- The Washington Times - Wednesday, July 14, 2010

The White House said Wednesday that stimulus act spending finally has kicked into high gear and as of June 30 had expanded the economy by up to 3.2 percent and created up to 3.6 million jobs, marking a key part of what they said is an ongoing economic turnaround.

Part of what the White House has dubbed the “summer of recovery,” it’s the latest effort to rehabilitate the beleaguered image of the $862 billion spending bill, passed last year with the assurance that it would set the economy on sounder footing and create millions of jobs.

“I feel very confident that, you know, when the studies are written years from now, it will be viewed as the tremendous success that I feel it has been,” Christina Romer, Mr. Obama’s top economic adviser, told Congress as she presented the White House’s fourth quarterly report on progress from the stimulus act.

But that message is facing an uphill battle as polls show voters are not convinced that the spending has succeeded, and instead has added to a staggering debt burden.

The Federal Reserve has signaled that it is taking a dimmer view of the economy’s prospects. Officials on Wednesday released details of the Fed’s June 22-23 meeting at which they lowered their expectations for economic growth and job creation this year.

Republicans argue that at this point, 17 months after the stimulus act was signed into law, it has failed to meet many of the administration’s original goals.

Before the law was enacted, the Obama team predicted that unemployment would peak at 8 percent if Congress passed the stimulus. Instead, it rose past 10 percent and currently stands at 9.5 percent.

“Where are the jobs? Companies aren’t hiring at anywhere near the rates the administration said they would be,” Rep. Michael C. Burgess, Texas Republican, said at a hearing of Congress’ Joint Economic Committee.

But Mrs. Romer told lawmakers the act is on track to meet the White House’s chief goal of saving or creating 3.5 million jobs, and said the fact that unemployment is higher than predicted is a symptom of a worse economy, not the failure of the stimulus.

Congressional Democrats, meanwhile, said Republicans are cheering for a bad economy.

“If you’ve got anything positive to say, I promise you, you will be told the sky is still falling, that this president had nothing to do with the progress, that there is no progress,” said Rep. Elijah E. Cummings, Maryland Democrat. “At some point, we have to join in and root for the home team.”

Mrs. Romer, in her report, said the economy is between 2.7 percent and 3.2 percent bigger than it would have been without the stimulus, and that Americans have between 2.5 million and 3.6 million more jobs thanks to the spending.

The report says that as of June 30, $480.3 billion had been either paid out in spending or allocated as tax cuts.

Of the up to 3.6 million jobs that the White House says were created, just 800,000 of them are from public works projects such as building roads and bridges. The report says $86 billion has been spent on those projects, which works out to about $107,500 per job.

Mrs. Romer said one benefit of the stimulus is that about $100 billion of the federal funding has a requirement that it be matched by private investment.

She said that has led to an additional $380 billion in private investments tied to the Recovery Act.

Struggling to drive home its message that the Recovery Act has worked, Mr. Obama has taken to the road this summer, visiting projects funded by the stimulus.

On Thursday, Mr. Obama will travel to Holland, Mich., for the groundbreaking of a plant that will build batteries for electric vehicles.

He also recruited former President Bill Clinton to join a meeting at the White House on Wednesday to talk about boosting clean-energy jobs.

Still, the stimulus has proved to be radioactive. Mr. Obama is calling for Congress to pass another round of stimulus spending, but with the country’s debt topping $13 trillion and a deficit that has reached $1 trillion for the first nine months of this fiscal year, members of both parties are wary.

In recent weeks, Democrats in both the House and Senate have proposed cutting some of the money still unspent from the stimulus and redirecting it to other more immediate priorities they say will produce jobs sooner.

The White House has been critical of those efforts, arguing that Congress should give the administration freedom to spend the money as planned.

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