Administration tries to explain away stimulus errors

Responding to rash of errors in its tracking of the $787 billion stimulus package, the Obama Administration has mounted a defense of its $84 million web boondoggle.

Obama special adviser G. Edward DeSeve writes on the White House website that the errors are minor compared to the overall to the massive bill.

First, the mistakes are RELATIVELY few, and don’t change the fundamental conclusions one can draw from the data. Even if as many as 5-10% of the reports or 5-10% of the totals are wrong (and we don’t think it is that high), that still means the Recovery Act saved or created between 600,000 and 700,000 direct jobs in its first seven months – more than most experts predicted when it passed. And most leading experts agree that – whatever the recipient reported total should be – the actual number of jobs saved or created is about double that, because the recipient reports don’t include direct payments to individuals, the jobs created by Recovery Act tax cuts, and the jobs created when workers on Recovery Act projects spend their paychecks.

The Recovery.gov team even weighed in on Twitter, passing the blame for the slew of faulty job numbers and phantom Congressional Districts on recipients making mistakes on the reports they submitted.

Did you know? Unless an egregious error is noted, Recovery.gov posts data exactly as it is reported by recipients.

But the Board overseeing the $84 million Recovery.gov project admits it never checked to see that the data going into the database was accurate. Ed Pound is Director of Communications for the Recovery Accountability and Transparency Board.

“People make errors, and we’ve found people are making errors in these reports,” Pound said…

Recipients file their reports on a password-protected site. That information is then relayed to officials who oversee the recovery.gov website to post, Pound said. Unless an egregious error is noted, Pound said they post the information exactly as it is received.

“Our job is data integrity, not data quality,” he said.

In New Hampshire, the stimulus website shows that 92.5% of all jobs "created or saved" by the stimulus are in Concord, likely the result of how state officials reported how they were spending the money to Washington. Of the 3,000 jobs reported by New Hampshire stimulus coordinator Bud Fitch, over 2,000 were public school teachers, and nearly all were working for state or federal governments.

As the Administration tries to explain away its ability to track how the government is spending $787 billion in taxpayer money, it lacks any explanation for how the stimulus has failed to meet the Administration's rosy projections, or why the same bureaucrats should be trusted with America's health care industry.

$6.4 Billion Stimulus Goes to Phantom Districts

Bill McMorris, who I quoted in this morning's story on the 440 phantom Congressional Districts that received funding under the stimulus.

The site’s monitors, however, are not too savvy about America’s political or geographic landscape. More than $2 million was given to the 99th District of North Dakota, a state which has only one congressional district. In order to qualify for 99 districts, North Dakota would have to have a population of about 60 million people, almost 24 million more people than California.

The stimulus revived 8 recently retired congressional districts. Pennsylvania’s 21st District has received just under $2 million in funds. Mississippi’s 5th District and Oklahoma’s 6th received $1 million from the legislation, respectively. All three were eliminated by the 2000 census.

Many other recipients carried the banner for congressional districts that have been defunct for decades. South Carolina’s 7th took the cake, garnering more than $27 million in stimulus funds, despite being eliminated in 1930. And Virginia’s 12th District may have been written off at the start of the Civil War, but it must carry some sentimental value in Old Dominion–it received more than $2 million, according to recovery.gov.

The stimulus helped to create 35 congressional districts in Washington D.C. and the four American territories, all of which have no congressional districts. These areas received $5 of the $6.4 billion distributed to the non-existent districts.

$84 million for a great website, with tons of functionality. Too bad they didn't bother to check to see if the data going in was garbage.

Mark Steyn tours the 00th Congressional District

Over at National Review Online, Mark Steyn explores the political implications of making up Congress Districts, like the Obama Administration has done with the stimulus package.

Reading those jobs numbers, I can't be the only resident of New Hampshire's Second Congressional District who dreams of relocating to the "00 Congressional District", land of 2,873.9 newly created jobs. What a great name! Because in the Obama budget you can always use a couple extra zeroes.

