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Jewish World Review
May 19, 2009
/ 25 Iyar 5769
Rosy report can't hide stimulus problems
On May 13, the White House released its first quarterly report on the American Recovery and Reinvestment Act, better known as the $787 billion stimulus bill. Reaction on Capitol Hill was swift: Republicans think it's a joke, while Democrats don't want to talk about it.
The report was unveiled not by President Obama but by Vice President Joe Biden, who said it "shows early progress providing immediate financial relief for American families and jump-starting billions of dollars in job-creating projects." In a press release, Biden claimed the stimulus has so far "created or saved" 150,000 jobs, and that "over 3,000 transportation-construction projects have been funded in 52 states and territories."
You don't have to look too hard to find problems with Biden's work. First, no one seems to know precisely where the figure of 150,000 jobs comes from. When President Obama used it in a speech on April 29, the Web site FactCheck.org pretty much demolished the claim. Previewing the Biden report on May 11, a "senior administration official" held a conference call with reporters and seemed unprepared when asked where the created-or-saved jobs actually are. "In terms of exactly where and in what sectors, that's not something I have numbers on," the official said, "because, precisely, we don't yet have any of the reporting."
As far as the 3,000 transportation-construction projects are concerned, there are certainly some under way, but no one seems able to confirm a number so large. "I'll buy lunch for the first person who can get a list of those transportation projects," one Senate Republican aide told me. "That's absolutely not true."
The real news about the stimulus is buried inside the Biden report. It says that as of May 5, $88 billion has been "obligated" for spending. "Obligated" is federalese for money that has been committed but not yet spent. A much smaller number, $28.5 billion, has actually been shoved out the door that is, $28.5 billion out of the stimulus total of $787 billion has so far been spent.
And where did it go? More than 95 percent has ended up in just two places: the Department of Health and Human Services and the Department of Labor. The Human Services money was poured into a program called FMAP, or Federal Medical Assistance Percentages, where it was given to the states to help pay their Medicaid bills. The Labor money has gone for extended unemployment-insurance benefits.
The report also shows that Health and Human Services will distribute by far the largest chunk of stimulus money over the next year. The money has gone to HHS because it is the easiest place to spend lots of cash fast. But all that Medicaid and social-services money, much of which will be used by state governments to cover their own spending excesses, is considered among the least stimulative parts of the stimulus bill.
The rest of the report is a series of anecdotes, which Biden calls "Reports From the Field." Some of the stories are well-worn. The Chicago window factory that has often figured in Obama-Biden discussions and photo-ops it's under new ownership and reportedly planning to rehire some laid-off workers. A Delaware company that makes traffic lights is said to be rehiring three laid-off employees. A South Carolina county is going to receive job-retraining money.
The stimulus is generating other anecdotes, too. Recently WBAL-TV in Baltimore, Md., reported that a local man, 83 years old, received a $250 Social Security stimulus check. The only problem: It wasn't for him it was for his mother, who died on Memorial Day in 1967. WBAL said Social Security officials "blame the error on the strict mid-June deadline of mailing out all of the checks, which didn't leave officials much time to clean up all of their records." Similar stories are now popping up around the country.
At one point in the report, Biden boasts that the government has made commitments for $1.1 billion in stimulus spending every day since the $787 billion bill was signed into law in February. At that pace, it will take the administration nearly two years to come up with concrete plans to spend all the money and longer still to actually get it out the door.
And even then, we still might be trying to find out where it all went.
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© 2009, NEA