UTT: New stimulus the same as old, failed stimulus

OPINION/ANALYSIS:

Brand-new title, same old story.

Last month, President Obama announced yet another stimulus plan. Granted, he never uttered the word “stimulus” in his speech at the Brookings Institution. Instead, he called it a “jobs plan.”

Notwithstanding the shift in terminology, the president’s new plan is nothing more than another serving of his old, failed stimulus plan. It calls for another massive dose of “infrastructure spending” — up to $50 billion more for roads, trolleys, trains and sewer systems. Such spending has proved one of the most impotent components of last year’s American Recovery and Reinvestment Act.

It’s hard to imagine Congress agreeing to double down on another losing hand of infrastructure spending. As the Congressional Research Service noted in an earlier review, to the extent that such spending is achieved through deficit finance, “the net impact on the economy of highway construction in terms of both [economic] output and employment could be nullified or even negative.”

Yet many on Capitol Hill seem eager to embrace a stimulus proposal that:

• Implements policy proved by several decades of independent studies to be highly ineffective.

• Repeats the approach most recently shown incapable of meeting expectations or stemming unemployment.

• Wastes billions of dollars and adds to the federal deficit.

• Is subject to exasperatingly long delays in implementation.

• Panders to politically powerful constituencies.

Big-government devotees, it seems, still relish throwing good money after bad. But they at least have learned some new semantic tricks.

In addition to jettisoning “stimulus” in favor of “jobs,” spending advocates also eschew describing the next round of costly infrastructure projects as “shovel-ready.” Instead, they refer to such jobs as “ready-to-go” — a relabeling that tacitly acknowledges the extended delays in getting the “shovel-ready” projects of the earlier stimulus under way.

Call them what you will, these types of projects are almost always slow off the mark because they require cumbersome, multilayered federal and state bureaucracies to stir into action.

Six months after the last stimulus was enacted, more than half of the approved projects had yet to put a single shovel to work. That’s no way to jump-start the economy. And that’s the good news about the plan.

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