Republicans seize on flaws found by GAO in stimulus jobs data

Republicans used new information about reporting errors in how the stimulus funds were spent to continue their criticism of the $787 billion economic package.

The Government Accountability Office (GAO) told House members Thursday that administration data suggesting the stimulus directly created more than 640,000 jobs contained flaws and that the methods used to track stimulus money need to be improved.

The GAO called for a closer look at a quarter of the 57,000 reports filed. About 4,000 of the reports from state governments, companies and other stimulus recipients showed that their stimulus projects saved or created jobs with no money being received or spent. Another 9,247 reports showed money received or spent but didn’t show any jobs saved or created.

“Funds are being used for appropriate purposes, but the question remains: How many jobs are being created?” said Gene Dodaro, acting comptroller general and head of the GAO, at a House Oversight and Government Reform hearing Thursday.

Other news reports have found stimulus data that suggest jobs were saved or created in congressional districts that don’t exist, such as the 99th district of California. A Wall Street Journal analysis said that the direct stimulus jobs tally, touted by Vice President Joe Biden as evidence that the package was working, was overstated by at least 20,000 jobs, due to reporting mistakes by recipients.

Rep. Darrell Issa (Calif.), the senior Republican on the Oversight Committee, said the stimulus data was “misleading” and accused the Obama administration of peddling “propaganda.”

“The fact is, they have no idea how many jobs have been saved or created,” Issa said.

Earl Devaney, head of the administration panel responsible for tracking the stimulus funds, acknowledged that flaws in the reports were an “embarrassment.” But he said he wasn’t surprised by the mistakes, arguing that they were an inevitable part of the administration’s effort to be as transparent as possible.

“It’s harder to practice transparency than it is to talk about transparency,” Devaney told the House panel. “It is definitely not something for the faint of heart.”

Democrats haven’t given up on the first stimulus. The White House pointed out that its estimates that the stimulus has created or saved approximately 1 million jobs through September is roughly equal to independent estimates by Moody’s and the Congressional Budget Office.

Unlike the hard count of 640,329 jobs released last month, the higher estimates are based on macroeconomic data that includes the indirect job-creation effects of tax cuts and spending.

Other Democrats on the Oversight panel noted that less than a quarter of the stimulus has been spent so far.

The committee’s chairman, Rep. Edolphus Towns (D-N.Y.), told The Hill that errors in the reporting should be corrected immediately, but he argued that the economy would be worse if not for the $787 billion package.

He noted that the economy grew in the third quarter for the first time since 2007, and that the jobless rate, which has risen to a 26-year high of 10.2 percent, typically lags behind GDP growth.

Still, Towns and other Democrats called for further legislation to create jobs.

Democratic leadership in both chambers have signaled that they plan to take up new jobs-creation legislation, and a bipartisan group of 161 House members calling themselves the Congressional Jobs Now Caucus plan to hash out new jobs proposals. The caucus is led by Reps. Bobby Rush (D-Ill.), Marcy Kaptur (D-Ohio) and Candice MIller (R-Mich.).Rep. Diane Watson (D-Calif.), a member of the Jobs Now Caucus, said that new measures need to be focused on jobs alone.

“I think we have to do a better job of directing that money to job creation and not to a bureaucracy,” Watson told The Hill. “Starting in the new year, it has to be jobs, jobs, jobs.”

This story was updated at 9:55 p.m.