Tag Archives: Economic Stimulus

Like a Business

14 May

Running government like a business apparently means this:

When someone gives you a gift of millions of dollars, you put it in the bank for a rainy day, and perform desperately needed infrastructure repairs and improvements with borrowed money, which the county must repay with interest.

The stimulus can’t work if the money isn’t spent, and is socked away for a rainy day. Why Collins bothered to attend Obama’s visit to ISI yesterday is beyond me.

The “Face” of the Stimulus

12 Mar

In the early 1930’s, with the United States still in the early stages of the Great Depression, FDR proposed a stimulus bill. Besides being a supremely confident egotist, tireless liberal advocate, cut throat politician and war leader, FDR was also a master communicator and marketer. Obama would do well to learn a thing or two, despite his rhetorical reputation.

FDR realized that Americans needed more than money, or jobs, or nice words on the radio that things were getting better. They needed tangible signs that the country was getting better. They needed proof they could see with their own eyes that their neighbors were back to work, and the government’s money was being spent on real projects of use to the community. They needed facts to confront fear and cynicism. Thus, the Works Progress Administration and Civilian Conservation Corps were born.  

Those two organizations did projects around the country that continue to benefit us to this day. They built schools, roads, bridges and public infrastructure. They hired artists to paint murals and include statues and carvings in new public buildings. They built the national park infrastructure that we know today, including iconic lodges and roads that are marvels of engineering at some of America’s crown jewels: Yellowstone, Glacier and Rocky Mountain. In Buffalo, WPA projects are scattered throughout the city, from small school reconstructions to the Old Rockpile and Buffalo Zoo. Regionally, Allegheny State Park and Letchworth extensively use infrastructure built by the CCC. In all cases, FDR was smart enough to place a plaque at each site, and remind the public where these projects came from.

Contrast this with our current “stimulus” ARRA bill. One third of the $786 billion has been spent, and very few people can tell you where it has gone. Tangible projects we all can see have been replaced with a website that is heavy on wonkiness and light on clarity, and provides ambiguous information on a variety of projects. I suppose its mapping function works well if you care more about what agency got the money than what work is being done. If that’s not an insight to the federal bureaucracy, I don’t what is.

So where is Stimulus money being spent in Buffalo? Can you name any projects off the top of your head? Buffalo Business First did an analysis a couple weeks ago, and ranked the projects by jobs created, and money spent.  The top of both lists? $73.6 million and 111 jobs at West Valley, to speed up clean up work that has been on-going for years. Six of the top ten job producers are work study programs at area colleges: 230 students working at libraries and delivering AV equipment at UB, Buff State, Canisius, Daemen, St. Bonaventure and ECC. Rounding out the top job producers are the NFTA (33.8 (?) workers upgrading batteries along the Metro Rail line), WNY AmeriCorps (22 VISTA positions) and the VA (19 folks paving the parking lot at the hospital). Top spenders of stimulus money? A new drain to keep floaties out of the Commercial Slip at Canalside ($17.7 million), $20.5 million to Buffalo Public Schools to retain teachers, $30.8 million to three agencies to help weatherize homes, $14.5 million for 56 hybrid buses for the NFTA, $6.5 million for BURA, and $7 million to repave Maple Road. Wow – Maple Road.

This Stimulus Plan had the potential to be as transformative as President Obama’s salesman-in-chief rhetoric. How about $786 billion in these five areas: public WiFi, high speed rail, next gen green energy, basic scientific research and national park reconstruction. Projects in those areas would be an investment in the future, not a propagation of the status quo or a finger in the dike. There is a smattering, as an afterthought, of those items in the stimulus bill, but they are dwarfed by the mass mush of uninspired projects that were going to be done anyway. BURA just granted a couple million to help redevelop the abandoned German orphanage on the East Side, making David Torke happy. Was that stimulus money? Who knows. Out of the biggest projects I laid out for Buffalo, how many are transformative? New hybrid buses, maybe?

