Stimulating Nothing

Officials said the size of the proposed two-year stimulus – equivalent to nearly a year of federal discretionary spending – had tested imaginations in Congress and the Obama camp. Aides and advisers are struggling to identify enough projects that would meet Obama's criteria that they be truly stimulative, create jobs and not be open to being branded as pork-barrel projects.

That in reference to the Obama $775 billion (as same news article pointed out, "$1 trillion" would be too politically charged) stimulus package.

Folks, that single paragraph is packed with so much meaning and is so revealing, we’re struggling with where exactly to start.

Having “tested imaginations in Congress” (a terrifying thought, itself) and “not be open to being branded as pork-barrel projects” in the same paragraph is inherently contradictory and suggests the random and haphazard nature this stimulus plan is sure to become.

And “struggling to identify enough projects” is perfectly evident that this stimulus plan is work for work’s sake and proof that the government cannot “create” 2 or 3 million jobs when it is going towards “work” that may or may not be necessary and on technologies that may or may not have any long-term self-sustaining viability and when there is no guarantee there will be any value added to the result of that labor in the aftermath.

So, if you are “struggling to identify (enough) projects”, you are attempting to pull 2-3 million people out of the private labor pool… out of the free market, the invisible hand of which is more readily able to identify “work” that is needed and is more apt to identify projects and technology that will produce wealth which will result in the true “creation” of jobs… and put all that human capital into a massive government-run jobs program, you are creating massive inefficiencies that will only serve to hinder the economy in the long-term.

And if you are just making up work for work’s sake how can that not be open to pork, graft, and bribery?

And who is going to run all this? Who is going to determine where the work goes and what states, districts, technology sectors, etc. get the jobs programs….?

Congress? Two words: Housing industry. How’s that working for ya?

There’s another little gem this stimulus package. People who don’t earn enough to pay federal income tax will be getting a $500 check ($1,000 for couples) in the mail which is intended to offset the payroll taxes they pay for Social Security and Medicare (Again, merely printing money). Huh? If you want to do something to offset payroll taxes and stimulate hiring as well as create upward pressure in wages, then cut those same payroll taxes of the employer. This frees up capital for him to go out and hire more people at higher wages.

One last bitch: The obligatory extension of unemployment benefits is a centerpiece of this legislation. Again, we know it sounds cruel of us but being humans, we know human nature better than about anyone else, so it strains credibility to be told that increasing the incentive to stay unemployed will reduce unemployment.

Obama is supposedly surrounding himself with sober, centrist, economic folks. It's all window dressing for all you supply-siders and fiscal conservatives as far as we're concerned if this economic "stimulus" package is any indication.