President Obama’s $787 billion stimulus bill to revive the economy is a staggering figure. So why then is there talk in Washington about a possible second stimulus package to jolt the American economy out of recession?
Economists say that only 10 percent of stimulus dollars have been spent and the president’s plan has been criticized for not creating enough jobs.
“You can’t justify it logically. You have to justify it politically and that’s what this comes down to. It’s political distribution of dollars,” said Matt Will, University of Indianapolis.
When the president signed the Recovery and Reinvestment Act into law in February, he said it would create new jobs. Yet unemployment now stands at almost 9.7 percent, the highest in over two decades.
When will voters learn that there is no way to stimulate an economy by spending? The right way to stimulate an economy is by creating jobs, by passing laws to encourage businesses to expand and hire more employees. For example, we could have spent 400 billion dollars and cut the employer portion of payroll taxes, so American workers would go on sale. The Democrat porkulus bills (1 and 2) did noting to create private sector jobs.
U.S. leaders should be open to the possibility of a second stimulus package to jolt the economy out of a recession still causing job losses, House of Representatives Majority Leader Steny Hoyer said on Tuesday.
…President Barack Obama led the charge for a two-year $787 billion stimulus package that his fellow Democrats who control Congress pushed through the House and Senate in February and he has argued it would help create or save up to 4 million jobs.
Create 4 million jobs? He’s lost 2.5 million jobs so far. Maybe he doesn’t know what the word create means?
As you all have heard, Laura D’Andrea Tyson, the Clinton economic adviser now on Team Obama, has floated a second stimulus plan. Democrat Sen. Sheldon Whitehouse of Rhode Island has echoed the call. Other Democrats are open to it.
Only 10 percent of Porkulus One has been spent, misspent, or gone untracked, but who’s counting?
I’ve uploaded two documents for your perusal this morning: The first is a GAO report on stimulus spending by states and localities, which will be released this morning at a House oversight hearing.
Bottom line: The funds are not being spent on what they’re supposed to be spent on. States made up their own criteria for spending. School and transportation bureaucrats preserved their own jobs instead of “stimulating” others.
Michelle lists a few of the key findings from the second document.
National Debt
Why didn’t the massive Democrat spending spree work?
This is lesson one of Economics 101. When government spends money, the money comes out of the private sector. Government is not even close to allocating capital and producing wealth as efficiently as the free market system.
Here’s where we get into the “saved or created” dodge of the Obama administration. The Porkulus money may have “saved” jobs, but they were government jobs, not the private sector. Most government employees have union representation, primarily by the SEIU. The only jobs Porkulus may have saved were those of bureaucrats in state government, and mostly to make sure the unions stay on the side of the Democrats.
None of that money went into promoting growth in the private sector, which is why unemployment skyrocketed. Capital stayed out of the market, in part because of fears of confiscatory tax increases and in part because of the amount of regulation threatened by the Obama administration, and what capital was left will get eaten up by the cost of Porkulus eventually. And the GAO says it will take months just to get effective reporting on how that money gets spent, regardless of where it goes.
Obama’s support is now virtually 50-50 according to Rasmussen Reports.But he won’t care, because he’s the Obamessiah! As long as the left-wing fascists and terrorists love him, who cares what economically-literate peons like us think?
It also ignited a trade war with Canada. In response to vague “buy American” provisions in the stimulus package, “A number of Ontario towns, with a collective population of nearly 500,000, retaliated with measures effectively barring U.S. companies from their municipal contracts — the first shot in a larger campaign that could shut U.S. companies out of billions of dollars worth of Canadian projects.”
Yet, Obama had the audacity to claim that only passing the stimulus package would save us from “irreversible decline” and economic ““disaster”.
Remember how Democrats used to complain about Bush and his “tax cuts for the rich”? Yeah, it’s strange how only people who pay taxes (59% of the public) can actually get tax cuts, isn’t it. But Obama has an even better idea: “tax hikes for the poor”.
A senior administration official said the new standards would raise the cost of an average car by $1,300, $600 of which could be attributed to the rules being announced today.
On the other hand, let’s take a look at Canada in relation to the United States, courtesy of the Cato Institute. (H/T Heritage Foundation)
The Cato Institute writes:
Spending: Spending by all levels of the Canadian government peaked at 53 percent of the country’s GDP in the early 1990s, then plunged to 40 percent in 2008. U.S. government spending has risen, reaching 39 percent of GDP in 2008. And with the stimulus package, that number is likely to jump even higher.
Government spending as % of GDP
Debt: The Canadian government cut its debt from 71 percent of GDP in 1995 to 32 percent in 2008. Under President Obama’s budget plan, U.S. federal public debt will jump from 41 percent of GDP in 2008 to more than 60 percent next year.
Federal debt as % of GDP
Deficits: Canada has balanced its budget every year since 1998 — not by raising taxes, but by cutting spending. The United States balanced its budget for four years in the late 1990s, but now deficits are so large that it’s difficult to imagine that ever happening again.
Surplus / Deficit as % of GDP
Corporate Taxes: Canada has cut the corporate tax rate from 28 percent to just 15 percent, and most provinces have trimmed corporate taxes as well. The U.S. federalstate rate stands at about 40 percent, and the Obama administration is planning to increase corporate taxes.
Corporate tax rates
It’s important to note that the Liberal party in Canada is socially progressive, but moderate on fiscal issues. Of course, now that the Conservatives have been running things, it’s gotten even better. It would be great if they could win a majority. The biggest problem in Canada right now is the fascist Human Rights Commissions, but there are candidates from the Conservative Party who intend to abolish the HRCs in BC and Ontario.
WINTERY KNIGHT 