So has anyone actually looked at the "stimulus" package?

The Coffee Shop
1

Seems to me they are passing or trying to pass something akin to an additional budget rather than a “Stimulus” package. “Additional” funds for everything from national parks to agriculture, and not “little” numbers either 1.7B for national park “Construction” alone. Oh if you’re wondering there are 388 “National parks”…which means there has been 4.4 million dollars allotted to each and every one of them and this doesn’t include there “Normal budget”.

The BILL reads like a litany of “pork” and I actually had to search for anything pertaining to any actual “Economic” influence, well unless you believe simply throwing money into the economy is going to somehow “Get the ball rolling”…which if that was the case why did it collapse in the first place because we’ve been throwing TONS of money in for the last 8 years.

I doubt I’ll go thru the entire thing as it’s HUGE, but I’d guess that 40% of it can be construed as pure pork and less than 20% of it is actual relevant “Stimulus”.

~Matt

2

Seems to me they are passing or trying to pass something akin to an additional budget rather than a “Stimulus” package. “Additional” funds for everything from national parks to agriculture, and not “little” numbers either 1.7B for national park “Construction” alone. Oh if you’re wondering there are 388 “National parks”…which means there has been 4.4 million dollars allotted to each and every one of them and this doesn’t include there “Normal budget”.

The BILL reads like a litany of “pork” and I actually had to search for anything pertaining to any actual “Economic” influence, well unless you believe simply throwing money into the economy is going to somehow “Get the ball rolling”…which if that was the case why did it collapse in the first place because we’ve been throwing TONS of money in for the last 8 years.

I doubt I’ll go thru the entire thing as it’s HUGE, but I’d guess that 40% of it can be construed as pure pork and less than 20% of it is actual relevant “Stimulus”.

~Matt

Agreed Matt, this is a disaster for the taxpayers. Like Rahm said “you never want to let a serious crises go to waste.”

Drudge has this on the $335M in the bill for STD related education:

http://www.drudgereport.com/

3

…which if that was the case why did it collapse in the first place because we’ve been throwing TONS of money in for the last 8 years.

I think the callapse is more related to an underregulated banking industry imploding in on itself due to an over inflated housing market. Pumping money into the economy did did help us recover from the previous recession. However, there wasn’t any long term return on where the money went. Killing people isn’t exactly a financial investment.

By the same token, I don’t think that doing anything to a national park is an investment either. Don’t get me wrong, I’m likely far to the left of this forum on envronmental policies, but I don’t think now is the time or place, and even if it was, 1.7 billion would better protect the environement by spending it on green energy research.

IMO, the money should go toward building infrastructure and alternative energy.

4

Regulation in certain spheres failed, but the Fed trying to play god with interest rates is the root cause here–just as it has been throughout the history of the worlds various financial panics.

5

The dems see it as an opportunity to push through a ton of crap that would likely never see the light of day otherwise. Anyone in opposition will simply be labeled as unwilling to help “stimulate” the economy. The sad thing is, the dems think so little of you and me that they don’t think that we’ll understand what’s going on.

As an alternative, the last Republican proposal I heard favored limiting the majority of the stimulus to tax cuts that would place $'s directly back into the hands of the Americans who need it, and an extension of unemployment benefits. Seems to make a lot more sense to me.

BTW…to put $825 billion into perspective, if you began spending $1 million per day back when Christ was born, you still wouldn’t be done…in fact, you won’t have spent your $825 billion for another 250 years.
**
Now, a question for the economists out there. Can someone please tell the class what happens to the price of goods and services when an enormous amount of cash is dumped into the economy without any relative increase in those goods and services?

For extra credit, what’s the term that we use to define such a situation and how does that impact the consumer?
**

6

I think the callapse is more related to an underregulated banking industry imploding in on itself due to an over inflated housing market.

Whatever your belief on the collapse you’ve illistrated my point. You can “Artifically” pump money into an economy and it won’t fix the economy, in fact it will create ANOTHER bubble as we saw with the housing market.

In order for the economy to recover you have to get a market supportable return on the investment, and government pumping money in does not do that anymore than over inflated housing prices does regardless of how or where it’s spent.

**However, there wasn’t any long term return on where the money went. Killing people isn’t exactly a financial investment. **

Of course there was, defense contracts, Haliburton etc etc., all that money was funneled back into the economy. Problem is that it was falsely placed there in the first place.

You can build planes and bombs or you can build bridges and roads. If the market doesn’t demand that those objects be there there will be no return on investment because no one will be willing to pay to use them.

IMO, the money should go toward building infrastructure and alternative energy.