I like to think of it as somewhere up around the Fourth Connecticut Lake or the Indian Stream by the old bootlegging routes in from Quebec. I drive around in the forlorn hope that one day on a rutted Class VI road deep in the woods, just over the washed out culvert, I'll round the bend and see the sign saying "Now Entering The 00 Congressional District. This $47,000 sign brought to you by the America Recovery & Reinvestment Act", and the Emerald City of Oo will rise before me, its streets paved with Stimulus green and lined with dancing fountains of sparkling H1N1 vaccine and Obamatronic statues that bow as you pass by as if you're the Japanese Emperor and they sing "Be Our Guest" in a faintly metallic voice. And I'll be greeted by 2,873.9 gnarled old stump-toothed loggers with an average of 2.7 fingers between them, now federally retrained as green jobs czars, NEA performance artists, end-of-life counseling coordinators and Joe Biden speechwriters...

92.5% of all NH Stimulus Jobs in Concord

According to the federal government's Recovery.gov database, which tracks how state governments are spending the $787 billion stimulus package approved last year, 92.5% of all New Hampshire jobs "created or saved" by the legislation are concentrated in the State Capital of Concord.
According to the New Hampshire summary page, the government credits the American Relief and Recovery Act with creating or saving 3,528.8 full-time jobs across New Hampshire. 3,264.4 of those jobs are listed under Concord zip codes. Outside of Concord, only a few communities have more than a handful of jobs credited to the stimulus; 37 in Manchester, 25 in Salem, 47 in Portsmouth, and 14 in Durham.

Orville "Bud" Fitch oversees Governor John Lynch's Office of Economic Stimulus. Last month, he reported that the stimulus had created or saved 3,007 full-time equivalent jobs statewide through September 30, 2009. The federal website relies on reports from individual grant recipients, as well as the state's report every three months.

The Onion covers Obama Teleprompter Malfunction

You know, when you've lost the Onion...actually, they destroy pretty much everybody.

Obama's Home Teleprompter Malfunctions During Family Dinner

Stimulus Package doubles size of Congress

The political appeal of the $787 billion stimulus package was that it allowed the Obama Administration to spread the money across all 435 Congressional Districts in an attempt to win votes from politicians eager to bring home the bacon in rough economic times. But reports by the Obama Administration's Recovery.gov database show that the money wasn't limited to those 435 districts. It also went to 440 Congressional Districts that don't exist.

Reporter Jim Scarantino of the Rio Grande Foundation broke the news yesterday that the stimulus tracking website listed millions in federal funds for projects in ten bogus New Mexico districts. Within hours, colleagues at other state think-tanks had published stories detailing the massive errors in their state's stimulus disclosure databases. By late-afternoon, ABC News and the L.A. Times had picked up the story, prompting an angry reaction from Democratic Congressman David Obey, who blasted the Administration's lax oversight of the nearly $1 trillion spending package.

Reporter Michael Noyes of the Montana Policy Institute investigated how his state could have received funding in 13 separate Congressional districts, when it has only one Representative.

Ed Pound, director of communications for the Recovery Accountability and Transparency Board, tells the Montana Policy Institute that his organization posts whatever information is reported by stimulus grant recipients, and doesn't check to make sure it's actually true.

"Our job is data integrity, not data quality," he said.

The Recovery.Gov website was set up in February with a budget of $84 million.

Overall, Bill McMorris of the Franklin Center for Government and Public Integrity calculates that $6.4 billion of the stimulus package has been distributed to 440 phantom Congressional Districts, which the Administration claims created over 28,000 jobs at a cost of $224,500 each.

The news of the mythical Congressional Districts comes on the heels of an admission by the Obama Administration that 60,000 jobs had to be cut from its latest stimulus report after finding faulty data from a dozen stimulus recipients.

