Stimulating Thoughts

Here's how I see it:

The companies at the top have lost in their speculations, which has left them strapped for cash. Only no one wants to loan to them anymore due to the speculations. So they want cash to avoid going belly-up, throwing thousands of workers out of work.

Meanwhile, the lack of cash flow has led smaller companies to have to cut down. Thousands Over a million workers have already been thrown out of work.

Further, people who had money in investments have watched those all go bye-bye, and so their disposable income no longer looks so disposable. They've stopped doing much of the big-ticket spending, and are starting to trickle to a halt on the medium-ticket nonessentials. People are buying less stuff, which leads companies to need to make less stuff, which means they're downsizing and . . . . over a million workers are out of work.

Okay, so we need to stop a huge circular clusterf*ck, right? Well, there's three things I see that are being talked about as solutions: 1) Band-aid some of the companies that are bleeding by throwing money at them, to let them go on functioning. 2) Throw money into stuff. Buying goods and services gives those companies profits they wouldn't have otherwise and keeps their people at work. Stuff that will be useful, not just anything, but still, let's buy us some stuff. 3) Take some of the money and use it for social programs to help the people who are already out of work, or are soon to become unemployed, so that they don't die or fall so far down the socioeconomic staircase that they and their kids will become permanent drains on the system instead of a recovered middle class once this is all over with. That means providing some fail-safes for food, shelter, and physical and mental health. 4) Take things that are simply waste and eliminate them. 5) Give tax breaks to people who've managed to keep their jobs, hoping that the extra will be considered disposable income and be spent and not hoarded, this way the government doesn't do so much of the spending to start the economy, the people do.

Some further observations:

Obviously the whole "give the money to the companies" thing was a good idea in theory, but in practice they're using it to fund luxury vacations and jets (indirectly, granted, but I presume that if the company had tanked by not getting bailout funds, it couldn't pick up the tab for these things). As a pragmatic matter, I suppose this is still "stimulus" in that the people who work in the vacation and jet industries get to hold onto their jobs a bit longer. However, I'm not certain that we're prepared to pay for Nero to fiddle while Rome burns just to keep the fiddlemakers in the black. Oversight appears necessary.

The "tax breaks will lead to growth" thing only works if the people spend the rebates. If they're using it to pay bills (which is what mine was used on last year) or stuffed in a mattress, it isn't going to work. This holds true even if we include businesses in the tax breaks. If all the Jane Consumers aren't buying clothes this year because they need to stash the cash to recompense a tanked savings fund, then clothesmakers aren't going to use a tax incentive to expand their business. No market = contraction, not expansion. Also, a tax break to a corporation also has no oversight. They might reinvest it in workers and expanding the factories, or they might use their refund to pay for vacations to Tahiti. Normally, I wouldn't give a damn what they do with it. But since we're considering giving them this money, I think we might want to know what the plan is, and have a bit to say in how it's spent (see previous paragraph). For all those business leaders who will b*tch about this - you shouldn't have changed my mind by buying jets, luxury vacations, and crap. In screwing us, you screwed yourselves.

It's easy for me to say "eliminate waste" and not so easy for the sides to decide what is waste. So maybe we should come up with a system for rating these things, not just believe politician's buzzwords. How's this: 1) Does it put or keep someone in a job? 2) Is the proposed end product useful? 3) Does it prevent the unemployed from bottoming out in crucial areas (medical, housing, etc), or help them to improve their job prospects? 4) Is the industry targeted in actual trouble? 5) Is there some oversight to ensure the above will happen, or is it just a blank check (i.e. throwing money at a company or giving a huge tax break tantamount to throwing money at a company)?

These are, IMHO, the crucial questions to be answered in order to target the stimulus properly. There may be more factors, if I think of any I'll list them in an update.

Where am I going with this? When I saw in this article where the Republican leaders have weighed in on their idea of waste, I take issue with some of the list. Keeping the factors in mind:

• $2 billion earmark to re-start FutureGen, a near-zero emissions coal power plant in Illinois that the Department of Energy defunded last year because it said the project was inefficient.

It will create construction work, and technological work. Perhaps some shipping of the parts. Can we make sure we are dealing with US suppliers? Just a suggestion. As for the inefficiency, I'm not sure one way or the other. In doing a bit of checking, this has to do with coal and new technology to refine it and reduce emissions, etc. I'm seeing one side say that the technology is just too expensive to be efficient at this time, and another side saying it was only too expensive when Illinois won the bid for the project over Texas and Texas-linked politicians decided to take their ball money and go home. It may be a boondoggle, or it may be a good example of investing in the future. So which is it? I think we have to ask the scientists. In absence of a clear answer, I'd say no to this one, but I'm open to correction.

