Saturday, May 22, 2010

Spending ARRA Money

It’s pretty clear that the government needs to spend money to keep the economy going. That’s basic Keynesian counter-cyclical governmental action – buy when no one else is buying. That’s not the time to worry about the deficit (but at the same time one hopes that in better times the deficit will be worried about – ojàlà). So I’m for priming the pump, and I wish we had another round coming.

But, then, even I have my doubts. I haven’t seen any big exposés of the shovel-ready projects of the original ARRA legislation – where is William Proxmire’s Golden Fleece Award when we need it? It’s really strange, come to think of it, that the Republicans haven’t come out with sensational stories about multiple bridges to nowhere. I wonder why. Maybe it’s mutual respect for each other’s district spending.

So, in lieu of Proxmire, here are my own personal observations of how money is filtering down to be government-spent. Item #1 – two weeks ago we received a notice from our local Contra Costa County Health Department. They had a $1 million grant program that they themselves could not spend directly, but had to divvy up among others (if they could have spent it themselves, knowing that health department, believe me, they would have. A classic health department, bureaucracy and empire building.) Anyway, we were notified about this program with one day turnaround time required – they are not used to involving others in money spending, I guess.

This grant program was a mélange of rules. How to apply, what criteria to meet, how to measure, who would be eligible for what, etc. etc. Just the reason I don’t deal with governments. Half the value of the grant, if received, would have been spent (and not reimbursed) by time and effort filling out the damn grant application. So typical. Then reviewed by the huge brains in the health department.

And what was the object of this million dollars to be spent, and the time of application to be spent on unpaid work, and the time of bureaucratic efforts to conceive the project, make the rules, and review the applications and later the work? Get this. Spending all this money to find the hard to reach populations in Contra Costa County and immunize them against H1N1!! Jesus! Talk about a stupid objective! Where is the evidence that this is a worthwhile objective? Where is the evidence of how much money would be spent per shot delivered? Where is the evidence that this is worth anything at all, especially when so many regular people are declining the H1N1 shots for various reasons of their own? Do we think that H1N1 is that much of a threat now? Anyone there with experience in trying to wipe out smallpox or polio with the CDC worldwide, who would know how uninformed this choice of objective is on so many levels? Government!!!

OK, so that’s only a million dollars. Then a friend of Sara’s who works for the health department in Seattle was visiting last week. Now we’re talking $25 million. What are they looking to spend $25 million on? Tobacco and obesity. What are they going to do about tobacco and obesity? OK, tobacco public health campaigns have been effective, and I love the old ads that were so sarcastic and hardhitting, about the hard-bitten faux advertising guys plotting about how to make kids into cigarette addicts. They probably helped. And it’s true that tobacco is a huge public health problem. Although it’s also true that probably the most important element of the anti-tobacco crusade was the tax policy. But OK, I’ll give them this on tobacco – important objective and a somewhat proven track record. On the other hand, I doubt if this money is going to lead to much increased employment, except maybe for the health department people and some advertising agencies. Not exactly the people I would target to get this country going again.

But obesity? What the hell are they going to spend the obesity money on? There is no proven way to combat obesity. We don’t know anything about advertising about obesity – who and what are going to be the targets? No one knows anything that will work! Gym memberships? Lectures about fast food? Hit squads on fructose-rich corn syrup? General money for the health department personnel so they avoid layoffs? Personally, I’d rather see some Ben Shahn art commissioned – at least that leaves a trace. I smell another Golden Fleece, sorry to say.

Which leads us to taxes. By the grace of God, I am a highly taxed person. I don’t squawk much about taxes, but lots of people do. They might give lots of reasons for their discomfiture, both practical and theoretical, but I think it comes down to this – what are we getting for our tax money? Even if we are borrowing money now and these expenditures might not be coming directly from taxes yet, we still pay interest and we the people will have to pay it somehow sometime. What are we getting for it?

When the money goes out to health departments and they are told, “Spend it in a good cause,” I don’t buy that. Pea brains don’t do well in spending Other People’s Money (OPM). Large brains don’t even do so well. I look at these idiocies and say, why not fix the pot holes on I-880? It turns out that construction projects don’t have a very good multiplier effect in rocketing money around in the economy. But then I have to ask, does giving money to public health agencies and advertising agencies do better?

That's what I see and that's what other people see.

Anyone ever thought of subsidizing bloggers?

Budd Shenkin


  1. If I were In Charge, I would divert that million dollars to the school nutrition system so that kids wouldn't have to eat crap for school breakfast and lunch. Here in rural Appalachia, it isn't a vegetable unless it's fried and battered.

    This would not only be anti-obesity, but also anti-constipation. The cost savings on Miralax alone would be economically beneficial, plus the increased school performance from decreased time required on the potty.

  2. Because consumer spending makes up 60 percent of the economy you could hand a dollar to the average person and place no restrictions on how he or she used it and still have a positive impact on the economy. It really doesn't matter where the money goes, just that it goes into the economy. If in the mean time it is spent testing some harebrained scheme, who knows it might discover something unexpected.

    We extent unemployment benefits, which is spent on whatever.

    On the other hand, I am sure there are far more worthy projects out there. Funding a good project might discover something that enhances our quality of life, but if not it will still employ idle yet capable resources and help get the economy going.