Columnist: 'Stimulus' Actually Raised Unemployment

Alan Reynolds, writing in Investor's Business Daily, makes a persuasive argument the Obama/Pelosi/Reid 'stimulus' bill was a complete bust, especially when it comes to creating jobs.

From his column:

The bill was launched last year amid grandiose promises of "shovel ready" make-work projects.

In reality, as the CBO explains, "five programs accounted for more than 80% of the outlays from ARRA in 2009: Medicaid, unemployment compensation, Social Security ... grants to state and local governments ... and student aid."

In other words, what was labeled a "stimulus" bill was actually a stimulus to government transfer payments — cash and benefits that are primarily rewards for not working, or at least not working too hard.

The American Recovery and Reinvestment Act of 2009 had extended federally funded unemployment benefits by 53 weeks, and another bill in November added 20 more — bringing the total up to 99 weeks in states with high unemployment.

As the Federal Reserve's Open Market Committee minutes for January noted: "The several extensions of emergency unemployment insurance benefits appeared to have raised the measured unemployment rate, relative to levels recorded in past downturns, by encouraging some who have lost their jobs to remain in the labor force. ... Some estimates suggested it could account for 1 percentage point or more of the increase in the unemployment rate during this recession."

Read the full column at the link below:

Investors.com - The 'Stimulus' Actually Raised Unemployment