Stimulus that doesn't stimulate - Part II

In our first post examining the American Reinvestment and Recovery Act we examine each category of spending and commented on whether or not it was worthwhile as well as its impact on stimulating the economy. Last week saw a Congressional Budget Office report (or draft) that drew some of the same conclusions that we did here. From the Washington Post article on the subject:

Less than half the money dedicated to highways, school construction and other infrastructure projects in a massive economic stimulus package unveiled by House Democrats is likely to be spent within the next two years, according to congressional budget analysts, meaning most of the spending would come too late to lift the nation out of recession.

A report by the Congressional Budget Office found that only about $136 billion of the $355 billion that House leaders want to allocate to infrastructure and other so-called discretionary programs would be spent by Oct. 1, 2010. The rest would come in future years, long after the CBO and other economists predict the recession will have ended.

This lays bare what is obvious to everyone but the most partisan Democrat-that the stimulus is a massive spending bill that is using the problems with the economy to justify the biggest government shopping spree in 60 years. And the reason is equally obvious. These politicians know that there will be will not be the normal money spigot they are used to under normal spending evaluation and deliberation in the legislature.

A side story on the CBO report is that the alleged report is no longer available. you can assign any motive you want for it but you can read it here and decide for yourself. Look for a new report soon that will sand over the factual rough edges on this one and make it appear the the spending is more immediate.

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