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Tuesday, December 29, 2009

Cash for Caulkers Boondoggle in Texas

By now, most of us have heard of the Cash for Caulkers scheme (if not, you can read more about it here).

Turns out, like much of the stimulus cash, these funds are being wasted on mostly administrative costs. The latest example out of Texas has that state spending $2 million to weatherize 7 homes. An average cost of $285,000 per home!

For more, check out this video from Fox News' "Cashin In."

Tuesday, December 22, 2009

More on the Willy-Nilly Stimulus Bill(y)

The Washington Examiner asks:
Has the American Recovery and Reinvestment Act -- known more commonly as the stimulus -- been a well-intentioned failure as a jobs-creation bill, or is it a huge porky slush fund that was created without much thought?
and answers:
President Obama promised that his stimulus package would be, among other things, "targeted." Our own Mark Hemingway reported recently a study of stimulus spending that demonstrated there is no rhyme or reason to stimulus spending in terms of local unemployment. ...

Nothing in the data suggests that higher-unemployment states are more likely to get larger amounts of money per capita. It appears that very little thought went into directing funds toward the states most in need of jobs during the first round of stimulus funding, which ended September 30.
Here is the graph Hemingway constructed to demonstrate his point:

("Each square represents a state (or D.C.), and each state sits along the two axes based on its unemployment rate and its amount of stimulus spending per congressional representative. (Congressional Districts contain roughly the same number of people nationwide).")

"Senate Plan will Cost NH"

That is the headline to a quick story in today's Union Leader as well as the simple message from the president and general manager of Anthem Blue Cross Blue Shield to NH's health insurance customers:
[E]xcise taxes on expensive health plans and a tax hitched to the ranks of those covered by not-for-profit insurers in each state both will add costs to local consumers and employers.

The tax on so-called Cadillac health plans will hit the state because health care costs in the area are high, a fact reflected both in medical bills and insurance premiums.

[President and general manager Doug] Wenners said disproportionately large numbers of both small and bigger businesses offer plans that will exceed the thresholds at which the excise tax begins to apply -- $23,000 per family, and $8,500 per individual.

The state will also be hit by a higher than average share of a national tax that raises a total $6.7 billion, but exempts those covered by not-for-profit plans. A higher percentage of people are insured by for-profits in New Hampshire than in any other state, Wenners said.

Monday, December 21, 2009

$4 Billion More in Earmarks

Remember that?

President Obama again broke that pledge today by signing a defense appropriations bill chock full of pet projects and pork barrel spending, much of which has nothing to do with national defense.

The Wall Street Journal reports:
But the earmarks in the defense-spending bill could point to a longer-term clash between lawmakers and Mr. Obama, who campaigned on a pledge of changing the way Congress allocates earmarks. Mr. Obama has said that earmarks can be a waste of government funds and wants more public information about how they are awarded by Congress.

Member of Congress in both parties defend the use of earmarks and say that they are often for worthy projects.

Among the earmarks in the Defense bill: $18.9 million for the Edward M. Kennedy Institute for the Senate sponsored by Sen. John Kerry (D., Mass.); a $23 million item for the Hawaii Healthcare Network, sponsored by Senate appropriations Chairman Daniel Inouye (D., Hawaii); a $20 million appropriation for the National World War II museum in New Orleans, by Democratic Sen. Mary Landrieu and Republican Sen. David Vitter of Louisiana; and $5 million for a Heritage Center at San Francisco's historic Presidio, an item included by House Speaker Nancy Pelosi in her "community funding requests." ...

As usual, many of the top recipients of earmarks in the defense bill were high-ranking appropriators: Mr. Inouye got 37 earmarks totaling $198.2 million, while ranking Republican Thad Cochran (R., Miss.) got 45 totaling $167 million. Mr. Inouye also is chairman of the defense subcommittee, and Mr. Cochran is the ranking member.

On the House side, defense subcommittee chairman John Murtha (D., Pa.) sponsored 23 earmarks totaling $76.5 million, while ranking Republican C.W. "Bill" Young got 36 totaling $83.7 million, according to Taxpayers for Common Sense.
Line by line, huh? Maybe next year, but not holding our breath.

Chat With Governor Lynch Today

This morning (Monday December 21, 2009) at 10am Governor Lynch will take part in an online chat hosted by the Live Free or Die Alliance. This is your chance to question the Governor directly with regards to the overspending in Concord and the 38 new taxes and fees (including the new LLC tax) instituted to pay for it all.

Here is how the LFDA describes the chat:
The LFDA will host its inaugural online chat event with Governor John Lynch on December 21st at 10:00am. Former Governor Steve Merrill will participate as Moderator in what is sure to be an informative session on the issues facing the state.

Anyone can participate in this live chat event. Once you are logged in, you'll be able to email your questions in to Governor Lynch directly about state and community issues that affect you, and listen live as he answers.
Visit the LFDA now to register and take part in today’s chat!

Friday, December 18, 2009

More Data Suggests Politicalization of the Stimulus

A report released by the Mercatus Center at George Mason University suggests stimulus dollars thus far have been doled out without regard to the levels of unemployment in a particular area. Instead, the report found, "Democratic districts received 1.6 times more awards than Republican ones" and "Democratic districts also received 1.89 times more stimulus dollars than Republican districts."

It had been reported from the beginning that the stimulus was crafted to reward favored industries. This news that distribution is also favoring a particular party is yet another strike against the increasingly unpopular bill. Fox News reports:
"You would think, right, that if the administration believes in its theory that government money can create jobs, they would spend a lot of money in districts that have high unemployment," study co-author Veronique de Rugy said. "We found absolutely no relationship. It just kind of shows that the money is spent kind of randomly."

Rather, the study found that Democratic congressional districts received 1.89 times more money than GOP districts. The average award for Democratic districts was $439 million, while the average award for Republican ones was $232 million.

On average, Democratic districts also got 152 awards, while Republican ones got 94.
The data is sure to fuel skepticism about the $787 billion stimulus bill passed in February that only garnered three Republican votes. While the administration claims it has created 640,000 jobs, critics point to the still-soaring 10 percent unemployment rate in arguing that the stimulus has had a nominal effect.

Oddly, the Mercatus study found far more stimulus money went to higher-income areas than lower-income areas.

"We found no correlation between economic indicators and stimulus funding. Preliminary results find no effect of unemployment, median income, or mean income on stimulus funds allocation," the report said.

Tuesday, December 15, 2009

Hate to Say We Told You So

Ten months since passage of the federal stimulus bill, the concerns expressed by many that the funds were simply an expensive, short-term fix are coming to fruition (emphasis ours):
The summer of 2009 was a boom time for Pike Industries and other paving firms in the state as $130 million in federal stimulus funds poured into the state, the equivalent of a full year of spending for the state Department of Transportation's typical highway and bridge program.

But with $110 million of the highway stimulus already spent or committed under the American Recovery and Reinvestment Act, prospects are not as bright for the coming construction season.

"We had a good year and I'm a big fan of what the stimulus did for us. The state Department of Transportation did a great job of getting the stimulus money out in a timely manner so it could have an immediate impact. But next year looks pretty bleak with only $20 million left," says Christian Zimmermann, Pike's CEO.

Monday, December 14, 2009

Democrats' LLC Tax

The New Hampshire chapter of Americans for Prosperity has a solid write up on the proposed LLC tax and an important call to action for anyone concerned with preserving small businesses in New Hampshire:
Mark your calendar for December 16, 2009 and promise yourself that you and others will take the time to testify at the only public hearing for the 5% Tax on LLC’s and Partnerships which the Department of Revenue Administration (DRA) plans to hold at 10:00am at their Concord office on 109 Pleasant Street.

This past June, when the NH Legislature was voting on HB2, the state budget, some powerful Democrats decided to slip into the bill a 5 % interest and dividends tax on individuals for any distributions they receive from a Limited Liability Corporation (LLC) and Partnerships, this is an Income Tax!

