• Election 2008
• National RCP Average
• Electoral Maps
• Battleground States
• Latest Polls

January 29, 2009

Obama Buys the Bush Bailout

By Maggie Gallagher

President Obama, taking a break from sucking up to world opinion on Arabic television, has a word for those big, bad corporate executives: Stop buying corporate jets and redecorating your offices! Or else!

Or else what?

The stereotypical Rush Limbaugh listener's Pavlovian response -- "Bad, bad Obama for interfering with the free market!" -- misses the point.

The president is not punishing failed and spendthrift executives. He is rewarding them with billions -- nay, trillions -- of taxpayer dollars.

Obama is betting that a little ritual public humiliation will distract the public's attention from the really key fact: The plan to shovel money to failed corporate executives is now Obama's and the Democratic Congress' plan. Yes, I know it began as President Bush's plan, but Obama and the Democrats have eschewed change in favor of continuity with one of George W. Bush's worst ideas.

And there's only one question Americans really care about in the new "recovery plan": Will it work -- restoring economic growth and adding jobs?

From what I have seen so far, I do not think so. I think the current administration is operating on a set of old ideas that are going to fail on a massive scale, in part because this massive new government spending will not be targeted, as promised to the American people, on the current economic crisis.

Instead, huge sums will be used to pay back interest groups that helped elect congressmen and senators and, yes, the White House. This is not a stimulus package. It is a wish list for the hard-left special interests.

So Barney Frank's banker friends get a little help from Washington. Planned Parenthood, which donates millions to political candidates, gets paid back with instant access to taxpayer financing abroad. So "community organizers" like ACORN become eligible for billions under a new "neighborhood stabilization program."

Sen. David Vitter, R-La., told FOX News on Tuesday that the money amounted to a "payoff" for groups' political activities in the last election. Huge sums are added to shore up careless state governments that have overspent during the good times, subsidizing fiscal irresponsibility on a massive scale.

There is a powerful case for using government to shore up the nation's banking system, which has a special role in the nation's economy -- unless private lending takes place, the economy will collapse. But by following Bush's lead in expanding the "recovery package" to include bailouts to auto executives, congressional Democrats sacrificed the idea of targeting money to banks.

Now powerful Democrats appear to have given up on the idea of targeting government money to the economic crisis at all. Don't believe me? Read the Congressional Budget Office's Jan. 26 report. Just a little more than one-tenth of the $800 billion in extra spending appropriated by Congress in the House bill would be spent in fiscal 2009, according to the CBO. So, for example, of the $59.5 billion in highly touted new transportation infrastructure, very little would get into the economy this year. And only 85 percent would be spent by 2013 . Or look at the tenfold spending on rural broadband service. "Five to seven years" is the timetable the CBO lays out for spending that so-called stimulus money.

The New York Times' David Brooks notes that the Obama plan amounts to $223,000 for each job allegedly created. So for every $50,000 a new worker might earn, $175,000 will go to government waste and political payback?

Is this what change looks like?

As Rahm Emanuel confessed in November, "You never want a serious crisis to go to waste."

I repeat the key question: Will it work? If, after Bush and the Democrats spent $700 billion and Obama and the new Democrats spend $800 billion, the economy is still in shambles six months to a year from now, the American people will know the answer.

And they will know who is responsible.

About Us | RSS | Contact | Advertise | Privacy Policy         © RealClearPolitics 2008