WASHINGTON -- Barack Obama's massive infrastructure spending plan to jump-start the economy isn't being criticized just by conservative critics. His chief economic adviser once called the idea one of the "less effective options" the president-elect is now promoting.
In a strategy paper in January that studied various economic-stimulus proposals, economist Jason Furman wrote that spending hundreds of billions of dollars to repair or rebuild the nation's roads, bridges, rail lines and other infrastructure was "likely to be less effective in spurring economic activity."
The reason: Big infrastructure-spending bills "do not provide well-timed stimulus or because there is considerable economic and administrative uncertainty about how they might work," Furman said.
While such public-works spending "might provide an important boost to long-term growth," he doubted it "would generate significant short-term stimulus" because all too often the money is not pumped into the nation's economic bloodstream "until after the economy had recovered."
One expects Obama's fiscally conservative economic critics to beat up his big-spending, New Deal-era ideas, but when his top economic adviser puts the core of his plan in the "less effective options" column, that's news.
But even other supporters of his giant stimulus have begun voicing doubts about whether a huge spending package -- in the $500 billion to $700 billion range -- can be spent quickly enough to have an impact on the recession. And some of them fear the stimulus may result in more wasteful pork-barrel spending.
Obama's plan will likely include, among other things, tax rebates for low- to middle-income workers, unemployment compensation, increased food stamps, Medicaid funding and other social-safety-net assistance. But infrastructure spending, pushed by the nation's governors, has become the plan's chief focus.
A week of interviews with economists around the country found little if any confidence in Obama's big-spending scheme.
"I don't believe it will work. Infrastructure spending has not proven to be an effective way to jump-start an economy in recession," said John Cogan, an economic policy analyst at the Hoover Institution at Stanford University.
"It takes considerable time for government agencies to evaluate alternative projects, put in place the required controls to ensure that the money is properly spent, and sign the contracts. The larger the amount of money to be spent, the longer it takes," said Cogan, a top fiscal adviser in past Republican administrations.
"Moreover, the spending tends to be wasteful. Projects funded under a 'stimulus' banner are often those that can't be justified on their own merits," he told me.
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