AP: Stimulus Is a Bust

The stimulus money to be spent on infrastructure really did nothing to save or create jobs. That’s not a conservative talking point; that’s the AP:

Ten months into President Barack Obama’s first economic stimulus plan, a surge in spending on roads and bridges has had no effect on local unemployment and only barely helped the beleaguered construction industry, an Associated Press analysis has found.

Obama wants a second stimulus, but what would be the point? (“AP’s analysis, which was reviewed by independent economists at five universities, showed that strategy hasn’t affected unemployment rates so far. And there’s concern it won’t work the second time.”) The reaction of economists is instructive:

“My bottom line is, I’d be skeptical about putting too much more money into a second stimulus until we’ve seen broader effects from the first stimulus,” said Aaron Jackson, a Bentley University economist who reviewed AP’s analysis.

Even within the construction industry, which stood to benefit most from transportation money, the AP’s analysis found there was nearly no connection between stimulus money and the number of construction workers hired or fired since Congress passed the recovery program. The effect was so small, one economist compared it to trying to move the Empire State Building by pushing against it.

Nor are business people impressed. (“‘The stimulus has not benefited the working-class people of Marshall County at all,’ said Isaac Zimmerle, a local contractor who has seen his construction business slowly dry up since 2008. That year, he built 30 homes. But prospects this year look grim.”) But politicians love this stuff. Despite ample evidence to the contrary, they continue to parrot the same rhetoric. Economic adviser Jared Bernstein insists, “When you invest in this kind of infrastructure, you’re creating good jobs for people who need them.” But not really.