Aroma: If stimulus smells like pork, ‘change’ hasn’t come
Published 12:00 am Saturday, January 24, 2009
Much of President Barack Obama’s time since Election Day and certainly the early hours of his presidency have appropriately been focused on the recession. He’s asked Congress to send him a $775 billion economic stimulus plan within the next month, and Congress is well on the way to doing just that. The plan, which may wind up as the single most expensive piece of legislation in the nation’s history, includes at least one proven tool for bolstering the economy — $300 billion in individual and corporate tax cuts.
The nation’s already anemic economy appears to be weakening further. The federal budget deficit is expected to soar past $1 trillion this year and likely will remain above that extraordinary mark for years to come. The national debt may reach $14 trillion by next year, standing at 95 percent of gross domestic product. Other financial crises are looming in the Medicare and Social Security programs as well as with private pension funds.
The bulk of Obama’s bill centers on a massive public works program designed to create millions of jobs. The history of such federal initiatives, however, has been less than impressive.
How should the new president and Congress respond and how will we know if promised changes in business as usual have come?
A key sniff will be whether the stimulus package isn’t loaded with pork.
A review of recent funding requests, all supposedly tied to job creation, from the nation’s mayors reveals a long list of questionable projects. A scattershot approach to job creation likely would not only waste time and money as the economy continues to sputter but also would drive up the deficit without a sufficient payoff.
One of Obama’s early tasks must be to use a portion of his considerable political capital to confront the soaring national debt. Failure to do so — following in the footsteps of George W. Bush — likely would inflict lasting damage on the nation’s long-term economic prospects.
Obama has mirrored many previous presidents by pledging to put a halt to federal spending that is wasteful and inefficient. He affirmed that in his inaugural address. Now he has to affirm it — if need be — with the veto pen. Also, he must not join the string of presidents who failed to confront growing problems in funding for Medicare and Social Security.
The fiscal and economic tasks awaiting the new president are unquestionably daunting. He has, however, two things in his favor: the good will of millions of voters who have demanded change in Washington and a Congress unlikely to engage in battle with a popular new leader during his first months in office.
The world is watching and so is the economy. The president must make sure specific spending is targeted to achieve specific results and is tracked to see if that happens. Sorry to say it, but anything less will be business as usual.