In the nineteen months that President Obama has been in office, there’s no action that he’s taken, no policy that he’s supported that’s received more undeserved criticism than the federal stimulus. Consistently maligned by conservatives, the American Recovery and Reinvestment Act (ARRA), which passed the Congress with no Republican votes in the house and only 3 in the Senate, has significantly eased the impact of the Great Recession and continues to do so, while at the same time laying the foundation for a true 21^st Century America.

Intended to create jobs and promote investment and consumer spending during the recession, it’s difficult to reconcile Republican objections to the ARRA, better known as the Stimulus. After all, they had all supported the TARP bailout, which sent the better part of a trillion dollars to the nation’s richest banks. But the Republicans stood in unity against a stimulus directed at helping middle and working class Americans. Some say that the opposition was purely political, just one of many attempts to block actions that might help the economy and improve the standing of the Democratic leadership.

That may well be the case, as there have certainly been a record number of obstructionist actions taken by Senate Republicans since Obama took office. But whether or not the Republican disregard for common Americans is behind their original opposition, it seems clearly to be reflected in their conspicuous attempts to discredit the positive impact the Stimulus has had.

Most recently, while unveiling first looks at the Republican plan for the future, House Minority Leader, John Boehner said that the Stimulus, “has gotten us nowhere.” Oddly enough, he made that statement after the nonpartisan Congressional Budget Office (CBO) report on the stimulus had been released. The CBO analysis concurred with the majority view on nonpartisan economists and found that the stimulus had raised the GDP by 1.7% to 4.5% and increased the number of people employed by 1.4 to 3.3 million. The report also concluded that the number of full-time-equivalent (FTE) jobs had been raised by between 2 million and 4.8 million. The truth is that the facts don’t support the conservative spin, so the Republicans don’t offer any facts, just sound bites like John Boehner’s fallacious claim.

Few and far between are any economists who would even marginally agree with Congressman Boehner. There may be debate over the extent of the impact, but no reputable person would even attempt to argue that the Stimulus has “has gotten us nowhere.”  Mark Zandi, former economic advisor to John McCain, took issue with Boehner’s falsehood and stated that, “Without the stimulus spending, instead of a 9.5 percent unemployment rate, we’d have an 11.5 percent unemployment rate.” But of course, when people are still struggling in a stalled economy, it’s exceedingly difficult to sell the fact that it would have been so much worse.

Caring more about partisan politics than the health of the American economy or the wellbeing of the American people, Republicans have chosen to ignore the facts and rail on about how ineffective the Stimulus has been. The trouble is that, since they have no credible argument with which to discredit the macroeconomic effects of the program, such as the number of jobs created, they’ve been forced to try to put the spotlight on “waste.”

Reports of “wasteful projects” started the moment spending targets began to be identified. But the Republican spin machine hit a crescendo in early August when Senators John McCain (R-AZ) and Tom Coburn (R-OK) released their report highlighting 100 projects they deem to be wasteful. Headlining their list is a $308 million contract the senators identify as being with oil giant BP. Of course, their report fails to mention that the money was actually given to Hydrogen Energy California, a BP subsidiary, in September 2009 — long before the oil spill. The report is also conveniently silent on the fact that the award actually went to a 50/50 joint venture, so BP isn’t even the primary awardee, and also that only $175 million of the total came from stimulus funds, while the private sector invested seven times as much money in the project as did government.

This is not to suggest that the Stimulus is without waste; any program with thousands of discrete expenditures totaling over $800 billion is going to incur some spending that could be considered wasteful. But does this justify raking through the contracts in an attempt to find anything and everything that can possibly be labeled waste? Does it justify using half-truths to cast expenditures in an illegitimate light?

The report tags the $71,623 awarded to Wake Forest University Baptist Medical Center as funding a study on, “Monkeys Getting High for Science.” The truth is that monkeys are being used, but the study is actually directed at research regarding cocaine addiction and relapse in humans. Along similar lines is the report’s characterization of $554,763 spent to replace windows at a Mount St. Helens visitor’s center as wasteful — because the facility “was closed in 2007.” Terrible, huh? . . . unless you consider that the Forest Service is performing the renovations in order to repurpose the center, so that they can, “protect the original investment and ensure continued good use of taxpayer dollars.” 

