Stimulus has helped economy, report says

WASHINGTON — Looking to boost his standing in a tough congressional election year, President Obama heads to Michigan on Thursday armed with a fresh report that he hopes will help convince people that his economic policies are making life better.

Obama will point to the new report from his own Council of Economic Advisers stating that the $862 billion package of spending and tax cuts enacted last year has added between 2.7 and 3.2 percent to the economy and saved or created about 3 million jobs.

More specifically, he'll visit a battery plant in Holland, Mich., to showcase his argument that $94.8 billion in stimulus spending on clean energy will save or create 827,000 jobs by 2012.

Republicans dismissed the report as political posturing based on false assumptions. "The stimulus has failed," said Rep. Tom Price of Georgia.

However, independent economist Mark Zandi said the White House estimate is in line with his own and those from other private-sector economists.

"They're reasonable estimates," said Zandi, the chief economist for the consulting firm Moody's Analytics. His analysis estimates that the economy is about 3 percent larger and that there are about 2.6 million more jobs now than there would have been without the stimulus.

The argument is critical for Obama and his Democratic Party heading into this November's elections for control of Congress. With unemployment stuck at 9.5 percent — 13.2 percent in Michigan — many voters are skeptical of Obama's policies and wary about the debt piling up to pay for them.

Obama worked Wednesday to set the stage for his trip to Michigan, seeking advice about how to create more jobs in high-profile meetings at the White House with billionaire investor Warren Buffett, then with former President Bill Clinton and a group of business executives.

The U.S. Chamber of Commerce jumped into the debate as well, with a public letter to Obama acknowledging that earlier, unnamed policies did stabilize the economy and prevent a depression, but warning that new tax increases and massive deficits "are needlessly prolonging the economic agony of the recession for millions of Americans and their families."