Politico, the ultimate Beltway newspaper, notes with amusement the presence of a “Do-Nothing Crowd” faction that opposes any “stimulus” plan at all:
“The economy was too big. It was all phantom wealth borrowed from abroad,” says Andrew Schiff, an investment consultant at Euro Pacific Capital and a card-carrying member of the stand-tall-against-the-stimulus lobby. “All this stimulus money is geared toward getting consumers spending and borrowing again. But spending and borrowing were the problem in the first place.”
[ . . . ]
There is no doubt these are minority views. Most lawmakers, economists and policymakers say the economy desperately needs a massive infusion of money to prevent collapse — and needs it now. The Obama administration, backed by many economists, says unemployment could easily top 10 percent and the gross domestic product could tank absent government intervention.
The language used to make the case for stimulus is stark and gloomy — and, by all measures, pretty accurate. But there is also a caveat attached to every solution proposed: that it simply might not work. Economists on the right and left say there is a chance, perhaps a decent one, that $1 trillion injected into a $14 trillion economy might be too little, too late to turn things around anytime soon.
In fact, government stimulus plans have a long history of failure. Remember last February’s $168 billion economic stimulus package? President Bush called it “a booster shot for our economy” and promised that it was large enough to have an effect. It wasn’t, and it didn’t work.
This time around, the Do-Nothing Crowd argues that the new spending — which dwarfs last year’s effort — is probably insufficient and definitely unwise. It is largely an economic argument. But there is also a cultural dimension. Many of the Do-Nothings argue that a painful recession is the best way to destroy America’s runaway culture of irresponsibility and debt. Economic turmoil, after all, has a way of grounding Americans.
Of course, the valiant “Do-Nothing” folks inside the Beltway aren’t exactly doing nothing:
To help push [the Do-Nothing] argument on Capitol Hill, the libertarian Cato Institute plans to take out a full-page ad in The New York Times and The Washington Post on Thursday and Roll Call on Wednesday, making the case against stimulus. The ad will include the names of 250 economists across the country who oppose the massive spending and tax cut program that’s backed by President Barack Obama and many congressional leaders. Many of those are Do-Nothings, while others have more nuanced views about how the proposal as packaged won’t work.
There are many things that are laugh-out-loud funny about this idea. First, it relies on newspapers — an economically inefficient medium on a the road to irrelevancy. Second, it relies on three newspapers that most Americans never have read and never will read. Third, the advertisement itself is a list of names of economists few people have ever heard of. (Now if the ad listed the names of 250 NFL players, folks might pay attention!) Fourth, we’re learning about the advertisement from an article in Politico, another Beltway publication that few Americans ever read. Fifth, the “newspaper ad with names” approach essentially reduces free-market economics to just another political lobby that employs a woefully outdated method of communication. It also reduces the legitimacy of economics by turning it into a numbers game — e.g., “we have more experts than you!”
And finally, it’s more then a little ironic that a libertarian, free-market think tank would oppose wasteful spending by dropping a six-figure sum of donor money on a project that is guaranteed to have absolutely no impact. It’s almost like Barack Obama thought of the idea himself!