Comments on: Porkulus destroyed/forestalled a net 599,000 jobs

By: J. Strupp

J. Strupp — Thu, 19 May 2011 18:40:12 +0000

I didn’t miss anything Steve. It just doesn’t make any sense. This is the run-of-the-mill “crowding out” argument that defies basic econ. One could make the argument (a weak one at that) that ARRA did little or nothing to sustain aggregate employment over the last two years. But the idea that ARRA stimulus money worked to crowd out private sector employment at a time when 8 million plus workers are out of a job and a quarter of the nation’s capacity sitting idle defies logic (and math). As I said before, this crowding out argument has been around since the beginning of the crisis and doesn’t have a shred of evidence to support it.

“The reason why the actual number of net jobs destroyed/forestalled by Porkulus is closer to 1,000,000 than 600,000 is because in many states, including Wisconsin, the bulk of the money was not used to replace other revenue streams, but supplement them.”

This makes no sense either. What you’re saying is that ARRA funds were used by “some” states to supplement other revenue streams which REDUCED growth and, therefor, aggregate employment. Your making the same argument Dupor and Conely that 1+1= -2.

It’s pretty clear that Dupor and Conely’s paper was written with a pre-determined conclusion in mind. Maybe you see it, maybe you don’t.

By: steveegg

steveegg — Wed, 18 May 2011 17:48:24 +0000

In reply to J. Strupp.

It’s been a while since you showed up. I see you missed the part of the paper that said that the government jobs “saved/created” and the private-sector jobs “destroyed/forestalled” was against what would have happened had Porkulus never came into being, not against the economic collapse.

As for the state/local government shortfalls, all that happened was, at the cost of 600,000 jobs (or more properly, closer to 1,000,000 jobs), Obama and company rolled into the federal debt 2 years of state/local deficit spending. To put it another way, instead of states and local governments cutting an aggregate $247 billion of spending, we put that, and a lot more not covered by the report, on the federal charge card.

The reason why the actual number of net jobs destroyed/forestalled by Porkulus is closer to 1,000,000 than 600,000 is because in many states, including Wisconsin, the bulk of the money was not used to replace other revenue streams, but supplement them.

By: J. Strupp

J. Strupp — Wed, 18 May 2011 04:15:59 +0000

“…while the entities in the goods-producing sector decreased their payrolls by 362,000 and those in the “HELP” services sector decreased their payrolls by 772,000.”

Imagine that. The goods-producing sector decreasing payrolls during the worst collapse in AD in almost a century. And no one refutes that ARRA helped to shore up state and local government budget shortfalls. Nothing in this paper is really fresh except for the rather odd, “crowding out” argument they put forward.

“This actually surprised the economists.”

Somehow I don’t think these conclusions surprised economists who openly refute Keynesian multiplier theory.

By: Porkulus Killed or Aborted Nearly 600,000 Net Jobs | The Lonely Conservative

Tue, 17 May 2011 01:30:23 +0000

[…] that’s the most damning study of the stimulus, aka Porkulus, that I’ve seen to date. As Steve Egg at No Runny Eggs pointed out, even the two economists seemed to be taken aback by their findings. The report, titled […]

By: Lonely Conservative

Lonely Conservative — Tue, 17 May 2011 01:19:07 +0000

This is one of the most damning studies of the stimulus I’ve seen yet. It’s also timely, considering the national debt debate going on.