Friday, June 17, 2011

Obama's ignorance on job creation

Jonah Goldberg has a lot of fun with Obama's supposed joke about shovel ready jobs turning out not to be as shovel ready as he'd t
This is a staggering indictment of the president, the team he assembled, and the journalists who accepted this administration’s arrogant assertions that they knew exactly what to do, how to do it, and what would happen as a result. Remember, this is the administration that to this day insists it is “pragmatic” and simply cares about “what works.”

“I think we can get a lot of work done fast,” President-elect Obama said shortly after a gathering of governors in December 2008. “All of them have projects that are shovel-ready, that are going to require us to get the money out the door.”

Jared Bernstein, economic adviser to Vice President Joe Biden — the White House’s point man on the stimulus — said in a cable-news interview in February 2009: “I think what people need to understand is that this really isn’t rocket science.” Spend a bundle on public works projects and — boom — you get a lot of people working.

They were wrong.

They were wrong not just about the effect of infrastructure spending — even an analysis by the Associated Press found no evidence unemployment was significantly improved by the Recovery Act’s public-works projects — but they were wrong about the existence of shovel-ready jobs in the first place. (They were also misleading, since only a tiny, tiny fraction of the stimulus went to any infrastructure at all. The bulk went to social programs.)

Back in October, when Obama admitted that he had to learn on the job that shovel-ready jobs don’t exist, then-governor Ed Rendell (D., Penn.) — a leader in the push for the stimulus — told the New York Times it was all a terrible misunderstanding. “When we said ‘shovel ready’ we meant ‘shovel ready’ in the way we do things.” He added, “I don’t think we meant to be deceptive.”

You’ve got to love the “I don’t think” there.

The “way we do things” involves endless paperwork, union regulations, environmental red tape, and the like. That’s why it only took 410 days to build the Empire State building and 16 months to build the Pentagon but nearly 20 years to complete Boston’s Big Dig. Lord knows how long it will be for the government to finish work on Ground Zero.

The point is that the president and his team came into office insisting that they were on top of things and above mere ideological considerations. When confronted with skepticism about the existence of “shovel-ready” projec, they in effect rolled their eyes and scoffed at the backseat drivers.
But they were the ones who were blinded by ideology. One need not be an ideologue to understand that public-works contracting has become bloated and Indeed, one must be an ideologue of a certain kind not to understand that. Or one has to be incredibly naive. Or both.
As soon as this stimulus was proposed, there were people who ridiculed the idea of these shovel-ready projects. For example, here is a post I had from January 2009 with criticisms from Lawrence Lindsay and Alice Rivlin on how the stimulus proposal was designed. And guess what? The CBO was warning back in January 2009 that the stimulus wasn't going to get the money into the system as fast as the Democrats were pretending. The Democrats steamrolled right over those critics. And now Obama is joking about acknowledging that his critics understood more about job creation than he and his advisers did.
As Goldberg concludes, the joke's on Obama.
For instance, you know where this jobs-council meeting took place? At Cree Inc., an LED lightbulb maker. Under the supposedly jobs-boosting stimulus, Cree received $5.2 million. According to, that $5.2 million created 3.02 jobs. That’s $1,716,171 per job.

There’s a funny joke in there somewhere, but I don’t think Obama wants to tell it.
And then, of course, there is the reality that Cree is building jobs in China. Given what a black eye that little tidbit gives the whole Obama claim about how the stimulus helped create green jobs for Americans, we're left to decide whether the President's appearance there was just bad staff work or if this was the best they could do in picking a backdrop for the President's claims.