Stimulus, Recovery, and Fallacies
NYT economic columnist David Leonhardt argues that the Obama economic stimulus package has “had a huge impact on jobs — employing something like two million people who would otherwise be unemployed right now.”
Kevin Drum agrees and presents a chart by Organizing for America (aka, Obama’s campaign PAC) to argue that “We still have a long way to go before job growth is back to normal, but the stimulus is getting us there a lot faster than we would have gotten there otherwise.”
Now, as I’ve said previously, I both opposed the stimulus package but think it likely did some good. How good, we don’t know — the two million figure is double most nonpartisan estimates — but it surely created some jobs. Hell, dropping that much money out of a helicopter would have created a bunch of jobs.
Further, I’ve conceded that the political realities were such that a President McCain would have had to pass something similar. Indeed, President Bush had already signed two bailouts and even circumvented the direct will of Congress to start bailing out the auto companies.
But the chart doesn’t tell us anything useful. Aside from the fact that the post hoc, ergo propter hoc fallacy is alive and well.
It’s quite probable that the worst of the recession — already one of the longest in history — was going to be over last spring, anyway. Jobs were likely to come back, anyway. They always do.
Beyond that, the stimulus package was passed in mid-February 2009 and much of the money still hasn’t been spent. That’s not Obama’s fault — it’s just the nature of funneling that much money into the economy, especially through the vehicle of state and local governments via the federal bureaucracy. Does anyone really think that the positive trend in jobs in April had much of anything to do with the stimulus package? Of course not.
Again, the stimulus was politically inevitable. It probably helped restore some confidence in the business sector and among consumers. It’s certainly helped to create some large number of jobs.