Economic Stimulus We Can Believe In

Hours before he announced that the Senate would not be voting on the package last night, Senator Harry Reid said that if Wall Street wakes up to news that there is no stimulus, nobody knows what the market would do.  Perhaps that fear is why he did not run the risk of losing the vote and sending the DOW to the low end of 7,000.  Reid claims he has sixty votes but that is doubtful.

Thursday, Senator Collins (R-ME) and Nelson (D-NE) headed a group of centrist Republicans and Democrats looking to slash about $100B worth of spending from the bill including education spending, state aid, Amtrak and green technology spending.  Meanwhile, Senator McCain (R-AZ) argued that FDR extended the Depression by spending and we cannot let it happen again...except the one time FDR cut spending in 1936 was the only time the recession came back during the 1930s.

Collins and Nelson are wrong.  Ed Rendell admitted that if the Senators get their way, Pennsylvania will have to begin to cut jobs including education jobs (perhaps law enforcement jobs?).  Paying people $30-$40 per hour to greenify the Federal Government's buildings cannot fail.  Amtrak is a mess...they can use that money immediately to lower their prices and/or fix their infrastructure.  And of course paying teachers to teach people to do stuff cannot possibly be stimulative.

First, let's keep the $275B in tax cuts but let's change the way we award them.  Let's say you're entitled to a $600 cut.  Divide that by three and you get $200.  So give Americans getting tax cuts that amount (a third of their cut) strategically right now (while we're all hurting), mid-May (so people travel) and mid-November (for Black Friday).  The alternative of course is adding $11 to people's paychecks per week for 52 weeks...is that going to change anybody's spending habits?  And to those who say this did not work last time...there's one huge difference: last time people spent it all on $4 gas that only benefited Arab tycoons, this time gas is $1.50.

Second, let's spend at least $200B on infrastructure (including education upgrades), a down payment on the $2.2T that the Corp of Engineers believe we need to fix this country's infrastructure.  Start spending on all the projects that have been halted due to the economy and are ready to go and continue with everything else.

Third, can we start firing police officers in a time when many mayors can brag about falling crime rates like Newark, NJ Mayor Cory Booker (D) and NYC Mayor Michael Bloomberg (I)?  Keep the $40B in state aid in the bill, Senators.  It'll save jobs and it'll save lives.

Research should account for about $100B of this package.  Let's research green technology and convert federal buildings and fleets of Government cars to zero-emissions.  Let's help the impoverished fix their homes to be more energy efficient.  Many of these jobs are going to be paying between $50,000 and $100,000 per year for years to come.

Finally, extending entitlements must happen here...Medicare, food stamps and unemployment.  The House estimated that'd be around $100B.

So that's only $715 billion.  And it'll work.  Reminds me of that "what if firefighters ran the world?" commercial where the Congressman firefighter said "this is the easiest job I've ever had".