WHITE HOUSE CONFERENCE CALL WITH ROB NABORS, OMB DEPUTY DIRECTOR; AND JARED BERNSTEIN, CHIEF ECONOMIC ADVISER TO VICE PRESIDENT BIDEN SUBJECT: "100 DAYS, 100 PROJECTS": REPORT ON THE RECOVERY ACT TIME: 4:03 P.M. EDT DATE: WEDNESDAY, MAY 27, 2009
ELIZABETH OXHORN (Recovery act press secretary): Hello, everyone, and thank you for joining us today. This is an on-the- record conference call on the first 100 days of the recovery act and the related report from the vice president that the president released earlier today.
On today's call are Rob Nabors, he's the deputy director of the Office of Management and Budget, and also, Jared Bernstein, chief economic adviser to the vice president.
I'm going to turn the call over to Rob and Jared now. They will give short introductions, and then we will have about 15 minutes of questions following their remarks. Thanks so much.
Rob?
MR. NABORS: When the president signed the recovery act a hundred days ago, he made it clear that we were just beginning the work that we needed to do in order to create jobs and set our economy on a firmer foundation. Every day since then, the administration has been working to meet that mission.
We have a long way to go, but today, a hundred days into the recovery effort, we have more hope for an economic turnaround than we did 101 days ago. So far, we've obligated more than $112 billion, helping people in every state and territory. We've invested in new energy technologies, education, transportation and manufacturing. We're weatherizing homes and providing training for workers. We're strengthening the safety net with expanded unemployment benefits, more affordable access to health care and food assistance for people who need it most. We're investing in programs that are making a difference today, while building a better economic foundation moving forward.
This is no simple task, and the economic troubles that we face are the results of years of neglect. We can't reverse that damage in a hundred days, but we are starting to turn the corner.
And with that, I'll turn to Jared.
MR. BERNSTEIN: Well, that's a great lead-in. Thank you. This is Jared Bernstein.
We have seen, as Rob just mentioned, some positive economic signs in recent weeks.
There's been some signs of stabilization in our housing markets. Some key interest rates, especially the 30-year fixed rate on the 30-year -- the 30-year fixed rate on mortgage lending is -- recently hit an historic low, and that's helping to generate more activity, both buying and refis.
The rate of job loss, though still extremely high, may have diminished. Recent readings of consumer confidence have gotten a bump. And most forecasters, including, importantly, Ben Bernanke, believe that gross domestic product, the broadest measure of our economy's health, will turn positive by the end of this year.
That said, our administration believes that we are far, far from out of the woods. To us, the fact that we're -- to us, the fact that we're losing fewer jobs is not good news. From our perspective, the American economy will not be fully up and running until we see robust job growth that provides working families with job and income opportunities every month.
And here's where the recovery act comes in. In every state across this country, people are at work who would not have been so but for the measures in this act. Whether it's tax cuts for working families, new construction, infrastructure investment, green job training, retrofits and weatherization, small business loans, fiscal support for states, the federal government has obligated $112 billion thus far for these activities. That's a tremendous dose of medicine into an economy that's finally showing some signs of breaking its fever.
And we're doing so with great care and scrutiny. We know that we can't afford to squander any one of the $787 billion associated with this act, and the president expects his staff, starting with my boss, the vice president, to enforce that principle every day.
And with that, we'll open up for your questions.
OPERATOR: Ladies and gentlemen, if you wish to ask a question, please press star, then 1, on your touch tone phone. You will hear a tone indicating you have been placed in queue. You may remove yourself from queue at any time by pressing the pound key. If you are using a speaker phone, please pick up the handset before pressing the numbers.
We do ask that you limit yourself to one question at a time. Once again, if you have a question, please press star-1 at this time.
One moment for the first question.
Our first question comes from the line of Tami Luhby from CNNmoney.com. Please go ahead.
Q Hi, thank you. It's "Loohby." Two questions. One is, what is the value of the tax cuts? Is that included in the 112 billion (dollars) that are obligated, or is there a separate number for that?
MR. BERNSTEIN: The tax cuts -- the tax cuts are included. The tax cuts have gone -- oh, they're not? I'm sorry.
MR. NABORS: They're not in the obligations.
MR. BERNSTEIN: Oh, they're not in the obligations. Sorry. Why don't you take that?
MR. NABORS: The tax cuts are not included in the level of obligations that we're reporting. Those obligations just relate to federal spending at this point. The tax cuts have started to be implemented, though, and we'll have additional information about the amount of money that has actually gone out in the near future.
