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"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.
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 them take all of the credit.
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History doesn't repeat itself, but it does rhyme - Mark Twain
Senator Warns White House Will 'Create Crisis' and 'Panic' to Push Stimulus
Sen. Jim DeMint, R-S.C., criticizes mainstream media for not reporting loads of pork in proposed legislation.
By Jeff Poor
Business & Media Institute
1/27/2009 5:04:03 PM
Is the new Obama administration taking cues from the Bush administration to get Congress to act? It certainly seemed that way to, South Carolina’s junior Republican senator, Jim DeMint.
DeMint, speaking Jan. 27 at The Heritage Foundation in Washington, D.C., explained the Obama administration will “create crisis and widespread panic” just like its predecessor in order to get Congress to act expeditiously.
“I’ve been around long enough to know whenever someone tells me I have to make a decision right now, my response is no,” DeMint said. “That clears it up right away and I think more and more the Bush administration and now this administration knows that they’re not going to get a quick reaction out of Congress unless they create crisis and widespread panic. And that’s going to be their M.O. to get Congress to act.”
Another senator, James Inhofe, R-Okla., explained the Bush administration used a similar tactic, under the direction of former Treasury Secretary Henry Paulson, to get the $700-billion TARP bailout bill passed by Congress back on Oct. 4, 2008.
DeMint said some Republicans now regret they voted for the TARP package, even though there is no way to gauge what might have happened had it not been passed.
“I think there’s a lot of buyer’s remorse among Republicans who voted for the bailouts of all kinds last year,” DeMint said. “And, it’s hard to prove that, some of them are saying, ‘It didn’t work out so well, but it’d been a lot worse if we hadn’t.’ It’s hard, it’s hard to argue that unless you know anything about how business works.”
“And then it’s obvious that what we did was inject a whole lot of uncertainty into the marketplace,” DeMint said. “So no, I don’t think there’s discord because of that, uh, and I really don’t blame my colleagues. If you got the President and the Secretary of the Treasury coming in saying, ‘The world economy is going to collapse next week if we don’t do something.’”
DeMint criticized the mainstream media for not conveying the message that some congressional Republicans are trying to spread about this package –that it’s filled with big-government wasteful spending projects that will do little to “stimulate” the economy.
“Well, it’s a good question and a lot of us are saying that,” DeMint said. “It’s not being picked up at all by the mainstream media and that’s why again, we’re going to have to take our message through you to the people, Rush Limbaugh, anyone who will talk about what’s really in the bill. We don’t need to make it up. It’s like they’re in a different reality. They’re talking about a bill, that when you look at it, there’s no resemblance to what they’re talking about.”
DeMint said it will take grassroots efforts to put the brakes on this stimulus package and he admitted he has seen it from constituents that are concerned about the bailout culture in Washington, D.C.
“So if we can just get the truth to the American people, or just a segment of the American people, I think you’ll, you’ll see a groundswell of anger, again because there’s, there’s a real fatigue out there on these bailouts,” DeMint continued. “I think even people who are normally not that political are coming up to me and they just sense that we’re running this country into a ditch. I’ve never seen people so anxious and so – well, I mean they grab my arm. They’re no longer single issue people. They just say, ‘Thanks for fighting. What can I do?’ I’ve heard that at least a hundred times. That’s – we just need to let people know the truth and think that they’ll get engaged.”
__________________ 2008 PPW Base - Fast Intentions
The more details I see of this "stimulus package" the more it pisses me off! I don't see anything in it that will help create enough jobs to actualy make a difference. If you're into construction you'll have a job with all road construction and building renovation going on. I guess if I lose my job as a software developer I'll be standing on a highway holding a sign STOP/YIELD for $25/hr.
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When was the last time you tried something new?
Manufacture fear and a sense of urgency and you can get anything past these spineless politicians.
It seems like they're saying, "Well, as long as you include a few billion to appease my special interests, I'll let the other hundreds of billions slide."
This bill is riddled with unnecessary spending, yet it will probably get through since the Republicans are too afraid of being criticized to oppose it. Bunch of nancy's these modern Rebublicans are.
As expected, Obama is following Bush's spending beyond our means policies. Neither party is serious about balancing a budget. The Dems tell you up front they will spend, Repo's do the same but act like they care about reducing spending.
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Jeff Wisener
350Z Editor
Nissan Sport Magazine
After crunching the numbers, i feel my bottom line will be helped. I might be reading the responses incorrectly, but i feel others don't share my sentiment.
As expected, Obama is following Bush's spending beyond our means policies. Neither party is serious about balancing a budget. The Dems tell you up front they will spend, Repo's do the same but act like they care about reducing spending.
and bush followed his father, who followed Reagan, the master of deficit spending
A 40-Year Wish List
