- Image via Wikipedia
Everybody you talk to has an opinion about the American Recovery and Reinvestment Act (ARRA) of 2009, better known as the Stimulus. Enacted in February of 2009, the program was intended to shore up short term consumer spending, provide aid to states and invest in projects to create jobs. With a total price tag originally estimated to be $787 billion, the Stimulus was originally supported by 51% of Americans, but a year and a half later, only 29% believed that it had actually helped the economy.
A Rasmussen Reports poll taken in July showed that not only did so few Americans believe the Stimulus had helped, but that 43% believed that it hurt the economy. That same poll revealed that 69% of those surveyed believed tax cuts were a better way to create jobs than more government spending. Without doubt, these attitudes are reason for concern, but they fall far short of telling the whole story.
Things actually get much more confusing when the results of a Gallup poll taken in June are also considered. The survey asked people if they would be in favor of Congress passing legislation to “Approve additional government spending to create jobs and stimulate the economy,” and 60% of those polled answered in the affirmative with only 38% in opposition.
So, 60% of Americans support more stimulus spending, but 43% believe that what was spent through July had actually hurt the economy, and 69% believe tax cuts would create more jobs. What can explain this incongruence?
The answer is likely found in the American proclivity to swallow political talking points without any verification of facts. A revealing example of this dynamic concerns the Obama tax cuts offered through the Stimulus. A CBS News/New York Times poll conducted in February of this year showed that 24% of respondents believed that Obama had increased taxes, while only 13% believed they had been reduced. Amongst Tea Partiers, only 2% believed taxes had decreased under Obama, and a whopping 44% believed they had increased. The opinions evinced in these polls have nothing to do with the reality that the Stimulus included 25 different tax cuts that benefitted 95% of all Americans.
Sadly, voter opinion seems to track much more closely to political rhetoric than anything substantive or factual. Republicans have consistently spread the message that Obama will raise people’s taxes, therefore people believe that he has. They’ve also espoused the position that tax cuts best stimulate the economy, and although the vast majority of economists believe tax cuts to be the worst form of economic stimulus, a majority of Americans adhere to the conservative falsehood.
This dynamic seems also to be at the root of public opinion regarding the Stimulus. Arguably the Obama administration’s most successful program to date, it has been credited by the Congressional Budget Office (CBO) with adding as much as 4.5% to the GDP and increasing the number of people employed by between 1.4 and 3.3 million. According to Mark Zandi, former economic advisor to John McCain, unemployment would be 11.5% instead of 9.5% without the Stimulus. But still 43% of Americans believe the Stimulus has hurt the economy.
The stimulus has paid out 77% of the $288 billion in tax relief, but only 64% of the $224 billion in entitlement funds, with direct investment funds trailing still further. Thus far, barely 54% of the $275 billion slated for contracts and grants has been paid, mostly because of the long lead times resulting from a shortage of “shovel-ready” projects. But as the projects ramp up, the real promise for future jobs, new industries, lower healthcare costs, more efficient government and improved energy independence will all begin to materialize.
More than $23 billion in contracts, grants and loans has come to California, funding over 18,000 awards. One major project right here in Contra Costa County is the fourth bore on the Caldecott Tunnel. Nearly $200 million was allocated to Caltrans for the project that would not have proceeded without the ARRA. In addition, direct local funding within Contra Costa County has funded 46 contracts and 252 grants totaling nearly $300 million. Investments include $43 million for transportation, $22 million for public safety, $14 million for energy, $126 million for education and more funding to assist with health and human services, housing, labor, technology and water/environment. Together, these projects have created nearly 500 new jobs, saved many times that amount and promise to create more as projects move forward.
Unfortunately, the Stimulus success stories are not what most people are fed through the media. Unless an individual happens to be working on a Stimulus funded project, their opinion is likely shaped by the spurious claims levied by its political opponents. People like House Minority Leader, John Boehner and half-term Alaska Governor, Sarah Palin have made it a practice to disparage the Stimulus without any facts to back their claims. Republican Senators John McCain (R-AZ) and Tom Coburn (R-OK) even went so far as to create a list of “wasteful” Stimulus projects that was more a waste of time to create or read than anything else.
The Stimulus could have been more effective. There’s little doubt that money could have been better directed to achieve maximum job creation, but to say that the entire program “has gotten us nowhere,” as John Boehner stated recently, is nothing short of a bald-faced lie. The Republican obstructionists have succeeded in using deception and distortion to convince American citizens that stimulus spending is ineffective and that tax cuts are a preferred option. Both economic theory and American history say otherwise.
The Stimulus has raised the number of full-time-equivalent (FTE) jobs by as many as 4.8 million. It is also creating new export industries, moving our nation forward with alternative energy and laying the foundation for lower healthcare costs and more efficient government. The most significant issue with the Stimulus is that it was too small, and the national conversation should now be focused on a second wave. But instead we toil with Republican subterfuge and self-serving delay.
Wake up America! Those who criticize the Stimulus, raise concerns about the deficit and at the same time fight for tax cuts for the super-rich, don’t give a care about your wellbeing. Open your eyes and see them for what they are — Republicans.

- Image via Wikipedia
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 21st 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 immediately 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 can muster.
The stimulus is exactly the prescription for America’s prosperous transition into the 21st 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 $1.2 trillion, and America would be that much closer to emerging from this greed-spawned recession into a bright and green future.

- Image via Wikipedia
The man who wants to be Speaker of the House, John Boehner, spoke out against Democratic leadership earlier this week. A string of cheap attacks and tired one-liners, Boehner’s diatribe was pure substance-free political posturing. He called for President Obama to fire his economic team, extend tax cuts for the wealthy and to put the brakes on spending. Lacking any shame, the congressman actually had the temerity to suggest the nation needs a “fresh start,” with “people willing to accept responsibility” in charge — as if he or any of his big-business Republican cronies have accepted one iota of blame for crashing the economy and killing millions of jobs, or for doing everything within their power to stall recovery.
The would-be Speaker, obviously intent upon leveraging public concern over jobs, used every opportunity to label the administration’s programs as “job-killing.” Weaving the term into every topic, “job-killing tax hikes,” “job-killing regulations,” “job-killing agenda,” Boehner evoked the reaper 12 times in all. Condemning the recent $26 billion stimulus bill, Boehner stated that it, “funnels money to state governments in order to protect government jobs.” Of course, he was referring to 161,000 teacher jobs, as well as 158,000 jobs for police, firefighters and healthcare workers. But those jobs weren’t worth saving to John Boehner. He continued his criticism with, “Even worse, the bill is funded by a new tax hike that makes it more expensive to create jobs in the United States and less expensive to create jobs overseas,” which would be alarming — if it were true, which it’s not. His “job-killing tax hike” was actually the closing of a loophole that encouraged corporations to ship jobs overseas.
What Boehner did reveal of the Republican plan for creating jobs appeared to be vintage Bush. It’s the same old recipe that drove the nation off a cliff the last time around — more tax cuts for the rich and less regulation. Conveniently ignoring the fact that President Obama wants to extend the Bush cuts for everyone making under $250,000, Boehner told the crowd that, “Raising taxes on families and small businesses during a recession is a recipe for disaster — both for our economy and for the deficit. Period. End of story.” He’s right, so if he truly believes what he says, he should stop fighting for cuts for the top 2% and join the Democrats in providing relief to everyone else — including all but 2-3% of small businesses.
Boehner is truly a master at the art of double-talk. He claims to advocate for small business, stating that expiring the cuts for the top 2% would, “affect half of small business income.” But he fails to mention that the “half” he wants to protect are “small business” only in terms of the number of employees. Boehner’s half makes 50% of the money, but consists of the wealthiest hedge funds, law firms and lobbying outlets, and comprise no more than 3% of the actual small businesses.
Amongst the newly formed ranks of Republican deficit hawks, Boehner also called upon President Obama to, “submit to Congress for its immediate consideration an aggressive spending reduction package.” Of course, being a good Republican, Boehner did specify that the freeze should only be for non-defense spending. But that’s just the tip of his forked tongue. Avoiding the disproven claim that tax cuts pay for themselves, Boehner is left with no explanation for his logical inconsistency in demanding spending cuts to fight the deficit, yet supporting $678 billion in millionaire tax cuts to choke revenue.
One lie after another, Boehner’s critique of the Obama Administration was as fact-free as his economic plan for the future. But possibly his most egregious distortion was regarding the stimulus. A critic from the beginning, according to Boehner, the program, “has gotten us nowhere.” Sadly, many voters will believe this whopper, even though it has absolutely no basis in reality.
Perhaps Boehner had not yet read the nonpartisan Congressional Budget Office (CBO) report on the stimulus. The CBO analysis 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. In response to Boehner’s fallacious claim, Mark Zandi, former economic advisor to John McCain, took issue 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, the facts regarding jobs and unemployment really only scratch the surface. The real impact of the stimulus is still in process. It is creating jobs in the present, but it promises to create far more in the future. The program is investing in research and infrastructure, providing seed money to jump start alternative energy, modernize transportation, fund ground-breaking medical advancements and enhance technologies such as broadband and smart grids. And in so doing, the program is also transforming the way government works.
Ever the champion of the status quo, it’s easy to see why John Boehner doesn’t appreciate the progress funded by the stimulus. When Boehner says it, “has gotten us nowhere,” what he means is that it has prevented the huge drop in wages his corporate cronies so desperately desire, and that it’s also paving the road away from dependence on fossil fuels. A green America with well-paid Americans working in new industries is Boehner’s worst nightmare. He and his Republican brethren are just fine with things the way they are.
In Boehner’s own words, “It’s time to put grown-ups in charge,” and since it’s obvious that the congressman never even learned the most basic rules of adulthood, like telling the truth and practicing what you preach, he must not be referring to himself. So, let’s all hope he gets his way and voters make the intelligent choice in November — they put the grown-ups in charge and vote Democrat.









