Barack Obama and Congressional Democrats are playing the voters for fools with the so-called stimulus package. The massive $825 billion package is not even targeted on programs to stimulate the economy. Instead, it is laced with runaway government spending for increased welfare, overgrown bureaucracy, pork, political payoffs, and other waste. That runaway spending is causing record smashing deficits of $1.5 trillion or more, equivalent to over 50% of the entire federal budget for fiscal 2008.
For example, the "stimulus" package includes $50 million for the National Endowment of the Arts to help "the arts community throughout the United States." Wouldn't want our economy to get behind in the international arts competition. The government is going to borrow $50 million out of the private economy to spend on this, which will result in a net loss of economic output rather than a net gain.
Another $2.1 billion is for Head Start, another program not previously known for stimulating the economy. A further $2 billion is to be spent on Child Care Development Block Grants, which provide day care. We are going to revive economic growth through the federal government spending billions on babysitting, rather than tax cuts for capital investment. A similar initiative involves $120 million to finance part-time work for seniors in community service agencies.
Then there is $500 million to speed the processing of applications for Social Security disability claims. This has already created one net new job in the employment of a person within the Obama Administration assigned to figure out what this has to do with stimulating the economy.
Another $6 billion goes to college and universities. We already spend hundreds of billions on these schools, and such education provides valuable long-term benefits. But this is not a means to spark a booming economy in the short term. The same is true of the $13 billion in Title I grants "to provide extra academic support to help raise the achievement of students at risk of educational failure or to help all students in high-poverty schools meet challenging State academic standards," as the congressional report accompanying the bill explains. Ditto that for the $13 billion in IDEA, Part B State grants to help pay for "the excess costs of providing special education and related services to children with disabilities."
Then there is the effort to stimulate the economy by increasing welfare spending. There is $20 billion for increased food stamps, including lifting restrictions on how long welfare dependents can receive food stamp benefits. Another $1.7 billion is to be spent to help the homeless, not previously in our history a significant source of economic growth. Another $1 billion goes for the Low Income Home Energy Assistance program, to help low income families pay their heating bills, a worthy objective that has nothing to do with stimulating the economy. Still another billion goes to the Community Services Block Grant to support "employment, food, housing, health, and emergency assistance to low-income families and individuals." Another $200 million goes for senior nutrition programs, such as Meals on Wheels. Then there is an additional $200 million for AmeriCorps, to help satisfy "increased demand for services for vulnerable populations to meet critical needs in communities across the U.S." Another $5 billion is devoted to public housing. None of this increased welfare spending has anything to do with promoting economic growth. Rather, it retards growth by inducing more dependency on government.
Another $87 billion is to be spent on Medicaid, a welfare program already costing roughly $400 billion per year. Those funds would be spent in part on "family planning services," meaning contraception. Reagan created a 25-year economic boom in part by cutting top marginal income tax rates. Liberal Democrats are now going to try to do it by passing out condoms.
Medicaid is one of the major entitlement programs projected to explode to overwhelming costs in the future. Obama is assuring the more conservative Blue Dog Democrats that he will address runaway entitlement costs as soon as next month. But to start let's increase those costs by almost $100 billion right now.
Then there is the funding to maintain and expand bureaucracy and overall big government spending. The "stimulus" package includes $2.5 billion for the National Science Foundation, $2.0 billion for the National Park Service, $650 million for the U.S. Forest Service, $600 million for NASA, $800 million for AMTRAK, $276 million to the State Department to upgrade and modernize its information technology, $150 million for maintenance work at the Smithsonian Institution, $209 million for maintenance work for the Federal Agricultural Research Service, $44 million for repairs and improvements at the Washington, D.C. headquarters of the Department of Agriculture, and $245 million to upgrade the information technology of the Farm Service Agency. Borrowing money from the private sector to spend on these bureaucracies will not provide a boost to the economy. It will likely again produce a net loss of output.
A shocking provision provides $1.1 billion for so-called federal comparative effectiveness research in regard to health-care services. The congressional report explaining the stimulus bill says:
By knowing what works best and presenting this information more broadly to patients and healthcare professionals, those items, procedures, and interventions that are most effective to prevent, control, and treat health conditions will be utilized, while those that are found to be less effective and in some cases, more expensive, will no longer be prescribed.
But a government bureaucracy in Washington is never going to know what "items, procedures and interventions are most effective to prevent, control and treat health conditions" for each patient, regardless of how much federal research is done. This is what doctors are for. This bureaucratic initiative is really laying the foundation for the eventual health care rationing to be imposed under the new Obama "universal" health care entitlement program, which is coming soon. I told you so, in previous columns.
To call this spending economic recovery stimulus, however, is an abuse of the English language.
Another abuse is to be found in the $4.2 billion provided to the Neighborhood Stabilization Fund, which provides the funds to local governments to purchase and rehab vacant housing due to foreclosure. The congressional report accompanying the stimulus bill states, "Up to $750 million may be used for a competition for nonprofit entities to enhance the funding included under this heading through capitalization of the funds." Reportedly, this funding is intended to be siphoned off to ACORN, the far-left, rogue, lawbreaking organization prosecuted across the country in the past couple of years for voter fraud. ACORN has also used violent intimidation tactics in the past to pursue its goals, and was heavily involved in housing programs in the past that led to widespread bad loans.
Another $79 billion is to go the states to maintain their runaway government spending, particularly for such spendthrift jurisdictions as California, New York, New Jersey, and Massachusetts. High state government spending is also not a source of economic growth.
Then there are other items in the "stimulus" package that may involve desirable government spending, but do not involve stimulating the economy, and should be subject to the normal budget process. These include $3 billion for health care prevention and wellness programs, such as childhood immunizations and other state and local public health programs, $2.4 billion for projects demonstrating carbon capture technology, $17 billion for Pell Grants, $1 billion for Technology Education, $1.9 billion for the Energy Department for "basic research into the physical sciences," $650 million for digital TV coupons to help Americans upgrade to digital cable television, $100 million to reduce lead-based paint hazards for children in low income housing, $400 million for "habitat restoration projects" of the National Oceanic and Atmospheric Administration, $1.2 billion for summer jobs for youth, $2 billion for Superfund cleanup, and others.
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