These are but a few examples of the distortions contained in the McCain/Coburn report. But whether or not you agree with Senator McCain that, “all of them are waste,” you still have to question his use of spin and what it says about his motives. This is especially true when, at the end of the day, even if you accept their entire list as “wasteful,” the $1.7 billion total is less than one-quarter of one percent of the total stimulus. This money is obviously nothing to sneeze at, but .002 waste is pretty damn good by any objective measure. The Pentagon, which David M. Walker, President of the conservative Peter G. Peterson Foundation and former comptroller general of the U.S., identified as a system, “so fundamentally flawed that billions of dollars in waste is virtually guaranteed every year,” would have to completely reinvent itself to even approach such efficiency. Yet do you hear any Republican cries to cut defense?

The honest truth is that the ARRA could have been handled better. It does include some waste and should probably have been more focused on very specific job-creating investments. But to say that the stimulus, “has manifestly failed,” as Republican candidate for Senate, Carly Fiorina did during last night’s senatorial debate, is to take spin and wind it up to the level of outright falsehood.

The ARRA, originally estimated to cost $787 billion but recently revised at $814 billion, was essentially divided into thirds, with one part each allocated for tax relief, entitlements, and contracts/grants. The tax relief component, with $223 billion spent out of the $288 billion allocated, provided tax cuts for 95% of Americans and also included $51 billion in tax relief for business. Entitlements, funded at $224 billion with only $143 billion spent thus far, consisted mostly of aid to states in the form of $86.8 billion for Medicaid, $53.6 billion to help local school districts and prevent further layoffs, and $82.2 billion to assist low income workers, the elderly, and the unemployed.

While little of the expenditures in these categories went directly to create new jobs, the money did save thousands of people from joining the ranks of the unemployed. It also ensured that those most adversely affected by the recession received relief. And it accomplished these ends while also putting the majority of the funds where they would be immediate spent and returned into the economy. This factor ensured sustainment of consumer spending, which amounts to 70% of the economy, and created the largest stimulating effect possible.

The final portion of the Stimulus, that marked for contracts, grants and loans, is really the forward facing job creation engine of the program. The original intent of this spending was to identify “shovel-ready” projects where the money could be put to immediate use. But far too few projects of that kind were found, so at present only $139 billion of the $275 billion allocated has been spent. But even so, exciting progress has been made, and if people can remove their partisan lenses for just a moment, they will see that this program is building the foundation for a better government, a stronger America, and a brighter future for all Americans.

Recipients of funding through the direct investment part of the Stimulus had reported a total of nearly 750,000 jobs funded by the program through the end of this past June. But these jobs are really just the beginning. The program has made over 215,000 awards, but because of the time requirements to ramp up production, less than 40% of the award money has been disbursed. The real promise of these investments is still in the future, and it will come in the form new jobs, new industries and a transformation of government and certain sectors of American business.

Stimulus investments are focused in five critical areas: 1) to seed research and development, 2) to modernize transportation, 3) to jump start alternative energy, 4) to promote ground-breaking medical advancement, and 5) to establish a platform to enhance private sector infrastructure. Together, these areas represent a game plan for, not only moving our nation away from dependence on environmentally damaging foreign oil, but also for creating a new energy economy, building American capacity for the future and infusing existing industries with new technology.

One exciting example of how the Stimulus is paving the way to a prosperous green economy is the investment in advanced battery technology. Advanced batteries are critical to the deployment of alternative energy technologies from electric cars to smart grid-storage. Prior to the Stimulus, the U.S. produced only 2% of the world’s advanced batteries. But stimulus funding will create 30 new factories thereby increasing the U.S. share of battery production to 20% by 2012 and to 40% by 2015. Most of the associated projects are being seeded through grant money, like that awarded to A123 Systems of Watertown, Mass., who will be building two U.S. based factories with stimulus money. A123 is already a big player in the market, with 5 factories in China, but the Stimulus is moving them home. According to company CEO, Bart Riley, “Without government, there’s no way we would’ve done this in the U.S.” It should be noted that A123 held an IPO to raise the private capital that’s required to match public funding on all grant projects.

