs, and the model would have said that the economy would otherwise have lost 31.5 million jobs without the stimulus. An asteroid could have hit the United States, wiping out everyone outside of Washington, D.C., and (as long as Washington still spent the stimulus money) the CBO's economic model would have produced the same stimulus jobs data. There is no adjustment made to reflect what actually happened in the economy after the stimulus was enacted.​

Now, who wants to claim CBO reports are accurate?

 

[Oddball]

More specifically, the CBO's model started by automatically assuming that government spending increases GDP by pre-set multipliers, such as:

Every $1 of government spending that directly purchases goods and services ultimately raises the GDP by $1.75;
Every $1 of government spending sent to state and local governments for infrastructure ultimately raises GDP by $1.75;
Every $1 of government spending sent to state and local governments for non-infrastructure spending ultimately raises GDP by $1.25; and
Every $1 of government spending sent to an individual as a transfer payment ultimately raises GDP by $1.45.[3]
(Note that all CBO figures in this paper represent the midpoint between their high and low estimates.)

Then the CBO plugged the stimulus provisions into the multipliers above, came up with a total increase in GDP of 2.6 percent, and then converted that additional GDP into 1.5 million jobs.

IOW, more unicorns and leprechauns.

Speaking of which, I don't see how they calculated a "saved job" in that boilerplate.

 

[8537]

CBO Admits their Stimulus Jobs Count Ignored the Economy

CBO Confirms Its Methodology

In a recent speech to the National Association of Business Economics, CBO Director Doug Elmendorf confirmed this by stating:

[W]e don't think one can learn much from watching the evolution of particular components of GDP [gross domestic product] over the last few quarters about the effects of the stimulus … so we fall back on repeating the sort of analysis we did before. And we tried to be very explicit about it that it is essentially repeating the same exercise we did rather than an independent check on it.[1]

When asked if this means that any actual underperformance of the stimulus would fail to show up in the CBO's stimulus jobs count, Elmendorf replied "That's right." This means the 1.5 million jobs saved estimate was pre-determined.

Of course, the stimulus was originally promised to create (not just save) more than 3 million jobs.[2] Instead, the economy has since lost more than 3 million additional net jobs.

The abject failure of the stimulus policies recommended by Keynesian economic models should induce some fundamental re-analysis of these models' assumptions. Instead, the CBO is re-releasing the same jobs analysis--with the same economic assumptions--that they had used a year ago.

The "Begging the Question" Fallacy

The CBO's conclusion that the stimulus created jobs is based on an economic model that began with the premise that all stimulus bills create jobs. In other words, the conclusion is already assumed as a premise. Logicians call this the fallacy of begging the question. Mathematicians call it assuming what you are trying to prove.

More specifically, the CBO's model started by automatically assuming that government spending increases GDP by pre-set multipliers, such as:

Every $1 of government spending that directly purchases goods and services ultimately raises the GDP by $1.75;
Every $1 of government spending sent to state and local governments for infrastructure ultimately raises GDP by $1.75;
Every $1 of government spending sent to state and local governments for non-infrastructure spending ultimately raises GDP by $1.25; and
Every $1 of government spending sent to an individual as a transfer payment ultimately raises GDP by $1.45.[3]
(Note that all CBO figures in this paper represent the midpoint between their high and low estimates.)​

Then the CBO plugged the stimulus provisions into the multipliers above, came up with a total increase in GDP of 2.6 percent, and then converted that additional GDP into 1.5 million jobs.

The problem here is obvious. Once the CBO decided to assume that every dollar of government spending increased GDP by the multipliers above, its conclusion that the stimulus saved jobs was pre-ordained. The economy could have lost 30 million jobs, and the model would have said that the economy would otherwise have lost 31.5 million jobs without the stimulus. An asteroid could have hit the United States, wiping out everyone outside of Washington, D.C., and (as long as Washington still spent the stimulus money) the CBO's economic model would have produced the same stimulus jobs data. There is no adjustment made to reflect what actually happened in the economy after the stimulus was enacted.​

Now, who wants to claim CBO reports are accurate?

If someone came here from, say, China and spent a billion dollars on goods and services, do you think that spending would cause the producers of his purchases to make more goods?

 

[daveman]

No, it was not a guess. It was the results of statistical modelling. The 1 and 2.9M figures are the extremes of either two or three standard deviations from the mean.

estimate.. guess... statistical modeling.... all pretty much the same thing.

An estimate from a model and a guess are not "pretty much the same thing". In fact, they are completely different.

