Archive for January, 2009
While a variety of reasons exist for why President Clinton defeated President Bush, Sr. in 1992, a primary reason was his focus on the economy. We saw a replay of this scenario in 2008 with President-elect Obama defeating his rival, in part, because of the high marks he received from voters on the economy in the days leading up to the election. Indeed, he emphasized in debate after debate that not only would he make the economy a top priority in his administration, but that he would also invest in areas such as broadband, health IT and developing green technology, like alternative fuels and the smart grid.
In fact, President-elect Obama is correct to recognize that these areas will drive long-term economic growth and be the basis for future prosperity and American competiveness. And investing in these sectors will also boost employment in the short-term. These are exactly the reasons why the proposed $775 billion stimulus package should include, at least in part, investment in digital infrastructure.
In the past, stimulus packages targeted traditional infrastructure projects—building more roads, bridges and sewers—to create jobs, and quite literally, dig our way out
President-elect Obama made his campaign about change and promises to do the same with government. One area to start is with the proposed stimulus package.
Already he has said this one will be different. His transition team released a statement yesterday that they were going to ban all earmarks from the proposed stimulus package.
But with the stimulus package having a proposed price tag of around $775 billion, of which approximately $300 billion is in tax breaks for low- and middle-income earners, we also need change in how the money is spent.
In the past, to the extent stimulus packages did more than spur additional consumer demand, they usually included some investments in traditional infrastructure — building or improving roads, bridges and sewers — to create jobs, and quite literally, dig our way out of a recession. Given America’s decaying infrastructure, these projects are also needed today and will help cash-strapped states move forward with projects that have been stalled.
But the fact is that investing in physical infrastructure will not have the same short-term impact on American jobs, or long-term impact on U.S. competitiveness, productivity, and quality of life