Obama's 2.5 million jobs are not enough

In this week’s edition of “Your Weekly Address from the President-elect,” Obama announced a goal of “2.5 million more jobs by January of 2011”:

“I have already directed my economic team to come up with an Economic Recovery Plan that will mean 2.5 million more jobs by January of 2011 – a plan big enough to meet the challenges we face that I intend to sign soon after taking office.

That is not nearly enough.

Historically, since 1940 the average percentage increase in jobs created by the U.S. private sector year over year has been a bit more than 2.1 percent. In August 2008, the most recent month available at the Bureau of Labor Statistics, there were 115,867,000 private sector jobs. At the historic average rate of 2.1 percent the economy should produce 2,433,207 “more jobs” each year – just about equal to the president-elect’s uninspiring two-year goal. Obama’s goal ought to be at least five million jobs. He should strive to at least reach the historic average.On the other hand, during the campaign Obama proposed $3,000 tax credit for businesses that hire new workers in 2009 or 2010. At $3,000 for every job created, five million jobs would cost taxpayers $75 billion. That would be in addition to the other $375 billion in job creation programs Obama proposed during the campaign:

During the campaign, Obama had talked about a $175 billion program for middle-class recovery, including $65 billion for tax rebates, $25 billion for infrastructure spending, $25 billion in aid to states, $40 billion for a new-jobs tax credit, $5 billion to expand loan guarantees for small business, with the rest going to aid to automakers and expanded unemployment insurance.

Separately, Obama has promised to create 5 million “green-collar jobs” by “strategically investing $150 billion over the next 10 years to catalyze private efforts to build a clean energy future.” That commitment suggests a higher quality of jobs, not just sheer numbers.

His economic plan during the campaign had specified: “Provide $50 billion to Jumpstart the Economy and Prevent 1 Million Americans from Losing Their Jobs: This relief would include a $25 billion State Growth Fund to prevent state and local cuts in health, education, housing, and heating assistance or counterproductive increases in property taxes, tolls or fees. The Obama-Biden relief plan will also include $25 billion in a Jobs and Growth Fund to prevent cutbacks in road and bridge maintenance and fund school repair – all to save more than 1 million jobs in danger of being cut.”

That total of $450 billion is enough money to simply give 8,958,254.5, nearly nine million families (8,958,254.5 to be more precise), $50,233. According to the U.S. Census Bureau, $50,233 is the real median annual household income in the United States.

Even if Obama only spends $300 billion on job creation, as reported by Katherine Skiba, that would still be enough to give an amount equal to the real median household income to nearly six million families.