Tag Archives: Economics

CBO: each job created by stimulus cost between $4.1 million and $540,000

Here’s the latest Congressional Budget Office report. (H/T American Enterprise Institute)

When [the American Recovery and Reinvestment Act] was being considered, the Congressional Budget Office (CBO) and the staff of the Joint Committee on Taxation estimated that it would increase budget deficits by $787 billion between fiscal years 2009 and 2019. CBO now estimates that the total impact over the 2009–2019 period will amount to about $831 billion.

By CBO’s estimate, close to half of that impact occurred in fiscal year 2010, and more than 90 percent of ARRA’s budgetary impact was realized by the end of March 2012. CBO has estimated the law’s impact on employment and economic output using evidence about the effects of previous similar policies and drawing on various mathematical models that represent the workings of the economy. …

On that basis CBO estimates that ARRA’s policies had the following effects in the first quarter of calendar year 2012 compared with what would have occurred otherwise:

– They raised real (inflation-adjusted) gross domestic product (GDP) by between 0.1 percent and 1.0 percent,

– They lowered the unemployment rate by between 0.1 percentage points and 0.8 percentage points,

– They increased the number of people employed by between 0.2 million and 1.5 million,

– They increased the number of full-time-equivalent jobs by 0.3 million to 1.9 million. (Increases in FTE jobs include shifts from part-time to full-time work or overtime and are thus generally larger than increases in the number of employed workers.)

We spend $831 billion taxpayer dollars to create between 200,000 to 1.5 million jobs. That works out to a cost-per-job number of between $4.1 million and $540,000.

Go socialism! Our children can afford to pay for our generation’s irresponsible wastefulness, right? I mean the ones we don’t abort, of course.

5,300 UK teens who aborted a baby in 2010 had at least one prior abortion

Dina sent me this disturbing article from the UK Telegraph.

Excerpt:

Pro-life campaigners said young women were being ”let down in an appalling way” after it emerged three of the 38,269 teenagers who had a termination in 2010 had undergone the procedure at least seven times.

NHS figures released to the Press Association under the Freedom of Information Act show another two teenage girls had their seventh abortion in 2010, the most recent year for which data is available, while four more teenagers had a termination for the sixth time.

Fourteen teenage girls had their fifth abortion in 2010, 57 teens had a termination for the fourth time and 485 women aged 19 or under went through the procedure for a third time.

Rebecca Mallinson, of the Pro Life Alliance, said: ”There is something seriously wrong with a country where teenagers are having even one abortion, let alone repeat abortions to this extent.

“We are failing these young people in an appalling way, and storing up serious sexual health problems for the future, whether the direct issue of sexually transmitted diseases, but also the effects that multiple abortions can have on future fertility.

[…]Of the abortions carried out on teenage girls in 2010, more than 5,300 were on teenagers who had already had at least one termination.

In the UK, taxpayers are forced to provide free abortions as part of their government-run socialist health care system. Many Christian voters are OK with subsidizing abortions because they think that wealth redistribution is a good idea. They think that people should be able to live any way they want, disregarding morality, and then have someone else violate their conscience in order to pay for the messes that result. It’s just wrong, but many Christians who care more about feelings than economics support it. They think that paying for someone else’s murders is “fairness”.

Christians should support individual charity, and the best way to support that is to let people keep more of their own money and give them tax deductions for charitable contributions. Whenever you get a secular government involved in helping others, it quite often just makes it easier for them to sin and to do harm. Thoughtful Christians should not support that. When you make sin “free” for someone by paying the costs, they will sin even more. We should never make it easier for people to sin. The first rule of sound economics – which Christians should know – is that when you subsidize a behavior, you get more of that behavior.

If you want to help someone in trouble, then use your own money – don’t take someone else’s money through taxes. People who make mistakes learn not to make them when they are accountable to the person who bails them out of it. There has to be oversight over how charity is being done at the individual level – not everyone deserves charity just because they are in a jam. Only if they have learned their lesson should they get it – go and sin no more, as Jesus says. That’s why individual charity is morally superior to government-run social programs. In a very real sense, Christians who claim to be pro-life can actually be pro-abortion in practice when they make it easier for women to have abortions.

In a previous post, I also wrote about how Christians should not tell women that premarital sex is a valid pathway to marriage – that men can be shamed and coerced into marriage after recreational sex with slogans like “man up”. That’s another mistake that many pastors make that increases the number of abortions. We have to start thinking things through if we are going to stop abortion.

Arthur Brooks: true fairness means rewarding merit, not spreading the wealth

Arthur Brooks is an economist, a Christian and the President of my third favorite think tank, the American Enterprise Institute. He has been making a push lately to convince conservatives to become more articulate when making the case for the free enterprise system. One of his major ideas is that happiness is not related to the amount of money you have, but it’s related to how well you can achieve your own prosperity and independence by your own labor. His research shows that people are happiest when they feel in control of their own prosperity, even if they have less wealthy than people who depend on the government to take money away from others so they don’t have to work.

Here’s an article he posted on AEI entitled “True fairness means rewarding merit, not spreading the wealth”.

Excerpt:

There are two main ways to define fairness: fairness in terms of opportunity, and fairness in terms of outcomes. The first means leveling the playing field, and the second means spreading the wealth around. The first means lifting people up on the basis of merit, and the second means bringing successful people down.

[…]In a 2005 Syracuse University poll, researchers asked a cross-section of Americans if they b14elieve that “everyone in American society has an opportunity to succeed, most do, or only some have this opportunity.” Some 71 percent of respondents said that all or most Americans can get ahead.

This is consistent with most of our experiences. It’s almost impossible to argue that American success is not earned. We can all think of times when our hard work has gotten us ahead or when we’ve been punished at work or in life for making poor decisions. Even if America’s not perfectly meritocratic, we all see how hard work pays off.

Now, of course, America is far from perfectly fair. But that‘s because life isn’t fair. For instance, all other things being equal, taller men and prettier women make higher salaries than their shorter, plainer counterparts. Believe it or not, there are studies that show these things (as if we needed them). More seriously, some people have substandard elementary education or childhood nutrition, which creates a lifelong disadvantage. Worse still, some children are born into families that don’t emphasize the values that beget opportunity: honesty, hard work, and education.

We need to address these inequities. Still, we shouldn’t abandon the idea of meritocratic fairness just because not everybody has completely equal opportunity. But this is what the president appears to be asking us to do.

America is built around the shared values and aspirations of mobility, opportunity, and merit. Even if only, say, half the outcomes in our life are due to merit, that’s still the half within our control. We should focus on increasing the role of merit, not dismiss the idea because it’s imperfect. Without a belief in meritocratic fairness, we have little incentive to work hard, be honest and optimistic, and create value in our lives and the lives of others. Fatalism and envy are simply not American values.

We need to make the case for the free enterprise system now, using moral arguments like this, otherwise we are going to find ourselves treading the path of countries like Greece, where almost no one works and almost everyone depends on the government to take care of them. It’s not sustainable.