Stimulus spent $160,000 for each job

Calculating the number of jobs created for the number of dollars spent for that purpose in the stimulus plan has come up with different figures, including as much as $250,000. But using the administration’s own optimistic figures that 1 million new jobs have been created, that still comes to $160,000 Per Stimulus Job:

The White House argues that the actual job number is actually larger than 640,000 — closer to 1 million jobs when one factors in stimulus jobs added in October and, more importantly, jobs created indirectly, such as "the waitress who's still on the job," Vice President Biden said today.

So let's see. Assuming their number is right — 160 billion divided by 1 million. Does that mean the stimulus costs taxpayers $160,000 per job?

Jared Bernstein, chief economist and senior economic advisor to the vice president, called that "calculator abuse."

He said the cost per job was actually $92,000 — but acknowledged that estimate is for the whole stimulus package as of the end of 2010.

So the White House insists that the stimulus spent $92,000 per job. That doesn’t, of course, mean that the new jobs paid that kind of money. They are mostly construction jobs that pay way less than that. But it shows how much the government spends in administration and its own trickle down processes. In the meantime, despite this job creation, the unemployment rate continues to climb, approaching 10%.

Related: According to consumer car site Edmunds.com, the Cash for Clunker program cost taxpayers $24,000 for each car. This for an average $1600 rebate on a car that cost an average of $26,000. (This was calculated taking into account the number of cars that would already have been bought anyway whose buyers needed no incentive. This was the cost of the extra cars that were purchased due to the federal program.)

About Gene Veith

Professor of Literature at Patrick Henry College, the Director of the Cranach Institute at Concordia Theological Seminary, a columnist for World Magazine and TableTalk, and the author of 18 books on different facets of Christianity & Culture.

  • http://puttingoutthefire.blogspot.com/ Frank Gillespie

    Since the Obama administration is declaring victory with the stimulus plan will they now admit that trickle down economics actually works ;-)

  • http://puttingoutthefire.blogspot.com/ Frank Gillespie

    Since the Obama administration is declaring victory with the stimulus plan will they now admit that trickle down economics actually works ;-)

  • Carl Vehse

    The Cash for Clunker program cost taxpayers $24,000 for each car. This for an average $1600 rebate on a car that cost an average of $26,000.

    The Zerobama’s version of “Grand Theft Auto” or “Gone in Sixty Seconds.”

    But the cost is nothing compared to what future U.S. generations will have to pay for half the voters putting a total clunker in the WH.

  • Carl Vehse

    The Cash for Clunker program cost taxpayers $24,000 for each car. This for an average $1600 rebate on a car that cost an average of $26,000.

    The Zerobama’s version of “Grand Theft Auto” or “Gone in Sixty Seconds.”

    But the cost is nothing compared to what future U.S. generations will have to pay for half the voters putting a total clunker in the WH.

  • Booklover

    Cash for Clunkers was a clunker. And it certainly wasn’t a green program.

  • Booklover

    Cash for Clunkers was a clunker. And it certainly wasn’t a green program.

  • Bryan Lindemood

    Wow – that’s pretty efficient for the federal government!

  • Bryan Lindemood

    Wow – that’s pretty efficient for the federal government!

  • http://www.bikebubba.blogspot.com Bike Bubba

    I actually think Edmunds was a bit too nice; when you count the value of cars destroyed, the cost per car sale is probably north of $30k. The cost will increase even more as other people with older cars cannot get parts to maintain them properly–in the end, we’re probably going to get to around $40k per additional vehicle sale.

    And cost per job? Well, given the 24,000 jobs that have actually been created, let’s just say the math isn’t looking pretty.

    You would be correct if you suggested that I don’t trust the administration’s numbers, as they’ve not been forthcoming with actual rationale for any of their figures–exactly what you would expect when the Secretary of the Treasury apparently cannot figure out Schedule SE.

  • http://www.bikebubba.blogspot.com Bike Bubba

    I actually think Edmunds was a bit too nice; when you count the value of cars destroyed, the cost per car sale is probably north of $30k. The cost will increase even more as other people with older cars cannot get parts to maintain them properly–in the end, we’re probably going to get to around $40k per additional vehicle sale.

    And cost per job? Well, given the 24,000 jobs that have actually been created, let’s just say the math isn’t looking pretty.

    You would be correct if you suggested that I don’t trust the administration’s numbers, as they’ve not been forthcoming with actual rationale for any of their figures–exactly what you would expect when the Secretary of the Treasury apparently cannot figure out Schedule SE.

  • dave

    The Stimulus was designed to do TWO things…one was to build things and two was to create the jobs are needed to do so.

    If you spend a billion dollars to build a bridge and you hire 2500 workers to build it, it doesn’t mean that you pay them 500,000 apiece. you have to pay for steel, you have to pay for equipment, you have to pay for insurance for the project, you have to pay for construction related costs.

  • dave

    The Stimulus was designed to do TWO things…one was to build things and two was to create the jobs are needed to do so.

    If you spend a billion dollars to build a bridge and you hire 2500 workers to build it, it doesn’t mean that you pay them 500,000 apiece. you have to pay for steel, you have to pay for equipment, you have to pay for insurance for the project, you have to pay for construction related costs.

