\u201cBy this estimate, the Recovery Act has met the president\u2019s goal of saving or creating 3.5 million jobs — two quarters earlier than anticipated,\u201d\u009d Romer said with a straight face. (More than 2.5 million non-farm jobs have been lost since ARRA was enacted in February 2009, all of them in the private sector, according to the Bureau of Labor Statistics.)<\/p>\n
How does the CEA arrive at these numbers? It uses two methods, Romer said. The first is a standard macroeconomic forecasting model that estimates the multiplier effect of fiscal policy. (The government\u2019s spending is someone else\u2019s income.) The second method is statistical, using previous relationships between GDP and employment to project future behavior.<\/p>\n
These numbers might just as well have been pulled out of a hat. Recall that it was the same model and method the administration used in January 2009 to predict an unemployment rate of 7 percent in the fourth quarter of 2010 with the enactment of the fiscal stimulus and 8.8 percent without. The unemployment rate now stands at 9.5 percent.<\/p>\n
Read it all<\/a>.<\/p>\n Update<\/b>: Michael Boskin chimes in on the same theme, calling them Obama’s Economic Fish Stories<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":" \u201cBy this estimate, the Recovery Act has met the president\u2019s goal of saving or creating 3.5 million jobs — two quarters earlier than anticipated,\u201d\u009d Romer said with a straight face. (More than 2.5 million non-farm jobs have been lost since…<\/span><\/p>\n