This stimulus plan has not lived up to any of its hype, and seems unlikely to do so in the future when the rest of the money is spent. Instead, it has become another symbol of the narrative of the first 14 months of the Obama administration: over promise and under deliver. The seas don’t have to recede and lions need not lay down with lambs – I’d be happy with a couple jobs and projects more inspired than a 2 inch asphalt lift on a suburban road.

Zimbabwe?

13 Mar

If the Governor of South Carolina doesn’t want to take, and doesn’t feel the need to help his people or his economy through taking his state’s $2.8 billion of stimulus money, that’s all well and good. Given that South Carolina has the country’s second-highest unemployment rate, I’m sure Governor Mark Sanford is confident that he knows what he’s doing.

But to suggest that the US will end up like Zimbabwe as a result of Keynesian pump-priming is a bit silly.

The Zimbabwean economy was based on agriculture (it was known as Africa’s bread basket), and party political kleptomania on the part of ZANU-PF. Its economic failure was triggered by, and is sustained in large part by, the tragic “land reform” expropriation of professionally-run farms that took place during the last decade.

I’d like to think that the US economy is a bit stronger and a bit larger, more resilient, and more diversified than Zimbabwe’s, but what do I know.

A Guide to the Stimulus

5 Mar

A guidebook to the stimulus courtesy of Senator Kirsten Gillibrand. Pretty handy, and helpful.

Quick Question

1 Mar
El Commandante

El Commandante

Most people agree that the stimulus isn’t the best thing in the world, but that some sort of government intervention in the economy was necessary in order to prevent a very bad and worsening situation from becoming catastrophic. In his CPAC speech of Castroesque brevity, the new de facto leader of the Republican Party, Rush Limbaugh, defended his stance that he wishes that the President fail.

Why then does the Republican Party advocate for catastrophe?

Deep Thought

26 Feb

Some people think it’s clever to hold a “tea party” to protest the stimulus package. But the original Boston Tea Party was all about taxation without representation.

Last I checked, Congress = “representation”.

The whole thing is fundamentally idiotic.

Volcanoes

25 Feb

Can Governor Bobby Jindal explain why it’s bad for the United States Geological Survey to modernize its volcano monitoring equipment?

When he heard Jindal’s remarks, Eichelberger said he “was frankly astonished” that the governor would use this particular example, given his own state’s recent brush with a catastrophic natural disaster.

Among the scenarios in which the USGS’s monitoring can assist — the catastrophic eruption of Mount St. Helens on May 18, 1980, which killed 57 people (including a geologist monitoring the mountain) and was the deadliest and costliest volcanic eruption in U.S. history ($2.74 billion in 2007 dollars).

This event was preceded by thousands of earthquakes in the two months before the volcano blew its top; some of these prompted the governor of Washington to declare a state of emergency and many residents were evacuated from a designated danger zone.

“This is a hazard we can do something about,” Eichelberger said. “We can spend a modest amount of money and prevent a tragedy.”

If that, and a Maglev in Southern California, are the best examples the Republicans can come up with to show “waste” in the stimulus law, I’m afraid that they’re in even worse shape than originally thought.

UPDATE: Read Krugman here. His reaction:

But both sides, I thought, agreed that the government should provide public goods — goods that are nonrival (they benefit everyone) and nonexcludable (there’s no way to restrict the benefits to people who pay.) The classic examplesare things like lighthouses and national defense, but there are many others. For example, knowing when a volcano is likely to erupt can save many lives; but there’s no private incentive to spend money on monitoring, since even people who didn’t contribute to maintaining the monitoring system can still benefit from the warning. So that’s the sort of activity that should be undertaken by government…

…The intellectual incoherence is stunning. Basically, the political philosophy of the GOP right now seems to consist of snickering at stuff that they think sounds funny. The party of ideas has become the party of Beavis and Butthead.

Obama One Month Out

24 Feb

The other day, the Buffalo Bean’s Matt Margolis tweeted that Obama’s approval rating had dropped 19% per Gallup.

I asked for a link, and went to Gallup myself.

