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How Obama Can Defend the Stimulus How Obama Can Defend the Stimulus

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How Obama Can Defend the Stimulus


President Barack Obama speaks during a campaign event at Morningside College, Saturday, Sept. 1, 2012, in Sioux City, Iowa.(AP Photo/Pablo Martinez Monsivais)

Republicans in Tampa agreed on many things: Hard work is good; “Obamacare” is bad. You built it; he didn’t. Talking to chairs is good; talking to Iran, not so much.

Another bit of consensus at the Republican convention was that the stimulus stank. Paul Ryan charged that the money “went to companies like Solyndra, with their gold-plated connections, subsidized jobs, and make-believe markets. The stimulus was a case of political patronage, corporate welfare, and cronyism at their worst. You, the working men and women of this country, were cut out of the deal.”


“What did the taxpayers get out of the Obama stimulus?” Ryan asked the crowd. “More debt. That money wasn’t just spent and wasted—it was borrowed, spent, and wasted.”

The interesting question now is how the president and his surrogates are going to respond. Obviously, they’re not going to concede that the American Recovery and Reinvestment Act was bad. But they need to make an argument for it at a time when the recovery, all would agree, stinks.

Part of the problem is that the administration may have raised expectations. Although the president and members of his administration warned countless times from 2009 on that the country’s economic problems couldn’t be fixed overnight, they offered an optimistic trajectory. Calling the post-stimulus period “recovery summer” and projecting that the bill would keep unemployment under 8 percent turned out to be a PR disaster since the economy kept contracting, albeit before the stimulus really got going.


So what’s a Democrat to do?

Along comes Michael Grunwald, a reporter for Time, with his new tome, The New New Deal. If you’ve read any of the early reviews, you’ll know that although Republicans have dismissed the stimulus as a big waste, and many on the left have said that at $787 billion the stimulus was too small to rouse the economy, Grunwald makes a more nuanced case, arguing that it was a landmark piece of legislation on the order of the New Deal even if it is not being recognized as such right now. There are things Democrats can mine here.

First, there’s lots of evidence belying the Tampa argument that Republicans had wished Obama well. We know that no Republicans in the House voted for the stimulus and only three did so in the Senate—the venerable bipartisan senators from Maine, Olympia Snowe and Susan Collins; and Arlen Specter of Pennsylvania, who later became a Democrat. Grunwald cites Republican members of Congress saying they weren’t even going to negotiate over this one.

This intransigence came even though they had supported a George W. Bush stimulus in 2008 that was smaller but still represented the larger Keynesian idea that government should spend in a recession because frightened individuals and businesses won’t do so.


Two, Grunwald makes the case that the stimulus really was an important down payment on the future, with money for high-speed rail and a smart electrical grid as well as more traditional “shovel-ready” jobs. It reformed the unemployment-insurance program, giving states more incentives to cover part-time workers; initiated a massive program that kept the homeless population from swelling, and launched the much-publicized “Race to the Top” education program and a $7 billion initiative to bring broadband access to rural areas. Bigger than the New Deal in actual dollars, it may not have
left the physical legacy of WPA murals and bridges and dams, but it was still hugely important.

When he speaks in Charlotte this week, the president will need to do more than look like a typical Democratic House candidate bashing the Republicans over Medicare—although the Ryan plan gives him plenty to work with. If he reads Grunwald’s book, he’ll be in better shape to frame his case.

This article appears in the September 3, 2012 edition of NJ Convention Daily.

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