More Congressional Democrats voiced concerns today about the pace of the economic recovery, but the White House is holding firm against the idea of a second major stimulus intervention. Two administration officials say the President will wait at least six months before deciding whether to support a second stimulus package. Still, some administration officials and allies concede that two tactical errors were committed during the stimulus battle, although they were perhaps unavoidable. As the Vice President said this weekend, White House economists underestimated how bad things were (as did everyone else, of course, aside from a privileged few.) Secondly, and perhaps more pertinent to today's debate, officials arguably oversold the stimulus package's inherent efficiency. Their words and deeds differed; the administration was careful to say that the economic recovery wouldn't be instantaneous, but, at the same time, it was politically critical to sell the stimulus by highlighting how quickly certain monies would be spent. ("Shovel ready" conjures up a picture of a worker, with a shovel in hand, waiting for the green light. The reality is more prosaic.)
That said, there is no appetite at the White House for a second bite at the apple. The government cannot handle any more money...federal employees are working as fast as they can to get the money out. When it comes to effective spending with a multiplier effect, there aren't that many projects that are underfunded. More spending would create a bottleneck, unless the White House endorsed direct transfer payments to people, either in the form of welfare, tax cuts, or both. Congressional liberals could stomach the deficit fight, but Congress can't, and the White House won't.
Perception drives reality: including the industry bailouts and the 2009 omnibus budget bill, the federal government has acted to stimulate to the economy no less than thrice. The administration agrees with Megan McArdle: passing a health care bill is tantamount to a "second" (or fifth) intervention.
Whether they sustain this position will test Obama's ironclad commitment to hold steady in the face of regular congressional (and even public) panics. And lest you wonder, White House officials are very much watching the new statewide polling data showing a drop in support among independent voters.
So Marc, do you agree that White House either missed getting the stimulus right or oversold it? Or you do not see any mistakes?
The question of interest is how much Senators Ben Nelson, Olympia Snowe; screwed up the stimulus. Perception is compromise for those folks kind of reduced the effectiveness of the stimulus.
If Congress and White House knew that there were not many shovel ready projects, why didn't they dole out money directly to every person as coupons which need to be spend over certain period? Do you think whatever tax cuts are there, those are diverted by public to savings as exhibited by increased savings rate?
The question is could White House been more creative in devising the stimulus package? Again contention is they just signed what Congress passed without being creative.
Surprising to Obama's stature there is a distinct lack of Policy Creativeness in his Administration. Don't talk about stress tests, Administration got luck there and it was the media chicanery by promoting green shot idea.
Something is terribly wrong with the Economy. VP Biden was expected to push the stimulus money when we find him dabbling in Iraq (why is then Hillary appointed as Sec. of State?). This administration sings paeans about Green Tech. but we see that the largest Wind Power Project is pulled off by Pickens. Why Government intervention there is bad when White House is inclined to poke everywhere? When Biden is expected to 'push push' money from Washington we find him apologizing on TV for assuming wrong unemployment rate?
Why is not Media (or you) go and ask then Robert Gibbs how come he answered the question wrong way when precisely a journalist asked the question about placid assumptions regarding unemployment rate? Go hold his feet to fire since he is on record or are you still in love with Obama Administration?
The disastrous path of this Administration is quite clear - careless attitude towards pushing money of stimulus while being equally careless in controlling medical costs of the currently baking health care reform. Again there is no creativity and uprightness in saying that Fed wants to cap the increase in costs of Medicare and Medicade by law and will spend money on additional coverage only on the basis of how much it collects (no counting chickens before eggs hatch).
Obama and his Administration needs some political jolt to get serious about the economy. They do not seem to be as original as promised and are essentially 'shaped' by the Washington instead of coming up with aggressive, creative ways.