President-elect Obama is lucky that his media followers don’t think carefully about what he says:
“Dec. 7 (Bloomberg) — President-elect Barack Obama said the U.S. recession will worsen before a recovery takes hold and that he will offer an economic stimulus plan “equal to the task” without worrying about a short-term widening of the budget deficit. Dealing with the loss of jobs, frozen credit markets, falling home prices and other signs of economic turmoil is “my number one priority,” Obama said on NBC today. Later at a Chicago news conference he said “more aggressive steps” are needed to cope with the housing crisis.”
- So short-term the economy will get worse.
- In the short-term the deficit is going to get worse.
- His stimulus plan that we’ve been hearing about lately? A long-term infrastructure spending program.
- And what is his long-term spending program going to do to the deficit? Something to worry about, maybe?
I had hoped that at this point I would be able to switch to saying something good about Obama’s idea of a long-term infrastructure plan. Yes, it will do more harm than good. Going into debt to solve a problem created by too much debt does not seem like a winner. But things like roads and bridges would give him something to show for our money in the end, even if it makes the financial situation worse and more drawn-out.
Unfortunately, I took the trouble just now to read beyond the headlines. It looks like he is using a very expansive definition of the term “infrastructure.” With the direction he’s taking, it’ll be a program to spend massive amounts of money on every special interest represented in Congress.
Saying something nice about Obama will have to wait for another time.
Computers in classrooms? I thought by now we had gotten over that fad and had been chastened by the results. And something that becomes obsolete in 5 years is not exactly infrastructure.
Greater broadband availability? Yes, that could be called infrastructure. But why should the government build this, when municipality after municipality has failed financially in its efforts to provide government-sponsored internet. Why not instead fix the tax and regulatory climate (including an abolishing or reform of the E-rate program) so that private companies will be motivated to build broadband services. Then local governments will have services to tax and so increase their revenues. And there will be obscene profits to tax, too, which will provide revenue. Why would government want to shut off its income-producing sources?
Technology in doctor’s offices? Spending on all this technology stuff may be a way to pay back all the high-tech workers and industries who spent so much money on his campaign. But why not instead create an economic climate in which doctors will be able to adopt the technology when it proves its ability to improve efficiency and make more money for them?
Sigh.
The biggest problem with the roads and bridges infrastructure produces jobs scenario is the claim by the government that we can create 35,000-45000 jobs per 1 billion dollars spent. These numbers are grossly exaggerated according to the heritage foundation as well as many government agencies. For more on this read. . http://www.heritage.org/Research/budget/bg2121.cfm
Actually a current estimate in the real world can be found at http://www.search4jobs.com.au/article/record-road-spending-equals-jobs/
Which states that over 16 billion. Dollars spent on a bridge in Queensland will create only 38,000 jobs over the 5 year project. Furthermore every time I pass a road construction or city works project I see 1 poor guy working while 3 other guys watch him and the real money is kept by the contractors who pay millions for lobbyist and pay even millions more in campaign contributions to grease the wheels of legislature.
If President elect Obama really wants to put 2.5 million Americans back in the work force the solution is quite simple. Take the $25,000 per job, created per billion dollars spent and use it to hire 40,000 new immigration enforcement officers per 1 billion spent, on a temporary basis and as they deport all the illegal workers the enforcement officers can fill the construction, and other service jobs that are opened up. The savings in educating, providing health services and other resource draining costs paid by state governments on illegal immigrants could be used in conjunction with federal funds on a local city by city effort to install energy efficient windows and doors, insulation and efficient heating units in inner city and older housing units. The work would now be done by American installers with minimal training. The increased demand for insulation, heat pumps, and windows would help the manufacturing industry hire more employees as well.
Predominately inhabited by the poorest in our society the savings in energy bills would certainly be spent in the local economy producing an even better tax and business base.
I must admit that putting a computer at every desk in every classroom is a terrific idea. For less than the cost of the textbooks currently used in classrooms our children would have far more resources from which to learn. The absurd idea that a computer in the classroom becomes obsolete after only 5 years does not consider the fact that 10 yr old machines have more than enough memory and computing power, and are being used in government offices every day, The fact that today’s computers have at least 10 times the power of ones used just a few years ago does not necessitate the need for all that speed and memory in a classroom setting. The reduction in the need of paper if universally adopted would save huge amounts of money and natural resources. If all the computers were manufactured by American labor, it would produce lots of decent paying jobs. The loss, if any to the paper manufacturing sector would be easily offset by the quality of life for anyone living within the smell of the paper mills.