Posts Tagged: stimulus

Sacramento project backed by stimulus hits high prices

Considered among the nation’s largest urban infill projects since Denver converted Stapleton Airport into a neighborhood, the ambitious plan to redevelop Sacramento’s massive railroad yard hit a snag, according to Tony Bizjak in the Sacramento Bee.

The plan, backed by some $28 million in federal stimulus funds, (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…)

The Real Reason Financial Reform Won’t Happen

Joshua Green’s massive article about Treasury secretary Timothy Geithner in the latest Atlantic tells us more than we want to know — even more than the latest Vanity Fair, which covers the big bankers and investors who run our economy in alarming detail. (more…)

On The Stimulus, Democrats Think Voters Can’t Handle The Truth

The Wall Street Journal’s Louise Radnofksy reports:

Democrats, stung by criticism of their $787 billion economic-stimulus plan, are targeting Republicans who have attacked the program and then lobbied to get money for their districts.

More than a dozen Republican lawmakers supported stimulus-funding requests submitted to the Department of Labor, the Environmental Protection Agency and the Forest Service, in letters obtained by The Wall Street Journal through the Freedom of Information Act…

Mr. Obama warned Republicans last month at their annual retreat that Democrats were ready to spotlight representatives who touted stimulus funds in their districts. “Let’s face it, some of you have been at the ribbon-cuttings for some of these important projects in your communities,” Mr. Obama said.

This seems dumb on the part of the Democrats. (more…)

Put More Energy into Hiring at Energy

As Ian Talley and Stephen Power report in the Wall Street Journal, the Energy Department has expended only 7% of stimulus funds the Department received in 2008 — funds that are supposed to go to job creation and innovative energy projects.  The tension at Energy is between vetting proposals carefully and getting money out the door quickly.  Officials want to avoid even the appearance of waste or haste in the selection process, something the Obama administration takes seriously.  But jobs are not being created even as other major programs at the DOE are also experiencing a slow rollout.  What’s the problem?

Talley and Power sum it up as follows:  “department offices were still too short-staffed and under-trained to handle such a massive increase in funding authority.”

Congress usually hates to fund new government hires, but in this case it’s understandable that more hands are needed.  Spending billions of dollars effectively isn’t easy.  So for future projects of this kind, Congress should include funding for temporary, project-related hires and training programs.  If they had set aside even a small portion of the billions in funding for temporary hires, contracts, and training, we’d have more funding going to clean energy projects and more people employed.

Stimulate The Schools

The New York Times’ Sam Dillon relays a study that state governments have spent almost all of the $100 billion in emergency education funding from last year’s federal stimulus bill. So since there’s still a recession and multiple state budget crises across the nation, states will cut programs and lay off teachers and other school workers.

Education funding to states was a great use of low-hanging fruit in the stimulus: you give the states X amount of money and then X amount of teachers won’t be laid off. Unless Congress passes a second round of stimulus for states, thousands of teachers will soon lose their jobs.

Thomas Friedman’s Next Book Probably Won’t Be About Rural Elderly

The New York Times’ Kirk Johnson looks at how state and local governments are failing the elderly, especially the rural elderly. Recession-fueled budget cuts have lead to 24 states cutting programs for seniors, but some of the biggest problems were not being dealt with by government in the first place: a lack of broadband internet access for the rural elderly, and the lack of public transportation.

In theory, the Obama administration is actually dealing with these problems through stimulus projects that deal with rural broadband and high-speed rail. But only a full-scale federal commitment to building a broadband grid and mass transit would serve the isolated people that Johnson profiles.

Trickle-Up Stimulus: Recovery Funds Benefit D.C., but — which D.C.?

The Washington Post’s Alec MacGillis takes an insightful look at the way Washington spending tends to stay in Washington — a good portion of it goes to private contractors paid by federal agencies to find ways to spend stimulus funds.  Among the winners are giant consulting companies like Booz Allen Hamilton and small players like Simonson Management Services.

