[Don't Forget the] Recovery

[Don't Forget the] Recovery

In March, we said:

In order to stimulate the economy, the US government must fund programs to provide jobs to American people, with a heavy focus on infrastructure spending. Infrastructure spending, or government funding of the building of roads, bridges, schools, etc, provides structure to America's crumbling infrastructure.
American buildings are falling apart. Destruction from natural disasters and simple age still ravage America's infrastructure, and the repair of roads and the like has become one of the most important issues today on a local level. America's buildings affect nearly every American every day, as they go to school, work, or home. The long term maintenance of failing infrastructure will result in incredibly high cost for the American taxpayer. If the problems are not immediately fixed, the financial consequences of quite literally rebuilding America will be great.
Additionally, infrastructure spending provides simple, viable jobs to US workers. In the current economy, with the shockingly high unemployment, workers are in desperate need of work that projects created by infrastructure spending will easily provide.
Often, the government will also hire small businesses to restructure the roads and buildings that must be repaired. Not only does that provide jobs, infrastructure spending funds small business, and, by extension, stimulates the economy on a national level.

Monday, President Obama proposed a 50 billion dollar transit spending plan, which is comprised mostly of infrastructure spending. Certainly, the plan is an important step in cementing the economy as President Obama's continued focus into the midterms, but also to confirm Obama's devotion to providing jobs for Americans. The plan includes an "infrastructure bank," which would be developed and run by the federal government but financed by both public and private investments.
This is the sort of plan that would pay dividends to the American people quickly and in large numbers, so the question arises as to why the plan is so small. Obama, as a senator, was a big proponent of plans like this one, so it isn't a policy-based trepidation on the part of the administration. The package was most likely set at a smaller size in hopes of gaining Republican votes, but didn't the President learn anything from the health care debate? Maybe if he set a higher goal, any 'compromise' set in Congress would be closer to what he actually wanted. Also, the administration was able to pass one of their main (if little-understood) policy goals, banking regulation, with a Republican filibuster and without conservative support. If there's anything that Republican congressmen are possibly inclined to support, it is a package like this one that will provide many jobs in their districts, even though conservative support for infrastructure spending is infrequent.
"1. It’s a good idea 2. It’s much too small 3. It won’t pass anyway — which makes you wonder why the administration didn’t propose a bigger plan, so as to at least make the point that the other party is standing in the way of much needed repair to our roads, ports, sewers, and more– not to mention creating jobs. Once again, they’re striking right at the capillaries," economist Paul Krugman wrote on his New York Times blog, Conscience of a Liberal on Tuesday.
Krugman is right. If only because of obstruction for obstruction's sake, passage- at least of this version- of the plan is unlikely. But this doesn't change the fact that the administration essentially threw away a good chance to appear completely in support of and devoted to creating jobs. Now, if the Obama administration wishes to use this economic focus to their advantage come November, they ought to try their hardest to get the new proposal passed.

[Photo credit: nytimes.com]