Now, if they based this completely on actual reported jobs, that would be something.

well, actual reported jobs DO serve as the framework for the report.

And those reports aren't believable.

State Demands County: Lie about Stimulus Job Creation Numbers

 

[daveman]

More specifically, the CBO's model started by automatically assuming that government spending increases GDP by pre-set multipliers, such as:

Every $1 of government spending that directly purchases goods and services ultimately raises the GDP by $1.75;
Every $1 of government spending sent to state and local governments for infrastructure ultimately raises GDP by $1.75;
Every $1 of government spending sent to state and local governments for non-infrastructure spending ultimately raises GDP by $1.25; and
Every $1 of government spending sent to an individual as a transfer payment ultimately raises GDP by $1.45.[3]
(Note that all CBO figures in this paper represent the midpoint between their high and low estimates.)

Then the CBO plugged the stimulus provisions into the multipliers above, came up with a total increase in GDP of 2.6 percent, and then converted that additional GDP into 1.5 million jobs.

IOW, more unicorns and leprechauns.

Speaking of which, I don't see how they calculated a "saved job" in that boilerplate.

WAG...like everything else.

 

[Full-Auto]

estimate.. guess... statistical modeling.... all pretty much the same thing.

An estimate from a model and a guess are not "pretty much the same thing". In fact, they are completely different.

Now, if they based this completely on actual reported jobs, that would be something.

well, actual reported jobs DO serve as the framework for the report.

And those reports aren't believable.

State Demands County: Lie about Stimulus Job Creation Numbers

THANKS Another link proving democrats are lying bastards.

 

[daveman]

CBO Admits their Stimulus Jobs Count Ignored the Economy

CBO Confirms Its Methodology

In a recent speech to the National Association of Business Economics, CBO Director Doug Elmendorf confirmed this by stating:

[W]e don't think one can learn much from watching the evolution of particular components of GDP [gross domestic product] over the last few quarters about the effects of the stimulus … so we fall back on repeating the sort of analysis we did before. And we tried to be very explicit about it that it is essentially repeating the same exercise we did rather than an independent check on it.[1]

When asked if this means that any actual underperformance of the stimulus would fail to show up in the CBO's stimulus jobs count, Elmendorf replied "That's right." This means the 1.5 million jobs saved estimate was pre-determined.

Of course, the stimulus was originally promised to create (not just save) more than 3 million jobs.[2] Instead, the economy has since lost more than 3 million additional net jobs.

The abject failure of the stimulus policies recommended by Keynesian economic models should induce some fundamental re-analysis of these models' assumptions. Instead, the CBO is re-releasing the same jobs analysis--with the same economic assumptions--that they had used a year ago.

The "Begging the Question" Fallacy

The CBO's conclusion that the stimulus created jobs is based on an economic model that began with the premise that all stimulus bills create jobs. In other words, the conclusion is already assumed as a premise. Logicians call this the fallacy of begging the question. Mathematicians call it assuming what you are trying to prove.

More specifically, the CBO's model started by automatically assuming that government spending increases GDP by pre-set multipliers, such as:

Every $1 of government spending that directly purchases goods and services ultimately raises the GDP by $1.75;
Every $1 of government spending sent to state and local governments for infrastructure ultimately raises GDP by $1.75;
Every $1 of government spending sent to state and local governments for non-infrastructure spending ultimately raises GDP by $1.25; and
Every $1 of government spending sent to an individual as a transfer payment ultimately raises GDP by $1.45.[3]
(Note that all CBO figures in this paper represent the midpoint between their high and low estimates.)​

Then the CBO plugged the stimulus provisions into the multipliers above, came up with a total increase in GDP of 2.6 percent, and then converted that additional GDP into 1.5 million jobs.

The problem here is obvious. Once the CBO decided to assume that every dollar of government spending increased GDP by the multipliers above, its conclusion that the stimulus saved jobs was pre-ordained. The economy could have lost 30 million jobs, and the model would have said that the economy would otherwise have lost 31.5 million jobs without the stimulus. An asteroid could have hit the United States, wiping out everyone outside of Washington, D.C., and (as long as Washington still spent the stimulus money) the CBO's economic model would have produced the same stimulus jobs data. There is no adjustment made to reflect what actually happened in the economy after the stimulus was enacted.​

Now, who wants to claim CBO reports are accurate?

If someone came here from, say, China and spent a billion dollars on goods and services, do you think that spending would cause the producers of his purchases to make more goods?