Because this was slipped into HB 2 at the eleventh hour, there was no ability for our taxpayers to testify on this issue. Now, the DRA has written the rules for this 5% tax on all LLC’s and Partnerships throughout New Hampshire.

There are well over 10,000 LLC’s and Partnerships in New Hampshire made up of small business men and women who are about to get a wakeup call from big brother; “You owe us more money!” ...

This is a game that different state agencies play with public hearings on rule making; if you wrap the hearing around holidays no one will show up and the proposed rules will slide under the radar screen and be approved, which will carry the same impact as law. The state is not serving our taxpayers by allowing mischief like this to happen, it is wrong and must stop.
Wednesday's hearing will be held at 10am at the Department of Revenue Administration's Concord office at 109 Pleasant Street. Please attend if you can.

Also, consider signing this petition started by two New Hampshire small businessmen concerned with the impact of the new LLC tax.

Thursday, December 10, 2009

$1.8 Trillion in New Debt

Hoping to somehow avoid an election year backlash over the ballooning federal debt, Democrats in Congress plan to lift the debt ceiling by $1.8 trillion before the end of the year.

Yes, you read that sentence correctly. Only in Washington:
In a bold but risky year-end strategy, Democrats are preparing to raise the federal debt ceiling by as much as $1.8 trillion before New Year’s rather than have to face the issue again prior to the 2010 elections.

“We’ve incurred this debt. We have to pay our bills,” House Majority Leader Steny Hoyer told POLITICO Wednesday. And the Maryland Democrat confirmed that the anticipated increase could be as high as $1.8 trillion — nearly twice what had been assumed in last spring’s budget resolution for the 2010 fiscal year.

The leadership is betting that it’s better for the party to take its lumps now rather than risk further votes over the coming year. But the enormity of the number could create its own dynamic, much as another debt ceiling fight in 1985 gave rise to the Gramm-Rudman deficit reduction act mandating across-the-board spending cuts nearly 25 years ago.
The one positive that may come of this debt allowance may be Senator Gregg's intention to attach his deficit reduction task force legislation to any bill containing a ceiling increase.

Wednesday, December 9, 2009

Stimulus Investigations

Elected officials in both Houses of Congress are calling for investigations into how millions in stimulus dollars have been spent.
Sens. John McCain and Tom Coburn are singling out 100 examples of stimulus spending they call unnecessary and unlikely to create many jobs.

In a report released today, the two Republicans take aim at grants for the arts and academic research projects, spending to boost tourism and leisure facilities, and administration and advertising costs associated with the $787 billion stimulus package. Water taxis, “little-used” bridges and “low-priority” renovations to roads, buildings and airports also come under fire.

A research project to study young adults’ use of malt liquor and marijuana as well as a National Institutes of Health grant looking at the connection between female college students’ alcohol consumption and casual sex both score highly on McCain and Coburn’s list of dubious spending. …

The duo, who have railed against “wasteful spending” in recent years, put out their “stimulus checkup” shortly before President Barack Obama made a speech at the Brookings Institution outlining new job-creation proposals.

McCain, from Arizona, and Coburn, from Oklahoma, say the projects they’ve identified “raise questions about how stimulus money has been used so far.”
Four Republican lawmakers demanded an audit of President Obama's $787 billion stimulus program on Wednesday following reports of exaggerated or inaccurate accounts of the number of jobs created.

Reps. Joe Wilson of South Carolina, Jack Kingston of Georgia, Mark Souder of Indiana and Jeff Miller of Florida called for the creation of a bipartisan commission to investigate the effects of the stimulus bill.

"It's time for Congress to demand answers on behalf of the hardworking taxpayers that we represent," Wilson said. "The misnamed stimulus is one of the largest spending bills in our nation's history and it is critical that American taxpayers receive adequate answers as to the whereabouts of stimulus funds."

Wilson's bill would create a 10-member panel appointed by the president and congressional leaders that would determine how many jobs have been created and the effectiveness of measures taken to prevent improper payments. Then the commission would recommend what changes could be made to save or create more jobs and prevent mismanagement of the funds.

The call for an audit came as news broke that a public relations firm headed by Mark Penn, Hillary Clinton's former campaign strategist, received nearly $6 million in stimulus funds to save three jobs -- a report Penn's company called "fundamentally inaccurate."

Try as they might...

Although Democrats in Congress and President Obama continue to stress the supposed need for and importance of a second stimulus, it seems the public remains unconvinced:
[A] new Rasmussen Reports national telephone survey finds that just 22% of Americans favor providing federal bailout funds to states with serious financial problems. Fifty-eight percent (58%) oppose giving bailout money to financially troubled states.

On top of that, 56% of Americans oppose the passage of another economic stimulus package this year. While House Speaker Nancy Pelosi and other congressional Democrats are hoping to spend more to combat unemployment, just 33% favor another stimulus plan.

Thirty-six percent (36%) of voters believe the first stimulus plan passed in February has helped the U.S. economy, but 34% say it has hurt the economy.

Most Americans (53%) believe the U.S. economy will be helped more by decisions made by business leaders to help their own businesses grow rather than by decisions made by government officials. Just 29% say decisions made by government officials to help the economy grow will do more.

By a 59% to 24% margin, voters believe that an increase in government spending will hurt the economy.

Tuesday, December 8, 2009

Obama on the Second Stimulus

Speaking today before the liberal think tank Brookings Institute, President Obama issued his strongest call yet for a second stimulus bill.

In response, Senator Gregg had this quip to offer, "At least the president's proposal will result in one new job — he'll need to hire a magician to make this new deficit spending appear fiscally responsible."

STEWARD will be keeping an eye out for other statements from state officials signaling their support, or lack thereof, for this next round of federal spending.

Despite Republican criticism concerning record federal deficits, Obama said the U.S. must continue to "spend our way out of this recession" as long as so many people are out of work. More than 7 million Americans have lost their jobs since the recession began two years ago, and the jobless rate stands at 10 percent, a statistic Obama called "staggering."

Congressional approval would be required for the new spending, the amount unspecified but sure to be at least tens of billions of dollars.

"We avoided the depression many feared," Obama said in a speech at the Brookings Institution, a Washington think tank. But, he added, "Our work is far from done."

It was the third time in a week the president had presided over a high-profile event on jobs, responding to rising pleas in Congress that he spend more time discussing unemployment as midterm election season draws near.

Obama proposed new spending for highway and bridge construction, for small business tax cuts and for retrofitting millions of homes to make them more energy-efficient. He said he wanted to extendeconomic stimulus programs to keep unemployment insurance from expiring for millions of out-of-work Americans and to help laid-off workers keep their health insurance. He proposed an additional $250 apiece in stimulus spending for seniors and veterans and aid to state and local governments to discourage them from laying off teachers, police officers and firefighters.

He did not give a price tag for the new package but said he would work with Congress on deciding how to pay for it.

Proposals in Congress being advanced by Democratic leaders that cover much the same ground would add up to $170 billion or more. Administration aides suggested the infrastructure proposals alone being weighed by the president could cost about $50 billion.

Monday, December 7, 2009

That's Some Return on Investment

A new, quick, analysis of the stimulus' job production numbers has shown one heck of an ROI thus far:
The Obama Administration is touting that their stimulus program has saved or created 640,329 jobs since it was enacted back in February through the end of October. This number is updated and posted on the Administration’s recovery.gov web site. That amounts to $246,436 per job based on the $157.8bn that has been awarded so far! Total compensation earned by the average payroll employee during October, on an annualized basis, was $59,867. If the government had simply used the funds awarded so far to pay for a year’s worth of labor, that would have paid for 2.6mn jobs!
It will be interesting to see what the Democrats do to improve that statistic in the next stimulus package they push.