I would prefer infrastructure and Alternative energy to Bombs and Planes as the “Return on investment” will be slightly more. However both options are far from optimal, IMHO.

I saw a good deal of money set aside for “Research”, but most of it was earmarked for very specific research and most of in only a few areas. I would prefer a more “open” R & D funds.

The other thing I think is a “Good” investment is going thru buildings and “modernizing” them. Personally I wish they would just cut government down so they didn’t need as many buildings, but of they must have so damn many then spend the money to cut the energy needs on them, possibly also using some of those buildings as “R & D” projects.

~Matt

7

Not to frighten anyone but I heard an interview from an economist that said he was looking for double digit inflation by the end of 2010.

Worst case scenario. Spend the money, get little economic boost from it. Inflation starts going nuts. Feds are forced to raise interest rates. A bigger gas tax is implemented then gas goes back up to 4$ a gallon.

We are sitting on an additional 3-4 TRILLION dollars in debt, double digit inflation, 4$-5$ gas, double digit unemployment and 10-15% interest rates.

That’s worst case scenario and I hope for the love of god it doesn’t happen.

OTOH the best case scenario I’ve heard, we are out of the recession by 1st quarter 10’. This was stated by another person, financial guy not an economist, and it was stated a few weeks back before the stimulus package was put together.

Now considering that only half of the 700B has been spent and no stimulus package was proposed IF we did pull out 1st Q 10’, one would question whether we needed the stimulus, the bulk of which will be spent after 2010 and or the initial 350B bailout.

Almost makes a guy actually want to become an economist :slight_smile: Interesting times.

~Matt

8

Some info on Amendments -

http://www.opencongress.org/articles/view/842-Stimulus-Floor-Amendments-in-the-House

The House Committee on Rules has just concluded their epic hearing to lay out the ground rules for Wednesday’s debate of the American Recovery and Reinvestment Act of 2009. Here is a complete list of the amendments that will receive votes on Wednesday by the full House of Representatives, as determined tonight by the Rules Committee (sponsors listed in brackets):

#178 – Would amend the aviation, highway, rail, and transit priority consideration and “use-it-or-lose-it” provisions to require that 50 percent of the funds be obligated within 90 days. Rep. James Oberstar ]

#199 – Would require that the Secretary require, as a condition of receiving funding under Title XIII of the Energy Independence and Security Act of 2007, that the demonstration projects utilize Internet-based or other open protocols and standards if available and appropriate, and would require that grants recipients utilize Internet-based or other open protocols and standards. Rep. Edward Markey ]

#95 – Would clarify that federal funds received by States under the bill for highway maintenance shall not be used to replace existing funds in place for transportation projects. Rep. William Shuster ]

#70 – Would increase transit capital funding by $3 billion. Rep. Jerrold Nadler , Rep. Peter DeFazio , Rep. Daniel Lipinski , Rep. Michael McMahon , Rep. Keith Ellison ]

#109 – Would strike the appropriations provisions from the bill. Rep. Randy Neugebauer ]

#172 – Would provide that job training funds may be used for broadband deployment and related activities provided in the bill. Rep. Maxine Waters ]

#132 – Would strike funding for Amtrak. Rep. Jeff Flake ]

#198 – Would expand the Berry Amendment Extension Act to include DHS to require the government to purchase uniforms for more than one hundred thousand uniformed employees from textile and apparel manufacturers. Rep. Larry Kissell ]

#22 – Would insert the text of the Whistleblower Protection Enhancement Act (H.R. 985 in the 110th Congress) regarding protections for federal employees who report waste, fraud, and abuse. Rep. Todd Platts , Rep. Christopher Van Hollen ]

#89 – Would require that the Recovery.gov website contain links and other information on how to access job information created at or by entities receiving funding under the bill; including links to local employment agencies, state, local, and other public agencies receiving recovery funds, and private firms contracted to perform work funded by the bill. Rep. Harry Teague ]

#195 – Amendment in the Nature of a Substitute. (REVISED) Would strike everything after enacting clause and adds income tax rate deductions for bottom two income tax brackets, alternative minimum tax relief, small business deduction, bonus depreciation, small business expensing, expanded carryback of net operating losses, improved home buyer credit, unemployment benefit tax exemption, health insurance premium deduction, repeal of 3 percent withholding requirement for government contractors, extension of unemployment benefits, and a Sense of Congress against tax increases to offset outlays. Rep. David Camp , Rep. Eric Cantor ]

