The headline is “Obama Jobs Plan May Prevent 2012 Recession.” But the story Bloomberg published, based on its survey of economists about the president’s $447 billion proposal, is best summarized by the second paragraph:
The legislation, submitted to Congress this month, would increase gross domestic product by 0.6 percent next year and add or keep 275,000 workers on payrolls, the median estimates in the survey of 34 economists showed. The program would also lower the jobless rate by 0.2 percentage point in 2012, economists said.
For those keeping score at home, that’s a “jobs plan” that costs more than $1.6 million per job. If the president wants to spend taxpayer dollars to provoke demand-side job creation, he would be better off holding a lottery and giving $10,000 apiece to 45 million people.
Worse, the Economic Policy Institute earlier this year estimated it would take job growth of 285,000 per month, every month for the next five years, for the economy to return to the pre-recession unemployment rate. That was after February’s job-growth numbers came out; job growth has come in well below 285,000 every month since then. (It was zero in August, in case you forgot.)
So, President Obama wants to spend $447 billion to speed up the recovery process by one month. Or, rather, the better part of one month.
The White House, according to Bloomberg, prefers to cite economists who say the plan would boost hiring by 1 million. But for every economist in the survey that says the plan would perform that well, there’s another who says it won’t produce any net new jobs. [This sentence has been edited from the original; see explanation in my comment at 11:20 a.m. -- KW]
Oh, and that line about the plan keeping us out of a recession next year? If 0.6 percent of GDP is the difference between being in a recession and staying out of one, we’re in for a rough 2012.
– By Kyle Wingfield