Highlights of $825 billion economic stimulus plan

[Joanne98]

Source: AP

Highlights of the $825 billion economic recovery plan drafted by House Democrats and President-elect Barack Obama's economic team.

SPENDING

Energy — $32 billion to fund a so-called "smart electricity grid" to reduce waste; $20 billion-plus in renewable energy tax cuts and a tax credit for research and development on energy conservation, energy efficiency and renewable energy, and a multiyear extension of the renewable energy production tax credit for wind, hydropower, geothermal and bioenergy; $16 billion to boost the maximum Pell Grant by $500; $6 billion to weatherize modest-income homes.

Science and technology — $10 billion for science facilities; $6 billion to bring high-speed Internet access to rural and underserved areas.

Infrastructure — $32 billion for transportation projects; $31 billion to build and repair federal buildings and other public infrastructure; $19 billion in water projects; $10 billion in rail and mass transit projects.

Aid to the poor and unemployed — $43 billion to extend unemployment benefits, increase them by $25 a week and provide job training; $20 billion to increase food stamp benefits by 13 percent; $4 billion to provide a one-time additional Supplemental Security Income payment.

Education — $41 billion in grants to local school districts; $79 billion in state fiscal relief to prevent cuts in state aid; $21 billion for school modernization.

Health care — $39 billion to subsidize health care insurance for the unemployed and provide coverage through Medicaid; $90 billion to help states with Medicaid; $20 billion to modernize health information technology systems; $4 billion for preventative care.

Law enforcement — $4 billion in grants to state and local law enforcement.

TAXES

Individuals — $500 per worker, $1,000 per couple tax cut for two years, costing about $140 billion; greater access to the $1,000 per-child tax credit for the working poor; expanding the earned-income tax credit to include families with three children; a $2,500 college tuition tax credit; repeals a requirement that a $7,500 first-time homebuyer tax credit be paid back over time.

Business — An infusion of cash into money-losing companies by allowing them to claim tax credits on past profits dating back five years instead of two; bonus depreciation for businesses investing in new plants and equipment; a doubling of the amount small businesses can write off for capital investments and new equipment purchases; allows businesses to claim a tax credit for hiring disconnected youth and veterans.


Read more: http://www.google.com/hostednews/ap/article/ALeqM5iBY9VnNiqr_CIcPWutqGB_TA_J5AD95NLKA81

[EconomicLiberal]

1. $825 billion isn't enough... it's only around 6% of the GDP.

This stimulus package needs to be around 10% of the GDP... about 1.5 trillion would be an ideal figure for the stimulus, with more infrastructure building projects and less tax cuts for the wealthy.

[Joanne98]

2. I don't think it's enough either. We're sooooo screwed!

[Alhena]

3. What- we're not stealing enough money from our kids as it is?

I fully agree that we'd have an even better economy if we stole $ 2 trillion from our kids to alleviate our present situation, but that doesn't mean it's the right thing to do. I've got $10,000 in my daughter's college fund. It would really help my financial situation now to raid that fund, but it's not the right thing to do.

I swear, by the time 2020 rolls around - with the boomer retirements in full swing- we're going to be in such a fiscal mess we won't be able to borrow a dime. There are going to be people suffering and needing help in 2020 as well. Too bad for them that we're spending all their money.

[Belial]

4. nt

[karynnj]

7. Economies of countries have different dynamics than family budgets

The problem now is that the economy is in a downward spiral - as people lose jobs or assets they curtail their spending as much as possible - this lowers the revenue of all the businesses they buy things from - causing them to lay off people or reduce their spending ....

At points like this, classical economics says that the government is the spender of last resort. If the spending and the tax cuts are designed well, they will create more income than the amount that the government spends. The end result could be an economy with more jobs and the creation of good new infrastructure.

