What The Heck Was The $862 Billion For Anyway?

From America's Right:

What the Heck Was the $862 Billion For, Then?


September 7, 2010 by Jeff Schreiber

Filed under Featured Commentary


It’s not like they haven’t tried this before.

Back when the president and his party was scrambling to pass the failed $862 billion American Recovery and Reinvestment Act, if you asked House Speaker Nancy Pelosi, the so-called “stimulus” bill was about four things: jobs, jobs, jobs and jobs, and without it, 500 million Americans were losing their jobs each and every month. If you asked Vice President Joe Biden, the bill was about his “favorite three-letter word: J-O-B-S.” The president himself assured the American public that so long as his stimulus bill was passed, the unemployment rate would not exceed eight percent (it’s now at 9.6 percent).



Then, in December 2009, the Democrats insisted that they needed another $130 billion or so. President Obama insisted that the stimulus bill was about stimulating the economy, and that a separate measure was needed to create jobs. He feigned anger for his base and warned Republicans to “stop trying to frighten the American people” and get out of the way. Thankfully, because of a unified Republican front and because of a brave Ben Nelson, the bill failed. The rabid lefties over at FireDogLake said that the GOP and Nelson “succeeded in destroying [the] lives of millions.” Michigan Sen. Debbie Stabenow–a Democrat, how shocking–essentially argued that the GOP was trying to tank the American economy for political gain.



Now, the president is calling for another $50 billion bill as the first part of several so-called “investments” over the next six years into various infrastructure projects. From the Associated Press:



The infrastructure investments are one part of a package of targeted proposals the White House is expected to announce in hopes of jump-starting the economy ahead of the November election. Obama will outline the infrastructure proposal Monday at a Labor Day event in Milwaukee.



While the proposal calls for investments over six years, the White House said spending would be front-loaded with an initial $50 billion to help create jobs in the near future.



The goals of the infrastructure plan include: rebuilding 150,000 miles of roads; constructing and maintaining 4,000 miles of railways, enough to go coast-to-coast; and rehabilitating or reconstructing 150 miles of airport runways, while also installing a new air navigation system designed to reduce travel times and delays.



Surprisingly, the Associated Press actually acknowledges that infrastructure improvements were a “central part” of the stimulus bill passed in early 2009. The funny part is that the AP, in parroting the White House talking points, actually sets out evidence showing that the administration’s faith in government stimulus was destined to fail from the get-go.



“[W]ith that spending winding down,” the AP piece reads, “the economy’s growth has slowed.”



Of course it has! Almost every time we see new GDP numbers, a few weeks later the already disappointing numbers are revised downwards. And, frankly, the only reason those paltry numbers are what they are is because of the influx of government spending. Now that the spending is winding down, the artificially inflated GDP numbers are as well. (In fact, more and more, folks are looking for something other than GDP to accurately denote economic well-being, but that’s a discussion for another time.)



It’s the same thing as the jobs bill: We need to spend more of your money. There are shovel-ready jobs this time, we promise. These projects will create jobs. Without spending your money, the economy will never recover.



We’ve heard it before.



Furthermore, even if a given infrastructure project is “shovel-ready,” such projects do very little to provide the private sector with the short- and long-term boost needed to bring the American economy out of the doldrums. In fact, while roughly $175 billion of the original $862 billion American Recovery and Reinvestment Act was to be spent on so-called “shovel-ready projects,” the federal government failed to take the necessary steps to prevent many of the jobs that were to be created from going to illegal immigrants. From a March 2009 report from USA Today:



Studies by two conservative think tanks estimate immigrants in the United States illegally could take 300,000 construction jobs, or 15% of the 2 million jobs that new taxpayer-financed projects are predicted to create.



They fault Congress for failing to require that employers certify legal immigration status of workers before hiring by using a Department of Homeland Security program called E-Verify. The program allows employers to check the validity of Social Security numbers provided by new hires. It is available to employers on a voluntary basis.