OPERATOR: Your next question comes from the line of John Sicilanio (sic/Siciliano) -- Sicilano (sic) from Energy Washington. Please go ahead.
Q Yeah, I just wanted to see if you could comment on -- the report sort of preempted the president's speech at Nellis Air Force Base, and it gave some details of the money that he's announcing for geothermal. It's 350 million (dollars). But I didn't see the solar. He has a solar program initiative he wants to replicate, the Nellis Air Force arrays. And I just wanted to see what the solar allocation would be.
MR. BERNSTEIN: This is Jared. That's 117 million (dollars) allocated for solar.
Q Okay.
OPERATOR: Our next question comes again -- once again from the line of Tami Luhby. Your line is open. Please go ahead.
Q Thank you. On May 18th, the recipients of the funds had to give reports particularly to the Department of Transportation, which provided actual job numbers. When do you expect those to be released, and how?
MR. BERNSTEIN: You hear the -- I didn't hear the -- did you hear the question? Because I didn't -- we didn't really get your question, Tami. Could you say it again?
Q Sure. On May 18th, the recipients of the stimulus money had to provide reports to their agencies, particularly the Department of Transportation and the highway-infrastructure money. When will those reports -- those reports include actual jobs created so far; when and in what form will those reports be released?
MR. BERNSTEIN: I think -- I think we're going to have to get back to precisely on the when. The form will be on recovery.gov, and we will report jobs created. There will be a quarterly report by the Council of Economic Advisers on jobs created or saved by the act, and that report will also include those numbers.
OPERATOR: Next question comes on the line of Jeff Earl (sp) from the New York Post.
Q Hi there. I'm wondering if you-all can provide some information on sort of this transparency question. I know you've put out a hundred projects today, but as you probably know, there are some private groups out there that are putting vastly more money -- vastly more projects and totals up on the Internet.
MR. NABORS: I think that from the very beginning we've been committed to putting as much information on the Internet as quickly as we can possibly get it. I can't speak to what the outside groups are doing. What I can say is that as information comes in from the federal agencies, from grant recipients and from outside agencies that are actually spending the funds that we are allocating, we're trying to get that information onto the Internet in as accurate and as timely a fashion as possible. And we're going to continue to try to do that going forward.
OPERATOR: Our next question comes from the line of Michael Cooper. Your line is open. And he is from The New York Times.
Q Thanks for doing this, guys. On the White House blog it spoke today about putting out a roadmap for the next hundred days in what kinds of things you hope to achieve. Can you give us any sense of what some of those things -- what you might be looking for with that?
MR. BERNSTEIN: This is Jared. We're going to continue to produce the kinds of materials we've produced thus far and to give folks the kind of information on obligation, on spend-out, on job creation, on projects that we've done so far. I think one of the important things to recognize is that some of the impact of the act ramps up in the second hundred days. For example, we've created or saved 150,000 jobs the first hundred days. The second hundred days, we expect to another 600,000.
Did you want to add anything, Rob? (Pause.)
OPERATOR: Are you ready for your next question?
MR. BERNSTEIN: Sure.
OPERATOR: Thank you. Our next question is from the line of Mike Burnham from Greenwire. Your line is open. Please go ahead.
Q Yes. Is the administration expected to make any estimates in terms of how many so-called green jobs would be created by the economic stimulus?
I know the administration has promised 3.5 million jobs will be saved or created by the end of next year, but I'm trying to get a handle on green jobs here.
MR. BERNSTEIN: We have not thus far committed to doing that, though we're looking at it. The Council of Economic Advisers, for example, is looking into that question.
One thing we did do early on was Christina Romer and myself looked at the number of jobs that we think will be created from expenditures in the energy space, those sets of investments. And that was over 450,000 jobs saved or created by the end of next year. Many of those jobs are green jobs, but not all of them.
You know, it's often very tough to decipher precisely what a green job is. You can be actually working on a project that fits the description of a green job in the morning, welding a wind turbine, and then in the afternoon be working on a different type of project that doesn't fit under that rubric. So it's tough to count. But it's not something that -- but it is something we're going to continue to look into.
OPERATOR: Our next question comes from the line of Michael Grabell from ProPublica. Your line is open. Please go ahead.