Now, you agree that this is better in the short run, but you say that it is worse in the long term. This is not necessarily the case. Imagine 2 scenarios, 1 - we fund a successful stimulus package and the economy is revived over the next couple of years. 2 - we decide to nothing (the extreme) or less - and the economy either continues shrinking or takes longer to revive. Now consider what the tax revenues are in each case - it may well be that scenario 1's tax revenues minus scenario 2's tax revenues over say the next n years might be greater than the cost (or the difference of the costs) in the stimulus packages in the two scenarios adjusted to include the appropriate interest cost.

Economists have calculated the "multiplier effect" for pass tax cuts or direct spending. There is no certainty as to impact of the items in the current proposal in the current economy - but past experience is the best information available. The arguments of what works best is because there are different econometric models - based on different theories and different past experience.

[Alhena]

13. It's possible you are correct, since no one can prove it for sure either way, but ...

I have an innate suspicion of convenient truths, and the notion that we're really doing our kids a favor by spending their money strikes me as being pretty convenient. It seems vaguely reminiscent of Reagan's justifications for running his big budget deficits, though I'm aware that you have a lot of economists from both parties on your side. I personally suspect that a lot of those economists are influenced by the fact that voters would not support a party that offered harsh medicine while the other party offered candy.

[karynnj]

14. I get where you are coming at and I think the big deficits were wrong

in the Reagan years. There is a difference in that there was not a similar economic crisis then - the tax cuts were done for ideological reasons - and were intended to starve government.

The problem I have now - is I can't see anything other than government forcing money in that can change the path we are on. (It does scare me that this is done when the budget is already extremely unbalanced. The deficits Bush admitted were large - but they included no expenses for Afghanistan and Iraq, because he said the costs were not known. (ummm putting in zero is not the best estimate they could have found.) In addition - they excluded things like the interest on the existing dept. Bush's budgets were as honest as ENRON's.) The problem is the contraction we are in may kill businesses that really were well run and were selling needed products and services.

[ixion]

5. sounds like mostly a bunch of handouts to Big Energy, etc

and, as usual, the taxpayer gets the short end of the stick.

[Zhade]

17. That's what I see, too.

NT!

[Doremus]

6. Where's the universal health care?

I thought it was going to be part of the stimulus plan?

"Health care — $39 billion to subsidize health care insurance for the unemployed and provide coverage through Medicaid; $90 billion to help states with Medicaid; $20 billion to modernize health information technology systems; $4 billion for preventative care."

Sounds good if you're unemployed or eligible for Medicaid, but where's the relief for the middle class we kept hearing about? There are plenty of us struggling to pay exorbitant premiums and medical bills.

[Zhade]

18. That would require Obama keeping his promises.

Many are seeing that as less and less likely.

[customerserviceguy]

24. There's relief in there for people to keep on COBRA

It's designed to funnel money into the existing insurance companies, not create something new.

Also, while they extend unemployment benefits, this bill fails to exempt unemployment comp from taxes. If they made that retroactive to the beginning of 2008, that would put an immediate infusion of money into the communities hardest hit by plant closures in the last year. It might save a few other jobs that are on the brink in those communities.

But, they have millions earmarked for more DTV coupons, I guess watching Judge Judy is way more important than seeing Michigan survive.

[ryanmuegge]

25. LOL. I hope you weren't seriously expecting that to really materialize. That was campaign rhetoric.

[12string]

8. Four Billion for Law Enforcement

How about cutting the law enforcement budget rather than give them more money to jail more citizens.We don't need more police.We need fewer laws.End the fucked up war on drugs and we would see a substantial drop in law enforcement needs.

[Zhade]

19. I'm just waiting for Obama to break his promise about DEA raids.

It'll happen.

[EconomicLiberal]

9. Also, I am dissapointed in the lack of money allocated towards rail projects.

Only $10 billion?

A much larger investment should be made in these projects. They could create countless jobs.

[Owl]

10. I agree. We should be slapping down rail lines like crazy.

For both freight and commuters.

[EconomicLiberal]

12. For comparision, California's upcoming rail project will cost $10 billion by itself.

Why not expand this budget to $30 or $40 billion?

[Baby Snooks]

11. Whose economy is being helped by this?

I really don't see where the economy is being helped unless you have an economy to help. A growing number of people don't.

