Fact-Checking The Stimulus Progress Report
ROBERT SIEGEL, host:
From NPR News, this is ALL THINGS CONSIDERED. I'm Robert Siegel.
One-hundred-fifty-thousand jobs created or saved, 95 percent of working families getting tax cuts in their paychecks - those are the headlines from the first White House report on the impact of the $787 billion stimulus package. President Obama signed the stimulus package 11 weeks ago, and a progress report was delivered to the president today by Vice President Joe Biden.
NPR's John Ydstie joins me now to assess the claims made in that report. Hi, John.
JOHN YDSTIE: Hi, Robert.
SIEGEL: Let's start with the total numbers. The administration says it has obligated $88 billion already, and to use their word, it has outlaid about $28 billion. What do those terms mean?
YDSTIE: Well, obligating $88 billion means the government has made binding agreements with contractors to do things like resurface highways. But it hasn't necessarily wired the money out. So it could still be a week or even months before the money goes out the door. The 28 billion in outlays is cash that's been handed over. The check's been sent, the electronic transfer's taken place. It doesn't mean all the money has been spent, but it's out there in the hands of the people who will do the spending.
SIEGEL: $28 billion out the door, and only about $760 billion to go.
(Soundbite of laughter)
SIEGEL: I understand how easy it would be for the government to count the dollars as they go out, but what about the claim of the 150,000 jobs created in 11 weeks?
YDSTIE: Right. That's a tough one to swallow, given that the Bureau of Labor Statistics has reported over a million jobs lost during the same period. And, in fact, many state governments which were targeted to received the funds quickly so they could preserve jobs continue to lay off large numbers of workers. But the administration that if it hadn't been for the stimulus spending, it would have been much worse. And the 150,000 number is not simply picked out of the air. The White House Council of Economic Advisors is using an econometric model that uses accepted rules of thumb for how many jobs are created by federal spending or tax cuts.
SIEGEL: So what's the formula? How much government spending per job?
YDSTIE: Well, the rule of thumb is that $100 billion of government spending will create a little more than a million jobs. That's about a $100,000 for each job. A hundred billion in tax cuts doesn't create quite as many jobs, about 690,000. As one economist put it, this is plausible, given how much money has been spent. It passes the laugh test, but it's an estimate. It's not a real head count.
SIEGEL: Now, in addition to the jobs figure, the administration say 3,000 transportation and construction projects have been funded, and it says unemployment benefits have been increased by $25 a week. You trust those numbers?
YDSTIE: Yeah, yeah. The $25 was called for in the stimulus legislation, and that's now being added to unemployment checks. And then the tax cuts for 95 percent of workers that you mentioned in the intro started going out to workers in April, in increments of about 13 bucks a week, on average. So those things are happening. The 3,000 new transportation projects is something the Transportation Department would keep track of. So these are likely accurate numbers. There are some criticisms about them, though. The money for transportation projects isn't getting to the neediest areas, according to the Associated Press. It did a study that shows the areas with high unemployment are getting considerably less of those dollars in communities that - where unemployment is relatively low.
SIEGEL: Thank you, John.
YDSTIE: You're welcome, Robert.
SIEGEL: That's NPR's John Ydstie.
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