Rep. Brian Baird, D-Wash. Posted on 07/24/2010 7:45:55 PM PDT by ex-Texan
WASHINGTON -- Economists generally agree that the largest spending package of all time -- the $787 billion stimulus law of 2009 -- worked as designed, stabilizing a heaving economy, possibly preventing a full-blown depression and freeing up money to pave rutted roads and keep many Americans at work.
This would seem to be good news for Democrats in a difficult election year. After all, they muscled the bill into law with virtually no help from Republicans.
Think again.
According to a July 13 CBS News poll, only 23 percent of Americans think the stimulus helped the economy (down from 32 percent in April). Eighteen percent say it actually made the economy worse, and 56 percent say it had no effect.
That view leaves Democrats grasping for a strategy to sell a policy they insist is economically sound and morally heroic. At the same time, some grumble that the White House and Democratic leadership have fumbled the sales job, allowing the stimulus to be "demagogued" by critics and co-opted by political opponents.
"Had we not passed the recovery act and enacted it, the economy would still be hemorrhaging jobs and we would be in much more dire straits than we are today," Majority Leader Steny Hoyer, the No. 2 Democrat in the House, said Tuesday.
Then the lament: "It is very difficult ... as a political argument to say things would have been worse. You know a guy who doesn't have a job or a gal who doesn't have a job and hasn't had a job for six months or a year or 18 months says to themselves, 'Mack, I don't think things could be worse.' But, in fact, most economists agree that they would have been substantially worse."
Even Harvard economist Martin Feldstein, a conservative who advised Ronald Reagan and, later, Sen. John McCain, said a burst of federal spending was necessary to prop up the economy.
"I support the use of fiscal stimulus in the U.S. because the current recession is much deeper than and different from previous downturns," he wrote in January 2009 as the stimulus was being developed.
Feldstein later softened his support, saying that stimulus spending was needed, but the law had flaws that limited its effectiveness, in particular the lower proportion of direct spending on infrastructure. Many Democrats also embraced that view, including Oregon's Sen. Ron Wyden and Rep. Peter DeFazio.
While the proportions of the stimulus are subject to endless quibbling among economists and some Democrats, congressional Republicans attack the law's very existence.
"I think most voters believe it has created more government than it has jobs," said Republican Sen. Lindsey Graham of South Carolina. "It was a partisan exercise and it seems to have been a flop."
For the public, the stimulus has been blurred -- and combined -- with other unpopular laws such as the $700 billion bank rescue package known as TARP, which had bipartisan support, and with the health care reform law approved exclusively by Democrats. It's made worse by unemployment that remains high -- 9.5 percent nationally and 10.5 percent in Oregon -- and talk of a double-dip recession.
Democrats don't get credit for the stimulus, Sen. Claire McCaskill, D-Mo., said in an interview, because in "most Americans' minds," the stimulus and other spending have been conflated and people "got all wrapped around this notion that things have gone crazy in Washington: They've opened the windows and started throwing money out."
But without the stimulus, McCaskill says, Missouri would have had to make an additional $800 million in cuts to its already strained budget.
Oregon Gov. Ted Kulongoski certainly agrees.
"I think the president did the right thing with the stimulus," Kulongoski said in an interview Wednesday in advance of the state's latest stimulus report.
Without federal help to financially stressed states like Oregon, there would have been "panic," Kulongoski said, as the bedrock services of health care for the poor, schools and law enforcement were shredded. "The choice was between a depression and a recession, and I think that's where we were headed."
The Oregon report released Thursday shows how the stimulus money is propping up services in the state. Since February 2009, the Recovery Act has pumped $1.9 billion into food stamps, low-income medical help and unemployment. Of the 6,150 Oregon jobs financed by the federal pot in the last quarter, almost two-thirds were educators in public schools and universities.
