790 Billion Reasons We Need to Get the Stimulus Right
The American people may be surprised to learn that Republican and Democratic members of Congress agree on the need for the federal government to act in a time-sensitive manner to prevent further job losses across our great nation and to stimulate job creation for our citizens. Our disagreements are not about whether to act. Rather, our disagreements are about how best to act. Given that almost $800 billion of taxpayer funds are at stake, getting the stimulus plan right does matter.
The American people rightfully expect Congress to work together in a bipartisan manner to address the economic crisis facing our country. Congress must act in a fiscally responsible manner that best protects American taxpayers, workers, and small businesses. Unfortunately, the economic stimulus legislation recently enacted into law by the House and Senate fails to meet these criteria. As with the $700 billion bailout of Wall Street passed by Congress last fall, this stimulus legislation will spend unprecedented amounts of taxpayer dollars with no measurable likelihood of truly stimulating America's economy.
I voted against the stimulus package because it will explode our national debt while failing to target federal spending on programs that have a proven record of job creation and economic development. Congressional leaders chose to turn a so-called "economic stimulus" bill into a massive spending package that funds dozens of new federal programs with little or no connection to economic stimulus. Such spending should be considered under the normal budget process, being weighed against other priorities. Instead, with the enactment of this so-called stimulus bill, the federal government will borrow an additional $790 billion over the next two years. Once interest on the additional debt is factored in, the total cost of the bill rises to over $1.1 trillion - approximately $9,400 per family in the United States.
Congress should have acted in a more targeted and proven manner. Unfortunately, only a small portion of the massive new spending contained in the stimulus bill will go towards highways, bridges, roads, and other transportation-related infrastructure, less than 8 percent in fact. Yet, this spending is the most likely to actually lead to job creation. According to the Democratic Chairman of the House Transportation & Infrastructure Committee, the Honorable James Oberstar, the approximately $60 billion in spending on highways and similar infrastructure in the bill creates 1.8 million jobs. The cost of creating or saving the other half of the bill's job goal of 3.6 million jobs: a whopping $730 billion. These numbers serve to confirm that, in fact, much of the spending in this legislation has little or nothing to do with job-creation. Assuming the bill's sponsors are accurate in their job projections, each job created or saved will cost the American taxpayers well more than $200,000 each.
If this legislation was truly about stimulating our nation's ailing economy, it would have placed much greater emphasis on tax relief for small businesses - the biggest engine for job creation in our economy. Unfortunately, however, only about one-third of one percent of the entire cost of the bill is tax relief targeting small businesses. I voted for an amendment that would have replaced much of the spending in the House version of the stimulus bill with significant tax relief for small businesses, as well as reduced tax rates for families and individuals in the bottom two tax brackets. Unfortunately, the amendment failed by a margin of 170-266.
A stimulus package focused on three primary components - "shovel-ready" transportation projects, tax relief for small businesses and families, and extended unemployment benefits for those citizens hardest hit by the economic crisis - could have saved the taxpayers hundreds of billions of dollars while jump-starting the economy with much greater likelihood of success. Such a package would have also likely received widespread bipartisan support.
Instead, a bill consisting of more than one thousand pages was crafted with little input from rank-and-file Members, loaded up with countless items unrelated to economic stimulus, and rushed through both Chambers with little opportunity for public scrutiny. The state of our economy is too important of an issue for such an approach. The American people expect and rightfully deserve better - both on substance and in process - from their nation's highest leaders.