It's true that the states chose to spend on the money increasing worker pay (http://research.stlouisfed.org/fred2/series/ECIGVTWAG) rather than hiring more workers, but that's a separate issue. (Call it anti-Keynesian spending during a recession.)
Historically we did things like hiring a bunch of unemployed people and having them build stuff (trails in national parks, fancy downtown landscaping, transit projects, etc). In the most recent recession, all we did was give the unemployed 99 weeks of free money.
http://research.stlouisfed.org/fred2/series/FGEXPND
http://research.stlouisfed.org/fred2/series/SLEXPND
It's true that the states chose to spend on the money increasing worker pay (http://research.stlouisfed.org/fred2/series/ECIGVTWAG) rather than hiring more workers, but that's a separate issue. (Call it anti-Keynesian spending during a recession.)
Historically we did things like hiring a bunch of unemployed people and having them build stuff (trails in national parks, fancy downtown landscaping, transit projects, etc). In the most recent recession, all we did was give the unemployed 99 weeks of free money.