Republicans in Congress were just barely able to extend for 90 days funding of nationally important transportation projects. The only conclusion is that the GOP has become, collectively, a fifth column traitor against our future economic health.
From the Economist:
The Treasury has just published a white paper full of reasons to favour additional investment. Even if you are sceptical of the utility of fiscal stimulus qua stimulus, now seems like a very good time to undertake much more investment than normal. As the Treasury paper points out, very low interest rates and high unemployment mean that the odds of crowding out private spending and investment are much lower than normal. Cheaper than normal capital and labour also imply that taxpayers will receive a better deal on spending than would typically be the case. The cost-benefit calculus on infrastructure investment has shifted toward doing more of it, or at least squeezing more expected investment into the present period. Other research, like the new Brookings paper by Brad DeLong and Larry Summers, also indicates that the bar for greater investment should be lower. Given the potential that unemployment will become increasingly persistent as time goes on, the value of government spending that reduces joblessness—even temporarily—is higher than may be appreciated. Any projects that seemed like good ideas in general, and there are a lot of them, look like really, really good ideas now.
And yet Congress has struggled mightily to keep even existing spending going. The nation’s primary transportation-funding law expired in 2009. Normally a wholesale replacement or reauthorisation would follow that expiration; Congress has instead repeatedly extended the old law while bickering over how to come up with money to replace the increasingly meagre take from the nation’s petrol tax. The latest extension is set to expire, and legislators are arguing over what to do next. They might extend the measure again—for 60 to 90 days. Or they might stonewall themselves into a temporary shutdown of all federally funded projects.
Inaction is absurd and embarrassing, especially since funding is the primary (though not the only) source of disagreement and the costs of borrowing and unemployment (and the likelihood of a decent return on infrastructure investment) indicate that just borrowing the money to spend on new roads and rails would be a reasonable course of action. If ever there should have been a policy so obviously sensible as to attract bipartisan support, more money for infrastructure was it. Right now, when it comes to partisan politics, sensibility’s got nothing to do with it.
Beezer here. How else to figure it? Big oligopolies in Banking, Fossil Energy, Agriculture and Health Insurance are funding Super PACs which daily bombard us with propaganda about how they still need subsidies and protections against competition. Tea Partiers and Libertarians are so disgusted with our government’s inability to help ‘We the People,’ they’ve paradoxically joined forces with the oligopolies–the very forces that bribe our government to insure our government serves the wealthy oligopolies instead of the general population.