Some parts of the economic plan are working

Robert Samuelson joins the growing list of economists and others who don’t find the so-called “stimulus” bill appropriate to the task:

Too Little Bang for The Bucks — Among the many claims made for the “economic stimulus” package now before Congress is that it will “jump-start” a “bigger, better, smarter” electric grid, enabling Americans to use energy more efficiently. The package commits $4.5 billion to this, which (says the White House) will help finance 3,000 miles of transmission lines and 40 million “smart meters.” Sounds great. But it may be mostly hype. For starters, $4.5 billion is a pittance. An industry study in 2004 — surely outdated — put the price tag of modernizing the grid at $165 billion…

In its releases, the White House gushes superlatives. The stimulus program, says one fact sheet, “launches the most ambitious school modernization program on record,” “computerizes every American’s health record in five years” and “undertakes the largest weatherization” — insulation — “program in history.”…

sacrificed are measures that, though lacking in long-term benefits, might help the economy now. A $7,500 tax credit for any home buyer in the next year (and not just first-time buyers, as is now in the bill) might reduce bloated housing inventories. Similarly, a temporary $1,500 credit for car or truck purchases might revive sales…

The decision by Obama and Democratic congressional leaders to load the stimulus with so many partisan projects is politically shrewd and economically suspect…Obama’s political strategy fails to address adequately the economy’s present needs while also worsening the long-term budget outlook…“Now is the time to make the tough choices.” — Barack Obama, Jan. 26…There were tough choices to be made — and Obama ducked them.

Samuelson is perhaps a bit too tough on President Obama. There is one part of an economic plan that is clearly working. President Obama might be able to fund a significant portion of his economic program just from collecting back taxes from his Treasury Secretary, HHS director, Chief Performance Officer (whatever that is), and other appointees.

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