“They could have deterred this, but they chose not to,” said Steven Camarota, director of research for the Center for Immigration Studies.



He said a federal requirement that employers use E-Verify would have reduced, if not eliminated, the hiring of immigrants in this country illegally.



An advocacy group for immigrants, illegal and legal, did not disagree with the 300,000 estimate. Camarota says the estimate is based on data from the U.S. Census Bureau’s Current Population Survey and other independent findings that 15% of all construction workers in the USA are either illegal immigrants or lack the status of legal immigrant authorized to work.



And then there were issues like those seen in Oregon, where many of the so-called “shovel-ready projects” just weren’t shovel-ready at all. Similar stories could be found throughout America, with maybe my favorite leading off a March 2009 piece in The Wall Street Journal:



On a warm afternoon last month, a week before the stimulus bill became law, Vice President Joseph Biden strolled out onto a narrow, 79-year-old bridge over the Conodoguinet Creek. He poked his shoe through a hole in a rotting girder, tore off a piece of rusty metal, and examined a crack in the concrete deck.



“Is this a shovel-ready project?” Mr. Biden asked Scott Christie, the state transportation official charged with deploying economic-stimulus money.



“It’s ready to go,” Mr. Christie answered. “I literally have the plans in the car right now.”



It turns out, though, that shovel-readiness is in the eye of the beholder. Soon after his visit, Mr. Biden found out that his model stimulus project wouldn’t see a shovel for almost four more months, possibly longer, knowing how such timetables slip. In North Middleton, a White House eager for action had run up against locals eager to avoid disruption. The locals won.



In fact, back in December 2009 while pushing for that separate jobs bill, President Obama argued that there were more shovel-ready infrastructure projects at that time than there were nine months before when the stimulus bill was signed. Essentially, he admitted that the whole thing wasn’t about shovel-ready projects in the first place. But who’s counting, anyway?



And this time, according to the president, it’s even paid for. The Associated Press notes that the Obama White House plans to “consider closing a number of special tax breaks for oil and gas companies to pay for the proposal.” So, as if spending another $50 billion (as just a first installment on a larger commitment, no less) is not enough, the president plans to further strike at the heart of the American economy by giving oil and gas companies yet another excuse to pack their things and bring their business and their jobs and their taxable revenue elsewhere. The same thing goes for another $100 billion proposal the president plans to unveil mid-week — the AP writes: “Similar to his proposal to pay for the infrastructure investments, Obama will ask lawmakers to close tax breaks for oil and gas companies and multinational corporations to pay for the plan.”



It’s like watching a child ride his tricycle head-first into a tree. Only this is no accident. This is 100 percent diametrically opposed to what we should be doing during an economic downturn. We should be saving, not spending. We should be making the United States of America as dashingly attractive as possible for oil companies and gas companies and multinational corporations, not chasing them out by instituting arbitrary moratoriums and making it infinitely more expensive to do business for the entirely superficial facade of paying for a stimulus bill that we all know will not work. President Barack Obama is actively working to destroy long-term economic and job growth in the name of a thinly-veiled attempt to pay off unions and other special interests in advance of a mid-term election in which the Democratic Party is set to be ruthlessly eviscerated by a newly awakened American people.



This is no accident. If the president were merely looking for some sort of populist boost in an attempt to shape public opinion in the weeks leading up to November 2, he would have called for the reintroduction of the housing tax credit, or a sequel to Cash For Clunkers. (Who cares that both may have caused more long-term harm than immediate good? Unintended consequences have never stopped liberals before.) But it wasn’t enough for this president to settle for the bump in the polls caused by a bunch of naive voters who recently found themselves behind the wheel of a shiny, new car — with the time running on the Democrats’ handle on congressional leadership, he wanted to strike another blow in his ongoing War Against Success and Prosperity.



The entire endeavor is an absolutely ridiculous farce. Just like the American Recovery and Reinvestment Act was about neither recovery nor reinvestment, this new call for a $50 billion infrastructure investment has nothing to do with infrastructure.



Thankfully, America has seen it all before.