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Biden defends economic stimulus plan

- The Washington Times - Friday, September 4, 2009

Vice President Joseph R. Biden Jr. offered a stout defense of the Obama administration's $787 billion economic stimulus package Thursday, saying the program is exceeding short-term benchmarks and is one-third of the way to its full goals.

As Republicans charged the administration was inflating the jobs "saved or created" by the recovery plan, Mr. Biden rebutted critics who say the money is being spent too slowly and trumpeted the progress.

Economists agree with Mr. Biden and President Obama, who say the stimulus plan has fought off the worst and prevented a depression. But they also questioned the job-reporting figures because it's difficult to predict what could have happened without the stimulus.

The vice president also did not mention the problems with stimulus spending -- from investigations into projects to states getting scolded for not using the money. But he did say he has asked the Cabinet secretaries to be more "aggressive" in doling out money.

He said he was rightly criticized by some for "moving too slowly," but said he needed the administration to set up a plan to minimize waste.

"If you look at the Recovery Act as a two-year marathon, we're ... just approaching the nine-mile mark," Mr. Biden said during an address at the Brookings Institute, a left-leaning think tank. "Some of the most exciting and transformative initiatives are just getting under way."

Among those will be high-speed rail and "clean energy" announcements, including one on solar power expected Friday, he said.

"The Recovery Act is not a single silver bullet, I think of it as silver buckshot," the vice president said.

House Republican Whip Rep. Eric Cantor of Virginia disagrees.

"They wanted to stave off unemployment and jolt the economy, and neither of those goals have been met," Mr. Cantor told The Washington Times.

He proposed taking $400 billion of unspent stimulus funds to pay down the national debt because Americans are worried about the swelling deficit.

But Mr. Biden argued the stimulus is "doing more, faster and more efficiently and more effectively than most people expected." He predicted there would still be bad economic news, but "I believe it's going to be the three steps forward to one step back."

After languishing for weeks, the government picked up the pace of spending in late August as it rushes to met Mr. Obama's goal of committing $225 billion in spending money by the 200-day mark.

The government spent more than $9 billion in stimulus money between Aug. 21 and Aug. 28 -- or nearly as much as it had spent the three previous weeks combined. As of Aug. 28, the government says it has spent $217 billion of the stimulus money.

Mr. Biden told a friendly crowd of about 100 people that the administration later this month will roll out a "detailed" and "modern" Web site to track the stimulus spending.

Mr. Biden cited economists who estimate the plan has so far created or saved between 500,000 and 750,000 jobs. He said some suggest that number is as high as 1 million. He said he is "confident" the White House Council of Economic Advisers' Sept. 10 projection of jobs saved or created will prove the administration has met or exceeded that goal.

Jacob Kirkegaard, a research fellow at the nonpartisan Peterson Institute for International Economics, doubts the figures.

"That is essentially an impossible number, more or less pulled out of a hat," he said. "The uncertainty of that number is so large that it is basically meaningless."

But Mr. Kirkegaard said it is clear the stimulus has been contributing to the slowdown of job losses. He also said the plan's size was "about right," even though he'd prefer the money be used more quickly.

Jeffrey Frankel, who served on the Council of Economic Advisors under President Clinton from 1996 to 1999, said the economists are in a tough spot because the American people want to hear about the number of jobs created. That's their preferred metric, he said.

"It's an important point that substantially more people have jobs today in the U.S. than they would if there had been no stimulus package and that's not a trivial statement," he said.

Stephen Dinan contributed to this report.