Next week, the House is expected to take up billions in dollars in spending, and tax increases, marketed by the Democrat majority as a "jobs bill." The tip of this iceberg contains tax relief extensions and unemployment benefits.
According to Democrat press releases, the bill could cost $190 billion or more, and will include spending measures such as unemployment insurance, COBRA, TANF, and FMAP. In addition, this bill is likely to include a Medicare Doc Fix and to extend the Build America Bonds program.
The tax extensions in this bill are expected to be offset; potential offsets that have been reported in the press include increasing taxes on carried interest, increasing the oil spill liability trust fund tax, increasing taxes on S corporation service businesses, among other tax increases.
Most of the spending provisions are not expected to be offset, and will add to the deficit.
Too Little (or Too Much), Too Late
At the height of the recession, the Democrat majority promised the America people that the $1.2 trillion "stimulus" bill was the key to prosperity-creating or saving three million to four million jobs, 90 percent of them in the private sector. The president's own economic advisor, Christina Romer, promised that the stimulus would keep the unemployment rate from exceeding 8 percent.
Democrats have not learned from their expensive mistakes of the recent past attempts to create jobs, as they work to introduce another deficit-busting "jobs bill" this week.
This new bill, which is presumed to cost greater than $190 billion, will likely be another squandered bill, similar to the $1.2 trillion stimulus; much of the funding borrowed from foreign entities such as China. At no single point since the bill was passed has the unemployment rate been below the promised 8 percent. In fact, the unemployment rate has not dropped below 9.7 percent this year.
Currently, the unemployment rate stands at 9.9 percent. But even these rates can be slightly misleading. This rate reflects those individuals who are unemployed and actively looking for work. It doesn't reflect those who have given up on the promises of stimulus-driven job creation-such as individuals who have lost jobs but have given up finding new ones; those who have settled for part-time jobs. Therefore, the real underemployment rate in the U.S. currently stands at an astounding 17.1 percent.
Democrats Jobs Solution: More Government = More Jobs
The Democrat majority pushed a massive stimulus through Congress, and have continued to waste huge sums of money with hopes of creating jobs, much like the bill that will be considered this week. While they have been largely unsuccessful, there is one particular sector that has experienced tremendous growth in employment: the federal government.
Since the recession began in the beginning of 2008, the private sector has lost nearly 8 million jobs, while the federal government has gained 240,000. Many of those government jobs can be attributed to hiring for the decennial census. However, even after you exclude the census and the Department of Defense, the President's Budget estimates the federal work force to expand by nearly 140,000 in 2009 and 2010.
Since the "stimulus" bill passed in February of 2009, the private sector has lost nearly 2.6 million jobs. On the other hand, the federal government has gained 182,000 since then.
But, for those who have been laid off, or continue to be unemployed, the Democrats have news for you. In their recently released summary of their bill, "The American Jobs and Closing Tax Loopholes Act of 2010," if nothing else, they are requesting a "Commerce Department study on job losses." So, while the Republicans continue to focus on fiscally responsible solutions to creating more jobs, the Democrats have decided to use taxpayer dollars to focus on studying the absence of jobs.