Did Federal Stimulus Really Create 70,000 California Jobs?


The numbers sounded terrific when they were announced Monday. The federal stimulus program produced more than 70,000 jobs in California, according to Gov. Schwarzenegger's senior advisor Richard Rice, who directs a task force that oversees economic recovery and stimulus dollars. More than 53,000 of those jobs came from federal money sent to state government entities. Nearly 17,000 of those jobs were the product of money given to local entities.

But there's more to those numbers than meets the eye. The jobs number does not reflect new jobs. Instead, it's is a mish mash that includes any job that can be said to be supported by stimulus funds. That would count new jobs, jobs that would have been eliminated but for stimulus funds, and perhaps even jobs that used to be funded with other money but now are supported by stimulus money.

This last problem is a persistent one in government programs. The new money doesn't so much add the new jobs as free up other money to go elsewhere. Asked to break down the job numbers on a conference call with reporters, Rice said it was too hard to tell how many new jobs were being produced."This is hard to track," he said.

This is the sort of thing that fans suspicion about stimulus. California clearly needed the help, and the money received has been considerable: $31 billion for state entities, and a total of $38 billion when local and private grants are thrown in. That's real money -- but not nearly enough to offset some $60 billion in cuts, tax increases and other budget adjustments made by the legislature over the past couple years.

By the time the stimulus has run its course, the state will have received $85 billion. But we'll likely never know the real impact on jobs of that money.

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