Observers who surmised that President Barack Obama’s American Jobs Act was a gimmick designed to make the employment situation look better just long enough for Obama to be reelected — never mind the long-term consequences — have been vindicated.
A recent Associated Press report states that Obama’s plan would at best reduce the unemployment rate by a single percentage point in time for the November 2012 election, after which it would become “a drag on the economy” to the point that “by 2015, the economy [will be] in the same place as now, as if there were no jobs package.” Taxes, meanwhile, will have permanently increased by some $1.6 trillion.
Obama has been careful not to make his own prediction about how many jobs his bill would create, fearing that he would only be sealing his own fate if reality failed to live up to his forecast. Instead, he turned to Mark Zandi, chief economist of Moody’s Analytics, who estimated that the bill would generate about 1.9 million new jobs in 2012, or 158,000 a month, leading to a one-percentage-point reduction in the unemployment rate and a two-percentage-point increase in the gross domestic product. The AP notes that Zandi’s jobs estimate “is somewhat higher than private analyses that suggest the plan would create 100,000 to 150,000 jobs a month.”
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