By Mary Kate Cary, Thomas Jefferson Street blog
In Washington, there's a phrase—"slow-walking"—to describe deliberately taking one's time in order to drag out the effects of a policy. That's what the Obama administration is doing with the massive $787 billion stimulus package. So far, only a fraction of the outlays has been spent, and according to a roundup in Politico this morning, the White House is leveraging every dime of that money in states that Obama won. In fact, 52 of 66 recent events to hand out stimulus money took place in states such as California, New York, Ohio, and Colorado—a "veritable map of Obama's election-night victories." Eamon Javers continues:
The stimulus bill has the potential to be a publicity bonanza for the Obama administration for years to come — through the 2010 midterm elections and beyond. As of mid-May, the administration had spent only 6 percent of the money Congress allotted for the program, and the White House says officials will continue to travel the country until all of the money is spent. The events generally come in the form of roundtable discussions, upbeat speeches and sweeping announcements of billions of dollars for local communities. Some have all the hallmarks of campaign events, featuring banks of television cameras, flag-bedecked stages and local politicians working the crowds. Many generate the kind of admiring local media coverage that politicians crave — and largely escape the attention of national outlets.
Politico also notes that at 14 additional events, Vice President Biden and cabinet members traveled to states that the Democrats lost narrowly and are hoping to turn into "blue" states in 2012. But here's the laugh of the day: "Politics plays no role in implementation of the Recovery Act or highlighting its successes. Period," said Liz Oxhorn, press secretary for the Recovery Act. Right.
The irony is that, according to Bloomberg columnist Caroline Baum, the economy is recovering without the stimulus money. With over 90 percent of it still unspent, she points out that the rate of decline in the real gross domestic product is slowing down from its previous highs—from 6 percent for the last two quarters to a projected 1.9 percent this quarter—due to actions by the Fed regarding monetary policy, not anything having to do with the American Reinvestment and Recovery Act. And yet, she points out, the amount of debt being handed off to future generations reminds her of the toxic "legacy debt" the government is worried about in the private sector:
This time around, a new president with solid majorities in both Houses of Congress was able to saddle future generations with trillions of dollars of debt less than a month after he took office. The Congressional Budget Office projects the debt-to-GDP ratio rising to 70 percent in 2011, the highest since the early 1950s, when the U.S. was winding down the war effort.
If you believe, as I do, that monetary policy is the more potent of the stimuli, that fiscal "stimulus" just transfers spending from tomorrow to today and from the private sector to the government, with no net long-term gain, then maybe it's time to stand up for the next generation.
Time for the administration to stop "slow-walking" all that debt to our kids.