Saturday, December 5, 2009

Policy U-Turn

Former Congressman Charlie Bass had an op-ed in yesterday's Roll Call, co-authored with Grover Norquist, the founder of the DC based think tank Americans for Tax Reform. Certainly worth a read:

Earlier this year, in the effort to turn our economy around and spur job growth, our leaders in Washington, D.C., were faced with two very different policy paths. Down one path was a return to the old-school big-government, big-spending, anti-corporate policies of the late 1970s — a path once thought to be relegated to the ash heap of history. The other path was one that has been blazed by most of the industrialized world at this point — a path that recognizes that lower corporate taxes are essential to competitiveness in this global economy, and that lower taxes create jobs. Unfortunately, President Barack Obama and Congressional Democrats chose the big-government, big-spending, anti-corporate path — and the results have been disastrous.

The approach of Obama and the Democrats has failed to turn the economy around, and, in fact, has resulted in an unemployment rate of at least 10 percent — a 26-year high. Indeed, despite administration claims about jobs saved or created, 2.8 million jobs have been lost since the stimulus became law. While the trillion-dollar “stimulus” has failed to deliver the jobs the administration promised, it has, unfortunately, succeeded in ballooning our nation’s deficit and piling on to a sky-rocketing national debt.

If we want an economic turn-around, then it is time for a policy U-turn.

Anti-corporate populism is certainly en vogue today. Some of the ire is well-deserved — the greed of a handful of corporate leaders is, in part, responsible for the economic troubles we face today. Unfortunately, however, much of this anti-corporate populism is the product of opportunistic politicians desperate to find someone to blame.

The truth is we cannot have meaningful job creation without policies that create an environment in which companies can grow and prosper, and a critical component of such an environment is a reduction in the corporate tax rate.

The United States was once the global leader in creating a tax environment that encouraged economic growth and created jobs. Indeed, it was the U.S. under Ronald Reagan in 1986, joined by the Margaret Thatcher-led Great Britain, which started the global wave of corporate tax cuts. The 1986 cuts, which lowered the top rate from 46 percent to 34 percent, marked the largest cut in the corporate rate since the tax was created in 1909.

As recently as 1980, the top corporate tax rates in industrial countries averaged 50 percent. Where Reagan and Thatcher led, however, the rest of the world followed. In fact today, the average top corporate tax rate for countries in the European Union is now 24 percent.

Cutting the corporate tax rate has proven to be a powerful force in spurring economic growth and development. According to Daniel Mitchell at the Cato Institute, the reason is simple. “Thanks to globalization,” he wrote, “it is much easier for capital to cross national borders, and investors naturally prefer lower-tax jurisdictions.”

Unfortunately, the U.S. has fallen far behind our global competitors in this critical economic trend that we once spearheaded. The top corporate rate in the U.S. has actually ticked up from 34 percent in 1986 to 35 percent today. In fact, our top corporate rate is now the second highest among countries in the Organization for Economic Cooperation and Development. Ireland, by contrast, has a top corporate rate of just 12.5 percent.

Cutting the corporate tax rate does not necessarily mean a drop in the revenue generated by the tax, just as raising the rate does not necessarily result in an increase in revenue. According to the nonpartisan Tax Foundation, “Many people would expect high tax rates to yield high tax revenues, but the reverse is often the case. Collection data from 2002 (most recent) demonstrate that many countries with high corporate tax rates — such as the U.S., Germany, and France — have lower-than-average corporate tax collections as a percentage of total tax collections. In fact, of the 13 states with above-average corporate tax rates, nine of them have below-average collections.

The converse is also true: Of the 15 states with below-average corporate tax rates, six of them (including Ireland, which has the lowest corporate tax rate in the OECD) collect higher-than-average revenue. In fact, only 13 of the 30 OECD countries meet traditional expectations by matching their high corporate rates with high corporate revenue or their low corporate rates with low corporate collections.

Democratic opposition to reductions in the corporate tax code and protectionist economic policies that they advocate simply ignore global economic realities. These positions may sell well to their liberal base, but the implementation of these policies is stunting economic growth and putting American businesses at a strategic disadvantage in the international marketplace.

Indeed, almost every economist agrees that the anti-trade, anti-corporate policies currently advocated by the Democrats costs jobs.

To grow the economy and create jobs, we need policies that encourage the growth of private business — not the growth of federal government. Cutting the corporate tax rate will spur economic investment and allow businesses to grow and add new jobs. The road back to a strong economy is a long one, but we won’t ever get there if we continue policies that keep us headed in the wrong direction.

Thursday, December 3, 2009

Investor's Business Daily Slams "Job Summit"

IBD isn't expecting much from today's White House job summit and they weren't afraid to say so in a column posted last night. Certainly worth a quick read.
The White House will hold its jobs summit Thursday. Don't expect this administration, so deeply devoted to government, to actually do anything that will create jobs for a country so in need of them.

Earlier this week, we published a chart showing the percentage of each president's Cabinet appointments with prior private sector experience going back to the first Roosevelt administration.

It was no surprise that not a single White House in more than a century has had a smaller ratio than the current administration. Only the Kennedy — less than 30% — and Carter — just over 30% — administrations were close to the Obama mark of less than 10%.

It is the height of hubris for an administration in which fewer than one in 10 Cabinet appointments have private-sector experience to hold a meeting with the goal of creating jobs.
The government, from lawmakers to bureaucrats, does not create jobs. It can move jobs from the private sector to the public through tax-and-spend wealth redistribution policies. But because government spending crowds out private investment, it is not a wealth creator and therefore cannot be a job creator.

Government is often a job killer. Economist Richard Rahn noted during the last Bush presidency that "government spending reduces more jobs in the private sector than it can create in the government sector."

"Countries with large government sectors," such as France and Germany, Rahn said, "tend to have much higher unemployment rates than countries with smaller government sectors."
Economic reality won't matter at the summit, though. What matters are appearances.

The White House wants to make a show of doing something, especially after its policies have done nothing to boost growth or stop the job losses. It would like to erase from public memory the utter failure of the $787 billion stimulus legislation approved just after Barack Obama took office. The administration knows its claim that thousands of jobs have been created or saved by the stimulus is bunk. And it knows the public knows.

But the stench of failed government solutions will remain.

Thursday's summit will be too heavy with union executives and eggheads whose experiences don't go beyond the academy. Neither group has a shining record of creating jobs, and their presence virtually ensures that little worthwhile will be considered.

Organized labor, for instance, contributes to unemployment. Its demands for above-market wages and lavish benefits mean that companies often can't afford to hire as many workers as they want.

Tuesday, December 1, 2009

Fed’s ‘Backdoor Bailout’ Benefits Wall Street, not Main Street

A great read from STEWARD's Penny Wise:

Democrats in Congress have been more than happy to faithfully vote for President Obama’s massive bailouts and federal spending spree, which has mostly enriched bankers, financiers and shareholders, but not helped small businesses and Main Street America. This is especially true in New Hampshire, where taxpayers are on the hook for far more than their fair share of the spending, and businesses are still looking for credit to create new jobs.

Healthy New Hampshire banks have received close to $41 million from the federal Capital Purchase Program (CPP) to support the economy in the state. Based on New Hampshire’s size and the $204 billion spent on the CPP portion of the Troubled Asset Relief Program (TARP), New Hampshire’s share should have been almost $983 million. That’s a difference of $942 million that taxpayers in New Hampshire are covering to support economic recovery in other states.

This all gets worse, as a report from the Special Inspector General for the Troubled Asset Relief Program (SIGTARP) details the handling of the bailout of insurance company AIG. The report states:

* Questions have been raised as to whether the Federal Reserve intentionally structured the AIG counterparty payments to benefit AIG’s counterparties — in other words, that the AIG assistance was in effect a “backdoor bailout” of AIG’s counterparties.

* Then-Federal Reserve Bank of New York (FRBNY) President Timothy Geithner and FRBNY’s general counsel deny that this was a relevant consideration for the AIG transactions. Irrespective of their stated intent, however, there is no question that the effect of FRBNY’s decisions — indeed, the very design of the federal assistance to AIG — was that tens of billions of dollars of government money was funneled inexorably and directly to AIG’s counterparties.

