Fox figures have been relentless in insisting that the economic stimulus failed -- even though experts agree that it boosted GDP and employment. Moreover, numerous economists "think the economy would be worse" today without it.
But on Fox Broadcasting's Fox News Sunday, Fox News contributor Karl Rove claimed that President Obama's policies have "utterly failed" and that when he "passed the stimulus bill, he said unemployment would be 6 percent." Rove also claimed that "each time [Obama has] sort of gotten around to tossing an idea out on the table, it has included only more spending, more deficit [and] more debt." From the August 21 edition of the show:
ROVE: Look, the president has had a Democrat Congress for over two-thirds of the time that he's been in office, and a Republican House and a Democrat Senate for less than a third of the time. He did have a -- he got what he wanted. He passed the stimulus bill in 2001 [sic]. He increased spending during that year as well. He got affordable care act. When the president passed the stimulus bill, he said that unemployment by this time would be 6 percent, that 5 million more people would be working -- nearly 5 million more people working today than are working.
The president's approval rating this week in Gallup on the economy is 26 percent. There's a reason why: His policies have utterly failed. This is the seventh or eighth or ninth time that we've heard the president talk about producing a plan, and each time that he's sort of gotten around to tossing an idea out on the table, it has included only more spending, more deficit, more debt, and the American people are fed up with it.
First of all, economists widely agree that the stimulus was not a failure. As Rove's fellow guest Bill Burton, a former Obama White House deputy press secretary, noted, "[T]he stimulus ... did actually create jobs." Indeed, independent and private analysts have stated that the stimulus created or saved millions of jobs, increased employment, and also boosted GDP by between 2.1 and 3.5 percent.
Rove's claim that "[w]hen the president passed the stimulus bill, he said unemployment by this time would be 6 percent" is also misleading.
Rove may have been referring to the fact that Obama advisers initially predicted -- 10 days before Obama was inaugurated -- that after stimulus spending, unemployment would not exceed 8 percent. However, advisers later said that the estimate was made before fourth-quarter results for the GDP from 2008 were available. As Jared Bernstein, then-economic adviser to Vice President Biden, explained: "[W]hen we made our initial estimates, that was before we had fourth-quarter results on GDP, which we later found out was contracting on an annual rate of 6 percent, far worse than we expected at that time."
Finally, Rove's claim that all of Obama's ideas have "included only more spending, more deficit [and] more debt" is laughably untrue. Has Rove already forgotten the recent negotiations over raising the debt ceiling? The final deal that Obama signed into law pledges to cut $2.1 trillion in spending in the next 10 years -- and did not include any revenue increases, as the president had called for. In private talks with Speaker John Boehner (R-OH), Obama reportedly had agreed to $250 billion in cuts to Medicare, $110 billion in cuts to Medicaid, and $200 billion in savings from other domestic social programs.