Tag: Stimulus Spending

Obama talked. And we got just more of the same…

Well it’s what? Some 961 days since he took office, and now Obama finally has decided he needs to tackle jobs – or appear to be doing so is what I see this as being – because he is heading for an epic ass kicking in 2012, even if his opponent is Dracula himself. Obama and his groupies are warning the republicans to pass this bill, and pass it fast, or else. I admit that I didn’t bother watching the community organizer in chief’s speech last night, but I did go read up on what he said, and as far as I can tell, while the left and the LSM are all talking about a bill, it is obvious that we have no bill whatsoever, but just a plan. Is this more of that special “Hope & Change” magic?

What I do know is that the price for this non-existent bill climbed from the $300 billion in new stimulus that was touted at the beginning of the week to a staggering something closer to another half a trillion. Fox news puts this new Keynesian stimulus plan that democrats are trying real hard not to refer to as stimulus part deux at $450 billion, but since there is no real bill, and I suspect that’s the number the WH gave them, I certainly wont be surprised that if we ever do get a bill, the price tag ends up being far costlier. Seriously, we waited over 30 months for Obama’s people to produce this junk?

The plan, touted as a bill, supposedly is a mix of tax cuts, tax credits, infrastructure investments and other measures – heavy on the infrastructure investment and other measures, and tax cuts and credits that I bet again only target those private sector industries the left wants to be the winners instead of those that actually would produce jobs immediately, I bet – needs to be nailed down, but so far, there is very little I see that will do any real job creation. And from the response by others that are not desperate democrats, it is obvious they where not very impressed. The problem our economy is facing right now is directly tied to the insecurity that the private sector feels because of what has been done so far. That’s because of a combination of things. The first is the myriad of crazy and unpredictable collectivist regulations coming from those things that Team Obama focused on, while ignoring jobs I should add, during its first 2 years. That coupled with a palpable hostility towards the private sector from these elitist academics playing political games, leave practically all small business owners feeling that it is simply too dangerous to expand and hire on new people, when the cost to them is nebulous and likely to just go up every damned time these democrats do anything. And that’s why trillions of dollars of government spending later, with even more debt being made we have no honest, real, and enduring job creation.

And this plan they claim is a bill? Well it is more of the same failed recipes of the last 30 months. Seriously, at this point Obama might want to take a page from my job plan. Topless coffee shops might actually do more to grow the economy than this idiotic plan of his that smacks of nothing more than another attempt to have tax payers subsidize the campaign coffers of countless democrats for the coming 2012 elections. Some people are advocating that we should let them actually create a bill and the pass it, because it is a victory for those that want these people out of power when it fails – and have no doubt it will fail – but seriously, the price tag is freaking frightening.

Obama’s job solution? More cowbell!

Seems like we are going to get to see insanity at play – the definition is doing the same thing over and expecting different results – tonight in Obama’s job speech, because his solution is to throw another $300 billion dollars in something they will try real hard not to identify as just more government stimulus, in tonight’s speech. Even more interesting was the quote I heard at the tail end of a radio news clip this morning where they had a politician I unfortunately did not identify – but he was a democrat – saying that the job’s plan was intended to produce an immediate bump for them. Long term this of course is wasted money, but 2012 is an election year. I am sure he didn’t mean to be that candid and honest about the plan though.

Then again, the issue may simply be that Obama is short and needs a lot more money to make that $1 billion war chest of his happen before the 2012 elections, and this “jobs plan” sure as hell is going to help if we go by what the other stimulus plan did for democrat campaign coffers. Maybe these tools will wise up that government can create jobs, but that government overregulation and stupid legislation sure as hell has killed the economy.Well, maybe not.

Your Stimulus Update

We already know that much of the so-called stimulus was not stimulus at all. A lot went to simply bolstering falling state revenues to put off their declines. One might argue that investments in research and technology have an economic payoff. But even the most ardent Keynsians has trouble arguing that pure transfer payments are an economic stimulus, especially when they’re mainly shoring up unemployment benefits.

But more and more info is coming out about the money that wasn’t just used to bail out the states. Here’s the latest:

Federal audits are turning up misspent taxpayer dollars in a $5 billion stimulus program aimed at lowering the utility bills of disabled, poor and older Americans by making their homes more energy-efficient.

