In his first month in office, President Barack Obama passed a $787 billion stimulus package. Predictably, just as President Franklin RooseveltâÄôs New Deal failed to rescue the nation from the Great Depression, ObamaâÄôs stimulus has thus far failed to rescue us from the “Great Recession.”
Now, after a record of failure of these Keynesian proposals, Gov. Mark Dayton is proposing the same big government on the state level, with his $1 billion bonding bill.
But “DaytonâÄôs Stimulus” will not produce the results he seeks. The costs are bloated and not market-oriented, and the blue-collar labor market is a fraction of the size it was in the 1930s.
The city of Minneapolis illustrates the bloated costs of ObamaâÄôs stimulus perfectly.
Minneapolis received about $32 million in stimulus funds and Minnesota Public Radio reported the result of this spending was 206 new full-time jobs. The average of that is about $155,339 per job created.
The average salary of a city worker in Minneapolis is $45,024 annually.
That $110,315 per employee discrepancy demonstrates nothing more than a waste of taxpayer money.
The waste becomes more evident when the actual items funded became known. Included in the stimulus were things like $15,551 to study drunken mice, or $250 stimulus checks to convicts. Given the apparent recent priorities of Democrats, one has to be concerned about the necessity of the projects in DaytonâÄôs bonding bill.
The high costs of the stimulus negate benefits claimed by its supporters. Many are now saying that there has been no benefit at all.
A look at the new unemployment numbers for the month of January shows that the unemployment rate has “fallen to 9 percent from 9.4 percent.” The catch is that only 36,000 new jobs were added. This means that the reduction in the unemployment rate is almost solely due to the expiration of an individualâÄôs unemployment benefit.
But we donâÄôt know if those 36,000 new jobs were in fact created as a result of the stimulus. We also donâÄôt know if those jobs are $8 per hour part-time retail jobs or new, high paying full-time jobs.
The stimulus was a clear waste of taxpayer money, and has achieved no results nearly two years after being enacted.
Furthermore, the idea of “stimulus” is more problematic today than it was in RooseveltâÄôs time, when there were far more blue-collar laborers looking for work. Approximately 8.7 percent of the workforce today is considered to be in the construction industry, or a farmer. In the 1940, that number was 25 percent.
This means that the percentage of Americans that are mobilized by these “shovel-ready projects” has fallen by nearly two-thirds. The bulk of the benefit of these government-initiated stimulus programs will go to less than a tenth of the working population.
WhatâÄôs more is that two UCLA economists have calculated that the big-government policies of Roosevelt in the 1930s actually prolonged the Great Depression by seven years.
In other words, Dayton is proposing something that hasnâÄôt worked on the national level in the past two years. ItâÄôs a proposal thatâÄôs in line with one that not only failed to revive the U.S., but actually kept it in the Great Depression for nearly double the time a recovery could be expected. ItâÄôs one that results in the taxpayers paying far more into the government than the benefit they receive.
I cannot imagine why, especially when our stateâÄôs budget deficit is $6.2 billion, Dayton would support wasting $1 billion dollars on bloated government pet projects that have not once in the past gotten Americans âÄî much less Minnesotans âÄî back to work.
Josh Villa welcomes comments at [email protected]
