Today the Senate defeated, on a party line vote, a proposal by John McCain and some others to modify the “stimulus” plan. Since more than half of the “stimulus” spending is planned for more than two years from now, by which time a recovery of the economy is likely even if very little is done, and since much of that spending is on pet projects and interest groups that Democrats had wanted to spend money on for quite some time, but couldn’t quite find the excuse, the Republican proposal was simply this:
If two quarters of consecutive growth in the economy are experienced after the “stimulus” plan is passed, then further spending plans in the “stimulus” bill would be cancelled, as being obviously no longer “necessary”. Specifically, this would apply to all plans to spend money more than two years in the future, obviously too late to be a “stimulus” for us now, anyway.
The proposal was defeated 54-42, with two Democrats joining all the Republicans voting for it, and only Democrats voting against it.
That’s because they’re determined to take this chance to do spending they’ve wanted to do all along, and are just burying tons of it in this giant, steaming piece of half-boiled pork of a “stimulus bill”, without regard for whether it wil actually stimulate the economy in any sustainable way, or not.
Of course, what produces sustainable stimulation is anything that encourages businesses to expand, and to spend money themselves on equipment/supplies (which creates/maintains employment for the providers of those) and to directly hire people themselves.
Spending tons of money on tons of entitlements, giveaways, etc., doesn’t stimulate the local small business (where 2/3 of US jobs are) to hire another person, or buy more equipment, or expand a store, or advertise more, or whatever. What stimulates business is tax cuts, changes in tax rules that allow them to totally expense equipment purchases (instead of having to depreciate over 5 or 7 years), relaxations in the rules surrounding hiring new employees (some states have regulated small business into outer space, and there are lots of federal rules, too), maybe a flat three month tax holiday, maybe some direct tax credit for hiring new employees, etc.
But the Democrats, too many of them hostile to business for ideological reasons, I guess, aren’t interested in any of those things. They want to reward their interest groups, pure and simple.
As before: I told you so.