The states themselves will spend the money somewhere else while raising fees and taxes. The Texas legislature is notorious for doing just that. Or just not spending the money at all. Which is what usually happens to programs for the poor. Republicans don't like the poor in Texas so their solution is to limit their share of funding for the federal programs. The same thing with education funding. Most of which is wasted by the local school districts. You could cover the entire cost of public education in Texas for five years and the Texas legislature would find a way to claim it wasn't enough and raise fees and taxes. I would imagine most state legislatures do the same. The Texas legislature created a fund for people who couldn't pay their light bill. Then they uncreated the fund. But everyone continued to pay into the fund every month when they paid their light bill. The legislature intended to just keep the money for themselves. Cute, huh? Nothing short of fraud but then who is going to charge a state legislature with fraud? Especially the Texas legislature.

I don't see where any jobs will be created through this. I see where people who have jobs will get some tax breaks and people who are on unemployment might have some extra unemployment while they look for jobs that don't exist and I see where some people who have jobs might make a better deal on buying a new home which might help people in the mortgage and real estate industry and I see where some other sectors might benefit those who have jobs but I don't see where any jobs will be created through this. Where are the jobs? In India? How about giving those who were self-employed, for example, who don't qualify for unemployment the air fare to India so they can work in a call center for a bank or telephone company or any number of "US" companies who have "outsourced" their jobs to increase profits for the CEOs which apparently is where most of the profit went and where most of the profit apparently will continue to go. Or how about a "joint" program with Mexico for "guest workers" so that for each Mexican "guest worker" our government hires, which our government does, the Mexican government will hire an American "guest worker." Before you call me racist, think about it. It has nothing to do with racism. It has to do with reality. What is the unemployment rate among "guest workers?" Probaby zero. Not that we can know for sure. They aren't on unemployment. Neither are a lot of Americans. Which means there are quite a few more Americans who are unemployed than what the "official govenrment figures" indicate. And they are "out of sight, out of mind." Particularly with regard to this new "stimulus package" from Congress.

Almost $100 billion for infrastructure. Most of which will go to contracts to political insiders. And of course, no offense again, the "guest workers" will be hired. They are cheaper which means more profit. And they work 24/7 which means the political insiders can get a bonus for staying within budget and completing the contract before the deadline. Happens in Texas all the time. The contractors love those bonuses. Mainly because the contractors, the owners of the companies, keep the bonuses for themselves. I bet it happens in other states as well.

As for increasing the budget for law enforcement obviously we are going to need more law enforcement officers to handle the riots at the community centers when they tell the 1,000 people in line there is no more money to help anyone and there is no food and to just stay where they are for another day or two and hope that in another day or two they will be the first in line. That is beginning to happen by the way in many cities. The lines are getting longer. The help is getting shorter. Where is the money in this to help those who can't pay their rent, keep their lights on, or feed their children? Where? I don't see it. Do you?

Maybe the attachment for law enforcement should be called the Nancy Pelosi Homeless Relief Program - some of the money can be used to pay for more jail cells to house the homeless so Nancy Pelosi and her neighbors in Pacific Heights, along with countless others in similar neighborhoods all around the country, won't feel so guilty about calling the police. San Francisco isn't the only city that arrests its homeless to keep them "out of sight, out of mind." After all, the homeless will have a nice bed and something to eat. For a day or two. When you think about, they actually are helping the homeless. While keeping the homeless "out of sight, out of mind." The rest of the money can be used in training law enforcement in "riot control."

Sorry but so far what I see in this is not change but the same old, same old. Thems that's got shall get. Everyone can else can be so kind, please, as to go find a freeway underpass and just drop dead.

What might have helped is just ensuring that every American citizen had some guaranteed level of income for the next two years. Income they could use to pay rent, keep the lights on, buy food and maybe buy some "luxuries" like clothes which might in turn help the economy.

But Congress doesn't like the poor any more than the Texas legislature does. And these are Democrats rather than Republicans.

The dynasty of the Republicrats continues. Along with their oligarchy.

