WASHINGTON – The government watchdog overseeing economic stimulus spending said Thursday that, in its rush to take credit for saving hundreds of thousands of jobs, the Obama administration was overly confident in its job-counting and did not acknowledge significant errors in the figures.

Numbers released last month identified more than 640,000 jobs linked to stimulus projects around the country. Despite warning signs that the numbers were flawed, the White House said the public could have confidence in them and they proved the administration was on track save or create 3.5 million jobs by the end of next year.

Since then, tens of thousands of problems have been documented, from the substantive to the clerical. Republicans have been able to use those flaws to attack what so far is the signature domestic policy of Obama’s presidency.

The criticism has resonated, even though economic data shows that overall government efforts, from President George W. Bush’s bank bailout to President Barak Obama’s stimulus, have improved the economy. Fewer than 1 in 10 Americans think the stimulus has created any jobs so far, according to a CBS News poll this week.

Earl Devaney, the watchdog whose group compiled and released the job data, said he could not certify the numbers were correct. Rep. Darrell Issa, R-Calif., asked whether the administration should have been more conservative and acknowledged it had “no idea” whether the jobs were being counted correctly.

“Wouldn’t that be a fairer way to put it?” Issa said.

“I like that statement,” DeSeve replied.

The White House said Thursday that it had been up front about the errors. Spokeswoman Elizabeth Oxhorn noted that, on the day the figures were released, Vice President Joe Biden said, “This is an unprecedented undertaking. And we know – we know that it’s not 100 percent accurate.”

The Obama administration has expressed varying degrees of confidence in the numbers, depending on who was talking and when:

-Sept. 23, White House communications director Anita Dunn: “It is not going to be a perfect process here at the beginning.”
-Oct. 29, White House press release: “These reports have been reviewed for weeks, errors have been spotted and corrected, and additional layers of review by state and local governments have further improved the data quality.”

-Oct. 30, Biden, in a White House press release: “These reports are strong confirmation that the Recovery Act is responsible for over one million jobs so far.”

-Oct. 30, White House economic adviser Jared Bernstein, in a report: “Focusing on (mistakes in the reports) risks obscuring a key point: Real-time reporting about job creation, with reports coming from thousands of projects all across the country, has never even been attempted before.”

-Oct. 31, Obama: “It is clear that the recovery act has now created and saved more than a million jobs.”

-Nov. 1, Treasury Secretary Timothy Geithner, when asked by NBC News whether the 640,000 figure was fact or spin: “This is a fact.”

-Nov. 6, Transportation Secretary Ray LaHood, in remarks to the Chamber of Commerce: “We know for a fact that Recovery Act investments have created or saved more than 640,000 direct jobs so far. These are real, identifiable jobs directly funded by the Act.”

-Thursday, Oxhorn, in a statement: “We have been clear from the beginning that the data would not be 100 percent perfect, but would provide a meaningful indication of Recovery Act job impact.”

RALEIGH, N.C. – Gov. Bev Perdue today launched racetothetop.nc.gov and called upon North Carolinians to participate in the federal “Race to the Top” initiative.

As part of the American Recovery and Reinvestment Act, Race to the Top is a federal $4.5 billion competitive grant fund that rewards states for educational innovation and achieving significant improvements in how students perform.

In addition to providing information about North Carolina’s Race to the Top efforts, the new website seeks ideas and suggestions from the public regarding new education innovations and reforms.

“North Carolina is already a national leader in educational innovation,” said Perdue. “We are turning around low-performing schools, working to lower the dropout rate and creating a network for virtual school learning opportunities so all students are career ready. I’m confident that our state is in a good position to receive Race to the Top funding.”

As part of Race to the Top requirements, each state must submit an application from the Governor and signed by the Chairman of State Board of Education and the Chief State School Officer. The application must assess the state’s current education reform efforts and build on those by presenting a comprehensive plan for improving student outcomes in four areas:

· Internationally-benchmarked standards and assessments.

· Development of data systems that measure success and improve instruction.

· Supporting effective teachers and leaders.

· Turning around low-performing schools.

North Carolina is already working on higher standards, better curriculum, developing teachers, and improving low performing schools. In addition, the state is creating new and meaningful assessments, including putting in place a Pre-K to 20 data information system to help keep students on grade level, and to ensure graduates are career ready and prepared for higher education.

The U.S. Department of Education will award the first Race to the Top grants in early 2010.

