Stimulating the Government Class
At a time when the phrase “trillions of dollars” is casually tossed around, $224,702 is still a lot of money.
According to “www.recovery.gov,” the website set up to flack the American Recovery and Reinvestment Act (ARRA), that’s the sum federal agencies have sent to Connecticut for every job the stimulus package has “created or saved.”
Signed by the president in February, ARRA contains a smattering of targeted tax cuts, but is comprised mostly of new expenditures. Over the next few years, over $500 billion will be disbursed as grants, loans, and contracts to state and local governments, quasi-public agencies, unions, universities, businesses, and nonprofits.
ARRA is founded on the discredited Keynesian notion that during a recession, government should go on a buying binge in order to compensate for falling consumer demand. Veronique de Rugy, a senior research fellow at the Mercatus Center at George Mason University, has a different perspective: “Overall, government spending doesn’t boost national income or standard of living. It merely redistributes it — minus the share it spends on the bureaucracy that collects and spends our tax dollars. The pie is sliced differently, but it’s not any bigger. In fact, it’s smaller.”
Federal figures show that to “create or save” 7,551 jobs, D.C. shipped $1.7 billion worth of “awards” to the Nutmeg State. Yet like the nation, Connecticut continues to lose jobs — more than 35,000 since the ARRA passed. Poverty is on the rise, in some cities and towns, dramatically.
Here’s another number of note: 06106. That’s the zip code where seven out of every ten stimulus-related jobs are located. It’s in Hartford. And you know who works in “New England’s Rising Star.”
That’s not to say “public servants” beyond the capital are being left out. The biggest recipients of ARRA generosity include the City of New Haven ($39.1 million), Waterbury’s school district ($30.2 million), Bridgeport’s school district ($29.7 million), New Haven’s housing authority ($28.3 million), and New Britain’s school district ($18.2 million).
Smaller municipalities have their hands out as well — not just to preserve jobs, but to grab long-sought goodies. ARRA has given:
* $4.6 million to New London’s Office of Development and Planning
* $3.4 million to East Hartford for a fire station
* $909,000 to Stratford for the demolition of 40 ramshackle cottages
* $900,000 to Naugatuck Valley towns for “brownfield” remediation
* $771,000 to Danbury for renovations to senior-housing complexes
* $545,100 to Fairfield for energy-efficiency projects
* $502,604 to the Willimantic Housing Authority
* $445,048 to Milford to retain teachers and paraprofessionals
* $367,000 to Torrington for sidewalk rehabilitation
* $75,000 to Bristol for police overtime
* $46,000 to West Haven’s school district for a stimulus-funds overseer
* $30,000 to Redding for a police cruiser
* $14,014 to New Britain for cafeteria cash registers at two middle schools
* $9,100 to Washington for Tasers and other police equipment
* $9,100 to Sprague for an all-terrain vehicle
Let’s leave an analysis of Connecticut’s ARRA corporate-welfare queens — a list that includes perpetually begging fuel-cell companies — for another time. The data indicate that in the early days of the Obama administration, fiscal conservatives were wise to warn that a bill many thought devoted to “shovel-ready projects” was primarily a mechanism to bolster Democratic Party constituencies, with public-sector employees first in line.
Connecticut is Exhibit A. Numbers from the state’s Department of Labor reveal that while the “government” employment sector has declined in the last nine months, the drop in private-sector jobs has been greater. And positions in “educational and health services,” which are heavily dependent on subsidies, have grown. (The U.S. Government Accountability Office reports that nationally, 89 percent of the $50 billion showered on state and local governments has covered Medicaid and education-related costs.)
What’s worse, all this “stimulation” is being charged to the nation’s credit card. Mickey D. Levy, Bank of America’s chief economist, recently told the (Manchester) Journal Inquirer that while the ARRA adds to Washington’s debt, it does “not add much to the nation’s productive capacity. Thus, current future taxpayers and generations will pay. There’s no avoiding it.” Furthermore, such “profligate fiscal actions require an enormous increase in government bond issuance at exactly the time overseas governments and private investors have a reduced appetite for U.S. government bonds. Likely, this will eventually result in higher interest rates and a lower U.S. dollar.”
Oh well. That’s a problem for other people to worry about. Connecticut’s congressional delegation, governor, state legislators, and municipal politicians are too busy delivering checks to their friends on the public payroll.
D. Dowd Muska is a writer, commentator and lecturer. His website is www.dowdmuska.com.
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