Stimulus spin 

White House distorts extent of economic recovery

When the big news broke this week that "the recession is over," I didn't notice a lot of Montanans out dancing in the street and partying. That, no doubt, is because unemployment continues to climb, retirement accounts remain ravaged and the prospects for jobs with livable wages and benefits remain elusive. The realities barely resemble the spin being spewed by Congress and the White House, although they nearly broke their arms patting themselves on the back with last week's announcement.

According to a press release issued by the White House, the $787 billion stimulus program that squirted out of Congress early this year has "created or saved" 640,329 jobs nationwide despite the fact that unemployment in the United States is now pushing toward 10 percent and has doubled that in many hard-hit areas. But as political spin-meisters such as Vice President Joe Biden like to remind us, it would be much worse had the government not spent all those hundreds of billions of dollars it didn't have. Biden then went on to say that if you add the jobs due to a whopping $288 billion in tax cuts, the real total is "more than 1 million jobs."

No sooner had the jobs figures come tumbling out of the politicians' mouths, however, than they were disputed nationally as wildly optimistic. Even here in Montana, the governor's budget director, David Ewer, put the real number of jobs "saved or created" at about 4,100 rather than the 6,247 figure put out by the White House. Maybe a couple thousand jobs is no big deal, but it is worrisome that even in a state like Montana, with less than a million people, the D.C. analysts could be off by a full 33 percent on their estimates.

As Ewer told reporters: "Those [4,100 job] numbers are being reported using the method required by the federal government. We've been told how those numbers get reported. I'm not going to represent that those are actual created jobs. Those numbers are artificially high in the state and the nation [and] are going to come down."

But if you really want to see how much spin and politics is being fed to us these days, compare the current accounting with the estimates put out by the White House last February on the impact the stimulus spending would have in Montana. According to "The Job Impact of the American Recovery and Reinvestment Plan," 12,300 jobs would be created or saved over the next two years. "Jobs created will be in a range of industries from clean energy to health care, with over 90% in the private sector," the plan stated.

Particularly worthy of notice is the White House assurance that "over 90 percent" of the jobs would be created in the private sector. In fact, according to the Associated Press, the zip codes to which most of the government stimulus money has been distributed are in Helena—the state capital zip code, to be specific. As the AP reported: "Recent reports say that money spent so far—still only a portion of more than $800 million in federal stimulus money allocated by the state—has mostly benefited teaching and government jobs."

So here's the situation: Not only are we being misled by our own federal government about the number of jobs produced through the massive stimulus spending, we are also being misled as to who got those jobs. And that raises yet another serious concern for the future.

While there's nothing wrong with creating or saving jobs in government and education, the real question is what happens after the stimulus money runs out? Put bluntly, who will pick up the tab for maintaining those jobs into the future? Unfortunately, while government does an excellent job of consuming revenue, it does a pretty poor job of creating it. One need only look at the recent $2 billion loss to the state's retirement investment portfolio to understand that government will never be able to make up those losses and will, as with continuing the stimulus jobs, turn without hesitation to the taxpayers to pick up the tab.

If Montana's taxpayers are going to somehow come up with the revenue necessary to fund the so-called stimulus jobs, where will they get it? The federal government can crow that the "recession is over" because of a slight uptick many relate directly to the massive expenditures for Cash for Clunkers and the first-time homebuyer credit of $8,000, but those aren't jobs. They don't put people to work on a permanent basis, and they will not produce increasing tax revenues to support the Bridge-to-Nowhere now being built with the borrowed dollars of the stimulus program.

The grim reality is that the future of the nation will likely produce less tax revenue, not more, as the Baby Boomers crawl into retirement and begin massively consuming revenues for health care while their tax revenue production plummets. The smaller generations following will then be burdened not only with trying to generate enough taxes to support their parents and grandparents, but will have to support the distinctly non-private sector government jobs created by the stimulus program. On top of that, they'll have to somehow find the additional revenues to pay back the national debt, which is now hitting record highs of $13 trillion.

Those expecting the United States to somehow jump back up to the unsustainable and tremendously damaging levels of our former highly consumptive society are, like the White House, primarily peddling spin and fiction rather than facing the hard truths that confront us as a nation.

Few politicians are willing to address these very real issues and their impacts. In fact, most would rather look longingly through rose-colored glasses. Sooner or later, however, we will have to face these grim realities, as will our kids. And we deserve, sooner rather than later, the truth—not more fairy tales from our government.

Helena's George Ochenski rattles the cage of the political establishment as a political analyst for the Independent. Contact Ochenski at

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