Reporters and everyone else keep referring to the $787 billion aid package Congress passed in February and the other extra billions already flowing through the system as “stimulus” money.
Everyone should stop. Only a small fraction of the dollars are being used to jump start the economy and to create new jobs.
The vast majority of the estimated $4 billion coming to Maryland from the American Recovery and Reinvestment Act will be used to prop up soon-to-be insoluble programs like Medicaid, pay pension benefits for state teachers that taxpayers cannot afford, extend food stamp benefits, prevent sexually transmitted diseases, and help the homeless, among other welfare programs.
The Department of Legislative Services outlined where the money is going in a March 2009 report, “American Recovery and Reinvestment Act: Impact on Maryland Governments.”
It shows that less than 20 percent of the money is directed to building “shovel-ready” projects like roads and bridges and to ensuring adequate and clean water supplies in the state. The report reveals no money targeted to inventing new technologies — not even the green ones much hyped by President Barack Obama and Gov. Martin O’Malley. Neither did it show money directed toward creating a lower taxed, pro-business environment that makes the state a top destination for those seeking to start businesses — the long-term key to Maryland’s health.
President Barack Obama last week claimed the legislation saved or created 150,000 jobs in its first 100 days and will save or create 600,000 more jobs in the next 100. Since it is impossible to measure jobs saved, no one can verify his statement.
Regardless of political obfuscation, it is possible to measure how many jobs were lost since the bill passed, about 1.6 million nationally. In Maryland, there are three thousand fewer people unemployed than in January, the month before the legislation passed, according to the state’s Department of Labor, Licensing and Regulation. But the labor force is 16,000 people smaller, so it’s hard to tell whether jobs were created or if people just stopped looking for work. (By comparison, there were 102,460 unemployed workers in Maryland in April of 2008. In April of 2009, there were 194,224.)
And from the looks of it, there is no way the nation will add 600,000 new jobs as a result of the federal government’s largesse if job postings reflect job openings. My search ofwww.usajobs.com, a federal government database, shows 43 positions available connected to the American Recovery and Reinvestment Act nationally. There are, however, 47,958 federal government jobs available worldwide.
When I clicked on the “Recovery Act Jobs” link on Maryland’s Department of Labor, Licensing and Regulation Web site, 28 jobs popped up, many of them temporary, paying minimum wage. The highest paying job was listed as a “Financial Compliance Auditor Trainee” for $43,055 – which is about $5,000 less than the average per capita wage in the state. Dividing $4 billion – the amount Maryland received from the package – by 28 jobs, it works out to be about $143 million investment per job created, surely a new record in employment cost-benefit analyses.
The federal and state job banks may not be the only jobs made available by the legislation, but wouldn’t it be more obvious that the state and nation were on the road to recovery by looking at job numbers?
The April unemployment rate, the most recent, was 6.8 percent in Maryland. In March it was 6.9 percent – near a 17-year high.Nationally, the unemployment rate is 9.4 percent, the highest in 25 years, and many economists predict it could go higher.
When the legislation passed, it was billed as a targeted means to get America working and spending again. But so far it’s turned into a short-term trust fund to prop up a lifestyle that Americans could not afford before the market crashed.
Signs point to the economy turning around. But it does not help President Obama’s cause to rely on shady accounting for his job numbers. He said his administration is “committed to creating an unprecedented level of openness in government.” For Americans to trust him, he must hold himself to that standard and take the consequences, even if it shows the stimulus package is no stimulus.
Examiner columnist Marta H. Mossburg is a senior fellow at the Maryland Public Policy Institute.
