Posts Tagged: American Reinvestment and Recovery Act

High-speed regional trains zoom into California

Several new trains capable of considerably higher speed should begin plying the rails in California in about four years time, thanks to an infusion of federal cash, reports Tim Sheehan of The Fresno Bee.

California received 68 million dollars from the federal government to buy 15 new American passenger cars and four new U.S.-made locomotives for the state’s three regional rail routes. The funding is a portion of the $336 million worth of Recovery Act funding — economic stimulus money — awarded as federal matching funds to California and outright grants to Illinois, Iowa, Michigan, and Missouri. (more…)

Iron Mountain Mine the Gold Standard for Environmental Hazards

In the shadow of the more or less pristine Mt. Shasta and Trinity Alps lies one of the most contaminated sites on Earth. Now an Environmental Protection Agency Superfund site, the Iron Mountain Mine has been undergoing remediation for over two decades and has been acknowledged as an environmental problem for over a century. (more…)

Only A Fraction Of Stimulus Cash Has Been Used

3708145387_76796cdaeb_mProPublica’s Christopher Flavelle reports that $136 billion in stimulus money has been spent and $84 billion in stimulus tax cuts has been allocated. That means there’s $284 billion left to spend in stimulus money (as well as $128 billion in remaining tax cuts) — more than twice the federal spending outlined in the stimulus bill has yet to take place.

There has been a lot of talk of a “2nd stimulus” or a stimulus that more directly deals with job creation. Most economists seem to favor such additional government spending, especially with national unemployment at 10.2 percent. But stimulus implementation has only started. The stimulus will eventually be judged not only on economic growth and job numbers but the success of projects like high-speed rail and centralization of health care records that have yet to begin.

Green Job Blues

The Washington Post’s Alec McGillis had a great piece this weekend revealing that the $25 billion “green jobs” portion of the stimulus bill has, well, yet to produce more than a few dozen green jobs. It’s a complex issue but the crux of green jobs seems to be this: If you are first concerned about global warming or whether federal and state governments use energy in an efficient way, it’s a promising program. If you are first concerned about job creation, “green jobs” stinks. (more…)

What Is Popular Is Not Always Right…Like the Homebuyer Tax Credit

The New York Times’ Jackie Calmes reports that a high-profile part of the stimulus bill — the $8,000 tax-credit to first-time homebuyers — has not been rigorously audited by the IRS. Calmes gets her info from a Treasury Dept. Inspector General report that features some embarrassing facts — like that a four year-old claimed a homebuyer tax credit. But the more systemic problem is that 60 percent of the 1.4 million people who claimed the tax credit have incomes below $50,000. This suggests that the tax credit might be doing exactly what the housing bubble did — encouraging people to buy a home who realistically can’t make the mortgage payments. (more…)

New Ways to Stimulate

The New York Times’ Jackie Calmes adds to the articles about the Obama administration and Congress considering an expansion of elements in the stimulus package, due to ever-rising unemployment. The programs that Calmes reports will be expanded are varied — there is extending unemployment benefits and the COBRA program, which provides health care to the recently laid off, both programs that expire Dec. 31. But then they are the “tax credit” plans — a tax credit to first-time purchasers of homes and a tax credit to businesses who hire new workers or don’t lay off current ones.

What’s missing from this discussion is any new government programs that more directly help the unemployed. Extending unemployment benefits and COBRA, of course, directly helps the unemployed. But these tax credits seem a limp, and easily exploited, way to nudge consumers and businesses to more stimulating behavior. I’d like a push for more civil servant and public goods projects — or at least a move to recall some of the teachers and health workers state governments were forced to lay off. The government should be one job market more able to respond to a recession, yet 53,000 government jobs were shed just last month.

It’s politically risky to push for such an expansion of government. But the NYT piece implies that what’s riskiest for Obama and Democratic leaders in Congress is to maintain the status quo and see unemployment continue to rise well into next year. Maybe in the case of fighting unemployment, helping people who need it most can also be good politics.


The New York Times’ Michael Cooper takes a look at the Government Accountability Office report released yesterday on stimulus spending. Cooper highlights problems getting the home weatherization program off the ground — the Labor Dept. was late to establish how much workers get to install these systems.

