Wednesday, January 28, 2009

Just a bit of complaining...

Let me preface this rant with yes, I know we need a bailout. But...

President Obama has promised to make government more open, a task which shouldn't be too difficult in the computer age where information can be digitized, indexed, and searched with querying assistants like Google. So for the bailout, Obama has launch "Recovery.gov" for government openness on how the bailout money is spent.

There's one problem, though: Recovery.gov currently contains none of that information, just a message which says "Check back after the passage of the American Recovery and Reinvestment Act to see how and where your tax dollars are spent."

How about I know what the bailout wants to do with my money beforehand?

Afterall, the government stating where the money goes beforehand could help guard the bailout bill against attacks from the seemingly anti-economy right. And not to echo their talking points, but a column about the bailout in today's Wall Street Journal that the starboard side is yammering about does have me worried.
We've looked it over, and even we can't quite believe it. There's $1 billion for Amtrak, the federal railroad that hasn't turned a profit in 40 years; $2 billion for child-care subsidies; $50 million for that great engine of job creation, the National Endowment for the Arts; $400 million for global-warming research and another $2.4 billion for carbon-capture demonstration projects. There's even $650 million on top of the billions already doled out to pay for digital TV conversion coupons.

In selling the plan, President Obama has said this bill will make "dramatic investments to revive our flagging economy." Well, you be the judge. Some $30 billion, or less than 5% of the spending in the bill, is for fixing bridges or other highway projects. There's another $40 billion for broadband and electric grid development, airports and clean water projects that are arguably worthwhile priorities...

Another "stimulus" secret is that some $252 billion is for income-transfer payments -- that is, not investments that arguably help everyone, but cash or benefits to individuals for doing nothing at all. There's $81 billion for Medicaid, $36 billion for expanded unemployment benefits, $20 billion for food stamps, and $83 billion for the earned income credit for people who don't pay income tax. While some of that may be justified to help poorer Americans ride out the recession, they aren't job creators.

On the last point the WSJ makes, they are correct -- Medicare is not a "job creator". Of course, I (as well as anybody else on the left, I imagine) would argue that such social safety nets are need to keep money in American's wallets. One thing that knocked the recession of the late 1920s into the Great Depression is that money dried up -- period. People literally didn't have a cent. And when you don't have money, you can't purchase anything, so the business sector stops producing, more people lose their jobs without government benefits to fall back on, so more people have not a cent... You can see how it snowballs. Indeed, the "safety net" is no joke -- social programs help keep recessions as recessions.

But what's also needed is job creation. As far as I can see, the $30 billion going to infrastructure repairs is the bulk of the act's job creation -- and that's less than 5% of the bill's money!

And why not put the expenses for different programs in their own bill? Why do we have a 647 page recovery bill in the first place chockful of payments to different programs? While some of this I can agree with, like social programs and aid to keep Amtrak running, other items are bullshit. $650 million for digital TV conversion? Uhm, why? I know in the face of an $850 billion bill, $650 million is a drop in the bucket ... But why?

How many other needless payments are there in the bailout? Damned if I know -- Recovery.org certainly doesn't contain that information!

I haven't looked over the actual legislation documents -- congressional bills and such -- that FDR signed during his first 100 days in office, but they look like single acts; single pieces of legislation. The Civil Workers Administration act setup the CWA and what the organization was supposed to do; the Tennessee Valley Authority setup the TVA, etc. There was no lump sum -- one all encompassing recovery act that included these programs. Back during the Great Depression, we had acts meant to create jobs, provide relief, save banks, etc.

And one thing FDR was successful with doing was getting American citizens to trust the government. Indeed before FDR took office, our government provided virtually no economic protections for citizens -- and many Americans liked it that way. They were proud and didn't want the government paying for them. But FDR developed a relationship with Americans through his fireside chats, telling them about the legislation he signed and how it would help them. FDR told it straight and became a trustworthy figure.

With clusterfuck bills like the Orwellian named "American Recovery and Reinvestment Act", Obama is not following FDR's footsteps. I know people will jump on me for attacking Obama after he's only spent a week in office and he hasn't changed the culture in DC yet, but this kind of government looks the same as the government we've seen for the past two decades: complex legislation with hardly any way to check it unless you have the time to read 650 pages of Washingtonian legalese. I expected more openness from the Obama administration -- I expected better. And yeah, his inauguration is not yet a distint memory, but the Obama administration isn't going to earn the trust of the American people if it keeps this up.

Additional reading and differing opinions:

dday @ Hullabloo points out good parts of the bill, including aid to state (so they can balance budgets) and the poor.

Steve Benen points out that some Democrats do not think the bailout bill goes far enough.

Liberal Oasis points out that most economists support the bailout bill. Libertarians from the Cato Institute oppose the bill, but the last time I checked Ron Paul got .02% of the vote, so nobody gives a shit what they think.

Kevin Drum is another blogger who points out the disappointment over funding for infrastructure repairs provided by the bailout. Given that engineers have given the state of America's infrastructure a near-failing grade of D and...
...estimated that it would take a $2.2 trillion investment…over the next five years to bring it into a state of good repair.”

I think there's room for a lot more than merely $30 billion of infrastructure repair. $2.2 trillion is a hell of a lot of jobs.

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