Last Friday's weak jobs report accelerated discussions of a possible second stimulus package. Will wonders never cease?
I agreed that the first stimulus package should've been large and have come soon. We got large and we got soon, if soon is defined by the date of the legislation. Not soon as defined by when it might do some good. What happened to all those "shovel ready" projects? We've been out stimulated by China, and, now, by France. Yes, France!
We also got $787 billions worth of large. But the large turned out to be large because it contained a lot of this and a lot of that, but not a lot of much that would create jobs. The administration wisely-no, cleverly, wise is too kind-changed their promise from one of creating new jobs to one of creating or preserving jobs. No doubt a few jobs have been created, but most of those are likely at the expense of previously existing jobs. A new contract to build a school will assemble the workers to do the job, but most of those workers would otherwise be doing another job.
More jobs probably have been preserved, such as teaching jobs that might have been cut from distressed school budgets. But the new and preserved jobs have been few and have been overwhelmed by job losses that have taken the unemployment rate to 9 ½ percent, and rising.
In a post when the stimulus package was new, I likened it to shooting wild hogs with a shotgun– a lot of firepower, perhaps, but too dissipated to do much good– too unfocused, too, well, too scatter shot.
It turned out that the stimulus plan was just another large government spending plan, and since then we've had other large spending plans, such as the budget, for example. If the stimulus plan is just another spending plan, perhaps our ordinary spending plans will provide the needed stimulus. Spending is spending, and we're already doing too much of it.
You have to measure the little temporary good being done against the long-term damage of the ballooning budget deficits and debt. I'd say we're spending like drunken sailors, but, as I read recently, even drunken sailors eventually return to home-town Sally.