But such implementation snafus are largely absent from the $150 billion that the federal government has now spent from the $787 billion stimulus package. Cooper points out that states have spent 84 percent of their stimulus cash to replenish dried up medicaid and education funds. When someone talks about the stimulus, infrastructure projects are often what comes to mind. But only four percent of the state money has gone toward highway construction.

The next phase of stimulus implementation will begin the true test of federal and local government. It’s easy to replenish a pre-existing medicaid fund, but it takes a certain level of competence to execute infrastructure projects.


The White House Council on Economic Advisers issued a report Sep. 11 claiming that the American Reinvestment and Recovery Act, better known as the stimulus bill, has created up to 1.1 million jobs. But all stimulus jobs are not created equal – 227,000 are summer-only employment for poor or otherwise disadvantaged people, ages 14-24. These jobs were for 20-30 hours a week, paid the minimum wage, and ended after 6-10 weeks. Summer is over – and so are these 227,000 jobs.

About $1.2 billion of the stimulus bill went toward bringing back the summer-only employment program, a part of the Workforce Investment Act youth program that runs out of the Labor Department. The mission of summer employment programs for disadvantaged youth is both vague and tantalizing – they’re supposed to spur consumer spending, provide for poor families, teach job skills, and open a world of possibilities for often ghettoized young people. The experience here in Chicago and across the country is that summer youth jobs begin to accomplish some of these goals. But summer jobs do not give disadvantaged young people what they really need – a year-round program to put them on track toward permanent employment.

Summer Stimulus

Summer youth jobs are the quintessential social program – conditionally funded by Democrats and reflexively opposed by Republicans. (more…)


The Wall Street Journal’s Louise Radnofsky reported this weekend that the stimulus bill has so far yielded 22,000 government contracts worth $12 billion — and that most of these contracts are going to big business:

The reported contracts include millions of dollars for big-name food, drug and auto companies. Del Monte Foods Co. and Hormel Food Corp.’s Jennie-O Turkey unit are providing supplies for food pantries, and so are private-label firms such as Lakeside Foods. Drug makers GlaxoSmithKline PLC, Merck & Co., Novartis AG and a unit of Sanofi Aventis Group are supplying extra vaccines for the Centers for Disease Control and Prevention. Chrysler Group LLC, Ford Motor Co. and General Motors Co. are selling hybrids and other fuel-efficient vehicles to the General Services Administration for the federal fleet.

Obviously, there might not be a ton of small businesses ready to sell hybrid cars and provide flu vaccines. But it would seem that you don’t need to rely on Del Monte and Hormel to keep food pantries going. The Obama administration has been pretty silent on “food politics” issues. Using stimulus money to help local food producers would be a nice, first step.


Apropos of my back-to-school extravaganza on teacher merit pay, the New York Times’ Sam Dillon takes a look today at teacher layoffs around the country. Dillon can’t give figures on how many teachers have been laid off in the past year, but a clear pattern emerges: State X can’t generate any revenue in the recession. So they lay off, say, 1,000 teachers. Then State X taps into stimulus money and re-hires, say, 700 teachers they’ve just laid off.

One issue here is whether the stimulus should have been big enough to prevent all teacher layoffs or whether the most sensible policy is really the status quo that just makes the layoffs less severe. Related is something I wrote about in the merit pay piece: the Education Dept. got $115 billion from the stimulus bill — more than twice its yearly budget. But a significant amount of that money is not just formula funding so states can deal with budget shortfalls. Billions, instead, are in competitive grants awarded to states whose education policy goals (more charter schools, strict evaluations of teachers) are in line with Barack Obama and Education Sec. Arne Duncan.

I’m ambivalent about how this allocation of education stimulus money is a good idea. On the one hand, if the federal Education Dept. thinks these state education departments are currently not very effective than maybe they’re right to use the stimulus to make these states change, instead of just blindly comping the status quo. But the fiscal crisis might not be the best time for innovation at a state level. Can school districts implement splashy new policies when these same districts are looking for coins under couches to keep band programs and 5th grade art teachers?-MB