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Wednesday, March 18, 2009No to part of the Stimulus Spending Package
In the Trib:
"Any time you have to run legislation and change your state policy and code for one-time money, that doesn't make a lot of sense," said Senate Majority Leader Sheldon Killpack, R-Syracuse. Lawmakers have to either kill the program when the money is gone or find a way to fund a benefit "you don't want in the first place." [Update:] Marc at KVNU For the People gets it: What needs to be acknowledged is that when the flow of federal money stops, this state will be required by the provisions established through acceptance of the stimulus money, to continue funding these expanded benefits.
posted by The Senate Site at 1:22 PM | Link
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12 Comments:
Correct me if I'm wrong, but the cost of the Stimulus Package will be added to the Federal budget deficit, and in turn, the national debt. It will be repaid by every American taxpayer in this country, now and in the future, until the debt is fully retired. No provisions will be made in the future for whether any of us lived in a state that refused part or all of the stimulus funds. We will pay our portion of that money back, whether we accept it or not. Refusing the money seems to be more of a political and ideological posture than any kind of sound fiscal policy.
All of this seems dependent on a the preconceived notion that the stimulus will not result in growing revenue two years from now. Either our legislators have little faith in us as taxpayers, or little faith in their own budgeting skills, or are just that devoid of real solutions and vision that the only response they have is turning down the stimulus money, defending and banking on the status quo.
How noble.
Ideological grandstanding being sold as "leadership."
I'm unsurprised and unimpressed.
Our bitter friend is partially right. Some parts of the stimulus spending package (road and building projects, etc.) may actually spur the economy. Other aspects may tempt us to build more government than we can afford.
Sustainability matters.
We'd be nuts to grab every dollar the feds offer without taking a careful look at what long-term strings are attached.
Expensive government won't automatically produce a hot economy. In the long run, it deadens the very thing it seeks to inspire.
Thank you for not accepting that money. I think we'll all be better off for it in the long-run.
We will pay the money back through Federal taxes whether we take the money or not. Refusing the stimulus funds will not reduce the share of the Federal tax liability by a single cent for any resident of the state of Utah.
This is a conflict between Pragmatism and Conservative Idealism. We can't change the Federal Stimulus Package, but we can do the best we can with the money that we get. We'll pay back our full share either way.
The fact the money is one-time is irrelevant for the purposes of a stimulus package and also for objecting to the package itself. Frankly, a stimulus package is not intended to be an ongoing source of funding. In fact, just the opposite is true.
As a matter of context, it is necessary to point out that a common criticism of any stimulus is that it is a "spending bill," leaving respondents bewildered, asking, "yeah, and your point is?" While a fabulous exercise in stating the obvious, it is often lost on some that the whole point of a stimulus is to SPEND money, thereby injecting money into the economy to encourage (i.e., stimulate) private investment and growth. However I would challenge anyone to describe to me a stimulus package that would not involve some sort of spending. I confess, I am not an economist.
Along the same lines as the previous criticism of a stimulus, justifying the refusal of certain funds for the mere fact they are one-time is really a straw man. Certainly, if one were to infer from Senator Killpack's comments that, but for the fact these funds were one-time, or provided the funds were ongoing, he would have supported the idea of accepting all of it, they would be sorely mistaken. This is not what I take Senator Killpack to mean - that he would take the money if it were ongoing, although I'd be interested to hear his response to such a question.
On the contrary, the very idea of the federal government providing ongoing funds of this kind to states for this purpose runs antithetically to the predominant ideological philosophy of the Utah State Legislature, as well as the whole purpose of a stimulus package per se.
Correct or no, the motive for a package like this is premised on the belief that corporations, such as Caterpillar, for example, need some assurance that there will be enough work to keep plants open. As the chair of the US Chamber of Commerce put it, the stimulus is similar to a defibrillator for the economy - to "shock" it back to life. Put another way, it is similar to a parent holding the back of a child's bicycle seat, steadying and assuring the child for the first few feet. Obviously, the parent could not (nor should they) hold on forever, but the help is valuable and even critical.
