Faith-Based Economics

At The Corner, Brian Riedl of the Heritage Foundation adds some excellent thoughts on the administration’s claim that its “stimulus” bill saved us all from catastrophe:

On the stimulus’s first anniversary, keep in mind one number: 6.3 million.
That is the Obama jobs gap — the difference between the 3.3 million net jobs President Obama said would be created (not just saved) and the 3 million additional net jobs that have since been lost.
By the president’s own logic, the stimulus failed. So Obama has shifted his argument. Sure, the economy lost jobs, he now says, but without the stimulus it would have lost nearly 2 million more jobs.
This “it would have been worse” theory is completely unprovable. No one knows how the economy would have performed without the stimulus.
Furthermore, it’s faith-based economics. The White House’s new estimates of “saving” nearly 2 million jobs are not based on observations of the economy’s recent performance. Rather, they are based on the Obama administration’s unshakable belief that deficit spending must create jobs and growth. Specifically, the White House’s “proof” that the stimulus created jobs is an economic model that they programmed to assume that stimulus spending automatically creates jobs.
How’s that for circular logic?
The idea that government spending creates jobs makes sense only if you never ask where the government got the money.

Read it all.


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