But these aren’t the jobs the stimulus is supposed to create.  V. Dion Haynes reports, also in the Post, on the rising jobless rate in the Washington, D.C. metropolitan area.  Government hiring is on the increase, but folks working in other sectors, like construction, are not getting jobs.  Looks like the stimulus is trickling up.

Why Doesn’t CBO Score the Afghanistan War?

I agree with Wisconsin Congressman Dave Obey, the top House appropriator, on funding the Afghanistan War:

As an Appropriator I must ask, what will that policy cost and how will we pay for it? We are now in the middle of a fundamental debate over reforming our healthcare system. The President has indicated that it must cost less than900 billion over ten years and be fully paid for. The Congressional Budget Office has had four committees twisting themselves into knots in order to fit healthcare reform into that limit. CBO is earnestly measuring the cost of each competing healthcare plan. Shouldn’t it be asked to do the same thing with respect to Afghanistan? If we add 40,000 troops and recognize the need for a sustained 10 year or longer commitment, as the architects of this plan tell us we do, the military costs alone would be over800 billion. And unlike the demands that are being made of the healthcare alternatives that they be deficit neutral, we’ve heard no such demand with respect to Afghanistan. I would ask how much will this entire effort cost, when you add in civilian costs and costs in Pakistan? And how would that impact the budget?

Obey’s entire statement on Afghanistan bolsters the case to scrutinize costs: he talks about how sending more U.S. troops might actually embolden terrorist groups, how the U.S. is moving from its narrow goal of wiping out al Qaeda, and how a war in Afghanistan helped sink the Soviet Union. You can disagree with all these points — but what they show is that there’s legit doubt about expanding the war. It’s not necessarily a national security imperative.

Yet the costs of any national security policy, be it the Afghanistan War, the Iraq War or the DHS build-up at the Mexican border, escape the budget scrutiny Congress applies to domestic policy. This double-standard is associated with Republicans, but it exists regardless of the party in power.  Barack Obama does not call on Office of Management and Budget Director Peter Orzsag to give charts and graphs on how Afghanistan will impact the 2019 national deficit.

Now would be a very appropriate time to fight this double standard given that Washington is debating the funding of a questionable war and also the funding of health care and more economic stimulus. Obey’s remarks do seem to be gaining traction — will other Congressional leaders second his analysis?

Larry Summers v. U.S. Government

There’s helpful, big-picture info in Ryan Lizza’s New Yorker profile on Larry Summers, the head of the White House National Economics Council (i.e. Lizza provides a narrative of how the Obama administration crafted both its stimulus and bank bailout policy). One somewhat tangential story that struck me was Summers’ view of the government implementing bank “stress tests.”:

Summers played the role of “the ultimate murder board,” according to Sperling, making the Treasury officials defend their ideas the way a Ph.D. student must defend a dissertation. He challenged and provoked Geithner to make sure that he had thought through every aspect of the plan. They argued back and forth, as they had done in the Clinton Administration, and their intensity was often jarring to the other Obama advisers. Summers didn’t trust the regulators, and was particularly worried about whether the stress tests designed by them were sufficiently tough on the banks. He pointed out that, in the days before Lehman, Bear Stearns, and Washington Mutual crashed, the same regulators had said that capital at those institutions was more than adequate.

Sure, but that was during the Bush administration! Obviously many of the regulators stayed the same when the White House switched hands — especially at the Federal Reserve. But the regulators Summers doesn’t trust here are also leaders at the Treasury Dept. that Obama appointed. Government official Summers is nevertheless dubious about the government’s competence to measure the financial health of banks.

The Obama administration has implemented a series of emergency economic measures before it has seriously pushed Congress to overhaul how financial regulation is done. This was necessary — but it’s created a situation where makers of of economic policy like Summers are skeptical of the very parts of government designed to carry that policy out.