* FRBNY’s decision to treat all counterparties equally (which FRBNY officials described as a “core value” of their organization), for example, gave each of the major counterparties (including the foreign banks) effective veto power over the possibility of a concession from any other party. This approach left FRBNY with few options, even after one of the counterparties indicated a willingness to negotiate concessions.

Simply put, FRBNY refused to negotiate with financial institutions willing to take less than full value on credit default swaps with AIG and instead paid all institutions 100 cents on the dollar, costing taxpayers “tens of billions.”

Republican Congressman Darrell Issa detailed the extent of the give-away by stating, “Behind closed doors and with no approval from Congress, the FRBNY added an additional $13 billion of debt on the backs of taxpayers to give a backdoor bailout to AIG’s creditors, including Goldman Sachs, Merrill Lynch, Société Générale and Deutsche Bank. The lack of transparency and accountability in this transaction is disturbing enough. However, there is evidence that this $13 billion expenditure was entirely unnecessary. All of this begs the question why the FRBNY would not drive a better bargain for the American taxpayer.”

Even more amazing is that the Treasury Department recently held a forum on small business financing. In prepared remarks for the forum, Secretary Geithner said the purpose of the forum was “to make sure we are doing everything possible to get credit flowing to small businesses that are seeking to expand and create more jobs.”

The problem for businesses in New Hampshire is that nearly $1 billion of credit that could be used in the state went to banks in other states ($942 million) – all on the heels of egregious taxpayer sell-outs like the “backdoor bailout” for AIG’s clients.

The Treasury Department took tax dollars from Granite Staters and gave it to reckless Wall Street financiers. In less than a year, that took a firm like Goldman Sachs from the endangered species list to paying out billions in bonuses. So while TARP and “backdoor bailouts” may be credited with boosting the stock market and making shareholders richer, small businesses continue to twist in the wind. Hard-working New Hampshire residents are stuck with the bill — and far too many remain unemployed.

Monday, November 30, 2009

Pelosi/Dean: "More Stimulus Equals More Jobs." Huh?

Democrat leaders are continuing to prime the pump for another stimulus bill sometime early next year. Over the weekend, both Nancy Pelosi and Howard Dean chimed in with the most recent talking point: More Stimulus equals More Jobs:

Pelosi via The New American:
Speaker of the House Nancy Pelosi (D-Calif.) figures that most Americans wouldn’t mind “absorbing” more "stimulus"-spawned government indebtedness if the additional government spending means increasing employment. “So if somebody has the idea that the percentage of GDP of what our national debt is will go up a bit, but they will now — and their neighbors and their children will — have jobs, I think they could absorb that,” Pelosi told bloggers during a conference call on November 24.

Speaker Pelosi thinks that it's a “false choice” to make Americans or their representatives choose between jobs and higher deficits, but when pressed to choose, she believes Americans would rather have jobs.

Of course, Pelosi's analysis overlooks the fact that the money spent by government to "create" jobs must be siphoned out of the economy, destroying jobs. This is true even when the "stimulus" money is created out of thin air through the Federal Reserve, since the infusion of this new money into the economy dilutes the value of already existing money, causing prices to rise. Pelosi may claim that choosing between higher deficits and jobs is a false choice, but in reality government spending (including stimulus spending) and debt are destroying jobs that Pelosi claims need to be created through more government spending and debt.
And Dean via PoliJam and Fox News:
Seeming to be oblivious to the recent media reports that showed that the stimulus job numbers that had been touted by the White House have been grossly inaccurate, former Democratic National Committee Chairman Howard Dean lauded the stimulus package while appearing on Fox News Sunday.

Dean slammed Republicans for attacking a program that he claims has been “unbelievably successful in saving jobs” and added that he is “more optimistic” that small businesses will be helped by the Democratic health care reform bill.

Of course, statistics show that the stimulus has created little by way of jobs. But the package can certainly be found to have added to the nation’s growing deficit, as well as be seen as burdening the future of our country as they are left with a huge debt that must be tackled.

Tuesday, November 24, 2009

Boomerang Kids

The last few months have seen a number of stories on the nonexistent job market for teens and recent college grads. A recent Pew study has quantified the effect of the poor economy which, for many young adults, is meaning a shorter Thanksgiving commute:

"The journey home for Thanksgiving won't be quite so far this year for many adults," said researchers Wendy Wang and Rich Morin, who wrote the report. "Instead of traveling across country or across town, many grown sons or daughters will be coming to dinner from their old bedroom down the hall."

Pew's survey and analysis of government data found that the share of adults 18 to 29 who lived alone declined from 7.9 percent in 2007 to 7.3 percent this year. Drops of that magnitude were also seen during or immediately after the recessions of 1982 and 2001.

Roughly one-third, or 35 percent, of boomerang kids said they had lived independently at some point in their lives but had to move back in with their parents. About half of the grown children worked full- or part-time, while 25 percent were unemployed and 20 percent were full-time students. ...

According to the latest Pew survey and census data:
  • About 20 million people ages 18 to 34 live at home with their parents — roughly 30 percent of that age group. That's up from about 18 million, or 27 percent, in 2005.

  • About 12 percent of young adults ages 18 to 34 said they were forced to move in with a roommate because of the poor economy.

  • Fifteen percent of adults 18 to 34 said they had postponed getting married due to the recession. That share increases to 21 percent for adults ages 25 to 34, when many people tend to get married.

  • Fourteen percent of adults 18 to 34 say they delayed having a baby.

Monday, November 23, 2009

Health Care Overhall Will Cause Rate Hikes in NH

Anyone who follows this blog, or with a modicum of common sense, probably already knew what today's Portsmouth Herald is reporting but here it is anyways (emphasis ours):
In a new internal study, New Hampshire's largest health insurer says that reform proposals under consideration in Congress will lead to premium increases for a majority of its individual and small business customers in the state.

"We support reform because the current (health-care spending) trajectory as a nation and state is unsustainable," said Douglas Wenners, the president and general manager of Anthem Blue Cross and Blue Shield. "But we believe you have to get to the root causes of medical cost increases and this (reform legislation) does that." ...

Anthem NH is the for-profit subsidiary of Well Point, the nation's largest private health insurer. According to 2008 state figures, Anthem has almost 55 percent of the health insurance market with more than 320,000 members. Anthem officials said the report was prepared in response to inquiries about how reform might impact premiums in the state.

The impact of reform, Wenners explained in an interview with the Herald, depends partly on demographics, premium group size, and health status of premium payers. Some young and healthy individual market members will see major premium increases of up to 93 percent — while other members who belong in a group plan and have average health could, with government subsidies, see a decrease in premiums as much as 9 percent.

The report says "purchasers of average age and average health are expected to face higher premiums post-reform, and we specifically expect a majority of small employer purchasers to face higher premiums post-reform."

Anthem, which insures 5,000 groups with fewer than 10 employees, said that more than 50 percent of New Hampshire small businesses would see significant premium increases under reform.

Thursday, November 19, 2009

Straightening out the mess

Following the revelations of phantom Congressional Districts receiving federal stimulus dollars, the Administration and the Recovery.gov team have rushed to correct the glaring errors. Today's Foster's Daily Democrat provides some background on New Hampshire's 4th, 6th, and 22nd Districts:
The errors also explain why Recovery.gov listed New Hampshire as having congressional districts "4" and "27." In both cases, there was a mix-up between the location of the actual work and the home state of the company doing it.

In the case of district "4," the contractor is Keene-based Environmental Alternatives Inc., a subcontractor of CH2M Hill Plateau Remediation Company, which was directly contracted by the Department of Energy for nuclear material stabilization and disposition in Richland, Wash. The report should have indicated Washington State's 4th Congressional District, Fitch said.

Recovery.gov listed the project as saving or creating no jobs but receiving $1,033,809.

