Economics 1A and Washington BS

The Obama administration today claimed that they had either created or helped to forestall the loss of 650,000 jobs with the stimulus money. They had the Vice President trot out this nonsense, with a joke that Reagan used to tell (although Biden claimed it was from his grandfather). When you push on the number it becomes all those jobs that were created as a result of a) more money to local and state government (an assumption that without the dough the jobs would have been lost) or to contractors who are using stimulus money to do projects. One other Administration official claimed that the actual number of jobs created or saved was 1 million.

Here are some questions that anyone should expect to be answered by the Administration - don't hold your breath.

1) Take them at their word for the higher number - is it reasonable to pay almost $80,000 per job? Have they done any estimates of how long these supposed jobs will last? Do they have any idea about the potential hiccup that happens when the stimulus dries up? One estimate by John Taylor at Stanford, suggests that the effects of the stimulus on GDP growth has been almost impossible to see.
2) Did they miss the session on opportunity costs? What might have happened in job creation both in the short term and long term if the government had not borrowed massive amounts to fund jobs that may or may not have been lost? Have they bothered to look at the short term costs versus the long term costs of less deficit financed funding. Considered another way the stimulus package added a bit more than $2500 per capita to the debt that faces every American.
3) The unemployment rate in the country (which is a trailing indicator) is approaching 10% - does that mean the Administration argues that the number of unemployed would have increased by 1,000,000 if the stimulus had not been in place? The most recent BLS numbers suggest that we have about 15 million unemployed - so the million more would add another 6% to the figure.