RALEIGH, NC – A new study by the consulting firm Arduin, Laffer & Moore (ALM) Econometrics and released by Raleigh’s Civitas Institute concludes that the American Recovery and Reinvestment Act of 2009 (ARRA) will actually cause North Carolina to lose up to 67,000 jobs over the next two years.

NBC17 is checking with Gov. Bev Perdue for the other side. Check back here for updates on this story.

The study, entitled “The Economic Impact of Federal Spending on State Economic Performance: A North Carolina Perspective” concludes, “In North Carolina, between 51.1 thousand and 66.9 thousand job losses can be expected to occur during the time that ARRA funds are being spent.”

Co-authors of the report include Arthur Laffer, former member of President Reagan’s Economic Policy Board and creator of the famous “Laffer Curve;” and Donna Arduin, former top fiscal advisor to Gov. Schwarzenegger in California and governors in Florida, New York and Michigan.

As Arduin explains, “Government does not create anything – it merely redistributes wealth by taking money from those who pay taxes – those who are creating jobs and wealth – and spending it with bureaucratic inefficiency, reducing the incentive for taxpayers to save, invest, and employ people.”

Government stimulus schemes not only fail to create any net new jobs, but actually reduce job growth. According to Civitas Budget and Tax Policy Analyst Brian Balfour, “Because government projects necessarily only consume resources, fewer scarce inputs are thus available for productive investment. A lower level of productive investment translates into slower economic growth and fewer jobs.”

North Carolina already has its own case study in government “stimulus” spending. Gov. Mike Easley “fast-tracked”’ nearly $750 million in state government capital improvement projects back in January, promising “these projects will produce nearly 26,000 new jobs.” In contrast to such bold claims, North Carolina has since lost 17,000 construction jobs – a contraction of roughly 8 percent – and 71,000 jobs overall.

“North Carolinians should not be fooled by grand promises of government-orchestrated economic stimulus and job creation, whether from D.C. politicians or state officials,” warned Balfour. “The findings of this study along with the disappointing results of Easley’s ‘stimulus’ show that government stimulus schemes do more harm than good.”

The study also warns of the added burden to the state as it expanded unemployment insurance benefits in order to receive ARRA funds, an observation underscored by recent media reports of the $925 million North Carolina borrowed from the federal government to meet its unemployment insurance obligations.

View “The Economic Impact of Federal Spending on State Economic Performance: A North Carolina Perspective.”

WASHINGTON  – The Senate is poised to add $2 billion to the popular “cash-for-clunkers” program after lawmakers agreed to vote on the government car incentives and give shoppers until Labor Day to make a deal on more energy-efficient models.

The White House has estimated that tripling the $1 billion program could pay for 500,000 more new-car sales, giving automakers a late-summer boost after months of ragged business. The Obama administration has said the program would go broke by Friday without Congress’ approval of the extension.

Senate Majority Leader Harry Reid said Democrats and Republicans had agreed to vote on the plan later Thursday after the formality of considering potential changes to the House-passed version of the bill. None of those amendments is expected to pass.

Senate approval of the House version would send the legislation to the White House for President Barack Obama’s signature and assure consumers there will be no interruption in the program that provides up to $4,500 in rebates and helped rescue car dealerships from lagging sales.

“There’s a significant majority that want to move forward with this legislation,” said Reid, D-Nev., who nonetheless agreed to bring up amendments as a goodwill gesture to those who otherwise might try to delay a final vote on the House-passed version.

The proposed changes that will receive an airing include placing an income limit on those benefiting from the vouchers, terminating the Troubled Asset Relief Program and requiring the government to sell off its shares in Michigan automakers General Motors Co. and Chrysler Group LLC.

Sen. Tom Harkin, D-Iowa, for example, wants the vouchers limited to individuals earning less than $50,000 a year or joint filers earning less than $75,000.

As the bill stands, Microsoft founder Bill Gates can get $4,500 to buy a new car, Harkin said Thursday. “You have to ask,” Harkin said, “is this a wise way to spend limited amounts of money?”

Any Senate changes to the bill would require another vote in the House, something that couldn’t take place until the House returns in September from a monthlong recess. The Senate is taking its break following votes on the car incentives and the confirmation on Supreme Court nominee Sonia Sotomayor.

Republican opponents have conceded they are unable to force all of the changes they want or to block the House version of the bill. But they still grumbled about more government handouts to the private sector.

