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Obama signs stimulus law
President Obama signed into law a $787 billion stimulus package designed to reverse the momentum of a deepening recession.
Declaring “the beginning of the end” of the nation’s economic crisis, President Obama this week signed into law a $787 billion stimulus package designed to reverse the momentum of a deepening recession. Obama signed the 1,100-page American Recovery and Reinvestment Act at a ceremony in Denver, saying it would save or create 3.5 million jobs over the next two years. The law is part of “the essential work of keeping the American dream alive in our time,” Obama said.
The stimulus law allocates $507 billion to projects such as road, bridge, and other infrastructure repair, alternative-energy projects, and transportation subsidies, and provides increased aid to the poor and unemployed through expanded health insurance and food stamp benefits. The remaining $280 billion takes the form of tax cuts, including a tax break of $800 for most working families. The law passed with the support of just three Republicans in the Senate and none in the House of Representatives.
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The process wasn’t pretty, said The Washington Post, but in the end, “Mr. Obama can claim a victory.” The package he signed is very close to the one he originally proposed. It has roughly the same proportion of spending to tax cuts and costs just $14 billion more. Though it still contains some irrelevant expenditures that are unlikely to help the economy, “the heart of the package is a collection of measures that do seem timely, targeted, and temporary.”
The stimulus would have been larger, and more effective, if not for Obama’s “futile pursuit of bipartisanship,” said The New York Times. In an attempt to win over Republicans who wanted to see him fail, Obama sacrificed spending on new school construction, billions in aid to struggling state governments, and other worthy projects. With the economy on pace to lose 5 million jobs, he’ll almost certainly need to come back to Congress and ask for more money in a year or two. Let’s hope he’s a little tougher when he does.
What the columnists said
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Obama’s victory was a product of despicable fear-mongering, said Jacob Sullum in the Chicago Sun-Times. Just as George Bush rammed through the Patriot Act after 9/11 by warning of imminent catastrophe if he didn’t get his way, Obama muttered darkly about the Great Depression and intoned, “We can’t afford to wait.” There was no time for Congress, much less the public, to even read the entire package before the final vote. And just as the Patriot Act turned out to be a Trojan horse for draconian tools that law-and-order conservatives had been seeking for years, the stimulus law “is a grab bag of expenditures that leftish Democrats have long wanted, repackaged for the crisis du jour.”
Obama won this legislative battle, but “at a high price—fiscally and politically,” said Karl Rove in The Wall Street Journal. “Obama, for all his talents, has already re-energized the GOP and sparked a spending debate that will last for years.” The big winners are the House Republicans, especially “young guns” such as Minority Whip Eric Cantor, who challenged the Democratic myth that pouring hundreds of billions into anti-poverty, welfare, and pork projects will revive the economy.
The Republicans remain as delusional as they were during last year’s campaign, said Frank Rich in The New York Times. They’re high-fiving in celebration of their imaginary “victory” over Obama, even though the president got a stimulus of the size he wanted, and on the schedule he set. If anything, Obama should be even more aggressive in pursuing his agenda on the economy, energy, and health care. “Far from depleting Obama’s clout, the stimulus battle reaffirmed that he has the political capital to pursue the agenda of change he campaigned on.”
What next?
Tens of billions of dollars in the stimulus package will be handed over to state governments to spend on local projects as they see fit—as long as they do it quickly. Figuring out what to do with this money “may sound like a nice problem for the states,” said Beth Fouhy in the Associated Press, but it will actually “set off huge internal battles” among governors, legislators, and countless interest groups. The big debate in Washington may be over, but 50 smaller ones are about to begin.