There, I found that Obama’s job approval rating had sunk 6% since Inauguration Day, but his job disapproval rating had risen by about 12%. Margolis posted a screen shot of his source, which said that Obama’s “favorability” had dropped. When confronted with the fact that, a) the poll didn’t measure “favorability”, and that b) it didn’t show a 19% drop, it became an argument more about semantics.

But what about Obama’s poll numbers since Inauguration Day?

If you were one to pay close attention to the news, you’d figure that the country was on the verge of all-out revolt, what with dillweed Rick Santelli calling for the traders at the Chicago Merc to join him in a “tea party”, and the Dow down to 1997 levels, unemployment up, banks not lending money, people not buying stuff, manufacturing collapsing, a housing and mortgage market spiraling ever-downwards, why you’d figure that people were calling for Obama’s head! After all, some of his cabinet appointees turned out to be tax cheats! ZOMG! Roland Burris! Other dumb shit!

Well, it’s true that Obama’s support is fading. Among Republicans. It seems that the party now apparently led by Santelli, Limbaugh, Palin, and Plumber found the best way to thwart bipartisanship is to not be bipartisan, and complain that Obama’s not being bipartisan. This has resonated with some Republican voters, who no longer like what Obama’s been doing.

The Washington Post notes that Obama’s job approval rating is at 68%. The Democratic Congress’ job approval rating is at 50%. The Republicans in congress get a measly 38% approval rating. It seems that the people recognize that this is an almost unprecedented economic crisis, and they’re reacting positively to the people proposing solutions, and negatively at the people grandstanding and saying no to stuff. A New York Times survey gives Obama a 63% job approval rating, and respondents credited Obama for attempts at bipartisanship, and fault Republicans for talking the talk but not walking the walk.

As TPM notes, the Gallup numbers that Margolis said represent a “19% drop” for Obama, show that his support has grown in that time among Democrats and Independents, and dropped only among Republicans.

Between the polling sample from January 21-25, compared to February 9-15, Obama’s ratings went from 90% to 94% among self-identified liberal Democrats, from 87% to 88% among moderate Dems, from 80% to 84% with conservative Dems, and from 47% to 50% among independents. On the other hand, his approval fell from 53% to 47% moderate Republicans, with a plummet of 36% down to 22% with conservative Republicans.

So, no. Most Americans think the Republicans are the ones thwarting bipartisanship and standing not on principle, but political considerations. They’re betting that the stimulus will fail and that they can make political hay from it in the future. Some are unabashed in expressing their hope that Obama fail and that more Americans suffer.

On the other hand, I hope that the stimulus works and that Obama succeeds. Not because I want Obama or Democrats to be re-elected, but because I want the country’s economy to improve and grow.

Why Don’t the People Listen to the Media?!

9 Feb

I mean, really. I thought the Republicans had won last week’s news cycle. At least, that’s what the big thinkers said.

Trying to Prevent a Depression

5 Feb

After eight years’ worth of profligate spending and tax-cutting, which ultimately helped lead to the current disaster, Washington Republicans would have you believe that the stimulus is “FAIL” or “socialism” or a waste-ridden boondoggle. I’ve also been tickled with certain quarters blaming the whole thing on the 110th Congress. Let’s start with some reality-based factoids. Such as the Republican Party had the White House and Congress from 2001 – 2005, and then grew its majority in 2005.

“This is going to probably be the most productive two years of our Republican majority,” said Tom DeLay of Texas, the House majority leader. “It’s not just Social Security and tax reform, it’s tort reform, regulatory reform, restraining spending, redesigning the House, redesigning the government.”

Obviously, none of those things really happened. Instead, they helped to go to war, spent like drunken sailors, expanded the size and scope of the federal government, and ensured that the wealthiest had happy tax cuts and loopholes, while laying the cost of the spending and cuts on the middle class and future generations. That’s the Republican platform, after all.

The housing bubble burst and obliterated the credit markets like a tsunami, causing the rest of the economy to screech to a halt when banks wouldn’t extend credit anymore. Continue reading