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There They Go Again: Two Senators Continue False and Misleading Attacks on Recovery Act

Jared Bernstein, Chief Economic Advisor to the Vice President, debunks the latest recycled attack on the Recovery Act from Senators John McCain and Tom Coburn.

This morning two senators—John McCain and Tom Coburn—released their third report critiquing 100 Recovery Act projects. And just like the last two, this one was an inaccurate and misleading attack on programs that are putting Americans to work across the nation. I’ll present some details in a moment, but it’s very unfortunate that, once again, instead of trying to help create the conditions for stronger growth, to help build on the momentum of the Recovery Act, McCain and Coburn spend their valuable time cooking up phony critiques and, with their Republican colleagues, blocking votes of even bipartisan measures to help small businesses.

Let’s start with the bigger picture. Just last week two prominent, independent economists released a rigorous study on how actions by the government (and the Federal Reserve), including the Recovery Act, helped to end the Great Recession. One of the authors—Mark Zandi—was one of McCain’s top advisers during his presidential bid. He and Alan Blinder (a former vice-chairman of the Federal Reserve) found that the Recovery Act has created or saved about 2.7 million jobs so far, and shaved about a point and a half off of the unemployment rate.

These jobs are the result of over 70,000 projects in action around the country, of grants to states supporting jobs of teachers, police, and firefighters, of tax cuts for working households, loans to small businesses, and investments in innovative new industries producing advanced batteries, clean energy, and much more. They’ve helped reverse a situation where last year, we were losing millions of private sector jobs; in the first half of this year, we’ve added 593,000 private sector jobs.

Now, we’re always glad to take a second look at projects when concerns are raised. In fact, there’s never been a stimulus program of this magnitude with anywhere near the amount of oversight that’s been brought to bear on the Recovery Act. And when we find a problem, we fix it. We’ve shut down hundreds of projects that weren’t delivering the goods.

But the inaccuracy of McCain/Coburn in this regard renders this report just as unreliable as the last two. We followed up the projects in those reports, and found half of their claims to be flat-out false or misleading. Many of the others criticized worthwhile, job-creating projects.  Check out this link and you’ll see that news outlets like CNN have debunked their claims in the past, often by simply going to the folks who were working on the project and learning about it:

In the current report, our review so far finds that five of the 100 projects are not even Recovery Act projects. And others are just blatantly wrong on the facts. Take for example an award that McCain and Coburn describe as “funding a WNBA Practice Facility,” when in fact the award is building a tribal government center that will create education and health facilities while also creating hundreds of jobs. Moreover, the tribe has agreed to disallow any commercial use of the facility. 

One of their top critiques in the new report is a clean energy program in California that’s put about 50 people to work so far, expects to create 1,500 construction jobs, and then 500 permanent green jobs after that. Gov. Schwarzenegger praised the program, as did the Chamber of Commerce. What would McCain and Coburn say to these workers? That they shouldn’t have this opportunity? That they should go back to the jobless roles? That building a clean energy future is the wrong way to go?

What ideas does Senator Coburn have to offer to the 35,000 people working in Oklahoma who wouldn’t be there without the Recovery Act?  What about the 64,000 Arizonans at work because of the Act? 

Instead of answers, we’re left with a partisan attack contradicted by one of the author’s own former advisers. But that’s not all. We’re also left with a choice.

The President has shown he is willing to work with anyone who will join us to figure out new ways to create more jobs. The Vice-President spends each week making sure we’re squeezing job out of every Recovery Act dollar.   Meanwhile, Republicans are blocking an up or down vote on a package of bipartisan proposals that would cut taxes for small businesses and allow them access to capital through community banks. It’s incredible, when you think about it: last week as they were working to turn out this hit-job of a report, these same two senators were voting against helping small businesses expand and create jobs.

Yes, we must carefully evaluate our progress, but we must do so without partisan thumbs on the scale. In that regard, the report these two senators are touting today is not a road map forward. To the contrary, it is one back to the failed policies that got us into this mess. We’ve tried that route. We cannot afford to go back there again.

Jared Bernstein is Chief Economic Advisor to the Vice President