These amendments will each get 10 minutes of debate (except the last one, which will get 60) and will be adopted to the bill if they receive a majority vote.
Also included in the rules package is a five-part amendment that will be considered adopted to the stimulus bill by the House when the package is approved. It removes a couple of items from the bill – family planning money, National Mall revitalization – that President Obama had personally asked congressional Democrats to remove because of GOP criticisms:
The amendment (1) requires that not later than 45 days after the date of enactment, funds provided to any State or agency thereof, the Governor of the State, or the State legislature by means of a statement submitted by its leadership, shall certify that the State will request and use funds provided by this Act. Funding to the State will be for public and private entities within the State either by formula or at the State’s discretion; (2) waives the local matching requirements and the salary caps for the COPS hiring program in fiscal years 2009 and 2010; (3) designates $15 million for the Historic Preservation Fund within the National Park Service for the renovation and preservation of buildings on Historically Black Colleges and Universities campuses and waives the institutional match for projects under this provision; (4) strikes funding for the National Mall Revitalization Fund; and (5) strikes section 5004 regarding family planning.

Here’s a visualization of where the funds are going in the stimulus bill: http://www.propublica.org/special/stimulus-bill-treemap

Some more on the amendments - http://www.opencongress.org/articles/view/840-Stimulus-Amendments-Proposed

The House Committee on Rules has posted all the amendments that have been submitted for their consideration tonight. There are hundreds:
Summary of Amendments Submitted to the Rules Committee for H.R. 1 – American Recovery and Reinvestment Act of 2009
To be considered by the full House on the floor tomorrow, amendments must be approved by the Committee at their meeting at 3:30 this afternoon. The folks at Open Left have organized a last-minute call-in on some of these. There’s only a couple hours left to push these through the Committee, give a call if you’re so inclined (202-225-9091).
Just going through this quickly, below are a few of the amendments related (somewhat) to transparency that caught my eye:
#188 – Would require that the Recovery.gov website track any obligation, solicitation, contract, or grant through an attached “unique identifier,” include a fully functional database that within 60 days of enactment can trace the flow of Federal dollars to the State and local level, and from the beginning of a project to the contractor, and in some cases, subcontractor level, and include information on the recipients of funds including any minority, disadvantaged or veteran-owned businesses. Schock (R-IL)/Smith, Adam (D-WA)]
#89 – Would require that the Recovery.gov website contain links and other information on how to access job information created at or by entities receiving funding under the bill; including links to local employment agencies, state, local, and other public agencies receiving recovery funds, and private firms contracted to perform work funded by the bill. Teague (D-NM)]
#110 – Would include the Comptroller General of the United States as a member of the Accountability and Transparency Board, would require reports to be posted on Recovery.gov, require bi-annual reports, and require the Chief Performance Office to report to Congress on a bi-annual basis on the activities of the Board. Neugebauer (R-TX)]
#159 – Would alter the composition of the Accountability and Transparency Board. Would apply the open meeting requirements of the Federal Advisory Committee Act to the Board. Finally, the amendment prohibits Board interference in pending or ongoing IG investigations. Issa (R-CA)]
#160 – Would prohibit the use of funds provided in the bill for lobbying, publicity, propaganda, or political activity, including election assistance and voter registration. Issa (R-CA)]
#68 – Would withhold half the discretionary funds made available by the Act until OMB submits an expenditure plan to the Committee on Appropriations that includes details of all proposed expenditures, a description of how funds provided will produce results, and a certification that the oversight requirements listed in Title I of the bill are in place. Rogers, Harold (R-KY)]
UPDATE: This one’s not related to transparency, but I think it’s noteworthy:
#76 – Would allow funds to be appropriated for public aquariums, zoos, and swimming pools. Snyder (D-AR)]
As ProPublica noted, funding for casinos, aquariums, zoos, golf courses and swimming pools is specifically banned from the bill. Which leaves one to wonder, what’s Snyder got against gambling and golf?
Also, Open Left succeeded in getting this one approved for consideration on the floor:
#70 – Would increase transit capital funding by $3 billion. Nadler (D-NY)]

9

Barry,

I agree parks may seem like a luxury right now but shoveling some money in their direction actually makes some sense. National parks are usually in rural areas with high unemployment. Many of the parks are still using infrastructure built by the WPA in the 1930s. Instead of paying unemployment to a bunch of people put them to work building park infrastructure that can be used for many years to come like the WPA improvements. Many of our national parks are international tourist attractions that generate more jobs and I think they are a national asset that needs to be taken care of.

While I would love a tax cut, I know I would put it in the bank. I think the republican proposal amounts to about $3000 average according to Rep. Boehner on Meet the Press last Sunday. That would buy most people some crap at Wal-Mart that is made overseas or help pay off some bills. That tax cut would be like a piece of candy, no lasting value.

