Obama Failed Math

Obama proposes to spend 3% of GDP to get a 2% boost - no thank you.

Obama's big jobs plan, according to economists at Goldman, Moody's, and JPMorgan, will boost GDP 2%. What happened to the 1.5 multiplier in the 2009 mega stimulus, which never materialized. The 2009 plan projected further that unemployment would not go over 8% with the ARRA. Notice the bold claims from the administration are not quite so specific. Expect to hear the stories of roads to nowhere, pet projects, programs that cost $400,000 per job, and an unemployment rate that does not go down to the claimed 7%. This program will NOT create 1.9 million jobs and unemployment will go up when labor force participation is factored in.

Government jobs plans don't materially create jobs on net. This plan spends over 3% of GDP to get a hoped for 2% GDP boost – there is no money back guarantee. We are borrowing the economy toward insolvency. The ability to print money does not change this.

References:

Bloomberg Article