Thursday, September 30, 2010

How many jobs were "created" or "saved"?

Recently someone said that the CBO claimed that 1.3 million jobs were created due to the stimulus. I don't believe that number for a second. It all depends on comparing how many jobs would have been created without the stimulus. We don't know that, so we can't really say whether the stimulus helped at all.

Nonetheless, I am lazy, is there anyone out there who can better explain this?

2 comments:

Daniel said...

The economy was stagnant. Business expansion occurs by getting credit from banks. This creates jobs. Banks were not lending. So where do you think the money to create new jobs would have come from if not from the stimulus?

Adam Freund said...

Daniel,

Even if we suppose you are right, that credit was limited and badly needed, you are treating the symptom rather than the cause. The more relevant question that needs to be asked and answered is why banks weren't lending in the first place? Pretty much the reason banks exist is to take our money and lend it out to other people.

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