Frankly, we doubt that President Obama’s latest jobs plan will return Arkansas and the country to prosperity, to the halcyon days of 11 years ago when the economy was creating 2.5 million jobs a year, paying off the nation’s debt and raising middle-class livelihoods. But if it is not likely to perform miracles, should we resolve not to do it?
That is the position of the national Republican Party and, alas, our own new Republican delegation in Congress. Simple good works is not enough. The package includes some worthwhile things that will be popular in Arkansas, they said, but it won’t create enough jobs to make much difference and, besides, the president is out politicking with the program. They are offended that the president would play politics with the economy. They would never, never do that.
Obama is making speeches about the jobs plan in the precincts of key Republican leaders in the hope it will build a little steam behind the legislation. But the Republicans are probably right. It is simple political motivation because everyone knows that not one Republican will cast a vote for the president’s plan, and there is nothing that he can do that will change that. Everyone knows it.
But we can contemplate what it might do in Arkansas if it were to pass. Arkansas would get about $1 billion over the next two or three years, which would be a sizable stimulus for economic activity. Most of it—some $645 million—would produce jobs in the construction trades, building and repairing highways, bridges and schools.
Congressman Tim Griffin said that it would be just more of the same kind of pointless stimulus spending that marked the president’s first stimulus bill in 2009. He cited a Republican calculation that the money spent in Arkansas in the next three years totaled $273,000 for every job that was created or saved. Not worth it, he said.
That does sound wasteful. But the government doesn’t simply cut a check to highway contractors to put someone on the payroll. They actually build things that are useful to people, like the mammoth reconstruction of the I-430–I-630 interchange in west Little Rock and major bridge and highway improvements in every part of the state. Much of the money went for asphalt, concrete, steel and the other supplies that gave the workers something to do.
About $300 million of the stimulus would save jobs—policemen, firemen, teachers—that are to be otherwise lost in the cost-cutting of state and local governments. Then the president proposes to again extend unemployment payments to those who lost their jobs in the 2008-2009 downturn and haven’t found new ones. All of it will pump money into the economy and stimulate consumption and demand.
That is what stimulus programs are supposed to do. It is the only way that government has found to stanch the hemorrhaging in a deep economic downturn. Both parties and every president since Franklin Roosevelt who was confronted with a recession have done it in one way or another. It has had mixed success. The Obama stimulus of 2009 stopped the precipitous slide of the previous 18 months, but that is as far as it got.
This recession, like previous ones caused by banking collapse, has been more resilient. The new Obama plan is not apt to put the economy on a burning pace. Until the homeowner crisis is fixed, we are not going to see a return to the glory days. The president proposes a little help in that quarter, but not enough.
Griffin’s solution—his party’s solution—is to cut taxes on corporations and the wealthy and halt government regulations that are supposed to protect consumers, investors and the environment. How, pray tell, will cutting taxes on corporations and investors create jobs when federal tax rates are already near their lowest levels in 70 years and corporate profits are setting records? Tax and regulatory relief for corporations is a helpful idea for campaign treasuries, but nothing else.
But all of it—the president’s anemic stimulus and the Republicans’ catering to the “crony capitalists,” as Sarah Palin calls them—is pie in the sky. Nothing will happen. This is all about the 2012 election. The unemployed? Who really cares about them?
