Monday, January 26, 2009

Obama's Millions

JWF discusses Obama's new executive order, which places mandates on the automotive industry. Subsequently, GM announces they will be cutting 2,000 jobs since they need to readjust to market demand.

This is in response to Obama's telling the country that
"It will be the policy of my administration," he said, "to reverse our dependence on foreign oil while building a new energy economy that will create millions of jobs."

JWF poses the extremely pertinent question, in the face of the 2,000 jobs lost in response at GM alone:
No doubt forcing mandates on the auto manufacturers will cost jobs. Where are these millions of jobs the government is going to allegedly create come from?

Well the answer is easy there.

Of the $363 billion in the "stimulus" intended for "direct injection" into the economy, $33.4 billion is directly set aside for Government Employee Salaries and Program Expenses. Beyond that, every section of the bill tells us that over and above that $33.4 billion, 3% of the other allocated monies may be used for further administration of the funds. That's an additional $9.89 billion that will be available to the government for administrative purposes, giving us a grand total of $43.29 billion for government employees.

If we go by the University of New Mexico's numbers for average salary and round up to $40,000, then apply a heavy benefits multiplier of say, 1.5, to account for government benefits, then we see that each government job probably costs, on average, about $60,000.

At that value, $43.29 billion pays for 721,500 government employees.

We're on our way to a million there.

Just a shame none of those will produce anything.

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