Q Hi. I had a question on the 150,000 job estimate which comes from the economic models. When you look at the report of actual jobs created to the House Transportation and Infrastructure Committee, it's 7,700 jobs. And then there's been anecdotal reports from different states, with the state fiscal stabilization funds, of a few thousand jobs here, a few thousand jobs there. How does this add up to 150,000 jobs ultimately? Has anyone tried to sort of make it work with the estimates that we have?
MR. NABORS: I think it would be -- I'll try a first cut at the answer and I'll let Jared -- I'll turn it over to Jared. But I think it's very difficult for us to try to reconcile the multiple methodologies that other folks are using. What we've tried to do within the administration is to put forward what we believe is a solid methodology that would be supported by most economists, that gives the American people an accurate and -- an accurate assessment of how many jobs are actually created. I don't know that I can really comment on the methodology that other folks are using at this point, though.
MR. BERNSTEIN: Yeah, I think you have to appreciate the -- there's two things. This is Jared. First of all, there's a difference between jobs saved and jobs created.
Some of the measures you cited sounded to me like they were counting jobs created, and that's obviously very important. But a job saved by dollars from the recovery act is a job that we absolutely want to count as one that would not be there in the absence of this spending.
Now, the 150,000 is a number that is derived relative to what's called a baseline, that is, relative to the amount of jobs we think we would be losing were the act not in place. In other words, those negative -- those job losses that you get every month, they would be more negative were this act not in place saving or creating jobs.
So if you kind of compare where employment is relative to where it would have been, that gap between those two, that's the 150,000 thus far. We're looking at saving or creating another 600,000 over the next hundred days.
OPERATOR: Our next question comes from the line of Louise Radnofsky from the Wall Street Journal. Your line is open. Please go ahead.
Q Hi there. Thanks for doing this. How much money do you expect to see made available and paid out in the next hundred days? I'm obviously not asking to the nearest .1 billion (dollars), but are we expecting to see another hundred billion? More or less?
MR. NABORS: I don't know that we can answer that question definitively. But what we would say -- and this is just building on a statement that Jared had made earlier -- we do expect to see recovery act activity ramp up as we put in our spending plans. As we put our spending plans into place and as the recovery money starts flowing through the states, we do expect to see the amount of activity -- to increase. We just can't predict at this point what the exact obligation levels will be at the end of the next hundred days.
OPERATOR: If -- once again, if you have a question, please press "star," "one" at this time. Our next question comes from the line of Michael Cooper from New York Times. Please go ahead. Your line is open.
Q Hi. Just to follow up on Michael Grabell's question about job creation, I had understood from reading the formula that it was based on, you know, a certain number of jobs per amount of dollars spent. But in Jared Bernstein's answer, you talked about looking at them compared to where you expected employment to be. Can you give us an idea of where you expect unemployment to be in the next hundred days, so we could figure out if you hit the 600,000 figure?
MR. BERNSTEIN: No, I can't -- I can't give you a precise guesstimate of where we expect unemployment to be in the next hundred days.
I mean, that's -- that's over -- I will say that over the next three months -- which kind of corresponds to that -- over the next three months, we expect the unemployment rate to continue to rise.
And it's an important point, Michael, because the fact that the unemployment rate is going up or the fact that we're losing jobs, again, is not -- shouldn't be taken as evidence that the plan is somehow ineffective. To the contrary; the unemployment rate would rise more quickly, job loss would be deeper, in the absence of the act.
And when Christina Romer and I did the initial estimates, we knew because of the depth of the recession that we would be losing jobs, that unemployment would be rising. But no way can we be that precise within a given, you know, one-, two-, three-month period, as you've asked. I wish we could, but that would really go beyond our ability to reliably estimate the impact of the spending.
OPERATOR: Our next question comes from the line of Stewart Doan from Agri-Pulse. Your line is open. Please go ahead.
Q Thank you. Thanks for holding the call. Question: If you could tell me what USDA's share of the recovery act money was, and how much has USDA already allocated to all the projects in its various mission areas?
MR. NABORS: USDA has obligated to this point about $2 billion, and I believe that is largely associated with rural housing loans and other types of rural projects.
OPERATOR: Our next question comes from the line of Matt Apuzzo from Associated Press. Your line is open. Please go ahead.
Q Hey, guys. Thanks for doing the call. I appreciate it. I just want to know if in the formula for job creation/saved there was any discussion about including any of the -- sort of the back-end costs of spending. You know, ultimately, some day, we'll have to pay for this, either through tax increases or interest rates -- you know, issuing more bonds or raising interest rates.
