AIP Column: Abandon Ship

In today’s column at American Issues Project, I take note of the fatalistic, shoulder-shrugging attitude Vice President Joe Biden demonstrated at the thought of Porkulus funds getting wasted by incompetence and fraud.  Instead of being outraged, Biden made it sound like he couldn’t really do much about it, or even cared to.  Does he not realize which branch of the government he serves now?

In this case, the Obama administration recognizes that people have perverted the use of their stimulus package, and sound almost completely disinterested in the fact. This money didn’t come from nowhere, although too many people believe it did. We had to sell bonds to raise the cash, on which we now have to pay higher yields, as investors trust us less with the money. We eventually have to redeem those bonds, i.e., pay the money back, and the money spent by the stimulus supposedly will put us in better position at the end than we would be without it.

Even if one accepts that as true – I certainly don’t believe it – the executive branch has the responsibility to ensure that the money gets spent correctly. If people are getting “scammed,” to use Biden’s word, then taxpayers expect the government to enforce the law and stop people from stealing our money.

Put it another way. The reason Obama and the Congressional Democrats insisted on spending almost $800 billion because only that amount of money would stimulate the economy. In fact, many of the Democrats in Congress complained that the package didn’t spend enough money, and that more was needed.

If any of that was true, shouldn’t the administration be demonstrating a zeal for compliance beyond anything we’ve yet seen? After all, in real dollars, this package outstrips what we spent on the entire Moon shot, all of the money spent on the war in Iraq, and it dwarfs the New Deal. In fact, it outstrips the New Deal and the Moon shot put together. They should have a large stake in it turning out well, but as Biden’s comment shows, they seem passive to the point of resignation about waste and fraud depleting their funds.

Why aren’t Biden and the rest of the administration terribly exercised about the potential for stimulus failure as the money gets wasted or stolen and as citizens get scammed?  I argue that they weren’t primarily concerned with stimulus anyway.  Their own economists predicted that the economy would recover regardless of whether the money got spent.

So why push it through?  Read my column for the answer.