• A $246 million tax break for Hollywood movie producers to buy motion picture film.

Are movie producers in trouble? I'm thinking not, or not yet. While producing film does fund jobs making film, I don't believe there will be less film bought if we don't fund it. So, as it fails Factor #4, I wouldn't be in favor of this.

• $650 million for the digital television converter box coupon program.

Are they locally built? If so, it keeps jobs going. The things are handy for the digital switch (Though I'm tempted to deduct points because I'm not so sure I agreed with the digital switch in the first place, however, given it's a done deal, the things will count as useful). I'm not sure how you would categorize "people that make TV converter boxes" as a job, but the people who sell them - Radio Shack, Circuit City, etc. are showing a downtrend, so the industry probably qualifies as troubled. So, all in all, it's valid. There is one negative, however, that doesn't fit neatly into the boxes above: We loves us some TV. I know people who would starve before they shut off their cable. So I'm not so sure we need this much funding. Let's make sure only the needy get the coupons. Can we go halves?

• $88 million for the Coast Guard to design a new polar icebreaker (arctic ship).

Creates jobs? Check. Creates something useful? Actually, a huge old Check. We need the things. Is the industry in trouble? Again, not sure which industry, but it sounds like generic factory work plus tech people, plus people to truck the parts, etc. This sounds like a good investment.

• $448 million for constructing the Department of Homeland Security headquarters. • $248 million for furniture at the new Homeland Security headquarters.

Create jobs? Oh, yes. Construction jobs, furniture makers, shipping, architects, and so forth. Is it an industry in trouble? I think construction qualifies, not sure about furniture makers but my instinct tells me probably yes - I'm fairly sure new furniture falls under "luxuries to cut" for most people. Is the product useful? Well, they need a headquarters, and this particular site, while controversial, has already been approved. So I guess it's only wasteful to go ahead and build the damn thing? Oookaaay. Kinda surprised the Reps were the ones bitching about this.

• $600 million to buy hybrid vehicles for federal employees.

Create jobs? Yep, auto industry sucks right now. Useful product? Absolutely, given gas prices and pollution reduction. So what's to whine about? Not understanding the problem here, either, except perhaps a knee-jerk "blech" reaction to anything with the word "green" in it.

• $400 million for the Centers for Disease Control to screen and prevent STD's.

Job creation? Medical workers, receptionists, basic desk jobs. Industry in trouble is n/a because it's not handing money to an industry, it's a government entity so by nature all its funding is government. It does provide medical assistance to those people who are not working, though I see where the Reps are upset - it has to do with sex. Okay, fine. I get that nobody is supposed to be having sex, hence the removal of the birth control portion of the bill (though why in the h*ll they think it will be cheaper to pay for welfare babies than the pill is beyond me). But what about making it part of a more comprehensive health provision? I'd expand, not contract, this puppy.

* * * *

I won't go into each and every provision, the rest are listed below, but you see where I'm going with this and apply the theory. We need to bring some brains to bear on this topic, and stop the partisan bullsh*t.

• $1.4 billion for rural waste disposal programs.

• $125 million for the Washington sewer system.

• $150 million for Smithsonian museum facilities.

• $1 billion for the 2010 Census, which has a projected cost overrun of $3 billion.

• $75 million for "smoking cessation activities."

• $200 million for public computer centers at community colleges.

• $75 million for salaries of employees at the FBI.

• $25 million for tribal alcohol and substance abuse reduction.

• $500 million for flood reduction projects on the Mississippi River.

• $10 million to inspect canals in urban areas.

• $6 billion to turn federal buildings into "green" buildings.

• $500 million for state and local fire stations.

• $650 million for wild land fire management on forest service lands.

• $1.2 billion for "youth activities," including youth summer job programs.

• $88 million for renovating the headquarters of the Public Health Service.

• $412 million for CDC buildings and property.

• $500 million for building and repairing National Institutes of Health facilities in Bethesda, Maryland.

• $160 million for "paid volunteers" at the Corporation for National and Community Service.

• $5.5 million for "energy efficiency initiatives" at the Department of Veterans Affairs National Cemetery Administration.

• $850 million for Amtrak.

• $100 million for reducing the hazard of lead-based paint.

• $75 million to construct a "security training" facility for State Department Security officers when they can be trained at existing facilities of other agencies.

• $110 million to the Farm Service Agency to upgrade computer systems.

• $200 million in funding for the lease of alternative energy vehicles for use on military installations.