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Watch the spending
Updated: August 21, 2010, 12:41 AM
Definition of disconnect: Political leaders are talking about a second economic stimulus this year even though the government has spent only 10 percent of the gargantuan package passed in February. Before we start thinking about another stimulus, shouldn’t we work the bugs out of this one first?
Of course, with the first one—actually, it was the second, factoring in President George W. Bush’s 2008 income taxrebates— the bugs were put in on purpose. Instead of tailoring a bill to stimulate the crumbling economy, House and Senate members larded the $787 billion package with enough pork to choke a pig. The result is that the bill contains many components that, whatever may be said in their defense, have little to do with putting Americans back to work.
What is more, the money that is being spent is only slowly leaking into the economy. Before this bill was ever passed, everyone involved understood that the need was to inject stimulus money into the economy.
President Obama shares responsibility for that mistake, especially considering Vice President Biden’s recent acknowledgment that the administration “misread” the economy— which was, in fact, in much worse shape than just about anyone believed. Obama could have drawn a line, insisting that the bill focus on the economy; because he didn’t, 6.5 million jobs have been wiped out and federal stimulus spending is ineffective in dealing with that disaster.
It’s too late to reshape that bill, but before anyone starts thinking seriously about yet another bill for which our great-grandchildren will pay, Washington must get the money flowing from the existing stimulus. The more people the country can get back to work, the more money will circulate in the economy.
That’s the point. That’s what has to happen, and we can’t wait another year or more for this stimulus to kick in. Although the rate of job losses has slowed, the numbers continue to climb. That puts increased pressure on everyone from employers, who have fewer potential customers for their products and services, to governments and school districts, which must operate with sharply reduced revenues.
It’s not Obama’s fault that the economy collapsed into this miserable recession, but it is his responsibility to take steps that soften its impact and hasten its departure. Before even more money is spent on stimulating the economy, he needs to be sure that the current effort takes root as quickly as possible. All of which is to say, he needs to do better.
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