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Then and Now: Little Reason to Believe President’s Latest Policies Will Be Any More Successful than His Past Policies

January 26, 2012

On January 24, 2012, the President said in his annual State of the Union Address: “This is a make or break moment for the middle class, and all those who are fighting to get into the middle class.”  Throughout his address, the President outlined his ideas for “helping” the middle class.  The words may sound familiar, but the promise rings hollow.  This is especially true when you consider the current state of the economy, and the fact that three years ago, the Obama Administration said its 2009 stimulus plan would be especially beneficial to “low- and middle-income” workers. 

“For example, if the simulation implied that 18.4% of the jobs created would be in construction, our estimate of the number of jobs created in construction in 2010Q4 is 18.4% of our estimate of overall job creation of 3.675 million, or 678,000….The estimates suggest that 30% of the jobs created will be in construction and manufacturing, even though these industries employ only 15% of all workers. Both sectors have been particularly hard hit recently. The other two significant sectors that are disproportionately represented in job creation are retail trade and leisure and hospitality (mining is also represented disproportionately, but employs less than 1% of all workers). Construction, manufacturing, retail trade, and leisure and hospitality all employ large numbers of low- and middle-income workers whose incomes have stagnated in recent decades and who have suffered greatly in the current recession.”

Source: 2009 Romer-Bernstein Report

Before accepting that the President’s next policy proposals will do anything to help the middle class, it is worth examining the Administration’s actual record on its stimulus promises – especially for workers in industries they identified as employing “large numbers of low- and middle-income workers.”  As the following data reveals, the Administration’s sorry track record doesn’t lend confidence that their latest plans to assist the middle class will hit the mark:



Administration Prediction of Job Creation by the End of 2010

Actual Change in Jobs since Stimulus (February 2009 –December 2011)

Gap Between Administration Prediction and Actual Change in Jobs









Retail Trade




Leisure and Hospitality




Source: U.S. Department of Labor data and Obama Administration projections.