In the case of district "27," the contractor is Litchfield-based Big Land Properties, LLC, which was directly contracted by the Department of Housing and Urban Development for Section 8 housing assistance at 1490 Meadows Apartments in Albany, N.Y., in the state's 27th Congressional District, Fitch said.

The website had the project saving or creating 2 jobs and receiving $124,774.

There was another error, but this time the work reported being done in New Hampshire's "6th" district actually happened in the Granite State. The project contractor, Metcalf & Eddy of Wakefield, Mass., incorrectly listed the project happening in the district where the company is located in the Bay State. The report should indicate New Hampshire's 1st Congressional District as the company was contracted by the Environmental Protection Agency to perform remediation using in-site chemical oxidation services at the Ottati & Goss site in Kingston.

Wednesday, November 18, 2009

Second Stimulus

More evidence today that Congressional Democrats plan to push another massive stimulus bill as they start pulling out all the stops ahead of next year's elections.

As the first $787 billion continues to fail to stimulate job growth, all while generating pages of negative press for the Administration and supportive Democrats, this today from the AP:
House Democrats are looking at swelling deficits further, at least temporarily, on a jobs-producing bill in response to double-digit unemployment and a sense within their ranks that the party needs to do more to put people back to work.

But many of the ideas on the table so far are extensions of last February's $787 billion economic stimulus package — such as unemployment benefits and subsidies to help the jobless pay for health insurance. They maintain the social safety net for the 15.7 million Americans out of work but they don't directly create new jobs.

Aware that the February stimulus bill has not prevented unemployment from reaching 10.2 percent and of public opinion polls showing the free spending measure is losing popularity with voters, Democrats are wary of putting a stimulus label on their new package."

I wouldn't characterize it as a second stimulus," House Majority Leader Steny Hoyer said Tuesday. "I don't want to be as broad as that, I want it to be very targeted on jobs."
Interesting argument there from the Majority Leader. If this second stimulus is supposed to targeted on jobs, what was the first trillion dollars targeted on? You know, the one the was supposed to keep unemployment below 10%?

Tuesday, November 17, 2009

More Jobs Confusion

Despite claims of honesty, transparency, and good government from the Administration, this first round of stimulus job numbers has been nothing close.

Just yesterday, the Administration cut 60,000 jobs from their original guesstimate. ABC reports:
The Obama administration, under fire for inflating job growth from the $787 billion stimulus plan, slashed over 60,000 jobs from its most recent report on the program because the reporting outlets had submitted "unrealistic data," according to a document obtained by ABC News. ...

One recipient – Talladega County of Alabama – claimed that 5,000 jobs had been saved or created from only $42,000 in stimulus funds.

"The administration committed from the start to be upfront with the American people about the impact of the Recovery Act. Overall, the recipients provided good information on the impact of the Recovery Act across the country," Rob Nabors, deputy director at OMB, told ABC News Monday. "The test that we used when examining the data for accuracy was, 'Is that reasonable?' When the answer was no, we acted accordingly."
And now this gem from the Recovery website, check out how many jobs were saved in New Hampshire's nonexistent 00th, 4th, 6th, and 22nd districts.

h/t to Grant Bosse for catching this first.

Monday, November 16, 2009

YOU'RE INVITED: Talk Turkey About Spending Luncheon

This Saturday (November 21st) STEWARD will host the FIRST forum featuring all five Republican candidates for US Senate.

A follow up to last month's wildly successful Chowderfest, the "Talk Turkey About Spending" Luncheon will take place at VFW Post 1698 (26 Peabody Pl) in Franklin, NH from 11 to 1.

The event is free to attend and will include a Thanksgiving style lunch as well as some great conversation with fellow conservatives from around the state.

Space is limited so please visit stewardofprosperity.org/turkey or call 603-415-2600 to RSVP!

We look forward to seeing you this Saturday!

Friday, November 13, 2009

A New Record!

Though not one we should be celebrating. From the Boston Globe:
The US government deficit hit a record for October as the new budget year began where the old one ended: with the government awash in red ink.

Economists worry that if such a deficit continues it could push up interest rates, further dragging on the fragile economic recovery.

The Treasury Department said yesterday that the deficit for October totaled $176.4 billion, the fifth-largest monthly deficit ever and the 13th straight month to show a deficit - another record.

The deficit for the 2009 budget year set an all-time record in dollar terms of $1.42 trillion. That was $958 billion above the 2008 deficit, the previous record.

Thursday, November 12, 2009

More Stimulus (Debt) Equals More Unemployment

Real Clear Markets provides a look at the three-month moving average (TMMA) of changes in total employment in relation to stimulus spending and the debt incurred:

As the financial crisis gathered momentum in late 2008, the TMMA fell continuously, reaching a bottom of 853,000 jobs lost per month in January 2009. Then this indicator began improving. By June 2009, when stories about "green shoots" were common in the financial press, the TMMA was "only" 230,000. However, it then began falling again. The October BLS numbers pushed the TMMA down to 589,000 jobs lost per month.

Economic growth is supposed to create jobs. However, the U.S. economy shed twice as many jobs (1,332,000) in the third quarter of 2009, when GDP grew at a robust 3.5% annual rate, than it did in the second quarter (691,000), when the economy contracted at a 0.7% rate.

How can this be? To paraphrase the 1992 Clinton campaign, "It's the bonds, stupid!"

The massive sales of U.S. Treasury bonds to finance "stimulus", bailouts, and other government spending is sucking capital out of the private sector and destroying jobs. Once again, the October 6th BLS report tells the tale.

The BLS "household survey" showed job losses of 589,000, while their "establishment survey" showed a reduction of payrolls of only 190,000. This shows that most of the damage is being done in small business, "under the radar screen" of the BLS.

Small businesses-especially new small businesses-account for essentially all net job growth. However, business creation and expansion requires capital, and more and more of the nation's capital is being commandeered by the U.S. Treasury in the name of "stimulus".

The FY2009 Federal deficit was $1.4 trillion. This was almost a trillion dollars higher than FY2008. The capital to buy this additional debt had to come from somewhere, and much of it was squeezed out of business. Here are some indicators, both statistical and anecdotal:

• During FY2009, "Gross Domestic Private Investment" fell by 25% (almost $500 billion/year). It would have needed to grow by 5% to keep the unemployment rate from rising from an already-too-high 6.2%.

• Many venture capital firms are informing entrepreneurs that there is no money available for new startups. The firms say that they must husband their capital to meet the needs of their existing portfolio companies.

• The 500 largest U.S. non-financial companies now hold more than $1 trillion in Treasury bills, amounting to more than 10% of their total assets. Corporate cash flows are rising, but the money is being invested in government bonds, rather than growth.

• Banks have cut credit card credit lines by 25%, or $1.25 trillion. Because small businesses are often financed with personal credit cards, this has a direct impact on small business survival and growth.

Wednesday, November 11, 2009

A Funny (Sad?) Explanation for Incorrect Stimulus Numbers

As we discussed earlier, the recent round of stimulus job numbers appears to have included a number of mistakes that hyper-inflated the supposed number of jobs created by the package. It turns out part of that mistake was due to an employees inability to calculate percentages and failure to catch a pretty obvious mistake.

The AP reported the story originally:
President Barack Obama's economic recovery program saved 935 jobs at the Southwest Georgia Community Action Council, an impressive success story for the stimulus plan. Trouble is, only 508 people work there.

The Georgia nonprofit's inflated job count is among persisting errors in the government's latest effort to measure the effect of the $787 billion stimulus plan despite White House promises last week that the new data would undergo an "extensive review" to root out errors discovered in an earlier report.
And the folks at Political Math broke down the error:
This is pretty funny. Or horrifying. Depends on how you want to look at it.

Several days ago, I noted on Twitter that there were a lot of “saved” jobs that weren’t saved at all but actually cost of living increases. About 24 hours after I noted this, there was an Associated Press article about that very phenomena.

