Why I think the stimulus worked and more

I typed this up last night for a Republican friend who is trying to convince me to vote Republican. I decided to post it here while I eat lunch.

First, When Obama took office we were losing jobs at a crazy rate.

August 2008: 84,000 - Unemployment Rate 6.2%
September 2008: 159,000
October 2008: 240,000
November 2008: 533,000
December 2008: 524,000
January 2009: 598,000
February 2009: 651,000
March 2009: 663,000
April 2009: 539,000
May 2009: 345,000
June 2009: 467,000
July 2009: 247,000
August 2009: 216,000
September 2009: 263,000
October 2009: 190,000
November 2009: 11,000
December 2009: 85,000 - Unemployment rate 10%

Total Job Loss during the period above was 5,815,000 jobs lost. From Dec 2007 to Dec 2009 there were a total of 8,467,000 jobs lost. I am pointing this out for perspective.

As you can see, an awful lot of jobs were lost from Aug 2008 to Dec 2009. At this point, the stimulus had started to pay for projects and is continuing to pay for projects... estimates are that this will continue through 2011. The current unemployment rate is 9.1% and job losses have fallen dramatically from the numbers we saw in 2008-2009. I think it is reasonable to say that the job losses incurred during the period above cannot be attributed to anything that Barack Obama did... those job losses started before he took office and he did not create the situation that caused them.

The point of the stimulus was to stop the accelerating rate of job loss. It is clear, by the numbers, that the stimulus did exactly that. The unemployment rate has stabilized and improved slightly since Dec 2009.

Since July 2009, the Private Sector has added a total of 923,000 jobs (above job losses). However, the Public Sector has lost 378,000 jobs (Firefighters, Policemen, Teachers, etc).

You can see where I got my data here: http://data.bls.gov/pdq/SurveyOutput...=CES0500000001

Here is where the interesting part comes in... Corporations are making record profits but aren't hiring.

http://www.bcg.com/media/PressReleas...d=tcm:12-76679
http://www.bcg.com/media/PressReleas...d=tcm:12-77753

There are a number of reasons why this is happening. I suspect the biggest reason is that we still haven't seen Commercial Real Estate take the hit that the Residential Real Estate market took. I think this makes investors very nervous. In addition, the current market isn't creating enough demand for increased production.

President Obama realizes that this is happening... so what he proposed is that we build a new market to create jobs in clean energy products. That effort has met every form of resistance that the Republicans can muster because it will directly affect oil and coal companies in the long term. Unfortunately, most of these companies don't see it as an opportunity... even though most other nations (including China) have boosted investment in that market to compete.

On another front, the Administration has tried to make significant investment in improving our rail system to streamline logistics. It is much cheaper and much faster to ship via rail than via trucks. It also saves alot of traffic on our highways. It also assists in getting products to market faster... especially if you are exporting. Our logistics infrastructure is old.

Additionally, the Administration has pushed for investing is improving our electrical grid and broadband access nationwide. Just recently, here in North Carolina, the Republican controlled legislature has been attempting to block those efforts to improve broadband access at the behest of Time Warner Cable (who have a monopoly here).

All the while, Republicans in Congress are protecting oil and coal companies, protecting the wealthy, and protecting the military industrial complex while pushing for more and more cuts to safety net programs and other domestic programs that have very little effect on the deficit or debt (besides Medicare/Social Security). Their idea of "job creation" is to give more tax cuts to corporations and wealthy individuals who have seen a 280%+ increase in earnings over the last decade but haven't created jobs here in the US.

The total NET WORTH of the US (assets after liabilities) is $56 Trillion. Roughly 85% of that $56 Trillion is owned by the top 10% of earners. Republicans like to talk about Wealth Redistribution... but they fail to mention that, since Reagan, there has been an immense amount of wealth transferred from the bottom 90% to the top 10%. There is a simple reason for that... the people with the means have the power to manipulate the system and they have been accelerating that pace.

History is important and in our history and we already experienced this type of rogue capitalism in the form of political entrepreneurs. There is an important distinction between market entrepreneurs and political entrepreneurs. Market entrepreneurs earn their money the old fashioned way through actual market capitalism and competition. Political entrepreneurs use their economic means to manipulate the political system so that they can manipulate the market and eliminate competition. In the early 1900s they referred to them as "Robber Barons".

This is the biggest threat we face as a nation, in my opinion, and as long as Republicans continue to defend political entrepreneurs they can't get my vote (same goes for any Democrat who does the same).