Obama hails $787bn stimulus plan as an American success

US is through the worst of the financial crisis thanks to Bill, President insists
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Facing a sceptical public and an implacable opposition, Barack Obama insisted the $787bn (£498bn) fiscal stimulus plan signed into US law a year ago had been worth the money.

Marking the anniversary with a renewed effort to show the everyday benefits of the American Recovery and Reinvestment Act, the President predicted it would save or create 1.5 million US jobs this year on top of 2 million last year.

Other members of his administration fanned out across television studios to highlight public works projects funded by the stimulus Bill, in a public relations battle that has implications beyond Mr Obama's own popularity. A nascent economic recovery is threatened by continuing high unemployment, which stands above 10 per cent, and the unpopularity of the first stimulus package is complicating efforts to pass a second "jobs Bill" that is currently under negotiation in Congress.

Reflecting popular scepticism, vandals on the stimulus Bill's Wikipedia page changed its title yesterday to "Big-Ass Slush Fund". A recent poll found only 6 per cent of Americans believe it has created jobs. The Republican opposition has been marking the anniversary by sending out year-old White House projections that the unemployment rate would be kept below 8 per cent. "It doesn't yet feel like much of a recovery, and I understand that" Mr Obama conceded in a White House speech. "It's why we're going to continue to do everything in our power to turn this economy around."

But he insisted stimulus spending had eliminated the threat of a second Great Depression and created conditions for recovery. The Bill earmarked money for tax cuts, infrastructure spending and other government programmes. So far, $179bn in the plan has been spent and $93bn in tax cuts have been issued. Another $154bn is in the process of being sent out. The Congressional Budget Office revised its cost estimate for the Recovery Act up to $862bn from $787bn last month.

As the administration published its first annual report on the legislation yesterday, Vice-President Joe Biden insisted taxpayers had "gotten their money's worth". The ultimate cost will be borne over future years, since it was paid for by adding to the national debt, which now stands at $12.4trillion.

Significant controversy exists about how to measure the number of jobs "created or saved" by the stimulus Bill. According to figures provided by those who received grants and loans, 595,263 jobs were created or saved in the final three months of 2009, the White House claims. A previous report, using a different calculation method, said it had saved 640,239 jobs in the prior quarter.

The independent Congressional Budget Office estimates that the fiscal package is responsible for employing up to 2.4 million people. The White House council of economic advisers calculates that between 1.5 and 2 million jobs have been saved or created by the legislation.