KYW Regional Affairs Council

“Stimulating Inconvenience”


by John Ostapkovich

PHILADELPHIA (CBS) —   There was a lot more to the big federal stimulus package than infrastructure, and maybe that’s a good thing.

The American Recovery and Reinvestment Act of 2009 totaled $787 billion, split about equally among tax cuts, payments to and for individuals, and public works.  This scheme, says Richard Harris, a professor of political science at Rutgers University in Camden, follows a pattern.

(Prof. Richard Harris. Photo provided by Rutgers Univ.)

“Up until recently, it was perfectly reasonable to say that if there’s an economic downturn, that government has a responsibility to stimulate the economy,” Harris (right) notes, “and ‘stimulus’ ordinarily means a combination, if you’re a Keynesian, of fiscal policy and government spending.”

But not all spending is equal, according to a Robert Inman, a professor of finance at the Wharton School in Philadelphia.

(Prof. Robert Inman. Photo provided by Wharton School, Univ. of Pa.)

“The best part of the stimulus package will be those programs that are largely targeted to the household sector, and within the household sector to the middle-income and lower-income families,” Inman (right) says, because those families are more likely to spend, rather than save, the income boost they receive.

Even on the jobs end, says Pat Gillespie, business manager of the Building and Construction Trades Council of Philadelphia, public works sometimes doesn’t work.

“The stimulus helped bridge some of the matching-funds kinds of gaps that local governments had to fix or repair a state road or fix or repair a bridge — but just some, not anywhere what the need is,” Gillespie says.

Two reasons, he says:  not enough “shovel ready projects,” and a lack of long-term planning.


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