Thursday, February 5, 2009

Getting it right and getting it right now

The proposed stimulus bill passed in the House with absolutely no Republican votes, despite tax cuts and other concessions inserted to entice conservative lawmakers to support the bill. Now the bill has moved to the Senate, where Republicans could theoretically filibuster it to death. This has led to attempts by both sides to make changes to the bill in order to ensure its passage; however, most of the cuts seem to be largely symbolic in nature, rather than significant reductions in the overall cost (see NY Times article).

The Republicans’ main complaints are that the proposed stimulus is nothing but a long-standing Democratic wish list, it’s too expensive, and it does not stimulate the economy quickly enough. No amount of cosmetic changes will negate these complaints. Indeed the real problem is that the sense of urgency, in part fueled by long inactivity during the final months of the Bush presidency, has caused Democrats to throw caution to the wind. The stimulus bill seems to be the result of a quick brain-storming session where lawmakers thought of every possible way to spend money then slapped it all together into one giant bill in the name of expediency.

In my opinion, the best way forward would be to cut the bill in two. Separate out the funding that can immediately stimulate the economy: the help to states, payroll tax holiday, funding for “shovel-ready” projects, etc. and pass that part immediately. Then carefully debate the non-immediate spending and long-term reforms, which somehow ended up in a stimulus bill. Whereas stimulus is needed in the short- and medium-term so badly at this point that anything which creates jobs is useful, only some of the non-stimulus spending is clearly justifiable on its own merits; it would be nice if it were not all rammed through without some debate.

Critics of the stimulus claim that only 37% of the electorate supports the bill (see a recent Gallup poll). While technically true, the part they like to leave out is that an additional 38% of the electorate would support the bill with some sort of changes. President Obama has indicated that he would like to pass a bill enjoying broad support (hence the concessions to Republicans even though their votes aren’t strictly necessary), but he also worries that the longer Congress takes to put it on his desk for signature, the more jobs will be lost (see his Op-Ed piece in the Washington Post). Splitting the bill in two would allow quick passage of a much cheaper measure that would pack almost the same punch in the short-term, while buying time to get the long-term part right. 

1 comment:

  1. A good point;; I think there were some political 'games' going on too. The Democrats are trying to fly everything through before the 2010 election, when they probably fear republicans will win back seats, and flying on the popularity post-election, which will also surely change in time. However, it is not a smart move. Rather than two bills, in effect we will have a number of them. The concept of Pork should not (and luckily did not) prevent some real measures being passed. But I wonder if Obama lost some patience with his Republican senators in the process....