More Stimulus Proposal Facts
January 26, 2009 – 11:16 ET
Total Cost of Stimulus Legislation: $825 billion
How does this compare?
• In 1993, the unemployment was virtually the same as the rate today (around 7%). Yet, President Clinton’s proposed stimulus legislation *only* contained $16 billion in spending
• The total cost of this one piece of legislation is almost as much as the annual discretionary budget for the entire federal government.
• This legislation nears a trillion dollars. President Reagan said the best way to understand a trillion dollars is to imagine a crisp, new stack of $1000 bills.
• If you had a stack four inches high, you’d be a millionaire. A trillion-dollar stack of $1000 bills would measure just over 63 miles high.
• In $20 bills, a trillion dollar stack would be 3150 miles high. That’s about the distance between DC and Trujillo, Peru.
• President-elect Obama has said that his proposed stimulus legislation will create or save 3 million jobs. This means that this legislation will spend about $275,000 per job. The average household income in the U.S. is $42,000 a year.
• This bill provides enough spending to give every man, woman, and child in America $2,700.
• This bill will cost each and every household $6,700 in additional debt, paid for by our children and grandchildren.
• Although this legislation has been billed and described as a transportation and infrastructure investment package, but only three percent ($30 billion) of this package is for road and highway spending.
• Much of the funding within the proposed stimulus package will go to programs which already have large, unexpended balances.
• For example, the draft bill provides $1 billion for Community Development Block Grants (CDBG), which already has $16 billion on hand.
• And, this year, Congress has plans to rescind $9 billion in highway funding that the states have not yet used.
• Deficit spending will not expand the economy. If that were true, then the current $1.2 trillion deficit — the largest in history — would already be rescuing the economy.
• $800 billion more will not change that.
• Trade groups state that every $1 billion in highway “stimulus” can be spent creating 34,779 new construction jobs.
• But Congress must first borrow that $1 billion out of the private sector.
• The private sector then loses or forgoes roughly the same number of jobs.
• Japan responded to a 1990 recession by passing 10 “stimulus” bills over 8 years (building the largest national debt in the industrialized world). Their economy remained stagnant and their per capita income went from the second highest in the world to the tenth highest.