In West Virginia, which received $38 million in weatherization funds, some of the money went for lobbying, to consultants who did little work and to recipients with connections to state officials who are doling out the funds, the Energy Department’s inspector general found.

In one case, West Virginia paid $25,000 to a lawyer for writing two sentences stating that weatherization contracts had been reviewed, reportedly after four hours’ work at a state office, according to a report analyzing how the federal stimulus money was used. A $20,000 consulting fee was paid to the former director of the state’s weatherization program after he left the job in May 2009 even though there were no specific work requirements set for the consulting contract.

I realize that to the true Koolaid-drinkers, none of this matters. Every dollar is a stimulating dollar, whether it’s wasted on a lawyer writing two sentences or used to fund energy research. But those of us with at least one toe in reality have to be angry about this. The Energy Department’s inspector general has warned that the weatherization program has little oversight, no internal controls and no accountability. Even if you think that weatherization is going to stimulate the economy, that’s $5 billion we might as well have set fire to.

It’s not like accountability in spending is a big mystery. The science community has been doing this for years. Right now, one of the most potentially important scientific missions of the next decade — JWST — is in danger of getting the budget axe. That’s because someone actually looked to see what was going on with the taxpayer’s money. Some branches of the government do this all the time. But with the stimulus, we decided that accountability meant nothing — spending as much money as possible, no matter what, was the important thing.

In this sense, Keynsianism can claim something in common with communism. Even if you were to concede that it works in theory (ahem), it has serious problem when you try to practice it. Small directed government programs can be managed, controlled and rendered accountable. Big huge unabashed spending initiatives can not be.

And while I’m up — let’s stop pretending that we’ve “only” had $787 billion in stimulus spending. We’ve racked up $4 trillion in deficit spending in the last three years — double what the Keynsians assured us we needed. The more we learn about the stimulus, the clearer it become that there really is no difference between “stimulus” spending and just plain spending. Why are we pretending otherwise?

Update: Oh, yeah. The stimulus also helped pay for Project Gunrunner

The Rainy Day

How often do you find Matt Yglesias and Megan McArdle agreeing on something? Yglesias, talking about the need to be conservative with future budget projections, says:

The other thing, of course, is that “stuff happens.” Nobody sitting down in 1925 to write a 25-year budget forecast would have made the funds available to win World War II. It’s nice to think that you have a plan that leaves headroom to engage in some deficit spending if it turns out a meteor is going to strike the earth, or Jack Layton is the leading edge of a Viltrumite invasion.

We don’t even need to go back to World War II. We can go back to 2001, when we had a projected surplus. So we spent and cut taxes. And … suddenly we didn’t have the money for a trillion dollar war. We can look at Japan, which invested zillions in “stimulus” spending, got themselves into massive debt and then got hit by one of the biggest natural disasters in history. Hell, we can look at our current situation, where we were pushed to the maximum sustainable debt and suddenly had an economic collapse. We see it in states that cut back on snowplow budgets in warm years, then scream for help when they get a blizzard.

McArdle makes the comparison to people’s personal finances.

Have you ever known anyone who got into trouble with credit cards? I don’t mean someone who had something go wrong and ended up deep in credit card debt because they had to pay the rent somehow; I mean someone who wakes up one day with $21,000 in debt, a closet full of shoes, and no idea where the money went?

The way they get into that trouble is often that they don’t budget. They consider each purchase in isolation: “can I afford these shoes? Can I make the payments on that television?” And in fact, they can afford each of their purchases. They just can’t afford all of them.

We hear this constantly on the spending side. “What kind of country are we if we can’t afford education?” “Surely, this country can afford to provide healthcare to everyone!” “Farm subsidies are such a small part of the budget!” Yes, we can afford some of these things; the problem is that we’re trying to afford all of them simultaneously.

And we’re setting ourselves up to make the same mistakes again. The liberal plans to sort of balance the budget all have taxes rising to historically high levels. The problem is that you now have no room if something really bad happens. Technically, yes, you’ve “balanced the budget”. But you’ve put yourself into such a tenuous fiscal position that a war, a disaster or an economic downturn is ruinous.

A time of peace and prosperity is not the time to be pushing your taxation level to the “break glass in case of emergencies” level. You have to leave some room for the unexpected.