What’s in the stimulus bill

Here’s the rundown on spending, courtesy of the House Appropriations Committee. My first take is that if you have spend $550 billion (the tax cuts will add up to $275 billion), it’s a sensible-enough plan for doing it. It’s a mix of things that make long-term sense (energy efficiency, infrastructure) and things that can have immediate effect (a food stamp increase, aid to states). None of this is any guarantee that it will work. But it’s a start:

·        $32 billion to transform the nation’s energy transmission, distribution, and production systems by allowing for a smarter and better grid and focusing investment in renewable technology.

·        $16 billion to repair public housing and make key energy efficiency retrofits.

·        $6 billion to weatherize modest-income homes.

·        $10 billion for science facilities, research, and instrumentation.

·        $6 billion to expand broadband internet access so businesses in rural and other underserved areas can link up to the global economy.

·        $30 billion for highway construction;

·        $31 billion to modernize federal and other public infrastructure with investments that lead to long term energy cost savings;

·        $19 billion for clean water, flood control, and environmental restoration investments;

·        $10 billion for transit and rail to reduce traffic congestion and gas consumption.

·        $41 billion to local school districts through Title I ($13 billion), IDEA ($13 billion), a new School Modernization and Repair Program ($14 billion), and the Education Technology program ($1 billion).

·        $79 billion in state fiscal relief to prevent cutbacks to key services, including $39 billion to local school districts and public colleges and universities distributed through existing state and federal formulas, $15 billion to states as bonus grants as a reward for meeting key performance measures, and $25 billion to states for other high priority needs such as public safety and other critical services, which may include education.

·        $15.6 billion to increase the Pell grant by $500.

·        $6 billion for higher education modernization.

·        $20 billion for health information technology to prevent medical mistakes, provide better care to patients and introduce cost-saving efficiencies.

·        $4.1 billion to provide for preventative care and to evaluate the most effective healthcare treatments.
·        $43 billion for increased unemployment benefits and job training.

·        $39 billion to support those who lose their jobs by helping them to pay the cost of keeping their employer provided healthcare under COBRA and providing short-term options to be covered by Medicaid.

·        $20 billion to increase the food stamp benefit by over 13% in order to help defray rising food costs.

·        $87 billion for a temporary increase in the Medicaid matching rate.

·        $4 billion for state and local law enforcement funding.

Upside Megan McArdle is skeptical. And she expresses her skepticism entertainingly, which is of course all that really counts:

The better the projects are, the less likely they are to be stimulative, because they’re complicated and time consuming, like healthcare IT and high-speed rail. If we do them on a stimulus timeframe, we’ll screw them up, waste an enormous amount of money, and likely make American voters worse off in the long term by locking them in to bad solutions–we won’t get a second bite at high-speed rail between LA and San Francisco. Mostly, Democrats took their wish lists, called them “stimulus”, and look set to inflict them on the American people in badly done drag.

Now, what does that remind me off? Rhymes with Whoosh Max Butts, I think . . .

Stocks Rally Further in Run-up to EU Summit

MOSCOW — Global stocks enjoyed one of their best days in weeks on Tuesday ahead of a summit of European leaders that’s expected to be dominated by calls to boost economic growth.

Europe remains the focus of attention across all financial markets in the run-up to the June 17 Greek election that could go a long way to determining the country’s membership of the euro as well as the future of the single currency zone.

Andy from MA

Justin this may be OT but I don’t think it is. Have you read this? What do you think of Reich’s recommendations?

http://tpmcafe.talkingpointsmemo.com/2009/01/15/what_should_be_done_with_the_next_350_billion_of_t/
plukasiak

I have a couple of problems with this –
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First off, $30 billion for highway construction? While I can see spending billions on repairing the existing highway infrastructure (bridge repair, road resurfacing), building one more foot of highway is antithetical to the entire “green” initiative stuff. An exception could be made to improve traffic patterns in urban areas and inner ring suburbs, but that’s about it.
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And I’d prefer to separate out the “stimulus” spending from the “safety net” spending — IMHO, while they both are necessary for the same reason, it should be made clear that one is an enhanced “safety net” that needs to go away once the economy gets back on its feet, while the other “infrastructure”/green projects will continue to be funded.
bryanfromhouston

Andy,
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I read that and its a hell of read.
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pluk,
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I’m with you on the highway stuff. We need mass transit or at least a good start. Has anyone done a study on how much time, money and energy we waste on highways, cars and stuck in traffic every single day? And it affects the poor disproportionately…because they live the furthest away, spend the most on gas and ultimately will require more on tolls, taxes and maintaining those vehicles. And I’m all for continued spending on going green…public transit should be available for every community over a certain size. Cars should be used only to get you from the country to the city or to drive from smaller cities to other cities. I love my truck, but I would rather be able to actually go somewhere when I had the real need to get in it.
jjworleyeoe

To me it makes more sense to fund programs that will create jobs rather than pushing tax rebates. If someone has a well paying job, they don’t need a tax rebate, and they’re paying taxes themselves. As for the proposed highway spending, I agree that these monies should be limited in scope, targeting only things that really in need of repair. Hey! Here’s an idea that wouldn’t cost us a dime. Force big oil to lower the cost of producing diesel and force the big three to start selling diesel cars. Something like a 1.3 CDTI Chevy spark that would get at least 60 MPG on the highway and cost $16K would cut back on a lot of oil consumption. Moreover, if we’re just dying to give money away, let’s give tax credits for buying diesel powered cars like we’re doing with hybrids.
tanboontee

What a statement: None of this is any guarantee that it will work! In other words, the probability of the stimulus bill NOT working can be high.

Dow lingers on just above 8000. If the percentage drop of Asian stock markets (or for that matter most other global markets) is of any guide, Dow could drop to 7000 or well below (50% of its peak value).

With all the gloomy predictions in the media, I wonder how long Dow will hold on before dipping to break the sensitive barrier of 8000. Perhaps soon.
(Tan Boon Tee)
timeto

It is communism, is communism, is communism.
http://run4chocolate.wordpress.com/ sauer kraut

How does increasing Pell grants and unemployment benefits keep people employed? That is a waste of nearly 100 billion right there.

4.1 billion to evaluate the most effective health care treatment? Sounds like the over-priced consultants will be happy but what about nurses, PA’s, PT’s, and others? Will this lead to job creation for them?

30 billion for roads? That’s it?

And just 4 billion for law enforcement?

Puhleeze.

This isn’t a stimulus but a method to avoid getting called out on pork spending. Put the pork back into the regular budget process instead of hiding it in this monster.
domitie

Why is it so hard to make the right stimulas plan for the American economy? Why do we need pork spending or cover up pork if it is in there? Why, why, why?