Noting stimulus gains — cautiously

By Lisa Mascaro

Sunday, Nov. 1, 2009 | 2 a.m.

Those green shoots that economists optimistically saw poking through the economy’s parched soil in the summer have not much sprouted in Nevada.

If anything, Las Vegas’ tourist-dependent economy continued to nose-dive, taking the service-based economy down with it. Housing construction, the other major driver of economic activity in Southern Nevada, packed up long ago.

Unemployment continues its seemingly unstoppable march — it was 13.9 percent in September. That’s twice what it was one year ago.

If all of the state’s jobless lived in one place, they would make up Nevada’s fifth largest city.

So it was with very bridled optimism that White House advisers got on the phones late last week to suggest that the administration’s economic policies are working to end the slide that has come to be known as the nation’s Great Recession.

The economy remains on the forefront of most voters’ minds, and whoever is credited with improving conditions for suffering households — or blamed for not doing enough — will surely be judged in next fall’s elections.

This was the White House message machine at work, trying to shape history in real time by showing that its efforts have helped to walk the nation back from the abyss — before its opponents could trash the results.

And understandably so, as the nation’s economic recovery, or lack thereof, is defining political futures.

This is playing out in Nevada, where the governor and his Republican allies in Washington opposed the White House’s recovery act and continue to question its worth, while the state’s Democrats in Washington say the governor has been too slow to spend the money that can put Nevadans back to work.

So on Friday, after the nation’s third-quarter growth in the gross domestic product, that barometer of fiscal health, was reported at 3.5 percent — generously in the black after so many quarters of flat lines and decline — officials took to the phones to cautiously suggest White House policies are working.

According to data the state filed with the White House Recovery Office, the money from Washington has saved or created 5,667 jobs in Nevada over the past several months — with many more to come.

Nevada saved or created 6 percent more jobs per capita with its stimulus money than the nation as a whole.

Yet with so much of the economic boost coming from government outlays — Cash for Clunkers, the homebuyers’ tax credit, the stimulus — there is a nagging concern that the gains may only be temporary.

By week’s end, the stock market virtually erased the gains it made with the heady GDP news, and consumer confidence is so low it might better be labeled consumer-lack-of-confidence: No jobs, no spending.

Job growth historically lags economic growth, but with unemployment so high in Nevada, how will we know if the recession is really over?

“The president’s work isn’t done,” said Jason Furman, deputy director of the White House’s National Economic Council, during a Friday afternoon call with the Las Vegas Sun.

“We’re cognizant of the enormous challenges ahead translating that economic growth into job creation for families.”

Congress is considering extending unemployment benefits through the end of the year, and the president wants to continue jobless aid into 2010.

The White House also gave its support last week to extending the first-time homebuyers tax credit, which has been used more in Nevada than any other state.

Later Friday afternoon, other White House officials did the calling.

Think of it this way, offered the vice president’s top economic adviser, Jared Bernstein: Even the largest stimulus package in the country’s history, which the recovery act was, “can’t fully offset the deepest recession since the Great Depression.”

Without the government assist, indications are things could have been worse.

But, he said, in a message that may shape the 2010 campaigns, “We’ve got a long way to go.”