About Me

Name: Old Retired Fart
Biography
Loading...

Create Your Own Blog Find Other Townhall Blogs

Comments

Blog Roll

 

Follow-up on Obamamath

Posted by Old Retired Fart on Saturday, December 06, 2008 1:25:04 PM
Was digging around a little this morning and found some facts and figures on government "infrastructure" projects.  After Hurricane Katrina here in Louisiana, we had "Project Blue Roof" to install tarps on houses damaged by the hurricane.  For the average 1500 square foot roof, the government paid the primary contractor $2250 (pretty similar to the cost of a basic three-tab roof, but that is another story).  By the time the money had passed through hands and gotten to the only person who actually had a job installing that tarp he got between $30 and $50.  Extrapolating that math each of those 40,000 jobs Obama spoke of would pay $555 a year.  Or another way of looking at it, he could actually "create" about 900 $25K jobs for 1 year with a billion dollars. 

Now if those same $1 billion are put into the hands of consumers, and assuming that they will spend 90% and save 10% (pretty high savings assumption), the result would be a $10 billion kick in the economy.  Seems like a no-brainer to me.

Email ItEmail It | Print ItPrint It | CommentsComments (0) | TrackbacksTrackbacks (0) | Flag as offensiveFlag as Offensive

Is Obama Math Ignorant, or Does He Think We Are?

Posted by Old Retired Fart on Saturday, December 06, 2008 11:28:22 AM
Short post this morning.  I was reading about Obama's latest public works proposal.  Leaving aside the whole idea of the government "creating" jobs, where does he get his figures?

According to the article this morning, "Obama estimates every $1 billion spent will result in 40,000 jobs."  Now here is my basic math...1 billion divided by 40,000 equals 25,000.  That means if there was no friction...loss of money on the way from the federal government to the workers, $1 billion would pay 40,000 workers $25,000 for one year.  (For the economists in the group, there is the money multiplier, but it is questionable if it applies here, and even if it did, it wouldn't change things much). 

Not sure that a one year job paying $25,000 is exactly what folks have in mind.

Email ItEmail It | Print ItPrint It | CommentsComments (2) | TrackbacksTrackbacks (0) | Flag as offensiveFlag as Offensive
« Previous1Next »