Coincidence? Almost certainly. But I’ll flatter myself anyway.

But the laugh riot comes several paragraphs into the article as they look into why Southwest Georgia Community Action Council was able to save 935 jobs with a cost of living increase for only 508 people. The director of the action council said:

“she followed the guidelines the Obama administration provided. She said she multiplied the 508 employees by 1.84 — the percentage pay raise they received — and came up with 935 jobs saved.

“I would say it’s confusing at best,” she said. “But we followed the instructions we were given.”

“Confusing at best”? The multiplication of percentages is “confusing at best”? It seems obvious to me she should have multiplied 508 people by the amount the increase (.0184) and gotten 9.3. But she forgot that you have to divide the percentage by 100 before you multiply.

The fact that she had “saved” more jobs than there were people in the organization should have been a tip-off. But this is a pretty common problem with people who don’t have a very good grasp on mathematics… they don’t recognize obvious mathematical errors, they just plug in the numbers and go with whatever comes out.

And this, children, is why you pay attention at school. So you don’t get in the national news for doing something really stupid and then blame it on the instruction manual.

Tuesday, November 10, 2009

The New Hampshire Eagle Times

Despite significant economic and budgetary issues, the State of New Hampshire has decided to join the newspaper business, reports today's Nashua Telegraph:
The state of New Hampshire last week agreed to guarantee 75 percent of a $250,000 loan from an Upper Valley bank to the new owner of the Eagle Times, an unusual deal because it involves a daily newspaper and the government it covers.

The Executive Council on Wednesday unanimously approved without debate the “working capital loan guarantee,” which would be administered by the New Hampshire Business Finance Authority.

Under the deal, the BFA and the state would be liable to pay up to $187,500 to Connecticut River Bank if Eagle Printing & Publishing LLC defaulted on the $250,000 line of credit it would receive from the bank.

Eagle Printing is the entity created by a small Pennsylvania-based newspaper chain which bought the Eagle and a handful of weekly papers out of bankruptcy in September.

Some Strings Attached

The AP reports that the next round of education stimulus spending will have significant strings attached. Specifically, schools will be required to adhere to President Obama's imposed educational goals:
The Obama administration is ready to hand out more stimulus dollars for schools, but this time, strings are attached. ...

Now [Secretary of Education] Duncan is making it tougher to get the rest of the dollars because the administration wants states to adopt President Barack Obama's vision of reform.

States will have to fill out a far more detailed application that demands information on Obama's broad goals — tougher academic standards, better ways to recruit and keep effective teachers, a method of tracking student performance and a plan of action to turn around failing schools.

For example, states will be required to identify their lowest-achieving schools by name and tell the department how, or whether, officials have tried to turn the schools around. ...

Similar strings are attached to a separate $5 million competitive grant program in the stimulus, nicknamed the "Race to the Top" fund, that Obama was promoting in Wisconsin last week.Obama has already coaxed several states to rewrite education laws and cut deals with unions as they compete for the grants.

And states can't even apply for them yet; those applications are expected later this week.

Monday, November 9, 2009

A New Look at the Same Bad News

Here is a new look at the failed promise of Obama's stimulus bill, courtesy of the Independent Institute:

Friday, November 6, 2009

Unemployment tops 10%

It was announced this morning that the Nation Unemployment rate had reached 10.2%. Steward founder Fred Tausch had this to say on the new:
“Paul Hodes and Carol Shea-Porter sold us a false bill of goods. They promised the stimulus would put Americans back to work, but instead the unemployment rate has climbed to its highest level in a generation. The joblessness situation is a tragedy for those who continue to look for steady employment, and it’s a tragedy for taxpayers who will now have to pay for the failed $787 billion ‘jobs’ program.”
The Associated Press provides a look at the then and now of this recession:
Here, by the numbers, are some other ways the work force has changed since September 1982.


110.7 million: Size of the work force in September 1982

154 million: Size of the work force in October 2009


10.7 percent: Adult male unemployment rate in October 2009

8.1 percent: Adult female unemployment rate in October 2009

9.5 percent: Adult male unemployment rate in September 1982

8.4 percent: Female unemployment rate in September 1982

ANALYSIS: The greater disparity between men and women in this recession reflects the heavy impact of layoffs in male-dominated fields, such as construction and manufacturing. Industries with higher female employment, namely education and health care, have actually added jobs during the recession.


15.5 percent: Unemployment rate in October 2009 for those without a high school diploma

11.2 percent: Rate for high school graduates

4.7 percent: Rate for college graduates

3 percent: Unemployment rate in March 1982 for college graduates (at the time, figure was reported once a year)


6.8 percent: Proportion of unemployed with college degree in September 1982

14.7 percent: Proportion in October 2009

ANALYSIS: College graduates still have much lower jobless rates than those with less education, but they are more likely to be unemployed than in 1982. Job cuts in the financial industry and in high-skilled manufacturing, such as the aerospace industry, have caught up with them, according to Gary Burtless, an economist at the Brookings Institution. And companies in all sectors are more willing to cut middle managers than in previous recessions, he added, which also affects college graduates.


16.6 weeks: Average length of unemployment in September 1982

26.9 weeks: Average length in October 2009, a record

ANALYSIS: More than a third of the jobless in October were unemployed for 6 months or more, compared with less than 18 percent in September 1982. One reason is that layoffs were more likely to be temporary back then, as manufacturers furloughed workers until demand returned. But last month only 10.9 percent of the unemployed were on temporary layoff, compared with 22.2 percent in 1982.


15.7 percent: Black unemployment in October 2009

19.7 percent: The rate in September 1982

ANALYSIS: While unemployment among African-Americans is higher than the nationwide rate, it is much lower than in 1982. That reflects both good and bad trends, according to Roderick Harrison, a senior research scientist at Howard University. On the positive side, there is a much larger black professional middle class that is less subject to layoffs than was the case 26 years ago, he said. But on the negative side, more African-American men have dropped out of the labor force after giving up looking for work, Harrison said — that means they aren't reflected in the unemployment statistics.


Michigan: 15.8 percent

West Virginia: 15.6 percent

Alabama: 13.8 percent

Ohio: 13.1 percent

Illinois: 12.2 percent


Michigan: 15.3 percent

Nevada: 13.3 percent

Rhode Island: 13 percent

California: 12.2 percent

South Carolina: 11.6 percent

ANALYSIS: Manufacturers in the rust belt were hit particularly hard in the early 1980s, putting Midwestern states such as Michigan, Ohio and Illinois in the top 5. While Michigan again has the nation's highest unemployment today, states like Nevada and California are suffering from the housing bubble.


4 percent: Teenagers' proportion of the labor force in October 2009

7.7 percent: Proportion in September 1982

Thursday, November 5, 2009

Crist Walks Back Stimulus Support

As the stimulus bill's popularity continues to slip, particularly in light of the fabricated claims related to its effectiveness, at least one high profile Republican is walking back earlier support for the legislation. Given Tuesday's election results and the emergence of a vocal, fiscally conservative wing of the Republican Party, this will be an interesting story to watch as Gov. Crist seeks the Senate nomination.
Charlie Crist on CNN yesterday said he didn't endorse the stimulus package. A snippet:

WOLF BLITZER: Let me interrupt for a second, governor. For a second, do you have any regrets about endorsing the economic stimulus package?

CHARLIE CRIST: Well, I didn't endorse it. I — you know, I didn't even have a vote on the darned thing. But I understood that it was going to pass and I wanted to be able to utilize it for the benefit of my fellow Floridians.

Didn't endorse. Got it? No siree. Yet here's that what Crist said Feb. 10 in Fort Myers when he introduced Barack Obama amid chants of "Yes, we can!":

CRIST: "We've had to cut about $7 billion the past two years and we haven't raised taxes and we're still in balance. But to be candid, it's getting harder every day. It's getting harder every day and we know that it's important that we pass this stimulus package. It is important that we do so to help education, to help our infrastructure, and to help health care for those who need it the most — the most vulnerable among us. And let me finish by saying, Mr. President, we need to do it in a bipartisan way. This issue of helping our country is about helping our country. This is not about partisan politics. This is about rising above that, helping America and reigniting our economy."