I understand not many people like the idea of government fulfilling a parental role, but economists of all walks of ideological life concur that such a measure as a stimulus is necessary. I suppose the assumption is that the stimulus would jump start the economy to the extent industry, commerce, and business in general would increase as a result, thereby providing greater revenue for the state budget. Considering the consequences of doing nothing (or accepting less than enough to get the job done) I'd say it's better to do something.
This isn't to say the stimulus is perfect. Many economists argue the feds aren't injecting enough money via the stimulus, thereby emulating what brought on Japan's "lost decade." However, be that as it may, I like the idea of a constructive stimulus package, as opposed to simply handing out $600 to everyone who earned more than $3,000 a year in adjusted gross income as was done last year by the previous Administration.
Summarily, my point is not to argue the merits or faults of the stimulus package. My point is to indicate that when Senator Killpack justifies his support for refusing certain portions because the funding is one-time, I grow skeptical. With nothing but respect for Senator Killpack and without any suggestion he means to deceive, I'd be more interested in getting an undiluted and direct justification.
If taking the money legally binds us to create a new program and fund it after the money is gone, we ought to answer two questions before we commit.
1. How bad do we need this?
and
2. Can we afford it?
Imagine a salesman showing you an expensive new car and telling you the dealership will take care of the first two payments. Same concept. Same questions.
Well, I don't know if it's really that simple. While your ability to pose questions so succinctly is a trait I admire, it is alarming someone would liken our State addressing the very real challenges of a serious economic crisis to a consumer on a Kia budget going for the new Bentley.
Certainly, a stimulus would be absolutely inappropriate in cases where it's merely meant to meet wants. But our times are very different. If we need it, then we should accept it. If we don't, then why accept even that which we don't have to create a new program for? Are we not all federal taxpayers too? Is something a need only if the state doesn't need to pay for it in the future?
Furthermore, the State's rejection of federally unfunded mandates is certainly not without precedent. See, Legislative action regarding No Child Left Behind in 2005.
By accepting some but not all, it leaves one to question whether we really appreciate the "need" but would never say "no" to "free" money. That doesn't make sense. Perhaps I don't "get it."
I answer your second question with another question: Can we afford not to accept the money? If your suggestion is that we are better off doing nothing, then let's dispense with the talking points and just call it how it is. Please, however, make sure to explain this position to those who play by the rules, but are losing their jobs and businesses; who have families to feed; mortgages to honor; cars to gas; and bills to pay.
If, on the other hand, your suggestion is that we can do better than this plan, then inquiring minds want to know! But accepting only a partial amount tells me some on the hill feel we "need" the help, but only insofar as there's not a chance it will cost us in the future. Is there nothing to be said for what rejecting the full amount would cost us now?
It seems awfully callous to suggest we only "need" something, or that a problem is only worth addressing, if we can get it for free.
This is not to say affordability should never be a concern. On the contrary, the point of the stimulus should not be to stimulate government at the cost of failing to stimulate the economy. Unfortunately, years of fiscal irresponsibility can not go unnoticed, and neither should the fact that real people are being affected by this crisis. Inaction really should not be an option.
Finally, I can't resist noting the double standard and poor timing on the part of the Legislature, choosing to pass bills, such as those relating to abortion, which will almost certainly cost millions to defend in court - millions which could be put to use serving humans that are already born! Did we ask about need and affordability when these came up for debate, or did we decide to "buy the Bentley" on principle?
According to Marshall's and other's logic, Utah should accept any amount of federal dollars without question no matter how much of a commitment Utah would have in the future to fund these programs on with our own dollars. According to Left's logic as presented in the above comments, if accepting federal dollars meant huge tax increases in the future, that would be OK because turning down that money means some other state would get the money and we would still have to pay for it.
The real motivation for their logic is that they would be perfectly OK with an increase in state taxes to make up for the eventual loss in one-time federal dollars.
Actually, the car purchase example is a good one. Although Marshall tries to dismiss it by saying the current economic situation is more serious than buying a car, the principle nevertheless is the same: can we afford to commit ourselves to a program in the long run once the "free" money runs out?
Word from Alaska:
http://housemajority.org/item.php?id=hmaj20090319-158
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