Sen. John Thune, R-S.D., called the bill an example of “Congress choosing winners and losers among industries.”

The government said Wednesday that more than $775 million of the $1 billion fund had been spent, accounting for nearly 185,000 new vehicles sold. Administration officials estimate the extra funding will last into Labor Day.

Car companies credit the clunkers program with driving up sales. Most consumers are buying smaller, more fuel-efficient vehicles through the program, according to a list of the top-10 selling cars released by the government.

Among manufacturers, General Motors Co. had the largest share, accounting for 18.7 percent of new sales; followed by Toyota Motor Corp., with 17.9 percent; and Ford Motor Co., with 16 percent. Detroit automakers represented 45.3 percent of the total sales while Japan’s Toyota, Honda Motor Co. and Nissan Motor Co. accounted for 36.5 percent.

The Toyota Corolla is the top-selling vehicle on the list, followed by the Ford Focus, Honda Civic, Toyota Prius and the Toyota Camry. There is one SUV on the list, the Ford Escape, which also comes in a hybrid model that can get up to 32 miles per gallon. Six of the top-10 selling vehicles are built by foreign manufacturers, but most are built in North America.

The prospect of extending the clunker program is causing automakers to rethink their production schedules and perhaps bring back laid-off workers.

GM’s manufacturing team was working on a production increase Thursday morning, Tom Stephens, vice chairman of product development, said in an interview.

GM has had spot shortages of compact and midsize cars, which have been popular with people trading in clunkers, Stephens said. The company also reported an increase in sales of the Chevrolet HHR small sport utility.

“Consumer confidence is really what you need here,” Stephens said. “It’s hard for them if they don’t know if they have a job or a for-sure paycheck to go out and make a major purchase, so I think this is kind of jump-starting some things.”

Hyundai Motor Co. already has added a day of production at its Montgomery, Ala., factory, while Ford Motor Co. is considering a production increase.

WASHINGTON, D.C. — Vice President Joe Biden and Attorney General Eric Holder Tuesday announced $1 billion in grants to fund the hiring and rehiring of law enforcement officers all across the country under the American Recovery and Reinvestment Act of 2009.

The grants will be awarded to 1,046 law enforcement agencies from all 50 states, including more than $30,956,114 in grants to fund the hiring and rehiring of 202 law enforcement officers in North Carolina.   These funds will provide 100 percent of the approved salary and benefits for these officers for three years.  All police departments receiving the grants will then be required to retain the grant-funded positions for a fourth year.

“A big part of the Recovery Act is about building communities – making them as strong as they can be, allowing every American family to live a better life than the one they are leading now,”  said Vice President Joe Biden.  “And we can’t achieve the goal of stronger communities without supporting those who keep our streets safe.”

The Recovery Act grants, which will be administered by the U.S. Department of Justice Office of Community Oriented Policing Services (COPS) through the federal agency’s COPS Hiring Recovery Program, provide much needed financial support to state, local and tribal governments,  and will help the nation’s law enforcement agencies add and retain the manpower needed to fight crime more effectively through community policing. The Department of Justice received over 7,200 applications for more than 39,000 officer positions, representing a total of $8.3 billion in requested funding.

“These Recovery Act funds will pump much needed resources into communities through a program with a proven track record,” said Attorney General Holder. “The tremendous demand for these grants is indicative of both the tough times our states, cities and tribes are facing, and the unyielding commitment by law enforcement to making our communities safer.”

The COPS Hiring Recovery Program funds were awarded to the following applicants in North Carolina:

Fairmont Police Department
1– $105,915

Winston-Salem, City of
25 — $3,884,575

Wadesboro Police Department
1 — $127,163.00

Fayetteville Police Department
17 — $2,528,240.00

Mt. Gilead Police Department
1– $127,179.00

Warsaw Police Department
1– $126,175.00

Kill Devil Hills, Town of
1– $163,410.00

Kenly Police Department
1– $116,579.00

Princeville, Town of
1– $97,491.00

Lumberton, City of
3 — $442,743.00

Charlotte-Mecklenburg Police Department
50 — $8,545,950.00

Enfield Police Department
1– $130,751.00

Kinston Police Department
2 — $252,588.00

Rocky Mount, City of
8 — $1,088,808.00

Wilmington Police Department
13 — $2,005,809.00

Roanoke Rapids Police Department
1 — $119,925.00

Hertford Police Department
1 –$164,644.00

Hope Mills, Town of
1– $152,372.00

Salisbury Police Department
4 — $646,924.00

Reidsville Police Department
2 — $287,472.00

Ocean Isle Beach, Town of
1– $145,288.00

Littleton Police Department
1 — $117,141.00

Lexington, City of
1 — $145,005.00

Elizabeth City
3 — $435,834.00

Mt. Airy Police Department
2 — $257,598.00

Lincoln County Sheriff’s Department
6 — $889,566.00

Waynesville Police Department
2 — $275,482.00

Sanford, City of
4 — $650,860.00

Wallace Police Department
1– $124,578.00

Chadbourn Police Department
1 — $123,158.00

Morven, Town of
1 — $115,523.00

Monroe Department of Public Safety
2 — $321,168.00

Greenville Police Department
8 — $1,648,656.00

Hoke County Sheriff’s Department
3 — $396,099.00

Roxboro Police Department
2 — $314,790.00

Henderson Police Department
3 — $369,306.00

Woodland Police Department
1 — $134,100.00

Troy, Town of
1 — $116,196.00

Garner Police Department
1– $172,356.00

Benson Police Department
1 — $146,352.00

Pittsboro, Town of
1 — $187,883.00

Sharpsburg Police Department
1– $116,952.00

Franklin County Sheriff’s Office
3 — $430,863.00

Eden Police Department
2 — $291,672.00

Plymouth Police Department
1– $117,206.00

Gastonia Police Department
8 — $1,038,960.00

Red Springs, Town of
1 — $136,356.00

Madison, Town of
1 — $137,840.00

Stoneville Police Department
1 –$100,835.00

Richmond County Sheriff’s Department
3 — $383,778.00

The Recovery Act includes $4 billion in Department of Justice grant funding to enhance state, local, and tribal law enforcement efforts, including the hiring of new police officers, to combat violence against women, and to fight internet crimes against children. In addition to today’s COPS awards, to date the Department of Justice has awarded $1.7 billion through formula state and local Edward Byrne Memorial Justice Assistance Grants, $95 million through the Victims of Crime Act Formula Grant Program, $41.5 million for Internet Crimes Against Children initiatives, $127 million in Office on Violence Against Women Recovery Act funds and $8.6 million for assistance for law enforcement along the Southern Border and in high intensity drug trafficking areas.

For more information about the COPS grants, or to learn which law enforcement agencies received funding, please visit www.cops.usdoj.gov.

RALEIGH, N.C. – Gov. Bev Perdue today announced a total of $45.2 million in drinking water, stormwater and wastewater projects in a second round of American Recovery and Reinvestment Act (ARRA) awards.  In total, 40 communities in 31 counties received second round funding.  More than half of the second-round projects were identified as “green” projects.

“These JobsNOW Recovery projects will create jobs, boost the economy, improve the state’s infrastructure and protect North Carolina’s drinking water and other water systems in the future,” said Perdue.

Nearly $23.9 million in recovery funds will be distributed by the Department of Environment and Natural Resources to 28 communities for public water supply projects.  New Hanover County, Jacksonville and Cary each were awarded $3 million, the maximum amount allowed by the ARRA program.  The full list of second-round drinking water award recipients is now available at: www.deh.enr.state.nc.us/pws/recovery.htm.  In April, $40.3 million in drinking water funds was awarded to 35 local systems in the initial round of projects.

In addition, awards totaling $21.3 million will go to 12 communities for wastewater and stormwater projects.  Southport, Burgaw, Brunswick County and Buncombe County received the $3 million maximum allowed under ARRA.  The full list of second-round stormwater and wastewater award recipients is available at: www.nccgl.net/Stimulus.html.  In April, $45.8 million was awarded to 36 communities for stormwater and wastewater projects.

Project awards are not final until all ARRA and other federal requirements have been met and the Local Government Commission approves the recipient’s financial qualifications.

Funds will be awarded as 50 percent zero-interest loans and 50 percent principal forgiveness loans.  In accordance with ARRA requirements, priority is given to projects that can proceed quickly, already have any required permits and have additional funding committed, if needed.

Also, non-ARRA N.C. Drinking Water State Revolving Loan Fund monies will provide $12 million for nine projects in Buncombe, Haywood, Macon, Vance, Polk, Caldwell and Watauga counties.  These projects primarily address failing systems and drought-related problems in the individual communities. The list of recipients can be found online at: http://www.deh.enr.state.nc.us/pws/srf/Pages/CurrentNews.htm.