I've just shown you that the CBO starts off with an unproven assumption, and you want to claim their work is accurate? With their starting point, there is no way they could report anything BUT a net gain.

Okay, then.

 

[daveman]

An estimate from a model and a guess are not "pretty much the same thing". In fact, they are completely different.



well, actual reported jobs DO serve as the framework for the report.

And those reports aren't believable.

State Demands County: Lie about Stimulus Job Creation Numbers

THANKS Another link proving democrats are lying bastards.

Yup.

 

[Truthmatters]

They deny any facts they dont like.

Its like the republican party is now a religion.

The facts just get brushed away and replaced with faith

 

[Oddball]

If someone came here from, say, China and spent a billion dollars on goods and services, do you think that spending would cause the producers of his purchases to make more goods?

I guess it all depends if the creators of the goods weren't taxed out of business, in order to provide those funds.

More broken windows.....

 

[Full-Auto]

They deny any facts they dont like.

Its like the republican party is now a religion.

The facts just get brushed away and replaced with faith

Here is your chance to prove the numbers that the CBO can not.

Dont get all wussified on us now. Post your proof.

 

[daveman]

Study: Obama Stimulus Destroyed Million Private Sector Jobs

Economists Timothy Conley and Bill Dupor are out with a study (PDF) on the impact of the $800 billion stimulus package passed in the early months of the Obama Administration:

Our benchmark results suggest that the ARRA created/saved approximately 450 thousand state and local government jobs and destroyed/forestalled roughly one million private sector jobs. State and local government jobs were saved because ARRA funds were largely used to offset state revenue shortfalls and Medicaid increases rather than boost private sector employment. The majority of destroyed/forestalled jobs were in growth industries including health, education, professional and business services. This suggests the possibility that, in absence of the ARRA, many government workers (on average relatively well-educated) would have found private-sector employment had their jobs not been saved. Searching across alternative model specifications, the best-case scenario for an actual ARRA has the Act creating/saving a net 659 thousand jobs, mainly in government.​

Moreover, the study suggests that most of the funding from ARRA was used by states to avert their own budget crises rather than fund new projects:

A large fraction of the Federal ARRA dollars was channeled through and controlled by state and local governments.4 This is important for two reasons. First, it opens the possibility that states might receive direct ARRA allocations due in part to exogenous capacities to channel or attract Federal funding. Approximately two-thirds of all ARRA spending is formulary, of which there is substantial exogenous state-level variation in formula `parameters.’
Second, channeling through states creates an environment where Federal dollars might be used to replace state and local spending. The Act legislated ARRA funds to go to state and local governments for specific programs, such as schools in high poverty neighborhoods and highway construction. Importantly, as depicted in Table 1, states and local governments were already spending significant amounts of their own dollars on many of these programs before the ARRA.Often state spending was substantially higher than nominally targeted ARRA funding.
Upon acquisition of ARRA funds for a specific purpose, a state or local government could cut its own expenditure on that purpose. As a result, these governments could treat the ARRA dollars as general revenue, i.e. the dollars were effectively fungible.​

 

[daveman]

They deny any facts they dont like.

Its like the republican party is now a religion.

The facts just get brushed away and replaced with faith

You don't have any facts. You have wishful thinking.

 

[Truthmatters]

This is a CBO report and what have you provided to back your claims?

 

[Oldstyle]

New CBO Report Finds Up to 2.9 Million People Owe Their Jobs to the Recovery Act


A new Congressional Budget Office (CBO) report estimates that the American Recovery and Reinvestment Act (ARRA) increased the number of people employed by between 1.0 million and 2.9 million jobs as of June. [1]


In other words, between 1.0 million and 2.9 million people employed in June owed their jobs to the Recovery Act. This estimate, by Congress' non-partisan economic and budget analysts, is more comprehensive than the 550,000 jobs that ARRA recipients reported in July, CBO explains.


While the report focuses primarily on the second quarter of 2011, CBO also includes new projections of the Recovery Act's jobs impact through 2012. It finds that in the current quarter (the third quarter of 2011), there are 0.8 million to 2.5 million more people employed because of ARRA.
The CBO report indicates that ARRA succeeded in its primary goal of protecting the economy during the worst of the recession. As the economy recovers, ARRA's effects will continue to decrease. CBO estimates that ARRA's impact on employment peaked in the third quarter of 2010, when between 1.4 million and 3.6 million people owed their jobs to the Recovery Act.
ARRA Also Boosted Worker Hours, CBO Finds

