Barack Obama has dubbed his behemoth fiscal stimulus proposal the "American Recovery and Reinvestment Plan." But if truth in advertising were required of White House plans, only one title would fit the trillion-dollar-plus-and-growing bill: The Generational Theft Act of 2009.
President-elect Obama was at his most candid when he told the country Tuesday that we face massive deficits for the foreseeable future. "Potentially we've got trillion-dollar deficits for years to come," he said, "even with the economic recovery that we are working on."
But one word is glaringly out of place in that warning. It's the word "even." Washington will saddle future generations with unprecedented debt because of the economic interventions Obama is planning, not despite them.
Think this through. We are now 13 months into the current recession. Since World War II, none of the recessions that have hit the U.S. economy have lasted more than two years. Most have lasted 12 months. The new mega-injections of government "investments" championed by Obama are intended to "break the momentum" of a recession we're probably more than halfway through suffering.
This is not to suggest that the economic picture is all sunshine and roses. Quite the opposite. Our fundamental ill is too much spending and borrowing and too little saving. It's going to take years to recover from the housing mess. Washington continues to encourage ever more ill-considered lending in a misguided attempt to stave off needed market corrections. The currently proposed combination of a nationwide infrastructure spending orgy plus tax-cut bribes does nothing to remedy that.
To paraphrase a previous Democratic administration: It's the timing, stupid. Keep in mind that the Democrats' stimulus timetable pushed through the House last fall proposed $34 billion in new, "ready to go" infrastructure spending -- only $9.8 billion of which could be spent in 2009. As writer Brian Faughnan points out: