CNN recently published an article on their website claiming what many of us believed anyway: the stimulus bill has had very limited effect on the economy.
According to a recent survey of economists, the stimulus bill “had little to do with the rebound”. First of all, I take principle with the “economic rebound” people keep talking about, but I’ve already beaten that issue more times than I’ve beaten Super Mario World.
I’ve only beaten that game once.
Even though for the first time in two years, according to the article, employers report growth in the private sector, these economists believe the stimulus had very little to do with it.
Instead of feeding the public sector by pumping random amounts of money into it, the government should have provided emergency tax breaks to business-owners to offset the credit crunch created by the collapse of the housing bubble. With this type of funding, businesses might not have had to lay off as many workers.
Alternatively, the government decided to expand the public sector. The administration totes having created nearly 3.5 million jobs because of the stimulus, but many of these jobs are temporary, some of which reportedly only lasting a day in some places.
In fact, in the same survey, the National Association for Business Economics polled sixty eight of its members who own firms in the private sector. A full seventy three percent of them said that only growth they experienced had little or nothing to do with the stimulus bill.
However, even though I’ve said many times that the administration is wrong with its overly optimistic outlook of the economy, the report also claims that industrial demand is increasing, which calls for an increase in the number of jobs. In the same poll, seventy percent of respondents believe the private economy should grow more than two percent by the end of 2010, which seems like a feat in of itself.
One last point the survey mentions is that the credit crunch is still being felt by small businesses. This ties into my last blog, because if Congress were to regulate the credit industry as it plans on doing, the predicted private sector growth could falter.
Read the CNN story here: http://money.cnn.com/2010/04/26/news/economy/NABE_survey