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March 31, 2010

Analysis: Shockingly Enough, Stimulus Money Awarded More Than Double to Democratic Districts Than Republican Ones

2.5 : 1, actually.

This president sure does transcend petty politics and show that there is no red America nor a blue America but just the United States of America.

First: The idea behind the $787 billion stimulus bill is that, if the government spends money where it is the most needed, it will create jobs and trigger economic growth. Hence, we should expect the government to invest more money in districts with higher unemployment rates.

Controlling for the percentage of the district employed in the construction industry, a proxy for the vulnerability to recession of a district, I find no statistical correlation for all relevant unemployment indicators and the allocation of funds. This suggests that unemployment is not the factor leading the awards. Also, I found no correlation between other economic indicators, such as income, and stimulus funding.

Second: On average, Democratic districts received one-and-a-half times as many awards as Republican ones. Democratic districts also received two-and-a-half times more stimulus dollars than Republican districts ($122,127,186,509 vs. $46,139,592,268). Republican districts also received smaller awards on average. (The average dollars awarded per Republican district is $260,675,663, while the average dollars awarded per Democratic district is $471,533,539.)

Of course, there are more Democratic districts than Republican districts in the Congress. So I checked for the correlation between political indicators and stimulus funding. I found that with the exception of the districtís party affiliation (whether the districtís representation was Republican or Democratic), political variables had no effect on stimulus funds allocation.

The good news here for Republican districts is (as Veronique de Rugy finds) that the stimulus funding was pretty useless anyway, costing $286,000 per job "saved or created (or funded)."

Thanks to StarChamberMaid.



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posted by Ace at 04:32 PM

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