Is Going Green Stimulating?

It’s February. Americans are losing their jobs at a rate almost none of us have ever seen. The economy is collapsing in a deepening tailspin of fear and gloom. Wallets are shut. Companies are closing. And in Washington, the “debate” over what makes a stimulus bill stimulating drags on.

Republicans have won the spin war hands down. The stimulus bill has been successfully reframed as a pork-filled mess. And as the Senate works today to get something passed Republicans and their media friends continue to pick out specific items in the bill that they argue are “wasteful spending.”

As usual the New York Post lards it on the heaviest: ”Is it worth spending $6 billion to make federal buildings more green? Maybe — but what in God’s name does that have to do with saving our bacon?”

The paper then quotes President Obama on another aspect of the proposal, “‘Now is the time to save billions by making 2 million homes and 75 percent of federal buildings more energy-efficient, and to double out capacity to generate alternative sources of energy within three years.’ Actually, no. The time to do that is after everybody has a job and enough to eat.”

Wow! Really? I’m not an economist and I’ve already spent some of the last two weeks pointing out what economists across the spectrum say about government spending as stimulus but doesn’t it take workers being paid wages to do these projects? How is that any different from building roads and bridges which has broad bi-partisan support?

The Washington Post editorialized yesterday, “Even potentially meritorious items, such as $2.1 billion for Head Start, or billions more to computerize medical records, do not belong in legislation whose reason for being is to give U.S. economic growth a ‘jolt’.” Why not?

Where would that Head Start money go? To hire more Head Start teachers. That sounds like it would help the economy, no?

And how would those billions to be spent on computerizing medical records? On software and hardware and training all of which would need workers. Stimulating the economy. Why is this so hard to understand?

The New York Post continues on what it thinks should be in the bill: “One packed with funding for shovel-ready projects, one that incentivizes small businesses to hire, one that cuts everybody’s taxes and puts money in people’s checking accounts so they can spend it on the barely-breathing retail sector.”

Oh where to begin?… All of that is already in the bill.

Let’s start with “shovel-ready projects.” There have been numerous reports about the relative shortage of “shovel-ready projects” and how the money in the bill is enough to do pretty much all of them. But there’s also this from the entirely non-political magazine Popular Mechanics which argues focusing on “shovel-ready” projects is a pretty crappy way of stimulating the economy. And again, how is employing people to repave a road any different from employing people to make Federal buildings or people’s houses more energy efficient? It isn’t.

Republicans and Senate Democrats have already changed the stimulus bill to add help for small businesses. But wait a sec. Wasn’t last year’s stimulus bill, pushed by the Bush Administration and signed off on by most Congressional Republicans, supposed to be a big boon to small business? Well that worked out pretty well didn’t it?

And finally that bit about putting money into people’s checking accounts. Get your story straight folks! Republican Senators are on the floor this morning arguing simply giving people a check for $500 won’t work because it didn’t work last year when Bush did it.

That’s why this bill would not do that, instead reducing the amount of taxes withheld from each paycheck. Small amounts get spent. Larger amounts get saved, not spent. The Post is simply wrong and virtually every economist has said as much.

All of which is not to say there isn’t some real crap in the bill the Senate is debating. Republicans and Democrats have put plenty of it in there. We just learned, for instance, that the Republicans most-favored amendment giving homebuyers a $15,000 credit for purchases made in 2009 would now cost twice as much as the GOP thought — $36 billion. That’s real money spent on something that would neither create jobs nor solve the underlying real estate crisis. And Democrats certainly could not really defend a couple hundred million bucks on family planning (even if it saved money down the line by preventing unwanted pregnancies).

So listen carefully and then think. Just a little. When someone brings up something that’s in this bill that they say is a waste, ask yourself a simple question: “Would the spending employ people?” In almost every case the answer is “Yes.” That’s the point, to paraphrase the President.

Incredibly Democrats let this bill be named a stimulus bill and then rechristened a “porkulus” bill by Republicans. It’s a jobs bill and that’s what Democrats should be calling it.