That’s the question Politico asked yesterday; my answer is, in short: “It shouldn’t be.”
This so-called “stimulus” package, all $850 Billion, 334 pages, and counting of it, contains very little by way of actual economic stimulation, and very much by way of massive pork barrel giveaways to be paraded as an “I got mine!” monetary victory in Senators’ states and Representatives’ districts — all at taxpayers’ expense.
Testifying Thursday before the House Ways and Means Committee yesterday, Thomas Barthold, head of the Joint Committee on Taxation, couldn’t promise one single job would result from the Democrats’ proposal, which makes one wonder what the point of all this spending really is in the first place. While earmarks like $1,000,000,000 for new Censuses, $400,000,000 for “habitat restoration and migration activities,” $150,000,000 for “bridge removal,” $800,000,000 more for Amtrak, and $200,000,000 for the “leaking underground storage tank trust fund” may be deemed necessary to some (particularly those who have a stake in each of those projects), none are actually stimulative to the economy.
The New Deal was a very, very raw deal for America at the time and since (with the latter being far worse due to the repercussions of such an increase in government ownership, involvement, and interference in the economy and the day-to-day lives of American citizens). At very least, though, its infrastructure projects were forward-looking for the time — new roads, bridges, etc. What was progressive in the 1930s, though, is now incredibly regressive, and therefore not worth a fraction of the time or investment now it was then.
We must shore up the parts of our infrastructure that are crumbling, yes; however, rather than working to enhance our current infrastructure with more 20th-century fingers in the dike, we should be investing in more forward-looking projects that will help move America as a whole into the 21st century while also actually creating jobs and helping increase wealth — and the chief way to do that is not by shelling out nearly a trillion dollars more in taxpayer-funded pork barrel spending, but by making America a place where businesses, entrepreneurs, innovators, and hard-working individuals can once again succeed without having the fruits of their labors appropriated by a “Nanny State” government which sees ensuring equality of outcome, often by penalizing the successful and by forcibly “sharing the wealth,” as its chief purpose.
Update: Over at the London Times, Matthew Parris makes a similar – but stronger – argument about the need to look forward rather than backward, and to count on the market working itself out rather than listening to “politicians whose rhetoric will go skyward as our popularity sinks.” (h/t Skanderbeg)
Steve Maley
Moe Lane
Dan McLaughlin
Neil Stevens
I know I'm cynical, but I'm thinking the answer to your question is that
bk (Diary) Saturday, January 24th at 5:12PM EST (link)2010 is an election year, and it will be convenient to be able to “stimulate” voters in districts which just HAPPEN to have tight races.
Exactly bk........ How convieeeeeeeeeenient ! ;)
Kenny Solomon (Diary) Saturday, January 24th at 6:06PM EST (link)There’s another reason too …… ‘yes, they can”, which makes it all the more dangerous.
RINO’s of the world, it’s huntin’ season. Y’all best getcher tails on the boogie, ’cause there ain’t no limit and we’z a-comin’..
Cheers !
Excellent post, Jeff. Kudos also to David Brooks
icbm (Diary) Saturday, January 24th at 5:23PM EST (link)who made some of the same points in his latest column (especially since it’s not so often that I can give him kudos).
http://www.nytimes.com/2009/01/23/opinion/23brooks.html?_r=1
Politicians anticipate a feeding frenzy of pork
1SGinTN (Diary) Saturday, January 24th at 5:27PM EST (link)But – one man’s idea of a pork barrel project could be another’s idea of local infrastructure improvement.
Jeff, I’m not going to get in a discussion over the semantics of it or debate any merits of one project over another (I’ve got a basketball game to go to). I also want to go on record as being against the “stimulus package” concept. I adhere to the Chicago School of economics theories, not the Keynesian ones. But I might as well be against the tide coming in for all the good it will do.
Therefore, if we MUST put our grandchildren and their kids in debt, bankrupt the nation, and wreck the economy for a long time to come – then lets do it with projects that have some semblance of common sense. But, again, the tides thing, I guess.
Tu Ne Cede Malis
-Virgil
Understand and Agree, 1SGinTN
Jeff Emanuel (Diary) Saturday, January 24th at 5:34PM EST (link)JE
I'm torn
Neil Stevens (Diary) Saturday, January 24th at 5:36PM EST (link)On one hand, I don’t buy into Keynes voodoo to begin with.
On the other hand, it’s fun to expose that this bill isn’t even what it’s being sold as, which is Keynes voodoo.
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“I rejoice that America has resisted.” – William Pitt, the Elder
It depends, doesn't it ...
10ksnooker (Diary) Saturday, January 24th at 6:40PM EST (link)If you want to stimulate Obama voters, pay them first. They will then be ready for 2010.
The problem I think is
roxer Saturday, January 24th at 7:47PM EST (link)that this will not create sustainable jobs nor create revenue positive facilities. After the schools, libraries, and roads are built, exactly how much revenue will be generated from them to pay back the treasury/tax payers? Nada. As a matter of fact, this is revenue negative because of the extra tax dollars now needed to keep these facilities operational.
Now take the Honda plant in Alabama and the BMW plant in South Carolina. Through some tax incentives, those facilities not only create sustainable jobs, but they produce a commercial product that puts tax dollars back into the treasury. This through taxes on raw materials, taxes from the workers (which are not paid by the state mind you), taxes on the corporation and from the investors. And finally taxes on the product sold to the public. All revenue positive.
