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Study: Federal Stimulus Keeps 66,000 MN Heads above Water

December 28, 2009

ST. PAUL, Minn. - Imagine the entire population of St. Cloud or a jam-packed Metrodome at a Vikings game. That's the number of people who have been kept above the poverty line by federal stimulus money in Minnesota, according to a new report. It says the stimulus funds have helped 66,000 Minnesotans by providing extra food stamps, extended jobless benefits and low-income tax credits, all while boosting the state's economy.

Steve Francisco, federal policy director for the Minnesota Budget Project, says Congress faces huge decisions in 2010 about whether to extend these provisions.

"Clearly, one of the most effective ways to help the economy is to put money into pockets - particularly of low-income people, who are most likely to turn right around and spend that money - generating additional economic activity that sustains jobs."

Francisco says other positive signs include the 2,000 jobs the state added last month. He estimates Minnesota's economic benefits from stimulus dollars are likely even higher than those outlined in the report, since it tallied only seven of the Recovery Act programs. The report was compiled by the Center on Budget and Policy Priorities and released by the Minnesota Council of Nonprofits.

Francisco says the study shows that the Recovery Act is doing the work it intended, and showing a good return on investment.

"Not only are we helping provide people with income when they need it and food when they need it, but the Act is helping to sustain jobs in the middle of this recession."

Economist Mark Zandi mentioned in his recent testimony to the U.S. House of Representatives that food stamps generate $1.73 in economic activity for every dollar spent and extended unemployment benefits generate $1.64 for every dollar spent, because the recipients use the money almost immediately.

The study can be found at

Laura Thornquist, Public News Service - MN