Monday, November 24, 2008
Can Obama save the economy on a shoestring?
This man is working on a plan to create 2.5 million jobs over the next two years. I can't wait to hear the devil in the details.
Don't get me wrong: Obama shouldn't have a ton of difficulty passing whatever employment stimulus plan he sends to Congress. The legislature is controlled by Democrats, incoming presidents usually get at least one of their first initiatives passed by Congress and not even the most partisan Republican will want to be painted as being "against jobs" come January.
That said, Obama still has a problem that Cuba Gooding Jr. might characterize by saying "show me the money." There are many ways a government can stimulate job growth, from tax credits to employers for hiring, to lowering interest rates, to funding road and rail and school projects to lending money directly to companies, which seems to have become a favorite in Washington.
The problem is the Treasury is already tapped (can anyone tell me where the first half of that $700 billion went?), and will likely be more so by the time Obama takes office. Citigroup is about to get a $20 billion "rescue", and an Obama adviser said Sunday morning that the new president might let Bush's tax cuts for wealthy people run out on their own, instead of repealing them. That means more tax money being doled out while fewer is coming in.
Economic stimulus is going to be the first, most important thing that the Obama administration does, but no one has yet answered the first, most important question about it: How are we gonna pay for all this?