To the conservatives clucking the proposed wasteful spending and what it will do to the deficit, remember tax cuts get added to the deficit too. I’ve been hearing for 20 even 30 years about the dire condition of the countries pipelines, roads and bridges. If we’re going to print money let’s shovel it into some bricks and mortar and finally put a dent into that back log of repairs.

Ok, I wandered from my original reply to your post, forgive me.

Paul

10

Here is CBO’s estimate for 2009-2019 http://cboblog.cbo.gov/?p=196

Snippet:

Under the standard assumption CBO uses for its estimates—namely, that current laws and policies regarding federal spending and taxation remain the same—we forecast the following: A marked contraction in the U.S. economy in calendar year 2009, with real (inflation-adjusted) gross domestic product (GDP) falling by 2.2 percent, a steep decline from a historical perspective.A slow recovery in 2010, with real GDP growing by only 1.5 percent.An unemployment rate that will exceed 9 percent early in 2010; the unemployment rate has been that high only twice in the past 50 years (in 1975, for one month, and in 1982-1983).A continued decline in inflation, both because energy prices have been falling and because inflation excluding energy and food prices—the core rate—tends to ease during and immediately after a recession; for 2009, CBO anticipates that inflation, as measured by the consumer price index for all urban consumers (CPI-U), will be only 0.1 percent.A drop in the national average price of a home, as measured by the Federal Housing Finance Agency’s purchase-only index, of an additional 14 percent between the third quarter of 2008 and the second quarter of 2010; the imbalance between the supply of and demand for housing persists, as reflected in unusually high vacancy rates and a low volume of housing starts.A decrease of more than 1 percent in real consumption in 2009, followed by moderate growth in 2010; the rise in unemployment, the loss of wealth, and tight consumer credit will continue to restrain consumption— although lower commodity prices will ease those effects somewhat.A financial system that remains strained, although some credit markets have started to improve; it is too early to determine whether the government’s actions to date have been sufficient to put the system on a path to recovery.

Here’s their assessment of the “American Recovery and Reinvestment Act of 2009” http://cboblog.cbo.gov/?p=199

Snippet:

Assuming enactment in mid-February, CBO estimates that the bill would increase outlays by $92 billion during the remaining several months of fiscal year 2009, by $225 billion in fiscal year 2010 (which begins on October 1), by $159 billion in 2011, and by a total of $604 billion over the 2009-2019 period. That spending includes outlays from discretionary appropriations in Division A of the bill and direct spending resulting from Division B.
In addition, CBO and the Joint Committee on Taxation (JCT) estimate that enacting the provisions in Division B would reduce revenues by $76 billion in fiscal year 2009, by $131 billion in fiscal year 2010, and by a net of $212 billion over the 2009-2019 period.
In combining the spending and revenue effects of H.R. 1, CBO estimates that enacting the bill would increase federal budget deficits by $169 billion over the remaining months of fiscal year 2009, by $356 billion in 2010, by $174 billion in 2011, and by $816 billion over the 2009-2019 period.

You also have to compare the best and worst cases of the alternatives. So, compare best/worst of the proposed plan with doing nothing and we get a better idea of the value of the plan.

The Director of CBO testified yesterday (http://cboblog.cbo.gov/?p=200) saying

“H.R. 1, the American Recovery and Reinvestment Act of 2009, would, in CBO’s judgment, provide a substantial boost to economic activity over the next several years relative to what would occur without the legislation.”
“As the possibility of another round of fiscal stimulus is debated, it is not a surprise that employment effects of stimulus have emerged as a key measuring stick. According to CBO’s estimates, with enactment of H.R. 1, the number of jobs would be between 0.8 million and 2.1 million higher at the end of this year, 1.2 million to 3.6 million higher at the end of next year, and 0.7 million to 2.1 million higher at the end of 2011 than under current law.”

11

Of course there was, defense contracts, Haliburton etc etc., all that money was funneled back into the economy. Problem is that it was falsely placed there in the first place.

No, no, no. My point was that there was no investment. ie You build a bomb and get paid for it. That bomb doesn’t change anything. It doesn’t allow you access to faster internet, cheaper energy, logistical improvements, etc. Its a bomb.

then spend the money to cut the energy needs on them

Again, that’s the kind of stuff I’m talking about. If you had to create jobs around the house, you are better off paying people to install new windows, insulation, and replace the old heater that needs to be replaced anyway than to plant a bunch of flowers that will die by next year.

12

The Perfect Storm.

Bailout=Hyperinflation, but if the dollar does not crash( I don’t think it will) won’t be too bad.