While governors and other local officials praise the influx of federal dollars that maintained crucial services, some business interests also point to loans to small business and investments in technologies such as advanced batteries, wind power and nanotechnology that would not have been possible without stimulus funding.
Oregon Rep. Earl Blumenauer said business leaders who've benefited from the stimulus need to let the people who work for them know where that job came from.
"This stuff didn't just drop out of the sky at a time when the economy was teetering on going over the edge," he said.
How deep a fall there might have been is impossible to prove. So, how much has the stimulus helped?
In its quarterly report last week, the White House estimated that stimulus spending so far has increased gross domestic product by 2.7 to 3.7 percent and saved or created between 2.5 million and 3.5 million jobs.
Given ranges like that, even the stimulus act's biggest boosters agree that people are confused.
"There's obviously a lot of uncertainty about any job estimates," Christina Romer, head of President Obama's Council of Economic Advisers conceded to reporters when the White House released the report. "I suspect the true effects of the act will not be fully analyzed or fully appreciated for many years."
Republicans in Congress, meanwhile, continue a relentless attack.
"This is no time to celebrate," Senate's Republican Leader Mitch McConnell said Wednesday after the White House report came out. "The fastest-growing parts of this Democrat economy aren't jobs -- they're the crushing burden of the national debt and the size of the federal government."
Democrats acknowledge they could have done a better job selling the stimulus. Some complain that the law's structure has hurt them because the tax break and assistance to states came first and only now are the more obvious -- and tangible -- benefits arriving as money for infrastructure begins to flow.
Oregon, for example, expects to get $410 million in transportation money. But most of that is coming in the second half of the three-year stimulus plan. Of 350 highway, road, bridge and transit projects already targeted around the state, half are completed. This summer, Kulongoski's office predicts, stimulus money will give Oregon its busiest summer transportation construction season in 50 years.
Rep. Brian Baird, D-Wash. Local politicos must have moved quickly to squelch a headline that signaled big time trouble for Obama. Small wonders never cease. Oregon is a blue state, after all is said and done.
As an impartial critic I only want to say that spending over $ 3.27 Trillion on a 'stimulus package' was a HUGE WASTE of taxpayer money. Why does the Oregonian insist on reporting the dollar total as a mere $ 787 Billion __ ? They lie about everything all the time.
Americans aren't stupid, Chuck.
Really? When did that happen? I must have missed that little bit of news.
It's NOT helping the economy either!
*Ping*!
I suspect Robert Barro is not among their list of economist. I am not either.
I guess this whole the worlds 2000 leading climate scientist lie worked so well, they can not resist trying it again?
Well I was just at the West Hills QFC and there were the headlines in the Oregonion basically saying that spending (PERS spending) would skyrocket but revenue would not. Gee, I guess my property taxes will go up.. to literally, pay for my neighbor?
“Really? When did that happen? I must have missed that little bit of news.”
Mr. Pope, as all neo-Marxist, lives in an alternate universe.
Worked as designed, my ass.
BS. Economists do not "generally agree" on that at all. I heard one on talk radio the other day pointing out that even obama's most optimistic economists estimate that porkus only stimulated about a 1.7% rise in the GDP over what it might have fallen to. Yet a full blown depression was over 6% or 8% below where we were at. So even without porkus, we would not have come close to a real depression.
It is beginning to look as if they get all the credit that they deserve for this fiasco.
Absolutely, it did. It saddled the American People with countless new bureaucrats, tons of unaccounted debt, and an oncoming plethora of regulations which will completely collapse the economy unless repealed, while transferring fortunes to Union coffers and Dem special interests.
The rest of that stuff may have been typical BS selling points, but when has that ever had anything to do with what a piece of legislation was designed to do?
No it was borrowed from the Chinese and will be part of what drowns us.
First, it’s sheer propaganda to claim that 0bama’s 2009 Stimulus “worked as designed” because the “design” was that it would keep unemployment below 8%.
Second, most of 0bama’s “stimulus” went to states as cash payments to bail them out.
