OPINION: 'Stimulus' a bad idea, then and now

The record-shattering $787 billion “stimulus” package was touted before Congress passed it as a way to immediately create jobs and get the economy moving again. Five months later, the only thing that seems to have been stimulated is growth in government.
The stimulus was flawed on many levels. Billions of dollars in new projects might satisfy the spending urges of many in Congress, but much of the spending is things that have nothing to do with stimulating the economy — like $50 million for the arts and $16 million to enhance the habitat of a special breed of mouse in the San Francisco area.
And let’s not forget that there’s no money for any of this. We’re spending borrowed money — and leaving a staggering debt for our children and grandchildren to pay back.
President Barack Obama insisted that Congress had to approve the stimulus immediately. His economic advisers said doing so would keep the unemployment rate below eight percent. The president said it would “save or create” 3.5 million jobs — an assertion that was rightly questioned by economists, who suggested he was over-hyping its impact in order to sell it to the American public.
Since that time, however, our national unemployment rate has surged to 9.5 percent — a 26-year high — and we recently learned that 467,000 more U.S. jobs were lost during the month of June. There’s simply no indication that the stimulus has “saved or created” jobs.
The White House notes that only about 10 percent of the stimulus money has been spent. Give it time, they now say. But that underscores one of the major flaws of the stimulus spending — the money won’t get into the economy fast enough. The bulk of the spending won’t even occur until next year, according to the Congressional Budget Office, too slow to have a meaningful impact.
On Sunday, July 5, the White House conceded it had “misread” how bad the economy was — a generous interpretation. Left unsaid was that it had also badly “misread” the impact of the so-called “stimulus.”
Now, there’s talk of another stimulus package later this year, although the administration seems to be sending mixed signals. A top administration adviser publicly said another stimulus-spending bill might be needed. Shortly afterward, newspaper headlines declared that the president was “leaving the door open” to another stimulus. In other reports, the president downplays the likelihood of another stimulus.
As part of my stimulus oversight responsibilities, I’m charged with tracking and accounting for stimulus funds spent in the state to ensure they are spent as intended and to reduce opportunities for waste and fraud. It’s a task I undertake regardless of my personal feelings about the stimulus. But as a CPA and one of the state’s chief finance officials, I worry about the administration’s willingness to continue to increase spending in the face of record deficits, and I worry about the mountains of debt we’re leaving for future generations. I’m also concerned that this deficit-spending might be making things worse rather than better, interfering with what would otherwise be the natural cycle of economic recovery.
The White House said the economy would begin improving within weeks of the stimulus bill being passed. Instead, we’ve committed billions for social programs and the economy is no better off for it. If the White House and Congress want to continue to increase spending in the face of record deficits and continue to grow government, they should not do it under the pretense of “economic recovery.”