JOBS, JOBS, JOBS….Our story so far: President Bush says his tax cuts will produce 1.4 million new jobs. Paul Krugman responded in his column saying, gee, 1.4 million jobs at a cost of $726 billion in tax cuts is $500,000 per job. Seems a bit steep, no? Maybe a more direct jobs program, such as aid to free-falling state governments so they don’t have to lay off thousands of workers, would be a better deal.

Next came Donald Luskin in National Review Online, complaining that Krugman is lying lying. See, it’s a 10-year tax cut, and that 1.4 million jobs is only through 2004. Looking out, we should assume, oh, 500,000 new jobs per year beyond that, for a total of 5.4 million new jobs over ten years. That’s only $134,000 per new job!

With me so far? Dwight Meredith was dubious about this, and Krugman himself replied on his own website (on Thursday, then again on Monday, and finally on Tuesday), making the point that a fiscal stimulus doesn’t last forever. Before long, the new jobs go away and the economy returns to its baseline performance. So the costs are for ten years, but the benefits only last for one or two.

Yammer, yammmer, yammer. Damn economists. But wait: it gets better.

Today Max Sawicky goes to the numbers and prints a handy little chart straight from the CEA report used by Bush, Krugman, and Luskin. The numbers are straightforward: 1.4 million jobs in 2003-2004, then -700,000 jobs in 2005-2007, for a net total of 700,000 new jobs. Hmmm, looks like Krugman’s only mistake was being too nice. It’s actually more like $1 million per job.

But here’s the final cherry: Luskin claimed that the CEA report only went through 2004, so he just sort of estimated job growth for the out years. But that’s not true: the CEA report makes estimates through 2007. What happened?

In comments at Max’s site, Dwight says one of his readers, Bruce Moomaw, emailed Luskin about this, and Luskin replied that he hadn’t actually read the CEA report. He just pulled the 5.4 million number out of the air.

Luskin wrote a thousand words making little more than wild ass guesses ? guesses that are clearly contradicted if he had bothered to read the report itself. Remember that the next time you read anything written by him.

(Or if you have a more cynical turn of mind, just take Megan McArdle’s advice from today: they’re all a bunch of policy whores and finding the Diogenes of economics takes diligence and patience. Something that, um, most of us don’t have. Hmmm, what was that again…?)

UPDATE: Dwight points out in comments that it was Bruce Moomaw who emailed Luskin, not him. This has been corrected in the text.