Administration officials have announced that there is $200 billion dollars of TARP funding left over from the bank bailouts. President Obama has expressed interest in funding a jobs plan (likely focused on updating highway and rail infrastructure and on weatherizing homes), while conservatives think it should go towards spending down the deficit. My gut reaction was to agree with the conservatives on this one, given that the deficit is at $1.4 trillion (to be fair, the deficit from Bush's last year was $1.3 trillion - so pretty much par for the course). At the same time, there are a lot of people who need jobs and energy efficiency and updating rail is always a good thing. Hmm - I'm conflicted.
http://www.politico.com/news/stories/1209/30347.html
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Pay down the debt. Name me two goverment programs that created jobs that have stayed under budget. $200 billion will balloon to $500 very fast.
ReplyDeleteI guess I was thinking about this from a political stance (eventhough that isn't clear from the post) and what I would do if I were in the President's shoes. If he pays down the deficit with it and the jobs #s don't recover, it will be used as an example of where Obama didn't do enough for the unemployed. If he puts the $ into a jobs program and the jobs #s don't recover, it will be seen as squandering money or as a misguided approach, both of which reflect poorly upon him. If he pays down the deficit and the jobs #s recover, the administration can tout it as a win-win and/or people will just forget about it. If he puts the $ into a jobs program and the jobs #s DO recover, he can tout it as a success.
ReplyDeleteBut yes, you're probably correct that the bill will inflate higher than $200b. Fortunately the TARP funds were already obligated to the executive branch, so they won't have to send it to the Congress (where it would certainly balloon to $500b or more). I would probably take your advice and pay down the deficit - publicity for additional spending is not what the administration needs right now.
Responding to you challenge, all of the programs I work with come in at or below budget (not that I have anything to do with that, but still) because we're given a certain amount each fiscal year (which, until this year, had been decreasing annually). All of these support jobs, either creating or maintaining workforce at State/local health departments, tribes, non-governmental organizations, non-profits, universities, community health centers, etc. I'm guessing you're talking about larger government programs like the WPA, etc. where the sole purpose is to create jobs? Not sure if you're referring to the stimulus bill, but I've seen the numbers that folks have said it takes to create a single job with the ARRA bill and I think they're inflated; a good amount of the funds in that bill went to sectors/projects that were not solely focused on creating jobs (health research grants, education grants, any number of random, questionable grants). Nearly ten billion went to NIH, which does a large amount of their research in-house. While they could certainly use the money and the work that they do is important, it's hard for me to believe that even 1% of that went to jobs. Maybe they hired an intern?