Reported problems with the stimulus jobs data are so widespread that the Washington Examiner's David Freddoso and Mark Hemingway have published an interactive map of bogus jobs created or saved by the stimulus.

Obama Administration gives New Hampshire three new Congressional Districts

Good news for all those Congressional candidates facing tough primaries next fall. The Obama Administration's stimulus package has created three or four more Congressional Districts in New Hampshire.

According to the summary of stimulus jobs "created or saved" in New Hampshire, the American Recovery and Reinvestment Act has created 3.2 jobs in the 6th District, zero jobs in the 4th District, and two jobs in the 27th District. New Hampshire, of course, only has two Congressional Districts.

The site also lists a whopping 2,873.9 jobs in the 00 Congressional District, which is presumably where former Celtic Hall of Famer Robert Parish lives.

Hattip: Jim Scarantino at New Mexico Watchdog, who discovered the problems with Recovery.org in his state. This appears to be a nationwide problem with the confusing reporting requirements imposed on recepients of grants under the stimulus package.

2 lawyers wrote their own meal ticket

The Nashua Telegraph runs an AP story on one of the most egregious cases of rent-seeking I've ever seen.

Every lawsuit filed or even threatened under a California law aimed at electing more minorities to local offices - and all of the roughly $4.3 million from settlements so far - can be traced to just two people: a pair of attorneys who worked together writing the statute, The Associated Press has found. The law makes it easier for lawyers to sue and win financial judgments in cases arising from claims that minorities effectively were shut out of local elections, while shielding attorneys from liability if the claims are tossed out.

The law was drafted mainly by Seattle law professor Joaquin Avila, with advice from lawyers including Robert Rubin, legal director for the Lawyers' Committee for Civil Rights of the San Francisco Bay Area. Avila, Rubin's committee and lawyers working with them have collected or billed local governments about $4.3 million in three cases that settled, and could reap more from two pending lawsuits.

Basically, these two daring entrepreneurs decided to go into the subsidy farming business in California. They push through a law that not only forces local governments to write them fat settlement checks, but also shields them from the consequnces of frivilous lawsuits. Win-Win, for them.

How's Your Bailout? Automotive Edition

The Wall Street Journal reports that General Motors is getting ready to pay back some of the money it borrowed from the federal government ahead of schedule. That sounds like good news, until you learn that it is paying back the loan with money cash it got from the auto bailout.

General Motors Co. plans to begin paying back a $6.7 billion loan it owes the U.S. government starting late this year, putting it on track to potentially repay the entire note by the middle of 2011, said a person familiar with the matter.

But in a move that could be controversial and risky, the car maker plans to use other money it received from the government to pay back the borrowing.

How's Your Bailout? Financial Edition

The Washington Post reports that 46 firms that received money from the Troubles Asset Relief Fund, otherwise known as TARP or the federal bailout, "had missed required dividend payments to the government as of the end of September".

Analysts expect more bailed-out firms to fail in the months ahead. Others may survive but will struggle to repay the government. Steven Rattner, the former head of the government's efforts to bail out the auto industry, said recently that the full public investment in GM is unlikely to be repaid. Meanwhile, AIG is dismantling itself, selling healthy subsidiaries at what critics say are bargain prices in an all-out effort to get cash to repay the government.

About $400 billion of federal investments remain in the corporate sector, much of it channeled through TARP. Critics of the program say losses were inevitable, in many cases.

There was a reason private investors didn't want to give these failing firms their money. It was a bad investment. Congress was more than willing to invest our money, though.

The FDA is out of control

I had missed this story on Friday. The New York Times reports that the Food and Drug Administration blames to ban alcoholic beverages with caffeine, unless the manufacturer can prove to federal bureaucrats that they are safe.

In a statement, the Food and Drug Administration said it had told nearly 30 manufacturers of the drinks that unless they could provide clear evidence of safety, it would “take appropriate action to ensure that the products are removed from the marketplace.” Officials did not say how long such a determination might take.