  • DonS

    The sad thing is that these numbers are not unique to the stimulus. This is generally the rate of efficiency of government benefit programs, because of the incredible fixed cost of the bureaucracy. We complain about charities which have overhead such that less than 80% of donations flow to the intended benficiaries, but government programs typically run between 25 and 50% efficiency. This is what makes the concept of government health care REDUCING costs so ridiculous.

  • DonS

    The sad thing is that these numbers are not unique to the stimulus. This is generally the rate of efficiency of government benefit programs, because of the incredible fixed cost of the bureaucracy. We complain about charities which have overhead such that less than 80% of donations flow to the intended benficiaries, but government programs typically run between 25 and 50% efficiency. This is what makes the concept of government health care REDUCING costs so ridiculous.

  • http://www.bikebubba.blogspot.com Bike Bubba

    Dave, you ought also to consider that the goal of the spend-u-more plan was to reduce peak unemployment from 8.5% “if we do nothing” to a peak of about 7.5%, if I remember correctly.

    Given that unemployment is currently closing in on 10% with the spend-u-more plan in full force, and every weekly unemployment shift a complete “surprise” to the economists monitoring them, isn’t it about time we considered the possibility that the models our government is using really aren’t working?

    I’m going to submit one that fits the data for the Depression and today; by taking money out of the private sector–whether by taxation, borrowing, or inflation–the government is eliminating the capital needed to create jobs, and in the process is (as Hoover and FDR did as well) actively destroying jobs.

    I realize the idea Obama claims to be working from is that the spending will “stimulate” more jobs…..however, the data simply aren’t pointing that way.

  • http://www.bikebubba.blogspot.com Bike Bubba

    Dave, you ought also to consider that the goal of the spend-u-more plan was to reduce peak unemployment from 8.5% “if we do nothing” to a peak of about 7.5%, if I remember correctly.

    Given that unemployment is currently closing in on 10% with the spend-u-more plan in full force, and every weekly unemployment shift a complete “surprise” to the economists monitoring them, isn’t it about time we considered the possibility that the models our government is using really aren’t working?

    I’m going to submit one that fits the data for the Depression and today; by taking money out of the private sector–whether by taxation, borrowing, or inflation–the government is eliminating the capital needed to create jobs, and in the process is (as Hoover and FDR did as well) actively destroying jobs.

    I realize the idea Obama claims to be working from is that the spending will “stimulate” more jobs…..however, the data simply aren’t pointing that way.

  • dave

    @DonS:

    Then why is the most popular health insurance plan in the Federal Employees Health Benefit Program, the Blue Cross/Blue Shield plan priced at about $400/month for great benefits? This is government procured insurance and it beats any deal you could buy yourself by a mile, by a thousand miles. Not only that, it’s cheaper than an equivalent plan offered by private sector employers.

    As for Medicare, less money is spent on administration of that program than in administering private health plans.

    How about next time not just making up 25% and 50% “efficiency” numbers when it pertains to government and quoting actual figures and using proper reasoning when interpreting them.

    By your standard, all I have to do is make up some number, I’ll just say the sky is 133% bluer here on the west coast because it sounds good and you might just believe it –except that doesn’t mean it’s true. Same with your 25%, 50% numbers.

  • dave

    @DonS:

    Then why is the most popular health insurance plan in the Federal Employees Health Benefit Program, the Blue Cross/Blue Shield plan priced at about $400/month for great benefits? This is government procured insurance and it beats any deal you could buy yourself by a mile, by a thousand miles. Not only that, it’s cheaper than an equivalent plan offered by private sector employers.

    As for Medicare, less money is spent on administration of that program than in administering private health plans.

    How about next time not just making up 25% and 50% “efficiency” numbers when it pertains to government and quoting actual figures and using proper reasoning when interpreting them.

    By your standard, all I have to do is make up some number, I’ll just say the sky is 133% bluer here on the west coast because it sounds good and you might just believe it –except that doesn’t mean it’s true. Same with your 25%, 50% numbers.

  • DonS

    dave @ 9:

    The FEHB is an EMPLOYEE benefit program, not an entitlement program. Apples and oranges, as you should know. And yes, the total premium for 2009, per month is $448.50. For a family, it is $1027.95. That is very typical for employer paid health insurance in 2009, taken as a national average.

    So what does an employee benefit plan have to do with the point I made earlier, pray tell? Do a little research on total budgets of federal cabinet departments that exist solely for the purpose of administering entitlement programs, such as HHS, versus actual distributed benefits. You will see that I was being quite generous.

  • DonS

    dave @ 9:

    The FEHB is an EMPLOYEE benefit program, not an entitlement program. Apples and oranges, as you should know. And yes, the total premium for 2009, per month is $448.50. For a family, it is $1027.95. That is very typical for employer paid health insurance in 2009, taken as a national average.

    So what does an employee benefit plan have to do with the point I made earlier, pray tell? Do a little research on total budgets of federal cabinet departments that exist solely for the purpose of administering entitlement programs, such as HHS, versus actual distributed benefits. You will see that I was being quite generous.


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