For House Republicans, none of which supported the Stimulus Bill, the thought must be “none of us voted for it so none of us will take the blame when it fails.” Might I suggest a double-edge sword.Â If the Stimulus Bill does reinvigorate the economy, then none of the House Republicans can take credit for it.Â Powder Blue blogger Allan Bartlett and I briefly debated the merits of the Bill on Facebook this morning; Allan thinks we still haven’t hit bottom and frankly his reporting on the financial crisis dating back the past few months has been pretty damn good.
I countered saying that those Free Market advocates haven’t exactly been doing much to grow the economy.Â Like it or not, the Federal Government has always been the world’s biggest venture capitalist.Â And where and when the private secotr fails to act, we look to the Federal Government to lead.Â We have a leader in the White House now; someone committed to doing the right thing for the country first instead of the party or ideological principle.
Today’s New York Times outlines why the Stimulus Bill isn’t what Rush Limbaugh and the House GOP leadership says it is:
From the editorial:
Contrary to the claims of Republican opponents that the bill indiscriminately rains money down, the amounts and categories of spending have, for the most part, been calculated carefully and chosen well.
Nearly 30 percent is devoted to unemployment benefits, food stamps and fiscal aid to states so that they donâ€™t have to cut services, raise taxes and lay off employees and contractors. Evidence is overwhelming that such spending yields the biggest return for every dollar spent. The bill, however, takes into account that these areas cannot absorb unlimited money. In calculating the expanded food stamps, for instance, it provides a significant increase immediately that would otherwise have occurred over time in line with inflation. That way, ample funds are available when needed, but there is no sudden cut off down the road.
Aid to states also is well thought out. The single biggest chunk of spending â€” $87 billion for states to shore up Medicaid programs â€” would allow them to provide care to the neediest, whose ranks have been swelled by the deepening recession. Equally important, by taking on more of the statesâ€™ Medicaid burden, the federal government frees up states to continue providing other services that would have had to have been cut.
One of those vulnerable areas, statesâ€™ education budgets, is the main target of another $79 billion. The money would help to prevent lapses in early childhood education, which often cannot be made up later. It would also prevent cuts in the curriculum and in extracurricular activities in grade schools through college â€” while averting big layoffs in a sector that is among the largest employers in many states.
Republicansâ€™ objections are mostly ideological. They worry, in particular, that subsidizing health insurance may be a step toward universal coverage. They may be right. But that is an argument for another day. The government must act urgently to protect the vulnerable from what is shaping up to be the worst recession in modern history and to boost the economy at a time when consumer and business spending is slack. Besides, a lamentably large amount of money goes to business tax cuts dear to Republicans. That is folly as stimulus but more than enough for political compromise.
A more thoughtful criticism is that the package is not more transformative in scope. There is more money for fixing roads, but not for high-speed railroads; for Head Start, but not for curriculum reform. That, too, is a discussion for another day.
Indeed, even with an $819 billion package, the challenge for the Obama administration is to lower expectations, not raise them. The hole the economy is in is so deep that even the stimulus package will only dig us halfway out.