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According to Admin the stimulus Plan is working

The Stimulus Plan has reached its fourth quarter at the end of 2009 and the Administration is happy with its performance so far. Their report on the progress claimed that employment and economy as a whole is in good shape, which would not have been possible without the $787 billion Stimulus Plan.

As per the Administration figures, $263 billion has been spent out of the total. This figure is a third out of the total and almost $150 million which was to be spent on different projects of public works are still unspent. The spending per quarter on projects and tax cuts has been $85 billion on an average. The tax cuts include business entities as well as individuals, and the spending takes into account the amount spent on education, health, and unemployment benefits. The last quarter saw a spending of almost $41 million on investments alone that will help to create employment in the field of public works, programs on energy development and IT related jobs in medical offices and hospitals. This figure is much less than what was spent in the second quarter for similar purpose which amounted to $6 billion.

The Administration has stated that the positive impact of the Stimulus Plan on employment would be seen more clearly this year, as most of the projects take time in planning and giving out on contract, which creates the time lag. Compared to this the effect of aid given by states and tax cuts, is seen at an early stage.

The Administration’s report which is prepared by the White House Council of Economic Advisors has stated that the last quarter saw the growth of the gross domestic product by two percentage points which was directly linked to tax cuts and spending of the Stimulus Plan. On the down side although the unemployment was two percent more than what was forecasted, the total number of jobs available were between one and half million to two million more in the last quarter, and this was attributed again to the Stimulus Plan. The Administration agrees that a 10 unemployment rate still shows that the US economy is weak but due to the Stimulus Plan its recovery will be faster.

The Administration had already predicted the slower economic growth in the last quarter, as they felt that usually stimulus packages will start off very well showing good growth in the beginning and then tend to level off in the fourth quarter. When the Stimulus Package was made into a law, in the beginning of 2009 the shrinkage of the economy was around 6%, and immediately as the Plan took effect the shrinkage was arrested to 0.7% in the second quarter and the third quarter saw an increase again to 2.2%.

Compared to the administration’s figures, certain private forecasters have said that the economy has grown by 4% in the last quarter, which in itself is greater than what they themselves attribute to the Stimulus Plan.

Tags: jobs, law, Stimulus, tax

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