Carving a foothold for America in the growing market for advanced batteries is but one example of the Stimulus taking our nation where it needs to go. Funding has also been awarded to finance three of the world’s first electric-car plants, and because those cars will need charging, the Stimulus will also increase battery-charging stations by 3,200%. Other energy related projects include, $3.4 billion for clean coal, loan guarantees to facilitate the first new nuclear power plants in 30 years, and investment in wind and solar, including building the nation’s largest photovoltaic plant in Florida and the world’s two largest solar-thermal plants in Arizona and California. All together, $90 billion has been allocated to fund alternative energy infrastructure and efficiency — a fact that may provide a little more insight into Republican objections — since the Oil and Gas industry represents the only “Strongly Republican” lobby in Washington, sending 73% of their contributions to the right.

One signature project, also in the energy space but designed to address the nation’s woeful record on energy efficiency is the Weatherization Assistance Program. Most Americans know that the U.S. is the planet’s number one energy customer, actually consuming more than 20% of world supply. But much less widespread is the knowledge that over 57% of what’s consumed is actually wasted. With a goal to weatherize 600,000 homes, the weatherization program will begin to address this issue. The program has already completed 200,000 homes and continues to move forward at a rate of 25,000 homes per month and has created more than 13,000 jobs.

Energy is without doubt the center focus of stimulus spending, as it rightfully should be. Our nation’s ever-increasing dependence on foreign fossil fuels is amongst our most serious concerns in terms of national security, economic wellbeing, and environmental health. Energy independence should be a national priority, but the transition is extremely expensive, so market forces work against change and instead serve to preserve the status quo. The writing has been on the wall for more than 30 years, yet industry has moved forward at glacial pace. The sad truth being that it’s more profitable to continue to push fossil fuels. This is precisely the type of situation that demands government intervention — when the good of the nation is at conflict with the profit motive of business. The Stimulus is meeting this need and is on track to meet its goal of doubling alternative energy by 2012.

Rounding out other stimulus highlights are investment in transportation, healthcare, and infrastructure. One notable public transportation component is an $8 billion contribution for high-speed rail projects across the nation, including $2.3 billion for the system to connect the San Francisco Bay Area and Orange County. There’s also a $27.5 billion slice working to fund highway and bridge projects across the country. On the healthcare front is $20 billion to move health records into the digital age, an endeavor that constitutes real healthcare reform and promises to deliver both improved care and lowered costs. Other infrastructure investments include $7.2 billion to extend broadband access, much into rural areas, and also $11 billion for electrical grid improvements. The focus on a smart-grid is essential for maximizing energy efficiency, and both the broadband and grid improvements will lay the groundwork for trillions of dollars in future utility investments.

And not only is the Stimulus transforming America, but also the federal government. Unlike the Defense Department tradition of doling out contracts without bids, the Stimulus launched the Advanced Research Projects Agency-Energy (ARPA-E) to ensure fierce competition for grant money. Modeled after DARPA, the Pentagon agency that gave us the Internet and GPS, ARPA-E recruited a host of outside experts to evaluate grant applications and winnow the 3,700 received down to the 37 awarded in the first round. Several of these grants will fund research that would otherwise be too expensive for profit-minded businesses, and if successful, the upside is absolutely immense. The intent is to create new industries, to solve longstanding problems, to reinvent the economy — these investments have the potential to create millions of jobs.

Anyone who really believes in America owes it to themselves to look deeper into the success and potential of the Stimulus. They should visit Recovery.gov and get more information. They should understand that this is the most transparent program ever instituted by the federal government, that all program details are readily available online, that program administration provides a 24-hour response to all state and local government queries, and that the Recovery Accountability and Transparency Board was established to prevent fraud and waste. The Board gives citizens the ability to help police projects with several means to report suspicious activity, and has already helped to block some 260 projects for skate parks, picnic tables and highway beautification.

It’s difficult to understand the mindset that would hold the Stimulus program in a negative light. Detractors want to discredit the program with trumped up examples of waste. Deficit hawks want to derail progress by convincing the people we can’t afford the investment, when in truth they simply want to maintain the status quo. They know that our nation recovered easily from a debt that was 122% of GDP after World War 2, and that we currently sit at only 94%. But they also know that it was higher taxes on the most wealthy that funded the recovery and paved the way to a flourishing economy and a strong middle class. And this they will fight with every lie and distortion they cab muster.

The stimulus is exactly the prescription for America’s prosperous transition into the 21^st Century. Where better to spend American tax dollars than on the core needs and functions of our society, on our infrastructure, on healthcare, on education, on creating industries to fight energy dependence and create American exports? Are we better served with spending trillions on foreign wars, on maintaining a military presence to defend Europe and Japan? Perhaps the money should go to bigger bonuses on Wall Street or higher pay for CEOs? The answers are clear. The stimulus investments are our future. They are the path back to prosperity, to jobs, to the strengthening of the American middle class. The Stimulus program represents the way a government of the People, by the People, and for the People should act. 

The only real negative about the Stimulus is that President Obama listened to Tim Geithner and Larry Summers instead of Christina Romer. Had he taken her sage advice, the Stimulus would have been $1.4 trillion, and America would be that much closer to emerging from this greed-spawned recession into a bright and green future.

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President Obama spoke briefly from the Rose Garden this morning about the economy. He acknowledged that the recovery is still fragile, but offered assurances that his team was, “hard at work on additional measures.” He offered few details, but pulled no punches in blasting GOP leaders for their obstruction of relief for small business. “I ask Senate Republicans to drop the blockade,” the President urged, referring to the persistent GOP filibuster of a small business aid bill that’s been stalled in the Senate since shortly after the House passed similar legislation this past March.

The small business aid bill, last blocked from going to the Senate floor at the end of July, includes $12 billion in tax relief and also creates a $30 billion fund intended to facilitate lending to small businesses. The tax breaks, designed to stimulate growth, include deductions for capital equipment investment and credits for new hires. With the large banks still withholding any funding for small business, the loan fund is designed to allow community and regional banks, those with assets under $10 billion, to fill the void. Small businesses need money to expand, and according to Bob Coleman, publisher of the Coleman Report, which provides information on small-business lending, many businesses are postponing expansion while they wait on the outcome of this bill.

Republicans in the Senate have spoken out against the bill, likening it to the TARP, which they all supported, but which has since fallen into disrepute. They label the bill as more Democrat spending, even though it’s fully paid for. Senate Minority Leader, Mitch McConnell explained that the Republicans had already been given 3 amendments to the bill, but that “three amendments is not enough.” Democrats countered that the border security provision offered by Republicans had nothing to do with small business, and that they would not allow the Republican maneuver to add a permanent extension to the Bush tax cuts. Republicans also complained about the $1.5 billion in aid to farmers contained in the bill, so Democrats removed the provision, but were still not able to sway any Republican support.

In his speech today, President Obama stated of the bill that, “there’s no reason to block it besides pure partisan politics.” Dean Baker, of the Center for Economic and Policy Research seems to be in agreement. Speaking in July, he characterized the standoff like this, “The Democrats want to hand money out to small banks and win some support among traditionally Republican backers, while the Republicans don’t want the Democrats to have any achievements to show when they campaign.” Even the U.S. Chamber of Commerce, who typically sides with Republicans, is fully in favor of the legislation.

So, how is it that the Party who purports to be a champion of small business, comes to resist, so adamantly, a bill designed to help that very segment? This is the same party that bases their defense of extending the Bush tax cuts for the rich on the detriment their expiration would have on small business, yet they won’t support this fully funded stimulus. Conservative voters should take heed, because this is just another piece, amongst a vast body of evidence that indicates where Republican loyalties are tied.

President Obama did mention a few other examples of efforts being pursued by his administration. He emphasized that they were still fighting for the extension of the Bush tax cuts for the middle class. Although he gave no indication of how they might achieve that without also extending the cuts for the rich. They are incapable without GOP support, and thus far, Senate Republicans remain firm in their resolve to force an across the board extension, that adds $678 billion to the deficit from relief for the rich, or nothing at all.

The President stated that further tax cuts to encourage businesses to create jobs in the U.S. were being considered. He also listed initiatives being pursued, such as, “rebuilding more infrastructure for the future” and “redoubling our investment in clean energy and research and development.” But he gave no details on these items, nor did he even mention the current stimulus, which is actively moving these initiatives forward. The stimulus which is so often maligned by conservatives, but credited by economists for avoiding 2 addition percentage points of unemployment and adding millions of jobs, is also providing a critical service in moving our nation into a clean, alternative energy future and building infrastructure in the areas of public transportation and a smart grid.

Much to the disappointment of many progressives, the President’s speech failed to clearly identify the severity of our current economic problems or the details of the administrations plan to address them. With both consumers and businesses tucking their money away, there’s little hope that things will change without further stimulus, but in an election year where the deficit hawks are out hunting for prey, Democrats appear to lack the resolve to promote such a bold action. The alternative is obviously a very slow recovery in which the middle class foots the lion’s share of the bill — and minus the public wherewithal to understand that the deficit has merely been presented to conveniently block further corrective action, we appear to be doomed to stew in this status quo.

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Article first published as Americans Need Jobs on Technorati.

We’re in a heap of hurt here people. Unemployment is stuck at 9.5%, and real unemployment, which includes those who have stopped looking for work, is still at 16.5%. This means we have nearly 30 million Americans competing at a ratio of 5-to-1 for what jobs are presently available. A continued jobless recovery with the possibility of a double-dip recession — what’s the average American to do?

People can help improve the situation by voicing their opposition to the anti-job policies promoted by certain factions in the federal government. The current focus on the deficit would be one such item. The last thing we need now is to further reduce the purchasing power of average Americans by trying to cut deficits at the expense of the middle and working classes. We successfully climbed our way out of a 122% deficit after World War 2; we’ll climb out of today’s 94% deficit too. The screech of the deficit hawks is really nothing but a wrong-minded attempt to draw attention from where it belongs — on job creation.

Concerned citizens can also make a difference by ignoring the fear mongers and voicing support for programs designed to help average Americans and create jobs. The American Recovery and Reinvestment Act (ARRA) is one such program. Though it’s taken a beating from conservative trash talkers, according to the nonpartisan Congressional Budget Office (CBO) the program has created between 2 million and 4 million full-time-equivalent (FTE) jobs, helped raise the GDP, and served to restrain further increases in unemployment. The only real problem with the stimulus is that it was too small.

If citizens really want to make progress, they need to compliment the above with a full court press on the Obama economic team. The trillions poured into Wall Street must at this point be considered a bad investment. The money cycle is still stalled, with small business and average Americans frozen out, while the banks that were saved are enjoying free money from the Fed and still partaking of the gambling practices that crashed the economy. Wall Street greed is the closest thing there is to a direct cause of these dire economic times — you can’t remove 8 million jobs from the economy and just keep on truckin’. The Obama team can, at the very least, increase the price of money to force these thieves to lend again. Obama can also appoint an advocate of the middle class to chair the newly created CFPB.

The last major part of the job picture is the impact of globalization. Unlike other areas where the American people must exert their will through political pressure, including their votes, The People can actually intervene directly in the trade imbalance. They can do so by buying American, which in general terms means shopping somewhere besides Wal-Mart. The nation’s largest retailer identifies more than 70% of its products as originating in China, and most of the rest from its other 47 foreign sources. Wal-Mart is the largest importer of goods from China and a direct contributor to the estimated 1.8 million jobs American jobs lost as a result.

Of course, a change in shopping habits alone will not remedy the situation. One key reason that China now enjoys such a trade advantage is the manipulation of the value of their currency. Estimated to be undervalued by approximately 40%, it’s impossible for American manufacturers to compete. Couple their artificial currency valuation with trade agreements that essentially allow them to pilfer the intellectual property of competitors, and the picture really starts to form. Add to this, their total disregard for the environment and regulations to protect it, and it becomes crystal clear that the deck is stacked. China enjoyed a $28.7 billion trade surplus in July — the U.S. accounted for $26 billion of that. These issues must be addressed by the federal government.

If Americans are ever again to enjoy anything resembling full employment and decent wages, The People must push the government to do the right thing. Businesses will do what serves business, and as in the case of Wal-Mart, what’s good for business isn’t always good for the American people. Fortunately, government is charged with serving the needs of The People — we just need to join together and remind them of that.

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