Minnesota Stimulus Facts: Who you gonna trust?


What does it cost to create or save a job in Minnesota under the $787 billion federal stimulus package, AKA the American Recovery and Reinvestment Act?

Gov. Tim Pawlenty’s spokesman says it’s more than $135,000 for each one of the 11,800 jobs counted this week. Pawlenty’s commissioner of management and budget says it’s less than $20,000 for each of those same jobs, barely half that if you count another 9,300 estimated positions indirectly supported by the program.

Hindsight is the official blog of Minnesota 2020. Hindsight gives the run down on the news that jumps out at us on the issues that matter.

Who ya gonna trust?

I’ll go with the finance guy, Tom Hanson, who actually signs the checks. He reported that the state has spent $1.6 billion of an estimated stimulus total for Minnesota of $8.9 billion over two years. But of the $1.6 billion out the door so far, only $231 million went to programs for which jobs were counted, Hanson told Minnesota Public Radio. The remaining more than $1.3 billion boosted unemployment and medical assistance – money that helps the needy and circulates throughout the economy – but doesn’t directly create many jobs.

A total of $4.2 billion in ARRA  funds is expected to go directly to Minnesotans, employed or not, in the form of individual tax benefits. That’s the kind of stimulus Pawlenty outspokenly approves of. He’s less sanguine about other stimulus programs that have preserved 5,900 jobs in schools and 1,200 in public safety while creating at least 900 of themrebuilding the state’s tattered transportation infrastructure.

That means, in addition to thousands of folks doing the public’s work instead of collecting unemployment benefits, Minnesotans get better educated children, more protection from crime and improved roads, bridges and transit. Tax breaks can’t do that.

By the way, the Pawlenty administration is no stranger to self-serving job-creation numbers. It claimed that the governor’s pet economic development program, JOBZ, had cost taxpayers only about $5,000 per new job created. The nonpartisan Office of the Legislative Auditor, however, found that the administration had overstated the actual increase in employment attributable to JOBZ while understating the tax breaks given to businesses.

The actual cost of each JOBZ job, according to the auditors, was $26,900 to $30,800. That’s five or six times the administration’s estimate – and two to three times the real cost of each Minnesota public and private sector job supported by the federal stimulus plan.

Who you gonna trust? Seems like an easy call from here.