Republicans Doubt Obama Job Estimates on Stimulus Bill

By Fred Lucas | February 4, 2009 | 6:16 PM EST

Sen. Jeff Sessions (R-Ala.), left, talks to Sen. Lindsey Graham (R-S.C.), as Sen. Jim DeMint (R-S.C.), second from right, and other Republican lawmakers, participate in a news conference on Capitol Hill in Washington, Wednesday, Feb. 4, 2009. (AP Photo/Susan Walsh)

Capitol Hill ( – Congressional Republicans on Wednesday rejected the idea that the $900-billion economic stimulus plan being pushed by the Obama White House and Senate Democrats will preserve or create more than 3 million American jobs.
“The important thing to appreciate about that number is that instead of being ‘creating’ 3 to 4 million jobs, it is ‘saving or creating’ 3 to 4 million jobs,” Rep. Tom Price (R-Ga.) told during a press briefing. “The problem with that line is that you can’t ever prove a negative. You can’t ever prove that there was a job that would have gone away that didn’t go away because of the bill.”
President Barack Obama and Democrats in Congress say that the stimulus package will create or save 3 million to 4 million jobs through federal spending on infrastructure, education and environmental initiatives. reported Wednesday that job-number estimate comes from a report done before Obama took office, which relied on stimulus spending of $775 billion. That is based on the “rule of thumb that a 1 percent increase in GDP (gross domestic product) corresponds to an increase in employment of approximately 1 million jobs or about three-quarters of a percent,” the report stated. (See Previous Story)
Still, the report does not demonstrate extreme confidence in the estimates, repeating several times that there is a high margin of error and that, “as emphasized above, there is considerable uncertainty in our estimates: both the impact of the package on GDP and the relationship between higher GDP and job creation are hard to estimate precisely.” 

The report, published Jan. 10, was co-authored by Christina Romer, who was then the nominee to become chair of the White House Council of Economic Advisers, and Jared Bernstein, who then worked in the office of the vice president-elect.
Price said the Republican alternative would have created more than 6 million jobs for half the cost of the Democratic proposal.
“So it’s important to realize what the real statement is, in that, ‘saving or creating’ jobs is different than ‘creating’ jobs, which we know will happen under appropriate tax policies,” Price said.
Sen. Jim DeMint (R-S.C.) agreed, as he stood with House and Senate Republicans during the press briefing, at which they criticized the stimulus package as nothing more than a massive spending bill.
“The Obama administration and the Democratic majority is on the wrong side of the economic argument when you listen to the experts,” DeMint told
The report, entitled “The Job Impact of the American Recovery and Reinvestment Plan,” estimated that Obama’s stimulus package would be worth about $775 billion and would have the effect of increasing GDP by 3.7 percent. As a result, the report said, it would increase jobs by 3,675,000 by the 4th quarter of 2010.

While the bill envisioned by Obama’s top economic adviser was valued at $775 billion, the bill that passed the House was valued at $819 billion, and the proposal currently before the Senate has exceeded $900 billion in value.
The Romer-Bernstein report estimates that construction would lead the way in gaining 678,000 jobs under Obama’s planned stimulus, since a significant part of the spending would be focused on highway infrastructure.
Next came retail with 604,000 jobs, the hospitality industry with 499,000 jobs, manufacturing with 408,000 jobs, professional and business services with 345,000 jobs, financial activities with 214,000, and education and health services with 240,000 jobs.