Wednesday, November 4, 2009

When the New York Times...

begins to question the Administration, you know something must be up. Today's paper contains another interesting look at the questionable stimulus job numbers from a source that isn't commonly heard questioning President Obama:

In June, the federal government spent $1,047 in stimulus money to buy a rider mower from the Toro Company to cut the grass at the Fayetteville National Cemetery in Arkansas. Now, a report on the government’s stimulus Web site improbably claims that that single lawn mower sale helped save or create 50 jobs.

Earlier that same month, when Chrysler got a $52.9 million stimulus order for new cars for the government, the struggling automaker claimed that the money did not save a single job.

Those two extremes illustrate the difficulties in trying to figure out just how many jobs can be attributed to the $787 billion stimulus program. Last week the Obama administration released reports from more than 130,000 recipients of stimulus money in which they claimed to have saved or created more than 640,000 jobs, but a review of those reports shows that some are simply wrong, while others contain apparently subjective estimates.

A spokesman for Toro said the 50-job figure was not accurate, making it one of a number of reports with apparent errors. In many other cases, though, claims of jobs created are simply judgment calls, often by recipients trying to follow complex federal guidelines.

Manchester Voters Say Stop the Spending

Tired of watching local and state budgets increase at a time when everyday Americans are struggling to make ends meet, voters in Manchester voted to stop the spending by supporting a tax cap in the state's largest city. The Union Leader reports:
"The people of Manchester have spoken," said Mike Biundo, a former Republican state representative who led the push to put the proposal on the ballot.

The proposed amendment to Manchester's City Charter passed with a solid 54.4 percent of the vote, according to unofficial results. The tally was 9,433 in favor and 7,906 opposed. ...

Proponents describe the cap as a "fail safe" that will stop the aldermen from forcing taxpayers to keep digging deeper every year. The cap would keep Manchester's tax rate from growing faster than the rate of inflation, as determined by the National Consumer Price Index-Urban. City spending would be similarly limited.

It would be possible to get around the cap, if 10 aldermen vote to override it. Many aldermen have noted, though, that getting 10 votes is not an easy thing to do.

Mayor Frank Guinta said the cap's passage, combined with a Republican victory in the mayor's race, represented a "strong statement in support of fiscal responsibility."

That, ultimately, is exactly what many voters said they were looking for.

"I do see a lot of wasteful spending," said Michael Biron, a Republican voter in Ward 8. "They should learn how to spend the money better."

Not all of the cap's supporters were Republicans. Heidi Jones, a Democrat who picked Alderman Mark Roy for mayor, said the proposal just felt right.

"Taxes are going up so much," said Jones, who voted in Ward 3, "and we don't see any benefit from it."

Tuesday, November 3, 2009

NH Revenues Continue to Come in Low

For the fourth straight month, New Hampshire tax revenues have come in significantly below the rosy projections of Democrats in Concord. The AP reports:
The state received almost $12 million less in October than projected.

Administrative Services Commissioner Linda Hodgdon said there was one bright spot. She said taxes on property sales came in right on target for the first time in many months. The tax is an indicator of home sales.

The state received $204 million during the month. Since July, the state's tax receipts have come in almost $38 million below projections, but Hodgdon said the total does not reflect $6 million the state expects to receive soon.
Hodgdon did not elaborate on this phantom $6 million. Nor did she comment on the ongoing JUA legal battle which is likely to blow another $110 million hole in the budget.

NHGOP Chairman former Governor John H. Sununu released this statement on the news:
The huge shortfall in October’s revenue collections is another indication of the deception built into Governor Lynch’s disastrous budget. The Democrats’ bloated revenue estimates and reckless spending have forced New Hampshire into a fiscal crisis.

The Democrats have spent the last few months trying to cover up their budget disaster and distract from their fiscal mismanagement. However these repeated monthly revenue shortfalls, coupled with the irresponsible use one time money and attempted theft of $110 million from the JUA fund, confirm that their budget was one of the most irresponsible budgets in New Hampshire’s history.

Monday, November 2, 2009


The Washington Examiner has some choice words to describe the Administration's stimulus job numbers:
When Vice President Biden greeted a group of labor leaders two weeks after President Obama took office, he said, “Welcome back to the White House” — a not-so-oblique reference to their lack of access during the previous eight years under the Bush administration. Judging by the White House’s claims of having “created or saved 650,000 jobs” with the $787 billion economic stimulus program, it appears those labor leaders taught the administration a thing or two during their visit. How else to explain the obvious featherbedding by White House officials in tallying the job numbers released Friday?

Featherbedding occurs when paychecks are issued for nonexistent employees and the money goes directly into union coffers. Thousands of the jobs Obama officials say were saved or created by the stimulus program are no more real than those invisible positions invented by unions to bulk up their treasuries. We know this to be the case because as Obama’s chief economist, Christina Romer, admitted several weeks ago, “It’s very hard to say exactly because you don’t know what the baseline is, right, because you don’t know what the economy would have done without [the economic stimulus program].”

Even if we take at face value the White House claim that it created or saved all these jobs with approximately $150 billion of the economic stimulus money, a little simple math shows the taxpayers aren’t getting any bargains here: $150 billion divided by 650,000 jobs equals $230,000 per job saved or created. Instead of taking all that time required to write the 1,588-page stimulus bill, Congress could have passed a one-pager saying the first 650,000 jobless persons to report for work at the White House will receive a voucher worth $230,000 redeemable at the university, community college or trade school of their choice. That would have been enough for a degree plus a hefty down payment on a mortgage.

Actually, taxpayers would be better off with such a deal, too, compared with the reality of the Obama stimulus program. Among the top 10 stimulus contracts awarded, there is the one for nearly $339 million that allegedly created or saved 41.19 jobs, or about $8.3 million per position. It was even worse with the $258 million contract to Brookhaven Science Associates in New York, where 25 jobs were saved or created, at a cost of $10.3 million per position. Rep. Kevin Brady, R-Texas, the ranking House minority member of the Joint Economic Committee, said it best: “What we know for certain is that 2.7 million payroll jobs have been lost since the Obama stimulus was signed into law, hundreds of thousands of more jobs are being lost each month, and America is so deep in debt, China and France are lecturing us to get our financial house in order.”

Friday, October 30, 2009

Secretary LaHood Visits NH

As you may know, Transportation Secretary Ray LaHood was in New Hampshire today attempting to defend the stimulus to a state growing more and more skeptical of its impact.

STEWARD put out the following release, lampooning the visit and laying out the real facts:

In the spirit of Halloween, Secretary Ray LaHood and local Democrats gathered today to “dress up” the stimulus package as a New Hampshire success story. It’s not. And for the 53,330 out-of-work Granite Staters, the disguise is more “trick” than “treat.”

With the Democrats talking about the stimulus today, it’s important to recap some key numbers:

· The White House promised 16,000 New Hampshire jobs when it announced the stimulus package back in February. The Administration also said that more than 90% of “American Recovery and Reinvestment Act” (ARRA) positions would be in the private-sector. (The White House, “American Recovery and Reinvestment Act: State-by-state jobs impact,” 2/13/09)

· Last week, the state’s Office of Economic Stimulus disclosed that at least 2,786 of the 3,007 Granite State jobs – or almost 93% – created or “retained” by ARRA were firmly public-sector. (State of New Hampshire, American Recovery and Reinvestment Act Progress Report – Data through September 30, 2009, Office of Economic Stimulus, 10/20/09)

· Although the Obama Administration and local Democrats may point to the Manchester Airport Access Road as a stimulus success, the state’s overall numbers tell a different story. According to the state’s stimulus progress report, a mere 116 ARRA-driven jobs have been in Highway Infrastructure Investment – and winter is nearly upon us. It’s a figure so under-whelming that even Congresswoman Carol Shea-Porter recently acknowledged that the program hasn’t delivered on what Democrats promised.

