How Much Does It Cost The Government To Create A Job?


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We are entering election season.  Our race out here in California is promising to be a squeaker.  On the one hand, we have Craig Huey, a Christian and life-long small businessman, who ran a marketing company, and who researched the candidates and judges in California for many years, putting out voter guides to help conservative voters be able to vote their values.  He was asked, make that urged to run for an open seat in Congress last year, and despite the long odds, and especially the fact this is a very democratically controlled area, he almost won.  Now, he’s backed up, and prayerfully considered that his next move should be to get elected here in our own state where we have seen democratic policies and liberal agendas nearly ruin California.

There is also another Republican candidate, Nathan Mintz.  Nathan is Jewish, staunchly conservative – on fiscal issues, but claims he will always be pro-choice, and is therefore not the best representative in the race for us who are socially – as well as fiscally conservative.  I know them both and think they are wonderful folks.  Nathan, in fact, helped found the local chapter of the Tea Party back in 2009 (South Bay Tea Party).  His wife is expecting a baby and is due any day now, how exciting Nathan!  Cheryl and I pray that the first moment he sees his baby and holds him/her in his arms, that he will renounce his faith in “Choice” and become a firm pro-life advocate!  Nathan is a young “Rocket Scientist” at Raytheon (his words, not mine) and he is a brilliant (by all accounts) young project manager.

The last candidate is a career politician, a democrat from the Torrance City Council.  The democrats have vowed to get behind this guy because they realize this new seat in the California assembly gives them their long desired shot at a “Super-majority” in the State Assembly.  They already have a super-majority in the State Senate.  That is where they have 2/3 majority (in terms of seats in the house) and can pass any law or legislation (tax!) they like.  They can also approve any spending bill, and vote themselves and anybody who works in government huge bonuses, salary increases and pension hikes.  These, mind you, are the same folks who refuse to talk about the $500B pension funding gap now existent in our state.  Could you run a business like that and get away with it?  Heck no!

Anyhow, Cheryl and I decided some time ago that we were Craig Huey supporters (after we heard him speak the first time!), and we’ve put foot to mouth in the sense that we support his campaign financially, and we put yard signs up, and we walk our precinct, make phone calls, and tell everyone we know about him.  So, last week, I did some research after I told Craig that his presentation was lacking only one detail.  He has been able to show how much it costs the private sector out here in California to create a new job, around $44,000 this past year.  That’s down from around $69,000 in 2007!  That’s how far down California has sunk.  But, I told Craig that we needed to prove how much it costs the Government to create a job, since they are always “Spinning” it to us that when they spend money it creates jobs.  So, what does it cost for the Government to create a job?

My research that I sent to Craig Huey this past week is as follows:

(Letter to Craig, 2012-04-04)

I’ve gone over this and over it.  I’m not saying I’ve dug and dug and dug, you can dig on this one forever it would seem.  I’m mostly basing my numbers on what others have produced before me.  And, I’m using our recent “Stimulus” to try and put a figure on what the Government “Pays” to create a job.  The first article (at the bottom of this actually, the blog article on economistsview) was published in Nov. 2008, before President <Obama> came into office.  I read a couple <and scanned dozens of> other articles at various points during his administration, and then finally I came across this one recently published:

http://loop21.com/jobs-obama-stimulus-created

Everyone (it seems) agrees that the “Stimulus” created some jobs.  How many, is the question.  If we believe the CBO’s <Congressional Budget Office’s> numbers from the most recent article (the loop21), then you have it that between 1.4M and 3.6M jobs were either “Created” or “Saved” <at some point during the stimulus> and most would agree that is the same thing.  So, just how $EXPENSIVE$ does that make those jobs?  We have to dig in and use the only numbers we’ve got.  The original stimulus was supposed to be $700B to the economy.

So, if you take:

$700B / 1.4M Jobs = $500,000 / Job

$700B / 3.6M Jobs = $194,444 / Job

<However>, Either way, it’s pretty darned expensive.  I’ve not come across the number that tells us how much was actually spent of the original $700B budget for the stimulus.  Let me see if I can get a lock on that pretty quickly here…  Sheesh, they stopped tabulating it appears to me.  It was too depressing I guess.  I find many sources that show how much was going to be spent, but nothing is updated <of those so-called “Transparent Government Accountability Web Sites”> as to actual spending into the 2011 year, which is when a lot of the money was to be spent!

December 2, 2010 is the last update I can find from any “Valid” source.  Here’s the link:

http://projects.propublica.org/tables/stimulus-spending-progress

I think that it shows they were on track to spend the bulk of the $700B in the “American Recovery and Reinvestment Act” in 2011 (like 40%).  That web site also reports that it’s more like $800B the Government planned to spend (ultimately it went up from $700B).  So, as of the end of 2010, we had spent 60% of the monies (roughly).  That means we were well on track to spend the rest in 2011, which we probably did, and the economy was already recovering by then anyhow, and the jobs created are very “Speculative” at best.  That’s when they claim they created the “most” or there was a “Peak” in jobs saved/created or something like that.  That’s what one of those other articles I read mentioned anyhow, which was that … that was the loop21 article also <what it said too>.

OK, so now we have that much money spent in total, nearly $800B!  And we get a total (possibly) of only 1.4-3.6M jobs?  Even at best that works out now to around $250,000 / job which is what GOPers were saying at the beginning!  The liberals with their “Keynesian” policies and their liberal estimates were saying at the beginning of the stimulus that it would cost only $63,000 / job!  Can you believe that?  They were off by like a factor of 4!!!!!  And it has that estimate in that original article I referenced (at the bottom, below)!  Can you believe those guys?

Now, all we gotta do to refute all the stimulus FUD is to prove that private sector jobs cost a lot less, and you already have those numbers that show it’s costing around $45,000 / job created currently in CA.  I think that’s a pretty decent argument to get the dratted Government to stop spending on these “Fictitious” jobs!  In the end, they sold us a bill of goods on the whole darned thing.

Here’s another “Fun” web site:

http://www.recovery.gov/Pages/default.aspx

I hope those numbers help in some small way, and maybe you can use them.

<closing>


Date: Sat, 31 Mar 2012 09:25:11 -0700
Subject: Economist’s View: How Much Does it Cost to Create a Job?
From: scott.debeaubien@gmail.com
To: sdebeaubien@hotmail.com

http://economistsview.typepad.com/economistsview/2008/11/how-much-does-i.html

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