CBO’s views on the payout rate from infrastructure spending long predates this administration. Check the testimony of various CBO officials on its web site. They have repeatedly said that only about 25% of money is spent the first year after being made available for spending. That means after the proposal has been made, after the authorization has passed Congress, after the appropriation has been made and the fiscal year has begun, and after the relevant federal agency has certified that the project is in fact ready to begin. Given that most public works projects take more than a year to complete, why is it any surprise that only a fourth of the money is spent the first year?
—Bruce Bartlett. So, only one quarter of a Keynesian stimulus plan will come online the first year after Congress has appropriated it. By then, the economy may well be in recovery and by the time 100% of the stimulus money comes online, the economy will assuredly be expanding. We are about to take our budget deficit into the trillions and we will have nothing whatsoever to show for it.
Remind me again: Why are we entertaining the thought of Keynesian stimulus? (Bartlett link via Will Wilkinson.)