[Zhade]

20. I'm starting to feel like I got suckered again.

Depending on what happens under his presidency, I may just about be done with this shit.

[leftstreet]

33. Good post

:thumbsup:

[Psephos]

41. A post worth reading twice. n/t

[OhioChick]

15. I'm a little let down...

Only $10 billion for science facilities?

And what about health care?

[Azlady]

16. It appears the education dollars are not for college/univ -

"local school districts". I hope there will be additional education dollars made available for college students.....

[Brucie Kibbutz]

21. It won't matter.

If something isn't done about the pathetic wages blue collar workers are stuck with, none of this shit will make a bit of difference. Even if everybody did have the technical skills for a certain trade or the skills to be in management, there are only so many of those jobs to go around.

We need jobs for blue collar workers that pay a living wage instead of chump change. If this problem isn't addressed, the number of working poor in this country will continue to grow and we will have solved nothing.

[ryanmuegge]

22. Job training for what jobs?!

[cottonseed]

23. This Country is Rotten. What I fear is how this money will be put to work.

I don't trust anyone with the chops to receive a large amount of these funds. That goes for private and state government. It's a crappy attitude, but I don't see anything over the last decade that would prove otherwise. The rot at the level of leadership in this country is pervasive and whether we release the money or not, it will never be put to good use. It will most likely end up in Dubai.

[Brucie Kibbutz]

29. Rotten to the core.

Hand over billions to industry and they'll just have everybody employed through Randstad working only 30 hours a week for $8/hr with no health insurance.

While labor has increased productivity and has become more efficient, the government has allowed it's corporate sponsors to reward those efforts with stagnant wages and fewer benefits.

And the people that are making enough to raise a family, both Democrats and Republicans, most of them know exactly what's going on and don't give a rat's ass about it.

[KakistocracyHater]

26. *****

I am going to say: Roman concrete for our national roads-I don't want those cheap, crumbling, asphalt junk roads anymore. I am also going to point out that building in stone lasts far longer & is less of an economic burden to "keep up" than the trash they use to 'build' today. I am going to say that killing public education helped measly, ugly, micro-minded men to hold power in what is generally called "The Dark Age", & that new school books are not needed except at the college level; using texts from writers who are passionate about their particular subject is far better than the junk that passes for school books today.

Outlaw ceo positions, corporations exist solely at the pleasure of the government-they actually are rewarded for driving the corp. off a cliff. IF YOU REWARD FAILURE EXPECT TO GET MORE OF IT. Ceo pay is a parasite on every company's payroll-do NOT tell me they are needed, it is quite clear they are unnecessary.

They said in 2000 & 2001 that Sprint & other telecoms had "overbuilt" & there were 2 cent/share, mergers, etc-yet the USA's internet speeds is slower than Asia's average internet speed-WHY? Did all that "extra" fiber optic line go into the spy room?

Water is very precious-why do we allow it to leak from our very old & aged pipes? I watched how the Japanese go around at night with a doctor's stethascope to listen for leaks in water pipes. They mark the spot with paint & the next day a repair crew comes & fixes the pipe.

[Brucie Kibbutz]

30. Ever drive through Oklahoma?

Significant portions of I40 through Oklahoma are concrete and driving on it is like driving through a battlefield that has been under artillery fire.

I've driven a truck for a living and I, as well as anybody else that has ever driven for a living, can tell you that asphalt is a much better surface to drive on.

[KakistocracyHater]

32. you are not referring to ROMAN concrete

that can only be found in Europe today.

Ancient Roman concrete has withstood the attack by elements for over 2,000 years. The basic construction techniques of the Romans must be better than those of modern practice as judged by comparing the products. Can we learn from the Romans in some way to improve our concrete? http://www.romanconcrete.com/docs/spillway/spillway.htm

http://listverse.com/history/top-10-things-you-didnt-know-the-ancients-had/

"The Romans are credited with inventing ‘modern’ concrete as a building material. It was a completely revolutionary material at the time. It was lightweight, extremely strong, dried underwater, and highly pliable when wet. The basic components of concrete haven’t changed in several thousand years, and in some ways, Roman concrete is superior to that which is used today."