I'm just wondering if there's been any talk about what the net -- what the net effect of jobs will be or if it's purely a front end. Just look at what will be created by the spending but not look at what the contraction forces would be, on the back end.
MR. BERNSTEIN: I'm trying to -- I believe that we did do that in the original paper that Christina Romer and I wrote. And you can -- you can look at that. And it is the case in these models that you do borrow slightly from future quarters. And I believe we have that in the paper.
Of course, the net effect is by far adding jobs to the economy, even with the fact that some of the addition, a small bit, comes at the expense of later quarters.
OPERATOR: Our next question comes from the line of Dennis Moore from the Fox Business Network.
Your line is open. Please go ahead.
Q I realize it was not exactly billed as this way. But you've got another 750 billion or so that has come out of there, in the TARP money and various other programs.
Have you done any attempt to look at, ooh, that's created some jobs too, and how could we count those?
MR. NABORS: We have not done that type of calculation from the Office of Management and Budget. I don't believe that the Treasury Department has formally released any such numbers either.
Jared, I don't --
MR. BERNSTEIN: No, I don't know of any such -- any such estimates.
OPERATOR: Your next question comes from the line of Lisa Lambert from Reuters.
Your line is open. Please go ahead.
Q Hi. I just had a question about the Build America bonds. I was wondering if those interest-subsidy payments were part of the 112 billion that you said was obligated.
MR. BERNSTEIN: No, it's not.
Q Will it be included in future projections?
MR. BERNSTEIN: It will.
Q Okay.
Thank you.
MR. BERNSTEIN: You're welcome.
OPERATOR: Your next question comes from the line of Phil Rush -- your line is open -- from The Hill.
Q President Obama talked on April 29th that 150,000 jobs have either been saved or created. You talked about, in the second hundred days, that there would be 600,000 saved or created.
Does that mean that we are basically, you know, one-third of the way into the next 600? In other words, have 200,000 jobs been either saved or created since April 29th?
MR. BERNSTEIN: We're unable to do such granular estimates that we can tell you month-by-month, in any meaningful way, about the pace.
We're sticking to basically quarterly estimates at this point. And by the way, that's also what the bill calls for, is for the Council of Economic Advisers to make -- to report on a quarterly basis about job growth. If you were to average that over the quarter, your calculation would be correct, but that's not something we've done.
MS. OXHORN: And this next question will be our last question.
OPERATOR: Our last question comes from the line of Michael Grabell, a follow-up, who's from ProPublica.
Q One of the big things about the stimulus package was the oversight mechanisms that were set up. And I'm wondering -- it wasn't included in the report. Has any waste, fraud, abuse, inefficiency been rooted out at this point in the game? Have any projects that have been proposed -- have any of those been rejected?
MR. NABORS: We spent a lot of our time working with the heads of the various agencies and working with the head of the Recovery Oversight Board doing exactly what you've identified. What we are trying to do, though, is we're trying to make sure that we don't get to the point where waste, fraud and abuse happens. From our perspective, any amount of waste, fraud and abuse is too much waste, fraud and abuse.
So what we're doing is we're spending a lot of time working with -- in OMB, working with the vice president's office and working with the agencies to help identify in the front end the types of projects that we find to be appropriate and acceptable recovery act projects and putting in place the mechanisms to make sure that the money that is being spent is being spent wisely and on the types of projects that we think are the most valuable. So we're trying to do that work on the front end.
There aren't specific examples that I can point to where we've -- where waste, fraud and abuse have been weeded out, but I know that there are a number of examples from our internal discussions where we believe that we have mechanisms in place to avoid the mistakes that have been made in the past when money's been spent.
MS. OXHORN: Thank you very much, everybody.
MR. BERNSTEIN: I was just going to add one point. Oftentimes in these discussions about the recovery act, we've talked about, as we did today, about the rate at which we are spending out the resources and obligating the funds. And one of the things we recognize is that there's a trade-off between the speed and the efficiency with which we get the money out the door and the oversight that the president and the vice president are -- hold in such high and important regard here.
And I think it's a balance, a trade-off, that we're working with here. And as Rob suggested, we think thus far that we're getting that trade-off right and distributing the funds in a way that's fast enough to get dollars out the door to create the kinds of opportunities that American families need right now, alongside the critically important oversight role that Rob was talking about.
MS. OXHORN: Thank you very much, everyone, for joining us.
