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Federal Stimulus

Republicans Deem Transpo Stimulus — 6% of Total Spending — a ‘Failure’

Republicans on the House transportation panel held a press conference today to deem the economic stimulus law a failure, citing low infrastructure spending in the nation's highest-unemployment states.

Unemployment_DOT_Stimulus_Spending.JPGRep. John Mica (FL), the committee's senior GOPer, and six colleagues displayed a chart (depicted at right) that used estimates of stimulus money spent so far by state DOTs -- as opposed to the amount obligated.

Tallying obligated money might have gotten in the way of the GOPers' argument, since states are beating the White House deadline for obligating transport funds.

But the press conference also hit on a theme that auditors at the Government Accountability Office (GAO) noted this week: Stimulus cash has not been steered to the nation's most economically devastated areas, largely because of an emphasis on getting money out the door quickly.

Transportation Secretary Ray LaHood responded quickly to the GAO report, asking governors late yesterday to redirect money to infrastructure in struggling areas.

This political firestorm over the stimulus' success obscures two crucial decisions that helped seal its fate as a job creator.

First, as Mica and his committee chairman, Jim Oberstar (D-MN), often pointed out during the stimulus, more cash for infrastructure would have generated more jobs.

The duo's proposed $85 billion transportation stimulus was ultimately cut to $48 billion to make room for extra tax cuts. That $48 billion represents just 6 percent of the total stimulus measure, as the AP points out in a fact check of today's event.

Judging the effectiveness of the entire law based on such a tiny slice of the pie -- no matter how economically potent transportation spending is -- seems misguided at best.

Second, investing more in transit would have given greater benefits to the urban areas that are the nation's economic workhorses. Transit also creates about 19 percent more jobs than road projects on a dollar-for-dollar basis, according to research by the Surface Transportation Policy Project.

Still, Mica's statement this morning made a compelling point, one that House Speaker Nancy Pelosi (D-CA) referenced yesterday:

Some leading Democrats are talking about the possibility of another huge stimulus, despite
the current package’s failure to put money on the streets quickly and
create jobs. 

In addition, the Administration wants to doom a major
transportation bill -- the only real jobs bill this Congress could
consider -- to an 18-month delay.

If House Democrats decide to focus on a new transportation bill as a de facto second stimulus, there could be some drama in the offing over the next few weeks.

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