As the economy sputters and falters the questions coming up time and again are: What should Obama do? What can Congress do?
They’ve tried spending their way to prosperity and as today’s jobs numbers show, 3.5 million jobs lost since Obama took office and an unemployment rate that shot up to 10.2 percent is damning evidence, turning the propaganda ploy of arguing for 600,000 stimulus-created jobs into a brazen farce.
They’ve tried to play Washington games with certain sectors and it didn’t work. Cash for clunkers gave car sales a quick pop, but much of it went to imports and in any event it evaporated as quickly as it appeared. Whatever help the first-time homebuyer tax credit provided the housing market is now spent.
Forget what failed in the past, what can they do now? Apropos the health care vote scheduled in the House for Saturday: First, do no harm.
President Obama’s domestic agenda is laced with job killing initiatives. Raising taxes is a centerpiece. Raising spending even more is assumed, as are massive new taxes and burdensome regulations as part of cap and trade legislation. And then there’s health care reform.
The nation needs real health care reform, not a tax-turbo charged government takeover of the health care system. But why does this matter to the economy in the now when the effects would all be in the future? Start with the fact small businesses would pay one-third of the $460.5 billion projected to come from the bill’s surtax according to the Joint Tax Committee.
More generally, the House health care reform bill is a jobs killer because businesses are forward looking. Job-creating economic recovery depends on business investment and business investment today depends on confidence that the economy will prosper tomorrow.
What can Congress do right away for the economy? Declare a 5-year moratorium on tax hikes. Hit pause on cap and trade. But first, recognize that the House health care takeover bill is a jobs killer and turn to real health care reform.
TIGGER: It’s not just a character from Winnie the Pooh. It also stands for the Department of Transportation’s Transit Investments for Greenhouse Gas and Energy Reduction or in other words: cash for buses. The DOT “has spent nearly half its $100 million grant budget to replace diesel buses with cleaner and more efficient hybrid-electric and fully electric models. Like Cash for Clunkers, these grants are intended to be dual-purposed: stimulate the economy and clean the environment.”
And like cash for clunkers, it will most likely do neither. Although Secretary of Transportation Ray LaHood believes “investing in green transportation not only helps the planet, but creates jobs and strengthens our economy”, one should take a look at how the cash for clunkers program fared. Yes, consumers took advantage of the taxpayer-funded handout to buy a new car while completely destroying their old one, but after the subsidy program ended so too did car sales. Sales in September for Chrysler, Ford and GM plummeted.
Many questioned the environmental benefits of cash for clunkers when considering new cars and cars with better fuel efficiency are driven more not to mention the environmental costs of destroying the car. The program failed to create jobs and did not increase sales of cars but instead affected the timing of those sales.
We’re hearing much of the same with the TIGGER program, which is part of the larger stimulus package signed into law in March:
“Yet job creation isn’t necessarily attributable to the TIGGER program alone. Eight of the participating transit agencies were planning to buy buses of some kind anyway — the grant money just enabled them to upgrade to clean-tech models. Of the agencies that made new orders with the grant money, many of them said they were simply expediting existing multiyear plans to replace older diesel buses with cleaner technology.”
“”They do improve emissions somewhat,” said Michael Sanders, transit administrator for ConnDOT’s Bureau of Public Transportation. But he suggested that the agency wouldn’t have invested in the pricier hybrids without the federal money. “They’re not dollar-for-dollar cost-effective in hard cash,” he added. “The difference is public relations, emissions reductions.”
Henry Jacoby, co-director of the Joint Program on the Science and Policy of Global Change at MIT, was an outspoken critic of the Clunkers program. He calculated that each ton of carbon reduced cost the government more than $160 — an expensive way to reduce emissions. “Cash for Clunkers was… being sold as a program to cut greenhouse gas emissions, but that’s not what it was for,” he added. “It was a program to help the auto industry.” He was similarly skeptical of bus replacement as a cost-effective way to reduce emissions.”
It’d be much better if TIGGER were just a character on Winnie the Pooh and not a taxpayer handout for bus companies.