The drinks, which combine malt liquor or other spirits with caffeine and fruit juices at alcohol concentrations up to about 10 percent, have become increasingly popular among college students. In a news conference, Dr. Joshua M. Sharfstein, the agency’s principal deputy commissioner, said their consumption was associated with increased risk of serious injury, drunken driving, sexual assault and other dangerous behavior.

I hope the Obama Administration leaves me along the next time I enjoy an Irish coffee. Or a Red Bull and vodka. (Okay, I hate Red Bull and vodka.) The FDA appears to be operating under the assumption that they get to arbitrarily decide where their regulatory powers begin and end. They haven't bothered to find out if these products are dangerous. They don't see any need to actually present evidence to ban the products until the prove they are safe. This
"Precautionary Principle" sounds like common sense, but it is actually an insidious way to ban any behavior that regulators don't like. Proving no harm is a huge, counterfactual burden for any manufacturer to clear. The FDA's failure to approve new drugs kills more people than it saves. Now, they want to bring that same failed approach to the grocery story.

Sunday Book Review- It's Getting Better All the Time

The late Julian Simon once bet doomsayer Paul Erlich that the price of a set of five precious commodities would drop from 1980 to 1990. Erlich thought that our limited resources would dwindle in the face of surging populations. Simon thought that human ingenuity would find ways to improve life for more and more people. Simon was right. He wanted to repeat the bet from 1990 to 2000, but the details were never settled. He would have won again, as the real price of the five commodities fell another 19% over the decade.

Simon died of a heart attack in 1998 at the age of 65, but his unyielding optimism in the face of the world's problem led Stephen Moore to finish Simon's manuscript, published as It's Getting Better All the Time: 100 Greatest Trends of the Last 100 Years.

How has the United States changed over the past century? Is life truly better now than it was in the past? Using statistical reports and other historical materials, Moore (fiscal policy studies, Cato Inst.) and the late Simon (business administration, Univ. of Maryland) argue that for the most part people entering the new millennium are much better off than their parents, grandparents, and great-grandparents. The areas covered include health, economics, race relations, safety, environmental issues, and women's rights. A number of charts and graphs, well complemented by an extensive index and a bibliography, shows the positive changes that have taken place over the past 100 years. Readers will appreciate the information provided by these colorful graphics, which readily allow for additional research on subjects of interest. (Library Journal)

Simon and Moore do not suggest that the challenges we face are not daunting, or important. Or that we can blithely ignore them as they will be inevitably solved. Rather, they provide staggering evidence that by tackling these problems with innovation and freedom, we can solve them faster and cheaper than you might think.

Expanded gambling not always sure thing

Kevin Landrigan leads off his weekly column in the Nashua Telegraph by reporting a glitch in the proposal to put video slot machines at the state's racetracks.

As it turns out, VLT gaming appears to meet the definition of a state lottery game. Voters approved more than a decade ago an amendment to the state Constitution which says that all profit from lottery games has to go to education.

For the layman, the essential difference is that at a VLT, all players are competing for one big jackpot. Theoretically at least, two people sitting next to one another playing a slot machine can win the jackpot at the same time.

Gaming Commission Chairman Andrew Lietz has confirmed that he would be asking Attorney General Michael Delaney’s office for a legal opinion on this subject.

Lots of other good stuff in the column, as always.

NH Retirement System reform may hit cities and towns

Shira Schoenberg leads her Capital Beat column in the Concord Monitor with some good old fashioned, green eyeshade, public policy reporting on the problems facing the New Hampshire Retirement System.

Actuarial consultant Gabriel, Roeder Smith & Co. is recommending that the retirement system raise the rates for employer contributions by an average of 22.68 percent in 2011. The increase would be lowest for state employees and highest for local police officers, firefighters and teachers.

"This is going to be a good-size hit on (municipalities') budgets," said Barbara Reid, government finance adviser for the New Hampshire Municipal Association.

