More on the economic "stimulus"

Tuesday, January 27, 2009 Comments

The 250+ page stimulus bill is now a revised 647 page stimulus bill.

There is a summary from the Committee on Appropriations posted here. Here are some highlights:

It starts off by repeating the line that this is a crisis not seen since the Great Depression. I respectfully disagree -- as bad as it is, it isn't yet as bad as the economy was during Carter's administration. Continual references to the Depression era are simply meant to scare us into giving the government carte blanche to do whatever they want. And what they want, is a new New Deal. Which is a bad idea, especially considering the first New Deal didn't work.

A little further down, it states, "This package is the first crucial step in a concerted effort..." Wait, hold on a minute. They're telling us that this $825 billion spending bill is just a "first step"?! Are they $%^&* kidding? Putting aside the fact that calling this a first step completely ignores the fact that we just passed a $700 billion spending bill a few short months ago, and we haven't even finished spending that yet. So if this bloated bill is just one step, what on earth do we have to look forward to? This bill alone is a black hole of spending with a ridiculous wish-list of things that have little or nothing to do with actually stimulating the economy, I can't even imagine what else they have in mind to follow this, or how many "steps" we are talking about here. I'm not sure I even want to know, but the question needs to be asked.


There is more in the commentary that I take issue with, but let's move on to what's actually in the bill.

Green energy and global warming initiatives are found throughout the bill. $54 billion in the section specifically labelled as energy-related, but there are additional amounts sprinkled throughout other sections that mention they are specifically for global warming / climate change (for example, $400 million to NASA for climate change research and $600 million to the Nat'l Oceanic and Atmospheric Administration for climate sensors and modeling). I'm not sure how spending money to combat global warming, especially when there is increasing evidence that there is no global warming (actually appears to be the opposite), stimulates the economy. If anything, forcing manufacturers to meet global-warming-inspired regulations will have the opposite effect in that it will increase costs to manufacturers and therefore to consumers.

Expanding government healthcare is another recurring theme here. In fact, $600 million is specifically identified to "prepare our country for universal healthcare." I don't see how that helps the economy either. Again, it would seem to me that it will have the opposite effect.

Looks like a lot of state "bailouts" here also, and my issue with that is that it rewards states who have mismanaged their budgets and overspent, while essentially penalizing states that have made the tough decisions and managed their budgets appropriately (forcing taxpayers from those states to foot the bill for the irresponsible states). This only encourages more irresponsible spending at the state / local level in the future.

There is significant expansion of government programs here, most of which I just don't see how that stimulates the economy. Sounds more like a laundry list of what the Dems have wanted to spend money on for years that they think they can push through in an "economic stimulus" bill that they couldn't otherwise if each issue had to stand alone on its merits.

There is a fair amount of money in the bill devoted to assisting those who have lost jobs (expanding unemployment, COBRA, and medicaid) and at least this has some relationship to the current problem. However, it treats the symptoms and does nothing to help the underlying cause.

In fact, only $530 million of the $825 billion package, or 0.1%, actually appears to be directed specifically to small business, which is the backbone of the economy (there is nothing directed to large businesses). And interestingly, much of that appears to be in the form of loans whereas all of the government entities will receive cash that does not need to be paid back.

There is mention made of tax relief for "95%" of American workers (note here it says "workers" while on the campaign trail I'm pretty sure it was just "Americans") but no dollar amount is specified as to how much that is.

Interestingly enough, someone was vindictive enough to add that Governor Blagojevich may not direct the use of funds provided in the package. I'm not sure why that was necessary, if he remains governor then it would be his job to direct the use of funds that come to his state (although based on the wording it sounds like his state gets nothing if he is still governor), and if he is impeached and no longer governor, than it would go without saying that he would not be directing use of funds. So it seems rather childish and unnecessary to me.

This bill will be coming up for vote in the next day or so, so if you have some input, now is the time to contact your Senators & Representative.

Heritage.org has some great analysis on this and what the implications are:

Stimulus 101
Commentary on the stimulus package
Nothing temporary about this spending
How the stimulus bill undercuts parental authority

Links to this post