13

The Perfect Storm.

Bailout=Hyperinflation, but if the dollar does not crash( I don’t think it will) won’t be too bad.
And nobody has yet mentioned the bad bank idea, which will sap even more taxpayer money when the FDIC starts grossly overpaying for shit assets.

14

The Perfect Storm.

Bailout=Hyperinflation, but if the dollar does not crash( I don’t think it will) won’t be too bad.

I guess it depends on what you mean by “too bad”…

People who are already struggling…maybe even unemployed, will find that the cost of goods and services will increase dramatically. Almost assuredly well beyond the threshold of any financial benefit that they personally received.

15

Honestly, I don’t want to read it because I know it is a giant cluster f*ck, I don’t need to know the details. It has gotten completely out of hand and I’m not sure there is any going back. I only hope there is something of use in there that would generate jobs.

16

The interactive illustration is very nice.

I just have to question the necessity of such spending. We are talking HUGE numbers and these are in addition to the regular budget.

I already used the National Parks as an example and just happened to mouse over the “Census”. 1 billion dollars, again in addition to the existing budget, for the census. So they were able to do the census before on some amount I’m guessing some amount less than 1 billion dollars. Now they are getting an additional 1B. So it really takes 3$ a person for every man women and child to count them up and compile the data?

41B for local school districts. Lets say there are around 15K school districts. That’s 2.7 million per district. That 2.7M represents a 10% budget increase for my district. I know I know there are much larger districts, but we are Illinois 3rd or 4th largest district so I’m guessing most districts are smaller than us. Still seems like HUGE numbers going out the door here. In fact this “Stimulus” package is as large as the entire US budget as recently as 1994, sorry that’s nuts.

~Matt

17

That bomb doesn’t change anything.

Well, unless it lands on your house :slight_smile:

For the most part we agree. Roads and Bridges are better “Investments” than bombs and planes. The point I’m trying to make is that if I build a bridge that no needs it’s no more of a good investment than the bomb.

With “Stimulus” and government spending we have a tendency to push the scale towards the “No one needs enough to pay for it” far more than does the market as well as create a situation that stifle competition and innovation thru “Focusing” on a narrow band. Rarely does the “Best answer” come from that band and since it’s hard to compete against “Free money” from the government the “Best answer” can’t arise.

If you had to create jobs around the house, you are better off paying people to install new windows, insulation, and replace the old heater that needs to be replaced anyway than to plant a bunch of flowers that will die by next year.

Again agreed. I personally don’t believe we should be taking this route at all, but since we are let’s at least do the best we can with what we got. Spending money that will result in future savings is better than spending money on “Pork projects” we don’t need. If we can lower the amount of energy consumed by public buildings by 10-20% we no longer need to build the “Alternative” power sources in the first place.

~Matt

18

Under the standard assumption CBO uses for its estimates—namely, that current laws and policies regarding federal spending and taxation remain the same—we forecast the following:

Do you know if there is a CBO estimation on inflation WITH the stimulus package? Overall the numbers without any change seem to be not to “Pessimistic” showing a recovery in 2010. I think that in and of itself throws into question the need for a “Stimulus” package.

You also have to compare the best and worst cases of the alternatives. So, compare best/worst of the proposed plan with doing nothing and we get a better idea of the value of the plan.

I would agree but using “jobs” as the only measure seems lacking. For instance by the end of 2011 We would ahve spent, according to the above numbers, about 476B of the total and would have an “Estimated average” of 1.4 more million jobs. That means that each one of those jobs cost 340K to create over doing nothing at all.

Couple that with the idea that with the idea that we lost nearly half that difference in the month of December alone and I’m not getting the “Warm and fuzzies” that this package will make any difference at all.

I guess my point is that if we only gain .7-2.1 million jobs, but inflation goes up dramatically AND we are saddled with and additional nearly trillion dollar deficit, is it worth it?

~Matt

19

Just out of curiosity, what university gave you your degree in economics, what qualifies you to say this won’t work? because there are a slew of world renowned economists including a couple of Nobel laureates who are supporting this package.

20

Just out of curiosity, what university gave you your degree in economics, what qualifies you to say this won’t work? because there are a slew of world renowned economists including a couple of Nobel laureates who are supporting this package.

Are they the same ones that got us here to begin with and claims “No one could see this coming?”. If so then I’m more than qualified cause I saw it coming a MILE away :slight_smile:

Other than that I’m not claiming it won’t work, in fact I’m somewhat confident it will work, short term. I’m questioning whether not this is the best option we have, particularly when we start talking in terms of 10-20 years rather than 1-2 years.

~Matt