This is an archived article that was published on sltrib.com in 2011, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.
A big applause line in the Republican presidential debates is that President Obama's economic stimulus package was a colossal waste of money that didn't create any jobs. Though it certainly is debatable how effective certain measures in the complex law have been, it is simply not true to say that it did not reduce unemployment.
In its latest report on the 2009 stimulus law, the Congressional Budget Office estimates that at its high point in 2010, the package created or preserved between 1.3 million and 3.3 million jobs and reduced unemployment between .7 and 1.8 percentage points. It boosted Gross Domestic Product between 1.5 and 4.2 percent.
You can read the report for yourself at cbo.gov/doc.cfm?index=12385.
The CBO may not be the final word on all things economic, but unlike partisan think tanks, it is known for its independence. It is regularly called upon to make estimates about prospective legislation sponsored by Republicans and Democrats alike, and both parties cite its opinions when that benefits them.
To refresh your memory, the Obama stimulus package came to be known as the American Recovery and Reinvestment Act, or ARRA. CBO estimated at the time that it would cost about $787 billion over the next decade. It has since adjusted that estimate up to $825 billion.
Even at that mind-boggling price, liberal economists like Paul Krugman argued at the time it was passed that it was not large enough and relied too heavily on tax cuts.
The law provided funds directly to state and local governments for things like expanded Medicaid payments and aid to education and transportation. You also may recall that the Utah Legislature briefly toyed with turning down the funds, but quickly dropped that idea. The hundreds of millions of dollars the state received prevented deeper layoffs of teachers, to cite just one example.
The law also extended unemployment benefits and expanded food stamps. It funded construction projects. It provided temporary tax relief for individuals and businesses by creating the Making Work Pay credit, adjusting the alternative minimum tax and allowing bigger deductions for depreciation of business equipment.
All of these measures pumped money into the economy. In fact, one reason often cited for the current economic slowdown is the expiration of the stimulus program. As ARRA funds have dried up, governments and school districts have laid off workers and exacerbated unemployment.