Brooks and the Problem With “Stimulus”

by Brien Jackson

Writing in today’s New York Times, David Brooks criticizes the stimulus package in probably the most irritating way possible:

In a fateful decision, Democratic leaders merged the temporary stimulus measure with their permanent domestic agenda — including big increases for Pell Grants, alternative energy subsidies and health and entitlement spending. The resulting package is part temporary and part permanent, part timely and part untimely, part targeted and part untargeted.

It’s easy to see why Democrats decided to do this. They could rush through permanent policies they believe in. Plus, they could pay for them with borrowed money. By putting a little of everything in the stimulus package, they avoid the pay-as-you-go rules that might otherwise apply to recurring costs.

But they’ve created a sprawling, undisciplined smorgasbord, which has spun off a series of unintended consequences. First, by trying to do everything all it once, the bill does nothing well. The money spent on long-term domestic programs means there may not be enough to jolt the economy now (about $290 billion in spending is pushed off into 2011 and later).

This, to put it mildly, is the sort of lazy, semi-romanticized, junior high thinking that’s dangerously infected out pundit class. Long story short; not everything is going to have the increasing returns of infrastructure development, new technology, or retrofitting buildings. You can’t put all your money to one thing, or to one industry, because then you’d just be propping up those places. Indeed, many appropriations are just going to be about getting money into the economy, and that’s ok. After all, it was Reagan who said “the best welfare program is a job,” and there’s at least something right in that formulation. In this case, the most effective “stimulus” in the short run (which really should be understood more as stabilization, but that doesn’t sound as good I suppose) is stemming the tide of job losses, and keeping people working. That keeps them earning a paycheck, paying their bills, and consuming a certain amount.

Add in the fact that the rest of Brooks column reads like it could have been written by any generic Republican in the last 15 years, and this isn’t exactly Brooks in top form.

Also, no mention of the fact that the CBO report he based his column on last week doesn’t exist. Shocking.

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