· In September 2008, New Hampshire’s unemployment rate stood at 3.9%. When the stimulus passed in February, it was 5.7%. Unemployment in the state hit 7.2% in September. (U.S. Department of Labor, Bureau of Labor Statistics)

· 53,330 Granite State residents were unemployed last month. That’s 24,540 more than last year at the same time. (New Hampshire Employment Security, Unemployment Rates, 10/12/09)

· The state has approved more than $407 million in ARRA-backed projects. That figure divided by the 3,007 jobs created or “retained” works out to roughly $135,350 per position.

These numbers are delivering this year’s real Halloween fright. Unfortunately, it seems as though our grandchildren will be taking their children “trick or treating” before the $787 billion stimulus tab is paid.

Thursday, October 29, 2009

Stimulus Job Numbers Inflated - Big Time

A closer look at the White House's stimulus job numbers shows that the administration padded the actual number of jobs saved or created by up $5,000 positions. The Associated Press reports:

The AP review found some counts were more than 10 times as high as the actual number of jobs; some jobs credited to the stimulus program were counted two and sometimes more than four times; and other jobs were credited to stimulus spending when none was produced.

For example:

_ A company working with the Federal Communications Commission reported that stimulus money paid for 4,231 jobs, when about 1,000 were produced.

_ A Georgia community college reported creating 280 jobs with recovery money, but none was created from stimulus spending.

_ A Florida child care center said its stimulus money saved 129 jobs but used the money on raises for existing employees.

There's no evidence the White House sought to inflate job numbers in the report. But administration officials seized on the 30,000 figure as evidence that the stimulus program was on its way toward fulfilling the president's promise of creating or saving 3.5 million jobs by the end of next year.

The reporting problem could be magnified Friday when a much larger round of reports is expected to show hundreds of thousands of jobs repairing public housing, building schools, repaving highways and keeping teachers on local payrolls.

Wednesday, October 28, 2009

Coverage of the Spending Summit

From the Union Leader:
The spending summit, attended by about 100, came just a week after a two-day discussion of state tax policy that the House Ways and Means Committee held. Republicans said taxes are only half the discussion, and that spending has to be talked about too.

Timing for state spending controls is off a bit, since a new two-year budget just took effect in July. But speakers yesterday said this is actually the ideal time to start examining what state government should be expected to provide, and how to best organize and pay for it.

Arlinghaus warned that Republicans and Democrats have to work together on the difficult task of reshaping budget priorities.

"If all you want to do is snipe at the other side, you're not going to get anything done," he said. Arlinghaus cautioned that it may take more than one election to turn the ship of state spending "It's a big problem and you can't fix it if the election is first and foremost in your mind," he said. "It's going to take a long time to fix this." ...

Over the past 20 years, spending of state revenues has increased by an average of 9 percent for every biennium Budget increases vary from a 30 percent jump in 1994-95 to a 1.9 percent decline in 1996-97, according to data from the New Hampshire Center for Public Policy Studies.

Lieberman Connects

Sen. Joe Lieberman (ID-CT) has connected with the concerns of the majority of Americans by saying he will oppose the President's government option health plan because Washington is simply doing and spending too much. This is an excerpt from a Wall Street Journal editorial:

The health-care debate isn't over, notwithstanding the White House-Nancy Pelosi attempt to make it seem inevitable. Majority Leader Harry Reid had barely announced his plan to include a public insurance option when Connecticut Independent Joe Lieberman declared yesterday that he'd join a filibuster against such a Senate bill.

"We're trying to do too much at once," Mr. Lieberman said. "To put this government-created insurance company on top of everything else is just asking for trouble for the taxpayers, for the premium payers and for the national debt. I don't think we need it now."

Bravo, Joe. It's a relief to see at least someone standing up to the Washington rush to rearrange 18% of the U.S. economy without carefully inspecting the cost and the consequences.

Mr. Lieberman added that he'd also oppose a bill that includes Mr. Reid's provision for states to "opt-out" of the public program "because it still creates a whole new government entitlement program for which taxpayers will be on the line." Exactly right again.

Tuesday, October 27, 2009

Are there jobs to count?

How to count and classify the jobs created by the federal stimulus remains a nagging question for policymakers and watchdog groups as the money from the package continues to roll out. But still, much of the evidence, no matter the metric, points to lower than expected returns. In the Granite State:
New Hampshire has assigned at least half of its economic stimulus money to various projects or programs, but job totals remain at just 19 percent of initial White House projections.

The equivalent of 3,007 full-time jobs was created or saved with stimulus money through September, according to a report released last week by Orville “Bud” Fitch, director of the governor’s Office of Economic Stimulus.

That’s a big increase from the last quarterly report, when 796 jobs were linked to the program through June. But it remains unclear whether New Hampshire will reach the 16,000-job benchmark touted by the White House
And nationally:
As the government implements the $787 billion stimulus program, the effect of the spending and tax cuts are proving difficult to measure.

Part of the challenge is that assessments of the impact often rely on imagining how the economy would have fared if the stimulus money were spent differently, or not at all. Debates continue today about the effects of the 2001 stimulus program that sent rebate checks to taxpayers.

Complicating matters further: Many spending projects might end up being short-term jolts that fizzle out, raising questions about their effectiveness. The $3 billion cash for clunkers program, funded partially by stimulus money, pulled consumers into auto dealerships nationwide. Auto sales soared in August, then slumped in September. Similar concerns surround the $8,000 tax credit for first-time home buyers that ends next month. ...

As stimulus money slowly is disbursed, the continued troubles in the job market are renewing the fierce political battle about the giant program's performance. If the program is stimulating the economy, why is unemployment rising?
These WSJ graphs add more fuel to the skeptics' fire.

Monday, October 26, 2009

Money Well Spent?

USA Today reports on the release of some $30 million in stimulus funds to shady defense contractors:
The Department of Defense has awarded nearly $30 million in stimulus contracts to six companies while they were under federal criminal investigation on suspicion of fraud.

The companies claimed to be small, minority-owned businesses, giving them preference in bidding for government contracts, Air Force documents allege. But government investigators found they were part of a larger minority-owned firm and not eligible for small-business contracts.

The Air Force and Army awarded the companies 112 stimulus projects, federal contract records show. It wasn't until Sept. 23 — more than a year after the investigation started — that the Air Force suspended the firms from new federal contracts.

Scott Amey of the non-partisan Project on Government Oversight said the case exposes an oversight gap under the $787 billion stimulus plan and federal contracting in general. "Was there any disclosure of the contractors' missteps prior to them receiving the stimulus money?" he asked.

Air Force Lt. Col. Ann Stefanek said the stimulus projects were awarded independently by officers at military bases who wouldn't have spotted problems unless a contractor was suspended or debarred.

Federal rules let agencies terminate contracts if it's in the government's interest. Stefanek and Army Maj. Jimmie Cummings said the companies' work has been satisfactory and neither branch plans to cancel the stimulus contracts that were awarded before the firms were suspended.

Thursday, October 22, 2009

Shea-Porter Stimulus Flip-Flop

Congresswoman Shea-Porter appears to be walking back her strong support of the floundering stimulus bill. As you may recall, Shea-Porter had this to say after voting in favor of the $787 taxpayer giveaway:
After seven years of mismanagement and no oversight from the Administration, the housing market is in a crisis, the economy is struggling, and families are paying more for everything from groceries to heating oil,” said Congresswoman Shea-Porter. “I’m pleased that we came together in a bipartisan manner to pass this stimulus package. It will put money in the pockets of hard-working American families and help to restore the strength of our economy.
But now, given the stimulus' dismal performance coupled with a tough campaign ahead, local and national media outlets are picking up on Shea-Porter's reversal: