How much stimulus/bailout is enough?
Not pleased with the $838 billion stimulus bill that passed the U.S. Senate yesterday? As the two federal chambers seek to work out an agreeable package, does it matter if the $838 billion Senate measure and the $820 billion bill that passed the U.S. House are dropped down to $789 billion? Or is it time to figure out (and hold your nose over) how much “stimulus” has been approved in the last year — and how much is yet to come?
OK, there was the spring 2008 tax rebate costing $170 billion that federal lawmakers were only too happy to approve back when President Bush was still in office. That was the Economic Stimulus Act of 2008 that gave $600 to single people, $1,200 to couples and $300 per kid in what the Internal Revenue Service called ’stimulus payments.’ It didn’t serve to stimulate the economy, apparently, because in December 2008 we finally learned the economy had been in recession since December 2007.
But as fall arrived, the financial “bailout” package became necessary (enough federal lawmakers felt so to pass it), when the pending failure of AIG and cries about credit markets choking off lending arose. The 2008 Emergency Economic Stabilization Act package of $700 billion was enacted, and this morning before Congress members of the banking industry defended their spending of that money to date.
That brought the 2008 stimulus/bailout/stabilization total to $870 billion, moving the Americans for Limited Government group to call 2008 The Year of the Bailout. That will be doubled in a couple days when President Obama signs the worked-out package for the new stimulus, which is weighted toward money for infrastructure projects on schools and highways to create jobs, while providing some tax relief — and considerable pork to boot, critics say. So we’re up to about $1.6 trillion in less than a year.
Will this work to push the economy out of recession? Seemingly every day I hear an economic source saying the recession hasn’t hit a bottom yet. While U.S. senators who voted for the package yesterday (like Tim Johnson, D-S.D., Ben Nelson, D-Neb., and Tom Harkin, D-Iowa) say action was needed to help the 3.6 million who lost jobs last year, we also hear Congressman Jeff Fortenberry, R-Neb., saying the size of government growth this decade of 60 percent is unsupportable.
“This aggressive spending, in the name of stimulus, is not the appropriate remedy,” Fortenberry said.
Countered Johnson, “Our goal was job creation, tax cuts for the middle class and investment in infrastructure.”
If you’re wondering, zero House Republicans voted for the 2009 stimulus plan, while three Senate Republicans went for the package yesterday, so the latest “stimulus” is the work of Democrats.
ADD AT 4:45 P.M. — With a House/Senate agreement on a $789 stimulus package set this afternoon, U.S. Sen. Ben Nelson has put out a release, saying, “soon the recovery can begin.” Feel better?
Tags: 2008 economic stimulus act, ben nelson, federal bailout, federal stimulus, jeff fortenberry, rebate checks, tim johnson, tom harkin