In addition to saving and creating jobs, ARRA has increased the number of hours worked, CBO has concluded. That is, without ARRA, many full-time workers would have been reduced to part-time status and fewer would have worked overtime. The combination of the increase in jobs and the increase in hours means that ARRA boosted the number of full-time-equivalent jobs by between 1.4 million and 4.0 million as of June, the report estimates. CBO finds that this figure peaked in the third quarter of 2010, and stands at up to 3.4 million full-time equivalent jobs in the current quarter. [2]


Among ARRA's most effective provisions for saving and creating jobs, according to CBO's estimates, are direct purchases of goods and services by the federal government, transfer payments to states (such as extra Medicaid funding), and transfer payments to individuals (such as increased food stamp benefits and additional weeks of unemployment benefits). CBO's estimates indicate that tax cuts are less effective job producers, and tax cuts for higher-income people have very low bang for the buck.

At this point the CBO's "estimates" have become a running joke, Synth. They're making a "count" and it's somewhere between 1 million and 2.9 million? WOW! Pretty darned accurate count! Sorry, but you've already got me laughing my ass off at you because they're using the infamous "jobs saved" statistic which is total bullshit. They don't have the faintest idea how many jobs were REALLY saved. And those supposedly "saved" jobs are the ones that Obama is now telling us he needs another half a trillion dollars to "save"...jobs that will have to be "saved" once again is soon as this new stimulus runs out. That isn't job creation. That's putting the country deeply in debt to keep his public sector union buddies working while the private sector continues to suffer.

 

[8537]

CBO Admits their Stimulus Jobs Count Ignored the Economy

CBO Confirms Its Methodology

In a recent speech to the National Association of Business Economics, CBO Director Doug Elmendorf confirmed this by stating:

[W]e don't think one can learn much from watching the evolution of particular components of GDP [gross domestic product] over the last few quarters about the effects of the stimulus … so we fall back on repeating the sort of analysis we did before. And we tried to be very explicit about it that it is essentially repeating the same exercise we did rather than an independent check on it.[1]

When asked if this means that any actual underperformance of the stimulus would fail to show up in the CBO's stimulus jobs count, Elmendorf replied "That's right." This means the 1.5 million jobs saved estimate was pre-determined.

Of course, the stimulus was originally promised to create (not just save) more than 3 million jobs.[2] Instead, the economy has since lost more than 3 million additional net jobs.

The abject failure of the stimulus policies recommended by Keynesian economic models should induce some fundamental re-analysis of these models' assumptions. Instead, the CBO is re-releasing the same jobs analysis--with the same economic assumptions--that they had used a year ago.

The "Begging the Question" Fallacy

The CBO's conclusion that the stimulus created jobs is based on an economic model that began with the premise that all stimulus bills create jobs. In other words, the conclusion is already assumed as a premise. Logicians call this the fallacy of begging the question. Mathematicians call it assuming what you are trying to prove.

More specifically, the CBO's model started by automatically assuming that government spending increases GDP by pre-set multipliers, such as:

Every $1 of government spending that directly purchases goods and services ultimately raises the GDP by $1.75;
Every $1 of government spending sent to state and local governments for infrastructure ultimately raises GDP by $1.75;
Every $1 of government spending sent to state and local governments for non-infrastructure spending ultimately raises GDP by $1.25; and
Every $1 of government spending sent to an individual as a transfer payment ultimately raises GDP by $1.45.[3]
(Note that all CBO figures in this paper represent the midpoint between their high and low estimates.)​

Then the CBO plugged the stimulus provisions into the multipliers above, came up with a total increase in GDP of 2.6 percent, and then converted that additional GDP into 1.5 million jobs.

The problem here is obvious. Once the CBO decided to assume that every dollar of government spending increased GDP by the multipliers above, its conclusion that the stimulus saved jobs was pre-ordained. The economy could have lost 30 million jobs, and the model would have said that the economy would otherwise have lost 31.5 million jobs without the stimulus. An asteroid could have hit the United States, wiping out everyone outside of Washington, D.C., and (as long as Washington still spent the stimulus money) the CBO's economic model would have produced the same stimulus jobs data. There is no adjustment made to reflect what actually happened in the economy after the stimulus was enacted.​

Now, who wants to claim CBO reports are accurate?

If someone came here from, say, China and spent a billion dollars on goods and services, do you think that spending would cause the producers of his purchases to make more goods?

I've just shown you that the CBO starts off with an unproven assumption, and you want to claim their work is accurate? With their starting point, there is no way they could report anything BUT a net gain.

Okay, then.

