Legal Commentary

On The Stimulus: The Question Is Not Did It Help, But Was It Big Enough?

By Big Tent Democrat

Matt Yglesias points to Tim Fernholz on CEA Chair Christina Romer's speech (PDF) regarding the stimulus bill. This part of Romer's speech, excerpted by Yglesias, appears to raise as many questions as it answers:

The role of the Recovery Act is clearest in state and local spending. Sharp falls in revenues and balanced budget requirements have been forcing state and local governments to tighten their belts significantly. But, state and local government spending actually rose at a healthy 2.4% annual rate in the second quarter of 2009. This followed two consecutive quarters of decline, and was the highest growth rate in two years. No one can doubt that the $33 billion of state fiscal relief that has already gone out thanks to the Recovery Act is a key source of this increase.

(Emphasis supplied.) There is a certain DUH quality to this passage. It raises these questions - (1) why didn't the Obama Administration put in more state and local aid in the stimulus bill? (2) Why did they allow Ben Nelson, Olympia Snowe, Arlen Specter and Susan Collins to cut out state and local aid from the stimulus bill? (3) Why did they allow them to include the non-stimulative AMT fix? (4) Why, in short, did the Obama team mishandle the stimulus bill?

Speaking for me only

Full post as published by TalkLeft on August 06, 2009 (boomark / email).