Though it's interesting that the RINOs in the GOP, who spent far
more than this bailing out their frat brothers on Wall Street and
farming out exclusive contracts to their chums, are complaining so
loudly.
In reality, I think a better approach to the 'stimulus' would be to
hold the people responsible for wrecking the economy accountable. For
example, if the Bailout was really (LOL) the only way to save the
economy; they should have subpoenaed the credit bureaus and paid off
everyone's debt. Result: no more credit crisis, everyone owed gets
paid off, and the shareholders secured. Then they could frozen all
the assets of these Wall Street looters and held it for collateral.
Even that draconian scenario is closer to a free market than what
actually took place.
"Never let a serious crisis go to waste. What I mean by that is
it's
an opportunity to do things you couldn't do before."
So said White House Chief of Staff Rahm Emanuel in November, and
Democrats in Congress are certainly taking his advice to heart.
The
647-page, $825 billion House legislation is being sold as an
economic
"stimulus," but now that Democrats have finally released the
details
we understand Rahm's point much better. This is a political wonder
that manages to spend money on just about every pent-up Democratic
proposal of the last 40 years.
We've looked it over, and even we can't quite believe it. There's
$1
billion for Amtrak, the federal railroad that hasn't turned a
profit
in 40 years; $2 billion for child-care subsidies; $50 million for
that great engine of job creation, the National Endowment for the
Arts; $400 million for global-warming research and another $2.4
billion for carbon-capture demonstration projects. There's even
$650
million on top of the billions already doled out to pay for
digital
TV conversion coupons.
In selling the plan, President Obama has said this bill will make
"dramatic investments to revive our flagging economy." Well, you
be
the judge. Some $30 billion, or less than 5% of the spending in
the
bill, is for fixing bridges or other highway projects. There's
another $40 billion for broadband and electric grid development,
airports and clean water projects that are arguably worthwhile
priorities.
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Add the roughly $20 billion for business tax cuts, and by our
estimate only $90 billion out of $825 billion, or about 12 cents
of
every $1, is for something that can plausibly be considered a
growth
stimulus. And even many of these projects aren't likely to help
the
economy immediately. As Peter Orszag, the President's new budget
director, told Congress a year ago, "even those [public works]
that
are 'on the shelf' generally cannot be undertaken quickly enough
to
provide timely stimulus to the economy."
Most of the rest of this project spending will go to such things
as
renewable energy funding ($8 billion) or mass transit ($6 billion)
that have a low or negative return on investment. Most urban
transit
systems are so badly managed that their fares cover less than half
of
their costs. However, the people who operate these systems belong
to
public-employee unions that are campaign contributors to . . .
guess
which party?
Here's another lu-lu: Congress wants to spend $600 million more
for
the federal government to buy new cars. Uncle Sam already spends
$3
billion a year on its fleet of 600,000 vehicles. Congress also
wants
to spend $7 billion for modernizing federal buildings and
facilities.
The Smithsonian is targeted to receive $150 million; we love the
Smithsonian, too, but this is a job creator?
Another "stimulus" secret is that some $252 billion is for income-
transfer payments -- that is, not investments that arguably help
everyone, but cash or benefits to individuals for doing nothing at
all. There's $81 billion for Medicaid, $36 billion for expanded
unemployment benefits, $20 billion for food stamps, and $83
billion
for the earned income credit for people who don't pay income tax.
While some of that may be justified to help poorer Americans ride
out
the recession, they aren't job creators.
As for the promise of accountability, some $54 billion will go to
federal programs that the Office of Management and Budget or the
Government Accountability Office have already criticized as
"ineffective" or unable to pass basic financial audits. These
include
the Economic Development Administration, the Small Business
Administration, the 10 federal job training programs, and many more.
Oh, and don't forget education, which would get $66 billion more.
That's more than the entire Education Department spent a mere 10
years ago and is on top of the doubling under President Bush. Some
$6
billion of this will subsidize university building projects. If
you
think the intention here is to help kids learn, the House declares
on
page 257 that "No recipient . . . shall use such funds to provide
financial assistance to students to attend private elementary or
secondary schools." Horrors: Some money might go to nonunion
teachers.
The larger fiscal issue here is whether this spending bonanza will
become part of the annual "budget baseline" that Congress uses as
the
new floor when calculating how much to increase spending the
following year, and into the future. Democrats insist that it will
not. But it's hard -- no, impossible -- to believe that Congress
will
cut spending next year on any of these programs from their new,
higher levels. The likelihood is that this allegedly emergency
spending will become a permanent addition to federal outlays --
increasing pressure for tax increases in the bargain. Any Blue Dog
Democrat who votes for this ought to turn in his "deficit hawk"
credentials.
This is supposed to be a new era of bipartisanship, but this bill
was
written based on the wish list of every living -- or dead --
Democratic interest group. As Speaker Nancy Pelosi put it, "We won
the election. We wrote the bill." So they did. Republicans should
let