White House: Recovery Act Raised Employment, GDP
By Kevin Robinson in News on Jul 15, 2010 2:00PM
The White House Council of Economic Advisers issued its fourth report on impacts of the American Recovery and Reinvestment Act (you can read a PDF of the report here). The report details some of the positive elements of the federal spending act, designed to kickstart the economy in the wake of the 2008 economic collapse, including 3.6 million jobs that were saved or created through the second quarter of 2010, exceeding the president's goals by six months. The report also estimated that as of this year's second quarter the Recovery Act boosted the gross domestic product between 2.7 and 3.2 percent, in line with Congressional Budget Office estimates. And the council noted that for every $1 in federal spending the private sector is investing $3 into the economy.
“We find that roughly $100 billion of recovery act funds use leverage and that these provisions are encouraging co- investment in a wide range of areas,” said Christina Romer, chair of the president's Council of Economic Advisors. Citing investments in clean energy, construction and economic development projects, she added "we estimate that the $100 billion in recovery act funds will partner with close to 300 billion (dollars) of other funds, the majority of which are from the private sector. That is, $1 of recovery act funds is matched by almost $3 of other funds.”
Vice President Biden, cognizant of anxiety among Americans over the state of the economy, reiterated the importance of both the federal recovery spending and the administration's economic policies. “We knew if we didn't act and we didn't act boldly, the best estimates were telling us that we would lose another 4 to 5 million jobs immediate -- in that year,” the vice president said. “Well, we did act, and I stand before you today to say to you that not only the recovery act, which we're talking about here in this quarterly report to the Congress, but the economic initiatives we took, they are working.”
Congressional Republicans, who supported the recovery act only minimally, disagreed with the administration's assessment. Rep. John Boehner, the House Minority Leader, took issue with the recovery in a statement. “No amount of Washington spin or fuzzy math can change the fact that the trillion-dollar ‘stimulus’ is failing by the Obama Administration’s own standards. The writing is on the wall for the president’s ‘stimulus’ policies and everyone - taxpayers, economists, and the rest of the world - sees it but him. The American people have had enough of Washington Democrats’ job-killing spending spree and want better solutions, which is what Republicans are offering.”