The President Presses his “$450 Billion Jobs Bill”
President Obama is ramping up pressure on Congress to pass his “jobs” bill. The Senate version of the bill isS. 1549, the American Jobs Act of 2011. According tothis report, the Senate will have a crucial vote on it Tuesday, deciding whether to move forward with debate.
That report does something else interesting, though. It calls the legislation a “$450 billion jobs bill.”
What on earth does that actually mean? Is it $450 billion in spending? $450 billion in tax cuts? Some combination of both? Is it really $450 billion?
We’ve looked at the numbers and will try to present them in a way that’s more useful. (We used the Congressional Budget Office’s Friday estimate for the bill. It’s here, and it’s also at the link that says “Read an Analysis of the Bill” in the “Learn More” box on S. 1549′s bill page.)
The real number is $350 billion. That’s about $175 billion in spending and about $175 billion in tax cuts over 10 years. There are about 100 million families in the country, so you’re talking about $1,750 each in spending and tax cuts per family.
You’ve got to crunch those numbers a little bit to give them meaning, though. One of the things we do is adjust based on how much future spending or taxes cost today. It’s a lot easier to come up with $10 or $10 billion if it’s ten years away. Expenditures that are far off in time are discounted. Same with taxes.
The bill has big near-term tax cuts in it, then it collects back those taxes in the out years. That lowers the cost of the bill, from what you’d expect—about $3,500 per family—to about $2,400 per family. (That’s taxes and spending combined. See our “about” page for more on our methodology for calculating costs.) Still a lot, but about a third less than it seems if you don’t adjust the numbers properly.
Now, what does the combination of spending and (total) tax increases mean for the national debt?
Well, it increases the national debt by about $770 per U.S. family.
That’s an increase over the current national debt of about $148,500 per family. So we’re talking about an increase in the national debt of about another 1/2 percent. (We’ll be sure to write a special blog post when the national debt rises above $150,000 per U.S. family.)
So there’s some better information to help you decide what you think of this bill. The taxing and spending in the bill add up to about $2,400 per U.S. family, about $770 of which would be new debt.
