Sunday, February 08, 2009

"Patriotism", Mr. President?

Martin Feldstein has some thoughts.

In the meantime, the President calls (R) Cave-In Specialists Specter, Snowe, Collins "patriots." We disagree, and not all that respectfully.

As a conservative economist, I might be expected to oppose a stimulus plan. In fact, on this page in October, I declared my support for a stimulus. But the fiscal package now before Congress needs to be thoroughly revised. In its current form, it does too little to raise national spending and employment. It would be better for the Senate to delay legislation for a month, or even two, if that’s what it takes to produce a much better bill. We cannot afford an $800 billion mistake.

So, Mr. President, is is "patriotic" to make an $800Bn mistake?

...the stimulus package is full of well-intended items that,unfortunately, are not likely to do much for employment. Computerizing the medical records of every American over the next five years is desirable, but it is not a cost-effective way to create jobs. Has anyone gone through the (long) list of proposed appropriations and asked how many jobs each would create per dollar of increased national debt?

So, Mr. President, is it "patriotic" to add $1Trillion to the national debt?

The plan to finance health insurance premiums for the unemployed would actually increase unemployment by giving employers an incentive to lay off workers rather than pay health premiums during a time of weak demand. And this supposedly two-year program would create a precedent that could be hard to reverse

So, Mr. President, is it "patriotic" to incent layoffs?

If rapid spending on things that need to be done is a criterion of choice, the plan should include higher defense outlays, including replacing and repairing supplies and equipment, needed after five years of fighting. The military can increase its level of procurement very rapidly. Yet the proposed spending plan includes less than $5 billion for defense, only about one-half of 1 percent of the total package. Infrastructure spending on domestic military bases can also proceed more rapidly than infrastructure spending in the civilian economy. And military procurement overwhelmingly involves American-made products. Since much of this military spending will have to bedone eventually, it makes sense to do it now, when there is substantial excess capacity in the manufacturing sector. In addition, a temporary increase in military recruiting and training would reduce unemployment directly, create a more skilled civilian workforce and expand the military reserves

So, Mr. President, "patriotism" ignores useful and practical military spending (and a LOT of domestic jobs) in favor of .....what, again?

All new spending and tax changes should have explicit time limits that prevent ever-increasing additions to the national debt. Similarly, spending programs should not create political dynamics that will make them hard to end

To Obama, "patriotism" is expanding the national debt and the reach and influence of the Feds.

The problem with the current stimulus plan is not that it is too big but that it delivers too little extra employment and income for such a large fiscal deficit. It is worth taking the time to get it right

Feldstein is right, of course. But is he "patriotic?"

I guess he's not--just like the 50+% of OTHER Americans who disapprove of this plan.

1 comment:

Deekaman said...

Excellent points. There's no doubt that this bill is a Christmas Grab Bag for Big Government. It will creat few private sector jobs and result in a longer lasting recession than had we done nothing.

"Never let a good crisis go to waste"