Almost to the day the American Recovery and Reinvestment Act of 2009 was launched, the economy stopped hemorrhaging jobs to the tune of 726,000 job losses a month and began a slow climb forward.
Sure, for all the world it looked like the economy was not going anywhere. After all, $830 billion goes only so far and where that took the United States on the jobs front was to a point, roughly speaking, where the economy was adding 100,000 jobs per month, for a net gain of 826,000 jobs -- not a bad day's work.
Having sold this stimulus deal with too many rosy promises, it was easy to point out that President Obama failed in his mission. He missed his marks badly, mostly because going from minus 726,000 jobs per month to zero does not sell nearly as well as going from zero into positive territory. It is expected that you start at zero, not at 726,000 jobs per month in the hole. So the only bragging rights that came with a enormous achievement was 100,000 jobs.
Similarly, the gross domestic product prior to the stimulus bill was at minus 6.3 percent. The stimulus package brought it to roughly 2 percent. The only credit the president can claim, however, is a lousy 2 percent, not the net gain of 8.3 percentage points.
Surprise, surprise, Republicans seized on the 100,000 jobs and the 2 percent GDP as paltry gains for an $830 billion investment, leaving Obama to crow meekly about jobs saved instead of what everyone wanted, which was new jobs created.
Bragging about 100,000 jobs per month didn't cut it.
About that time, however, governments in Europe were taking notice of monster debts on their ledgers and leaders there spun around. moving from a stimulus-oriented strategy to a fiscal discipline orientation. At that point, they turned their backs on their economic plight and concerned themselves with deficit control.
Look where it got them. Within two years, major economic institutions, like the International Monetary Fund and the Organization of Economic Cooperation and Development, were pointing out that the austerity measures were an abysmal failure. But it was too late.
From BusinessLife.com, posted Sept. 9, 2011:
"The debate over fiscal policy in the United States, the sovereign debt crisis in some countries of the euro area and the fact that governments have fewer options to boost growth are driving both business and consumer confidence downward. The extent of bank deleveraging, due to the impact of regulatory changes, may also have been underestimated.
Earlier improvements in the labor market are now fading, hiring intentions are softening and there are greater risks that high unemployment could become entrenched."
Sound familiar. It should.
Flash forward to Tuesday and we find Republicans appalled that President Obama, in the face of enormous deficits that nobody likes -- penciled in tens of billions of dollars in economic stimulus for infrastructure improvements in his budget proposal. After all, deficit or not, when presidents leave the office they want to say they left the nation's roads and bridges in at least as good a condition as when they took over.
More to the point, the stimulus package ran its course and Republicans, champing at the bit for the spotlight and desperate to draw attention away from the national embarrassment of the George Bush years, refused to invest another dime in the economy. Where will that get us?
In international markets Wednesday, the Nikkei 225 index in Japan gained 0.39 percent, while the Shanghai composite index in China surged 2.87 percent. The Hang Seng index in Hong Kong jumped 2.16 percent, while the Sensex in India rose 0.23 percent.
The S&P/ASX 200 in Australia added 0.37 percent.
In midday trading in Europe, the FTSE 100 index in Britain climbed 0.17 percent, while the DAX 30 in Germany rose 0.19 percent. The CAC 40 in France gained 0.24 percent, while the Stoxx Europe 600 gained 0.16 percent.