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Unhappy Fourth Birthday for Stimulus

February 15, 2013

February 17, 2013, will mark the fourth anniversary of Democrats’ failed 2009 stimulus plan – and yet another year in which Democrats’ economic policy promises turned out to be oversold and underperforming.  As displayed below, despite adding $1 trillion to the national debt, this 2009 legislation has been followed by 2.8 million fewer jobs and an unemployment rate 2.7 percentage points higher than Democrats predicted in selling their 2009 policy.

JOBS: Still 2.8 million fewer jobs than the Administration predicted with stimulus – now four years later

Administration prediction for December 2010  137.6 million 
January 2013 actual 134.8 million
2.8 million fewer jobs than predicted

UNEMPLOYMENT RATE:  2.7 percentage points higher unemployment rate than the Administration predicted by now with stimulus

Administration January 2009 prediction for January 2013  5.2% 
January 2013 actual 7.9%
2.7 percentage points higher than predicted

Current data follows prior years of similar stimulus disappointment:

  • When he signed that $1 trillion plan into law in February 2009, the President predicted  “it will create or save 3.5 million jobs over the next two years.”  On the first anniversary of the 2009 stimulus, President Obama said it “is on track to save and create another 1.5 million jobs in 2010.” Instead, the first anniversary in 2010 was marked by a record 16 million individuals being out of work.
  • Then came the second anniversary of the 2009 stimulus law, with more disappointment for workers. In early 2011 payroll employment was over 7 million jobs short of the Administration’s pre-stimulus forecast.  And instead of causing unemployment to fall, the unemployment rate remained stuck at 9 percent or higher for the 21st consecutive month – the longest period since the Great Depression.
  • In 2012, the third anniversary of the 2009 stimulus brought more of the same. By then unemployment still remained above 8 percent – part of a record string of 43 straight months during which the unemployment rate was above 8 percent.  This contributed to sky-high durations of unemployment and 11 extensions of the Federal unemployment benefits, costing Federal taxpayers more than $260 billion to date.