Getting the Stimulus Right
Whether you call the cash infusions being enacted or contemplated in Washington rescue plans, bailouts or stimulus packages, they all boil down to the same thing: putting almost inconceivably massive amounts of cash into a large number of very powerful hands. The confluence of money and power always sets in motion the scheming of every interest -- and self-interest -- group imaginable and even outright theft, as the shenanigans in the Illinois governor's office so aptly underscore.
So from here on out, every move ought to include safeguards that help aim money toward projects that serve general public interest -- not individual pockets.
One of the best places to start can come under the heading of what not to do. And the $700 billion financial rescue plan approved before the election is an effective object lesson. The congressional oversight board named to keep watch on the fund issued its first report today and its findings are predictably dispiriting but can be useful in crafting future packages. It poses 10 questions to which the answers ought to be clear already but are not -- basic questions such as, What is Treasury's strategy and, What have the recipients done with the money received? Think about that for a second -- the department has nearly finished out handing half of the package without, in the words of the panel, "seeking to monitor the use of funds provided to specific financial institutions."
I think we can agree that from here on out that a given of any package is that the government, and hence the taxpayer, know what is being done with money being handed out -- especially the nearly billion dollars to stimulate the economy that the Obama team is drafting. That cash will flow through every state and be available to nearly every industry in some shape or form.
Economist and former Clinton administration Labor Secretary Robert Reich has come up with three rules for the package that are deceptively simple, including complete transparency for use of the funds. The second is to bar specific earmarks for projects and amendments to the package, which is how considerable amounts of pork are sneaked into bills. Those protections would allow states to decide the best use for the money, not politicians in Washington who all too often use federal money to finance projects of favored institutions and interests. Third, take lobbyists out of the picture by barring any company from receiving funds if it "has paid a lobbyist to seek any portion of the stimulus package on its behalf."