Is that supposed to be an answer to my question? And no, they don't start with an unproven assumption. A rightwing talking point factory claiming that economic multipliers don't exist are stating as much - but it's simply a lie.

Do you deny the existence of economic multipliers?

 

[8537]

If someone came here from, say, China and spent a billion dollars on goods and services, do you think that spending would cause the producers of his purchases to make more goods?

I guess it all depends if the creators of the goods weren't taxed out of business, in order to provide those funds.

More broken windows.....

No one was taxed out of business to create the goods.

I notice that, like Daveman, you are incapable of answering a straightforward question.

 

[Moonglow]

CBO Admits their Stimulus Jobs Count Ignored the Economy

CBO Confirms Its Methodology

In a recent speech to the National Association of Business Economics, CBO Director Doug Elmendorf confirmed this by stating:

[W]e don't think one can learn much from watching the evolution of particular components of GDP [gross domestic product] over the last few quarters about the effects of the stimulus … so we fall back on repeating the sort of analysis we did before. And we tried to be very explicit about it that it is essentially repeating the same exercise we did rather than an independent check on it.[1]

When asked if this means that any actual underperformance of the stimulus would fail to show up in the CBO's stimulus jobs count, Elmendorf replied "That's right." This means the 1.5 million jobs saved estimate was pre-determined.

Of course, the stimulus was originally promised to create (not just save) more than 3 million jobs.[2] Instead, the economy has since lost more than 3 million additional net jobs.

The abject failure of the stimulus policies recommended by Keynesian economic models should induce some fundamental re-analysis of these models' assumptions. Instead, the CBO is re-releasing the same jobs analysis--with the same economic assumptions--that they had used a year ago.

The "Begging the Question" Fallacy

The CBO's conclusion that the stimulus created jobs is based on an economic model that began with the premise that all stimulus bills create jobs. In other words, the conclusion is already assumed as a premise. Logicians call this the fallacy of begging the question. Mathematicians call it assuming what you are trying to prove.

More specifically, the CBO's model started by automatically assuming that government spending increases GDP by pre-set multipliers, such as:

Every $1 of government spending that directly purchases goods and services ultimately raises the GDP by $1.75;
Every $1 of government spending sent to state and local governments for infrastructure ultimately raises GDP by $1.75;
Every $1 of government spending sent to state and local governments for non-infrastructure spending ultimately raises GDP by $1.25; and
Every $1 of government spending sent to an individual as a transfer payment ultimately raises GDP by $1.45.[3]
(Note that all CBO figures in this paper represent the midpoint between their high and low estimates.)​

Then the CBO plugged the stimulus provisions into the multipliers above, came up with a total increase in GDP of 2.6 percent, and then converted that additional GDP into 1.5 million jobs.

The problem here is obvious. Once the CBO decided to assume that every dollar of government spending increased GDP by the multipliers above, its conclusion that the stimulus saved jobs was pre-ordained. The economy could have lost 30 million jobs, and the model would have said that the economy would otherwise have lost 31.5 million jobs without the stimulus. An asteroid could have hit the United States, wiping out everyone outside of Washington, D.C., and (as long as Washington still spent the stimulus money) the CBO's economic model would have produced the same stimulus jobs data. There is no adjustment made to reflect what actually happened in the economy after the stimulus was enacted.​

Now, who wants to claim CBO reports are accurate?

If someone came here from, say, China and spent a billion dollars on goods and services, do you think that spending would cause the producers of his purchases to make more goods?

ahem

Goods and services from China accounted for only 2.7% of U.S. personal consumption expenditures in 2010

FRBSF Economic Letter: The U.S. Content of “Made in China” (2011-25, 8/8/2011)

 

[Conservative]

They deny any facts they dont like.

Its like the republican party is now a religion.

The facts just get brushed away and replaced with faith

Which one of these is at your alter?

 

[Truthmatters]

Krugman Eviscerates The Latest "Stupid Stimulus Tricks" | Media Matters for America



What this study claims to do is estimate the effect of the stimulus by looking at cross-state comparisons. So the first thing we should understand is just how difficult it is to do that.

Remember, the stimulus was not big compared with the economic downturn. The original Romer-Bernstein estimate was that it would, at peak, reduce unemployment by about 2 percentage points relative to what it would otherwise have been. And most of that effect was supposed to come through measures that would have been common to all states: tax cuts, transfer payments, etc.. At most, differences between predicted effects among states should have come to no more than a fraction of a percentage point off the unemployment rate.

Meanwhile, there were large differences in actual unemployment changes by state