That’s too bad, because the lobbying story would stand alone well. It includes an amusing battle between the asphalt and concrete industries, who are trying to influence which infrastructure projects get funded.
Concrete lobbyists want more money for such long-term projects as interstate highways, bridges and waterworks — projects that, not coincidentally, use more concrete. The asphalt industry prefers repaving and road repair that use more asphalt.
“When you have a road or highway that needs to be fixed quickly, asphalt is the way to go,” says Margaret Cervarich, a vice president at the National Asphalt Pavement Association.
I’ve got a novel idea: Get the lobbyists out of there and pick projects by need—whatever material it takes to build it.
But back to the Journal. This is also good to know:
Lobbyists for U.S. footwear makers and retailers want lawmakers to wall off their drive to scrap import taxes on cheap shoes from a competing push to lower tariffs on all imported clothing and textiles.
The shoe lobby sent a letter to congressional leaders Tuesday asking for a stimulus provision abolishing the import tax on synthetic, fabric and canvas shoes. The American Apparel & Footwear Association, the Footwear Distributors and Retailers of America and retail footwear companies say the tax can reach 67.5%.
Is it me or will making it cheaper for sweatshops in China and Indonesia to export shoes to us most definitely not help create jobs in the U.S.? Good for the WSJ for pointing out this ridiculousness, which, because it’s “free trade,” will probably find its way into the bill anyway. Anyway, we could use those tax dollars right about now. We’ve got a $2 trillion deficit to pay for!
Of course, not all the lobbying efforts are wasteful. Here’s one that would be productive:
But the firms struck pay dirt Tuesday in the Senate Finance Committee, winning a 10% tax credit for investments in current-generation broadband technology, and a 20% tax credit for investments in “next-generation” broadband, not only in rural and underserved areas but any residential area.
The WSJ pairs that story with one questioning whether all the spending is going to be enough.
All else being equal, Mr. Simonson estimated that the plan as currently formulated could create 1.8 million construction jobs in its first year. But the sector has shed 899,000 jobs from its peak in September 2006.
“There’s going to be such shrinkage in private construction projects — offices, hotels, retail, manufacturing — and also declines in state and local funded projects that I’m guessing the stimulus will just slow the decline,” he said.
Goldman Sachs economists say $1.2 trillion in fiscal stimulus is needed over two years to offset the sharp private-sector contraction.
And it’s important to note, as the paper does here, that all this spending will have effects that will in part offset any positive impacts:
The one thing that is certain to flow from the stimulus is a large increase in the federal debt. Large government budget deficits are showing signs of starting to nudge interest rates on government debt higher, from very low levels.
If that persists, it could eventually damp some of the stimulus-plan’s benefits. Higher government rates raise the cost of borrowing not only for the Treasury, but also for many private-sector borrowers, since corporate bonds and mortgage bonds are often benchmarked to Treasury yields.
Now let’s turn to the Washington Post’s A1 effort.
It has a good report on how even some Democrats are questioning the pace of the moves. This is a very interesting plan and one a lot of people could get behind:
In testimony before the House Budget Committee yesterday, Alice M. Rivlin, who was President Bill Clinton’s budget director, suggested splitting the plan, implementing its immediate stimulus components now and taking more time to plan the longer-term transformative spending to make sure it is done right.