This is what the Republicans should be saying about Obama and the Dems plan. People will get this.
“Where I stand does not depend on where I’m standing.”
–Fred D. Thompson, 2008
Amtrak? Amktrak?!
scottbomb (Diary) Sunday, January 25th at 1:03AM EST (link)Even when I didn’t have a car (not that long ago) Amtrak was worthless for long-distance travel. Greyhound (private enterprise, imagine that) got me there faster and for less money. $800,000,000 down the tubes.
www.HowObamaGotElected.com
“The American people will never knowingly adopt socialism. But, under the name of ‘liberalism’, they will adopt every fragment of the socialist program, until one day America will be a socialist nation, without knowing how it happened.” – Norman Thomas, U.S. Socialist Party presidential candidate 1940, 1944 and 1948
I've taken Amtrak many, many times...
Bill S (Diary) Sunday, January 25th at 1:14AM EST (link)…along the STL/Chicago corridor. It works great. Yeah, they’re late sometimes, but I haven’t found it incredibly worse than airlines (and I have a lot of experience with airline delays…) If the gubmint could do something about the freight conflicts, it would help a LOT.
“It’s such a fine line between stupid, and clever.” – David St. Hubbins
There is more economic benefit to hauling freight
1SGinTN (Diary) Sunday, January 25th at 1:25AM EST (link)BTW, I read somewhere that the freight-to-passeenger ratio in the US is exactly opposite from that in Europe.
Tu Ne Cede Malis
-Virgil
You Bail Them Out, We Opt Out.
mcshalom Sunday, January 25th at 6:04AM EST (link)You Bail Them Out, We Opt Out.
Dear , or should I say Expensive Ben S. Bernanke,
All of Our Economic Problems Find They Root in the Existence of Credit.
Out of the $5,000,000,000,000 bail out money for the banks, that is $1,000 for every inhabitant of this planet, what is it exactly that WE, The People, got?
If my bank doesn’t pay back its credits, how come I still must pay mines?
If my bank gets 0% Loans, how come I don’t?
At the same time, everyday, some of us are losing our home or even our jobs.
Credit discriminates against people of lower economic classes, as such it is unconstitutional, isn’t it? It is an supra national stealth weapon of class struggle.
Credit is a predatory practice. When the predator finishes up the preys he starves to death. What did you expect?
Where are you exactly in that food chain?
Credit gets in the way of All the Principles of Equal Opportunity and Free Market.
Credit is a Stealth Weapon of Mass Destruction.
Credit is Mathematically Inept, Morally Unacceptable.
You Bail Them Out, We Opt Out
Opting Out Is Both Free and Strictly Anonymous.
My Solution: The Credit Free, Free Market Economy.
Is Both Dynamic on the Short Run & Stable on the Long Run, The Only Available Short Run Solution.
I Am, Hence, Leading The Exit Out of Credit:
Let me Outline for You my Proposed Strategy:
? My Prescription to Preserve Our Belongings.
? Our Property Title: Our Free, Strictly Anonymous Right to Opt Out of Credit.
? Our Credit Free Money: The Dinar-Shekel AKA The DaSh, Symbol: - .
? Assets Transfer – Our Right Grant Operation – Our Wealth Multiplier.
? A Specific Application of Employment, Interest and Money.
[A Tract Intended For my Fellows Economists].
If Risk Free Interest Rates Are at 0.00% Doesn’t That Mean That Credit is Worthless Already?
Since credit based currencies are managed by setting short-term interest rates, on which you have lost all control, can we still say that are managing?
We Need, Hence, Cancel All Interest Bearing Debt and Abolish Interest Bearing Credit.
In This Age of Turbulence The People Wants an Exit Out of Credit: An Adventure in a New World Economic Order.
The only other option would be to wait till most of the productive assets of the economy get physically destroyed either by war or by rust.
It will be either awfully deadly or dramatically long.
A price none of us can afford to pay.
“The current crisis can be overcome only by developing a sense of common purpose. The alternative to a new international order is chaos.”
- Henry A. Kissinger
What Else?
Until We Succeed the Economy Will Necessarily Continue to Sink Into a Deeper and Deeper Depression
You Bail Them Out, Let’s Opt Out!
Check Out How Many of Us Are Already on Their Way to Opt Out of Credit.
Let me provide you with a link to my press release for my open letter to you:
Chairman Ben S. Bernanke, Quantitative [Ooops! I Meant Credit] Easing Can’t Work!
I am, Mr Chairman, Yours Sincerely [Do I really have the choice?],
Shalom P. Hamou AKA ‘MC-Shalom’
Chief Economist – Master Conductor
1 7 7 6 – Annuit Cœptis
Tel: +972 54 441-7640
Fax: +972 3 741-0824
http://edsk.org/
Exactly right Jeff! The stimulus should be spending and tax cuts that can have short term impact and
Mike gamecock DeVine (Diary) Sunday, January 25th at 8:49AM EST (link)as to tax cuts, permanent rate changes that will change behavior from save to spend/invest.
We may need to do other things, but dems want to get half their agenda passed of as so called stimulus.
I think they may well have their comeuppance if their is no recovery for two years.
Mike DeVine’s Examiner.com, Charlotte Observer and The Minority Report columns
“One man with courage makes a majority.” – Andrew Jackson