Ohio State economists Timothy Conley and Bill Dupor released a report last week that’s the most damning study of the stimulus, aka Porkulus, that I’ve seen to date. As Steve Egg at No Runny Eggs pointed out, even the two economists seemed to be taken aback by their findings. The report, titled “The American Recovery and Reinvestment Act: Public Sector JobsSaved, Private Sector Jobs Forestalled” found that the net number of jobs destroyed or forestalled by the spending bill is nearly 600,000.
Our benchmark results suggest that the ARRA created/saved approximately 450 thousand stateand local government jobs and destroyed/forestalled roughly one million private sector jobs. State and local government jobs were saved because ARRA funds were largely used to oset state revenueshortfalls and Medicaid increases rather than boost private sector employment. The majority of destroyed/forestalled jobs were in growth industries including health, education, professional andbusiness services. This suggests the possibility that, in absence of the ARRA, many government workers (on average relatively well-educated) would have found private-sector employment had their jobs not been saved.
Just think, without all of that wasteful spending, and the interest on the debt it created, we could have had a few more hours or days before hitting the debt ceiling. Not to mention all of the income tax revenue the federal government lost out on by destroying private sector jobs.