For further information on ARRA drinking water project funds and criteria used in the selection process, visit the Division of Environmental Health Web site.

For more information about ARRA wastewater and stormwater project funds and the criteria used to select the recipients, visit the DWQ Web site.

WASHINGTON  – Projects in some of the nation’s poorest areas don’t appear to be getting a fair shake in the spending of $787 billion in stimulus funds, the chairman of the House oversight committee said Wednesday.

Rep. Edolphus Towns, D-N.Y., chairman of the panel, said he was particularly concerned that transportation projects in economically distressed areas were being left out – even though they are supposed to be a priority.

“There is a substantial variation among states as to what constitutes an economically distressed area,” Towns said. “For this reason, it is unclear whether Recovery Act funds are going where they are needed most.”

Towns comments came in response to a Government Accountability Office report released Wednesday at a hearing before his committee.

The GAO said about half the money set aside for road and bridge repairs is being used to repave highways rather than building new infrastructure. And state officials aren’t steering the money toward counties that need jobs the most, auditors found.

The Obama administration intended for the stimulus to jump-start the economy, build new schools and usher in an era of education reform. But government auditors said many states are setting aside grand plans to stay afloat.

The GAO said the stimulus is keeping teachers off the unemployment lines, helping states make greater Medicaid payments and providing a desperately needed cushion to state budgets.

But investigators found repeated examples in which, either out of desperation or convenience, states favored short-term spending over long-term efforts such as education reform.

In Flint, Mich., for example, new schools haven’t been built in 30 years but the school superintendent told auditors he would use federal money to cope with budget deficits rather than building new schools or paying for early childhood education.

The 400-page stimulus includes provisions for long-term growth, such as high-speed rail and energy efficiency, but their effects will be seen later.

Since Obama signed the stimulus bill in February, the economy has shed more than 2 million jobs. Unemployment now stands at 9.5 percent, the highest in more than a quarter century.

Robert L. Nabors II, deputy director of the Office of Management and Budget, testified that 150,000 jobs had been created from stimulus spending. With the stimulus spending, he said the nation is moving down the right path.

“We are making progress, but we still have a long way to go,” Nabors said.

On the Net:

Government Accountability Office report on state stimulus spending

House Committee on Oversight and Government ReformStimulus spending

BY TYLER WHITLEY
Media General News Service

President Barack Obama’s stimulus package is not working and should be amended to encourage more job creation by small businesses, the House of Representatives’ Republican whip said Monday.

Rep. Eric I. Cantor, R-7th, seized on weekend remarks by Vice President Joseph R. Biden Jr. that the Obama administration underestimated the depth of the economic recession when it was preparing the $787 billion stimulus package. Biden said the economic projections made before the Obama administration took office were overly optimistic.

In a conference call with reporters, Cantor said the fact that unemployment is approaching 10 percent shows that the package is not working.

“It is my belief that they didn’t misread the economy. What they did is they miswrote the stimulus bill and got the prescription wrong,” Cantor said.

He said that more emphasis should have been placed on creating jobs in the private sector rather than preserving jobs in the public sector.

Cantor said that when the bill was under discussion, he and other Republican leaders presented the president with an alternate plan that would have lowered tax rates and allowed small businesses to take a tax deduction equal to 20 percent of their income. Small businesses employ about half of all private-sector employees, Cantor’s office said.

Some Democrats are suggesting that another stimulus bill is needed. Cantor disagreed, saying some of the money in the existing bill should be redirected to job-creating programs that work.

“This administration has tried to do way too much too soon,” Cantor said.

The Democratic National Committee and the Democratic Congressional Campaign Committee accused Cantor of hypocrisy, noting he has criticized the stimulus plan while praising a proposal for high-speed rail between Washington and Richmond that would use stimulus funds.

“It’s time that the Cantor-led ‘party of no’ stopped playing politics with American jobs and started offering real solutions to help the president put the country back on the right track,” Alex Gerlach, a spokesman for the DNC, said.

Asked about his support of the high-speed rail, Cantor said the rail system could promote 185,000 jobs in Virginia.

“I don’t see any inconsistency there with supporting something that creates 185,000 jobs and being against a bill that has spent almost $800 billion, only maybe 12 percent that could arguably be proven to have any job-creating potential,” he said.

Tyler Whitley is a staff writer at the Richmond Times-Dispatch.

The N&O breaks down how stimulus money will be used in NC.