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February 4, 2009

When Stimulus Ainít

Kevin E. Dayhoff

Last Wednesday, the House of Representatives passed its $819 billion version of the economic stimulus package by a vote of 244 to 188. Not a single Republican voted for the measure – for good reason.


As a matter of fact, 11 Democrats also voted against the American Recovery and Reinvestment Act; a point of which “is significant,” according to Dan Clifton, the head of policy research at Strategas Research Partners, who was quoted in a CNN article to observe: “First, it gives Republicans cover… And it gives extreme leverage to the Senate.”


This week, the $885 billion Senate version faces stiff opposition as a larger number of Democrats and Republicans are ducking for cover as more and more Americans are becoming aware of the details and ultimate ramifications of the measure.


James Pethokoulis, of U.S News and Report, explained it best: “Let's say your house is burning down, and you have a water hose in your hand. Do you a) try to put out the fire; b) start filling up your pool; c) sprinkle your lawn; or d) some combo of ‘a,’ ‘b’ and ‘c.’


“To the Obama administration's credit, it didn't choose ‘b’ or ‘c.’ Unfortunately, it went with ‘d.’ Although there has been a sense of urgency in getting the stimulus bill passed, the bill itself shows little urgency in doing much to help the economy.”


On Sunday, Senate Republican leader Mitch McConnell, of Tennessee, according to an Associated Press account, predicted that “the massive stimulus bill backed by President Barack Obama and congressional Democrats could go down to defeat (in the Senate) if it's not stripped of unnecessary spending and focused more on housing issues and tax cuts.”


Sen. Jim DeMint (R., SC) accurately characterized the proposal as “a spending plan. It's not a stimulus plan. It's temporary, and it's wasteful.”


Writing in Politico on Monday, Ben Stein noted that the Congressional Budget Office recently “released its analysis of the Senate bill, showing that $694 billion, or more than 78 percent of the money in the package, would pump into the economy by Oct. 1, 2010, a major improvement over CBO’s scoring of the House-passed bill. But the pace for highway construction outlays in the same period is 35 percent, or less than half that.”


Essentially the stimulus package is cynical partisan politics at its worse. The Democrats are taking advantage of an extraordinary challenge to the well-being of our nation to promote its vision of a social welfare democracy and wealth redistribution.


It has little to do with stimulating the economy and everything to do with ramming through a social and political agenda for which the Democratic Party has been otherwise thwarted for the last decade.


While President Obama has been receiving accolades for reaching out to the Republican leadership for support, sharp-eyed political observers have noticed that the gestures are hollow and only for show.


The subplot being played out in Washington is that President Obama and the Democrat congressional leadership are keenly aware that there are no guarantees that the economic stimulus plan will work and desperately want buy-in from Republicans so that any subsequent blame can be shared.


Meanwhile, the Democrats hope that the social-welfare spending will put salve on the effort in order to – at least – maintain the base of their support.


Republicans are aware that the party has suffered an erosion of its base support as a result of its failure to rein in spending during the waning years of the Bush Administration. The GOP must seem to avoid the appearance of being petty and obstructionist like the Democrats during the George W. Bush years at the helm.


David Rodgers wrote in Politico on Monday that White House Budget Director Peter Orszag “met last week with skittish freshmen, overwhelmed by the scale of the package — and the political gamble — before them.”


Sen. Mark Udall (D., CO) subsequently remarked: “We have to act … but we have to be thorough, careful and get every assurance we can from the best minds, best historians, and best economists that this is where we ought to place our bet.”


The Associated Press cites Sen. Jon Kyl of Arizona, the No. 2 Republican in the Senate, as saying he is “seeing an erosion of support for the bill and suggested that lawmakers should consider beginning anew.


“When I say start from scratch, what I mean is that the basic approach of this bill, we believe, is wrong.”


Well, the economic stimulus package, as it is currently configured in both the House and Senate, is wrong. There is no better time for you to get in touch with the congressional leadership and weigh-in that the current economic stimulus package must be defeated.


Everyone understands that something must be done.


Of course, the quickest remedy is to reduce tax rates and return money and liquidity back into the hands of the private sector.


Yes, we must act. However, one should never sacrifice order in the pursuit of progress. Much of the leadership in Washington acts as if there has never been an economic downturn in history and seem oblivious to the fact that the only thing worse than the current economic hardships is Congress making it worse, simply for the sake of political expediency.


It is time for everyone to take a deep breath, scrap the current legislation, and start over from scratch.


Kevin Dayhoff writes from Westminster: E-mail him at


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