A failure can make for a valuable learning experience, and the stimulus package is no exception. Clearly the stimulus has not worked, and from its inception many economists doubted the wisdom of the federal government trying to spend our way into prosperity. But putting aside questions about the merits of spending as means of sparking an economic recovery, it appears that the feds were not even able to dole out the money in a timely manner. The culprit — regulatory red tape.
Several studies conducted by the Department of Energy’s Office of the Inspector General (here , here , and here) have concluded that many of the stimulus-funded projects related to energy were very slow to get off the ground. For example, DOE’s investigation of one program dealing with block grants for energy conservation projects concluded that “as of August 2010, more than one year after the Recovery Act was passed, grant recipients had expended only about 8.4 percent of the $3.2 billion authorized for the Program.” Not exactly the “shovel ready” boost to the economy we were promised.
Regulatory delays were the reason. In its most recent report, DOE’s Inspector General concluded that “various regulatory requirements had slowed spending,” including “the Davis-Bacon Act, National Historic Preservation Act, Buy American provisions of the Recovery Act, and National Environmental Policy Act (NEPA).”
Granted, the programs funded by the stimulus are a big waste of taxpayer dollars, and it is a good thing that the feds can’t squander our money more quickly. But the point is that even the big government proponents of the stimulus package are finding out what it is like to get tripped up by — big government. Whilst hoisted on their own petard, one can hope that the legislators who supported the stimulus might figure this out.
Perhaps they will learn the critical lesson that can lead to real economic growth. Just as stimulus spending faces a regulatory gauntlet, so does private investment. Efforts by large and small businesses to expand — the real source of an economic recovery and job growth — are hampered by the regulatory state at least as much as are the government projects highlighted in the DOE reports. Streamlining or eliminating these regulatory hurdles would do far more to help the economy than all the stimulus spending in the world.
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by Hans Bader on June 9, 2010
in Agriculture, Bailout Watch, Deregulate to Stimulate, Economy, Employment, Energy, Environment, Ethanol, Global Warming, Health and Illness, International, Natural Resources, Politics as Usual, Precaution & Risk, Regulation, Sanctimony, Stimulus to Nowhere, Trade, Zeitgeist
Columnist Tim Carney notes that BP, responsible for the massive oil spill, is “a close friend of big government whenever it serves the company’s bottom line.” It lobbied for President Obama’s $800 billion stimulus package, the “cap-and-trade” global-warming bills backed by Obama, and “the Wall Street bailout” that Obama voted for. “BP has more Democratic lobbyists than Republicans.” Obama is the biggest recipient of campaign cash from BP executives.
Obama’s global warming legislation expands ethanol subsidies, which cause famine, starvation, and food riots in poor countries by shrinking the food supply, and also result in deforestation, soil erosion, and water pollution. Subsidies for biofuels like ethanol are a big source of corporate welfare: “BP has lobbied for and profited from subsidies for biofuels . . . that cannot break even without government support.”
The $800 billion stimulus package is using taxpayer subsidies to replace U.S. jobs with foreign green jobs. It is also destroying jobs in America’s export sector.
Obama falsely claimed that the stimulus package was needed to prevent “irreversible decline,” but the Congressional Budget Office admitted that it would actually shrink the economy “in the long run.” Unemployment has skyrocketed past European levels, as big-spending countries have fared worse than thrifty ones. As the Examiner notes, “If his stimulus program was approved, Obama promised, unemployment would not go above 8 percent . . . The reality is that it passed 10.3 percent.” In 2008, Obama promised a “net spending cut,” but as soon as he was elected, he proposed massive spending increases.
Obama’s global warming legislation would also drive jobs overseas, since it would impose a costly cap-and-trade carbon rationing scheme on American industry, while leaving foreign plants operated by multinational corporations unregulated. That’s one reason why many big companies with plants overseas are lobbying for the global-warming legislation, which would give them an advantage over competitors that make their products largely in America. The legislation would result in a tax increase for American consumers of up to $200 billion a year or $1,761 per household.
Unlike other oil companies, which have good records of safety and avoiding spills when it comes to oil drilling, BP has a bad record, earning it the label of “serial environmental criminal” from critics. The Obama administration granted BP a waiver of environmental regulations in April 2009, yet it blocked Louisiana from protecting its coastline against the oil spill by delaying rather than expediting regulatory approval of essential protective measures. It has also chosen not to use what has been described as “the most effective method” of fighting the spill, a method successfully used in other oil spills. Democratic strategist James Carville called Obama’s handling of the oil spill “lackadaisical” and “unbelievable” in its “stupidity.”
Obama is now using BP’s oil spill to push the global-warming legislation that BP had lobbied for.
Richard Morrison and Marc Scribner team up with William Yeatman, Ryan Radia and Iain Murray, to bring you Episode 92 of the LibertyWeek podcast. We take on the prospects for cap-and-trade climate legislation, the FCC’s broadband power grab, tales from a hung parliament and an exciting new job opportunity in Venezuela.
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A new ordinance in San Luis Obispo, California makes it illegal to feed ducks. The solons of San Luis Obispo claim that feeding the animals increases pollution.
One wonders what political intrigues and backroom deal-making went into the duck feeding ban. It was not a stand-alone ordinance; it was tucked into a bill updating the city’s storm water management regulations.
Was the duck language tucked in to guarantee a wavering council member’s vote? If so, it was a lot cheaper than the “Lousiana Purchase” and “Cornhusker Kickback” that enabled the health care bill to pass.
Joking aside, one is still left wondering what would cause a politician to hold such a grudge against ducks. Of all the sources of pollution in San Luis Obispo, ducks would have to be pretty low on the list.
(Hat tip: Megan McLaughlin)
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President Obama has nominated law professor Goodwin Liu, a left-wing extremist, to the nation’s largest federal appeals court, the Ninth Circuit. Liu is hostile to “‘free enterprise, private ownership of property, and limited government.’ According to Liu, these are ‘code words for an ideological agenda hostile to environmental, workplace, and consumer protections.’” Liu opposed the appointment of Supreme Court Chief Justice John Roberts, who was easily confirmed by the Senate in a bipartisan vote of 78-to-22, on the grounds that Roberts supported these “basic precepts of American liberty and economic freedom.”
Liu has been suggested by left-wing “civil-rights” groups as a possible Supreme Court nominee.
Liu also believes in “a constitutional right to welfare“ (perhaps echoing Obama, who has expressed regret that the Supreme Court “didn’t break free” from legal constraints in order to bring about “redistribution of wealth”). Liu is also a big user of politically-correct psychobabble, writing that a judge is supposed to be a “culturally situated interpreter of social meaning” rather than an impartial umpire who interprets the law in accord with its plain meaning or its framers’ intent.
Bar association standards say lawyers are supposed to have practiced law for at least 12 years before being nominated to a judgeship, and also must have “substantial courtroom and trial experience.“ Liu has no trial experience, and has not even been out of law school for 12 years, meaning he is by definition unqualified under ABA standards. But a liberal ABA committee, showing ideological bias, rubberstamped his nomination anyway, ignoring his lack of the required qualifications, since its members share his extreme political views.
Meanwhile, the Obama administration is doling out favors to politicians that violate federal influence-peddling statutes. (Earlier, the Administration fired an inspector general, Gerald Walpin, who uncovered wrongdoing by an Obama crony.)
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