Dean Michener, director of governmental relations for the New Hampshire School Boards Association put it this way: "This kind of increase is just not sustainable."

Don't worry. She's got plenty of the campaign tidbits that make the column a must-read for political junkies as well.

NH Building Aid not sustainable

Karen Langley in the Concord Monitor reports on the state's Building Aid Program, which is currently funding by borrowing money to give to local school districts.

The state pays out about $45 million in partial reimbursement of school building costs annually. The money was included in the state budget's general fund until 2009, when an increasingly tortured economy pushed legislators to borrow the aid.

Borrowing the money can work as a temporary salve but would have a crippling effect if continued, the state treasurer has told members of the legislative committee commissioned to study the program. If the state continues bonding at current rates, the annual debt service will reach $50 million by 2020, said state Treasurer Catherine Provencher.

No Guarantees: Eagle Times subsidy is wrong

The Union Leader comes out against the New Hampshire government backing a loan for a local newspaper.

One is the Eagle Times, the Claremont newspaper that folded earlier this year only to be reborn under a new publisher. The council agreed -- unanimously -- to have the state guarantee 75 percent of a $250,000 line of credit to the publisher. That's $181,500 for which taxpayers are on the hook if the paper goes out of business again.

This is an outrageous risk of taxpayer money.

You will get no argument from us about newspapers' value to a republic. But the civic services journalists perform are beside the point. A newspaper is a private enterprise. The state's duty is to spend taxpayer money on legitimate public services that only the state can provide. Bankrolling a business -- any business -- is not one of those functions.

Obama proposes Federal Subway Administration

Is there any challenge in this country for which the Obama Administration won't seek a federal takeover?

The Obama administration will propose that the federal government take over safety regulation of the nation's subway and light-rail systems, responding to what it says is haphazard and ineffective oversight by state agencies.

Under the proposal, the U.S. Department of Transportation would do for transit what it does for airlines and Amtrak: set and enforce federal regulations to ensure that millions of passengers get to their destinations safely. Administration officials said the plan will be presented in coming weeks to Congress, which must approve a change in the law.

The proposal would affect every subway and light-rail system in the country, including large systems in Washington, New York, Boston, Los Angeles and San Francisco.

State Finance Directors Warn of More Trouble Ahead

The Wall Street Journal reports that next year's state budget problems will likely be larger than this year's.

Short-term budget gaps have battered states as revenues plummeted during the recession. Aided by about $250 billion in funds from the stimulus package expected through the end of next year, states managed to close the gaps this year. But both finance directors, speaking at a Pew Center on the States event in Washington, were pessimistic about their states' futures beyond fiscal 2011.

"We're facing a cliff in 2011 when stimulus dollars run out," said Mitchell Bean, director of the Michigan House Fiscal Agency. "There is not an end in sight, even in recovery."

Welcome to the NH Blogosphere

Adam Krauss has done a fine job covering New Hampshire politics for Foster's Daily Democrat. He wrote some outstanding stories on the revenue sharing debate in this year's budget. Now, he's started his posting political tidbits on a new blog called Soundings.

A Narrow Victory for the New Hampshire Economic Recovery Coalition

That was a close one. Forces in Maine tried to remove our neighbors from the New Hampshire Economic Recovery Coalition by lowering Maine's income tax.

A law that would have lowered the state's income tax but imposed sales taxes on a variety of services is on hold now that opponents have collected enough signatures to place a repeal of the law on the June 2010 ballot.

Maine's secretary of state announced Nov. 9 that sufficient signatures had been collected.

The bill to revamp the state's tax system was approved by the Maine Legislature in June and signed by the governor.

Following last week's rejection of the Spending Cap, Maine is clearly doing its part to help the Granite State. But hold off on the celebratory parades in Portsmouth and North Conway. Maine voters have a chance to reinstate the lower income tax rate next year.