FACT CHECK: Data belie Biden stimulus anecdotes

WASHINGTON — In his first quarterly report on the nation’s stimulus package, Vice President Joe Biden uses anecdotes to paint a glowing picture of an economy on the rebound. In reality, the picture is incomplete and the colors far more muted.

It is not disputed that Washington is spending historic amounts of money at a rate far faster than normal. Workers are getting tax breaks, Washington is picking up a greater share of state Medicaid costs and road construction projects are beginning.

Even Recovery.gov, the Web site that has yet to live up to its billing as a one-stop way to track every penny, offers more information than typical government programs, and faster.

But the effect of that spending is less clear. Many of the claims the White House is making are based on anecdotes selected to fit the Obama administration’s message. For instance, the report cites a newspaper article about workers being rehired at a factory in Chicago. That account is true, but is no more an accurate snapshot of the nation’s economy than a story, not cited in the report, about a Roanoke, Va., railcar factory closing.

Capturing the full effect of the stimulus at this early stage is difficult, but the administration has set high bars for success. In championing those successes, however, the White House plays a little loose with the facts.

BIDEN SAID: First-time homebuyers are “driving increased activity in the home sales market,” while mortgage and title companies are hiring more workers because of the first-time homebuyer tax credit included in the stimulus bill.

THE FACTS: The report cites anecdotes from a New Orleans business journal to back up the claim. It’s true, buyers are taking advantage of the $8,000 first-time homebuyer tax credits. The IRS said more than 567,000 tax returns claimed the credit in just the first weeks of the program. But that hasn’t provided an immediate turnaround in the market.

Since February, sales of existing homes have fallen 3 percent and new home sales are down .6 percent.

And the number of jobs in the real estate industry has declined by about 20,500, according to the Department of Labor.

There are signs that the housing market is improving. But the numbers suggest that if the market bottomed out, it did so in January, before the stimulus was passed.

BIDEN SAID: Employment agencies are placing more workers in jobs, and demand is up since February.

THE FACTS: The report cites an interview with an employment service manager quoted in the same New Orleans business article. The anecdote may be true, but it’s impossible to extrapolate that any further, even just to New Orleans. The city has lost more than 200 jobs since February. Overall, Louisiana lost 16,085 jobs over the same span, according to the Department of Labor.

THE WHITE HOUSE SAID: The stimulus has created or saved 150,000 jobs.

THE FACTS: Since February, the nation has lost more than 1.3 million jobs, according to the Department of Labor. To make the case that the country created jobs over that same stretch, the White House has put forward a benchmark of jobs created “or saved.” The argument is that the job numbers would have been even worse had it not been for the stimulus, and the difference between those numbers is a net positive.

To visualize that disconnect, consider this: The administration has promised to create or save 600,000 more jobs in the next 100 days. Even if the nation loses another 5 million jobs during that span (a highly unlikely prospect) the White House could still claim success.

There are few hard numbers when it comes to tracking stimulus jobs. The Obama administration numbers are based on estimates by the White House Council of Economic Advisers, based largely on a formula Obama’s transition team put forward. It estimates the effect of tax breaks, government spending and social programs on job growth.

Spending money will put people to work. But spending has a cost. At some point, Washington will have to pay for this program, either by raising taxes or interest rates, and those policies typically hurt job growth. The Obama administration’s job data do not take into consideration this back-end cost, an omission some economists, particularly conservative economists, say is a flaw in the analysis.