Let’s call it like we see it: bailing out state *governments* failed to revive the private economy.
Failure.
Failed.
The poor isn’t getting anything, the middle class is getting laid off, and the rich are parking their 75ft sloops in R.I.
The stimulus work as intended ...
Blah...blah...blah... more journolist talking points.
Americans aren't stupid, Chuck.
Needs Repeating and loudly!!!
The US Treasury entry must be seen in this context. COS Rahm Emanuel took control of the US Treasury when he crept into our WH. "Professor" Obama knows nothing about high finance----but Rahm toiled on Wall Street before coming into government (4 term-Congressman, Clinton henchman and Fannie Mae looter).
Behind The Real Size of the Wall Street Bailout (more like $14 trillion)
Mother Jones | Dec. 21, 2009 / FR Posted January 04, 2010 by E. Pluribus Unum
A guide to the abbreviations, acronyms, and obscure programs that make up the $14 trillion federal bailout of Wall Street.
The price tag for the Wall Street bailout is often put at $700 billion—the size of the Troubled Assets Relief Program. But TARP is just the best known program in an array of more than 30 overseen by Treasury Department and Federal Reserve that have paid out or put aside money to bail out financial firms and inject money into the markets. To get a sense of the size of the real $14 trillion bailout, see our chart here. Below, a guide to the pieces of the puzzle:
Treasury Department bailout programs (controlled by Rahm Emanuel)
Money Market Mutual Fund: In September 2008, the Treasury announced that it would insure the holdings of publicly offered money market mutual funds. According to the Special Inspector General for the Troubled Asset Relief Program (SIGTARP), these guarantees could have potentially cost the federal government more than $3 trillion [PDF].
Public-Private Investment Fund: This joint Treasury-Federal Reserve program bought toxic assets from banks and brokerages—as much as $5 billion of assets per firm. According to SIGTARP, the government's potential exposure from the PPIF is between $500 million and $1 trillion [PDF].
TARP: As part of the Troubled Asset Relief Program, the Treasury has made loans to or investments more than 750 banks and financial institutions. $650 billion has been paid out (not including HAMP; see below). As of December 21, 2009, $117.5 billion of that has been repaid. Government-sponsored enterprise (GSE) stock purchase: The Treasury has bought $200 million in preferred stock from Fannie Mae and another $200 million from Freddie Mac [PDF] to show that they "will remain viable entities critical to the functioning of the housing and mortgage markets." GSE mortgage-backed securities purchase: Under the Housing and Economic Recovery Act of 2008, the Treasury may buy mortgage-backed securities from Fannie Mae and Freddie Mac. According to SIGTARP, these purchases could cost as much as $314 billion [PDF].
--SNIP--- long read
Federal Reserve bailout programs
Commercial Paper Funding Facility: With the support from the Treasury, the Fed established the CPFF in October 2008 to increase the availability of short-term debt (commercial paper) funding. Up to $1.8 trillion [PDF] was earmarked for the program.
Mortgage-backed securities purchase: In 2009, the Fed earmarked up to $1.25 trillion to buy investments based on home loans.
Term Asset-Backed Securities Loan Facility: TALF provides financing to investors who are buying asset-backed securities. In February 2009, the Fed and Treasury announced an expansion of the program to generate up to $1 trillion in new lending.
Foreign Central Bank Currency Liquidity Swaps: The Fed has provided $755 billion [PDF] for currency liquidity swaps with foreign central banks.
--SNIP--- long read
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DID GANGSTER GOVERNMENT SCAM $14 TRILLION USING THE MADOFF MO? Madoff created a supersecret labyrinth of interrelated international funds, institutions and financial entities of almost unparalleled complexity and breadth......with assets and businesses in multiple places overseas that hid thievery, money launderering and tax evasion.
At least half a dozen people in the Obama admin are going to walk away from “ Public Service “ living like the Sultan of Brunei.
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