[Brucie Kibbutz]

34. Start rolling 80,000 pound trucks on it

and the concrete sections will settle uneven with each other, making for a very bumpy ride, even though the surface of each section may be perfectly smooth.

[KakistocracyHater]

35. yeah, they already have in Europe

http://www.travelinginspain.com/salamanca/roman_bridge.htm
http://nature.wallpaperme.com/3932-2/Roman+Bridge_+Guadalquivir+River_+Cordoba_+Spain.jpg

[Brucie Kibbutz]

36. What makes you think

that using a different kind of concrete will make the sections settle evenly? It's got nothing to do with poor quality concrete. Like I said, the surface can stay smooth for years but the sections will not stay even with each other and the road will get bumpy because of it.

When they were building the Nashville Superspeedway, the owner of the track assured the drivers that the concrete surface would be smooth. Only the best materials would be used and the utmost care would be used in pouring it. All those measures were taken and guess what? It's about like driving down an old country road because the sections didn't remain even.

Another thing to keep in mind is that roads in Europe don't get anywhere near the truck traffic that our interstates do.

[KakistocracyHater]

38. It is the lower COST of concrete that lasts 2000 years

There is a small city just south of me, they incorporated, they swiped alot of our local shops to their area, the sales tax is what they were aiming to get. This little city has resurfaced their main roads 3 or 4 times in the last 7 years alone. !IT COSTS TOO MUCH! to be using materials that need replacing-see? Would you buy that as head of a city? Would you want to have to pay a billion dollars every decade to do the upkeep on a local bridge? To constantly have to fill potholes & resurface ALL YOUR ROADS?

!!!I want LONG PRODUCT LIFECYCLE!!!

It costs less as a STATE
It costs less as a NATION
It costs less as a CITY

[Brucie Kibbutz]

42. Why would we want it to last 2,000 years

when it's miserable to drive on one year after it's poured?

[Psephos]

40. Nice pics, but those are masonry (cut stone) aqueducts - not concrete

They originally were built to allow canals to span valleys and rivers. Very ingenious.

In cases where they've been re-purposed as actual roadways, and not just quaint bridges for foot-traffic and the odd Citroen, guess what they use as the paving surface?

[customerserviceguy]

27. Who drew this mess up?

Looks like it is "more of the same" on the pork side of things, not really much thought into doing anything that will bring true sustainable economic growth.

I saw a more complete version of what's in the bill when I was taking a break at work today, the $500 middle class tax cut is supposed to come out of Social Security taxes! If Chimpy had tried that, we'd cry foul on it.

[High Plains]

28. $4 billion for the cops? No, thank you. We have more than enough already.

[Brucie Kibbutz]

31. More "tacticool" toys for SWAT teams

so they can carry out their no knock raids on people with a dime bag in their house.

[Igel]

37. It's a funded wish list for the most part.

If you offered Congress that much money 2 years ago it wouldn't be much different. Or if we'd had a dem Congress in 1998.

"Stimulus" has little do do with it.

[Psephos]

39. $825 billion/3 million jobs promised = $275,000 per EFFIN' job

And that's only IF three million jobs actually materialize, and only IF $825 billion turns out to be what actually gets spent, instead of twice that. Might as well play Russian roulette - the odds are better.

By comparison, $825 billion is twice what's been spent in Iraq so far. Think about it.

But *don't worry*, we'll just put it on the credit card...and maybe y'all will crank out some more babies who can pay the bill when they grow up.

Healthy and wealthy again! All it takes is a mountain of more debt, an ocean of more expenditure, and pork as far as the eye can see.

[Romulox]

43. Pork masquerading as a jobs program. nt

[amandabeech]

44. Fool me once, shame on me. Fool me twice,

and I'm a Democrat.

Poster 11 talked about jobs in India.

How about all those unemployed in China getting call backs because Americans are spending again?

Is this just another attempt to keep China buying our bonds?