The House just approved a $15 billion jobs bill that was already passed by the Senate. Will it help the economy? The NYT told readers that Representative Bob Etheridge, "estimated that the measure could create one million jobs." It then quoted Republican Representative Steven LaTourette saying that: "This is a no-jobs bill, this is a faux-jobs bill, this is a snow-jobs bill." Later we are told that: "But lawmakers said that given the dismal unemployment picture, they were willing to give it a try, and estimated the tax breaks would put 300,000 people to work." It's not clear where this 300,000 jobs number came from or which lawmakers it is associated with. As a practical matter, the incentive in the bill, which is primarily the 6.2 percent employer side of the Social Security tax, is unlikely to be large enough to have much effect on hiring. Even in the current weak economy, employers hire close to 4 million workers a month offsetting the departure of roughly the same number of workers. Most of these new hires would qualify for the credit, which means that the bulk of the $15 billion is likely to go to firms for hiring that they would have done in any case. Readers are not likely to have the time or background to evaluate competing assertions about a bill's impact. The NYT reporter should.
--Dean Baker
