Monday, July 5, 2010

$800 billion wasn't put to work

"We opened the window behind me and threw eight hundred billion dollars out of it."

That was how an aide to a local congressman described to me the economic-stimulus act when it passed in the winter of 2009.

The aide didn't mean it would all be a waste. Or would fail to boost a cratering economy.

He meant that what was unusual about the American Recovery and Reinvestment Act, other than its staggering cost, was that it was a smorgasbord. A huge experiment in infusing borrowed cash into a gazillion pre-existing channels, from government social programs to grants for road construction to walking-around money in worker paychecks.

It was an emergency. Seattle Congressman Jim McDermott described it as "Congress flying blind."

So here we are a year and a half later. It seems obvious the experiment helped stop a free fall. You can see that in areas where the stimulus has ended. The housing market, for instance, propped up for months by stimulus tax credits, has dropped sharply since that program expired.

But you don't have to be an economist to see that Congress swung and missed on the issue of jobs.

All that spending hasn't gotten many back to work. Take the freshest data for Seattle and King County. In the first three months of 2010, the act is credited with paying for 2,712 jobs here. That's in a county with a labor force of 1.1 million and 90,000 more currently jobless.

A few thousand jobs in three months is better than nothing. But it's also not much. It shifts King County's unemployment rate by only two-tenths of a percentage point.

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