GOP Stimulus Myths

Summary
Do some of the Republican claims you've heard about the stimulus bill sound too awful to be true? We find a few that are wildly exaggerated or downright false.

It's not true that the bill contains spending for "golf carts." It has $300 million to buy fuel-efficient vehicles, some of which may be electric cart-like utility vehicles like those already in use on military bases and at other government facilities.

Money claimed to be for "remodeled federal offices" is mostly designated for upgrading buildings to "green" status through such things as thicker insulation and highly efficient lighting, not new drapes or paneling.

A widely repeated claim that $8 billion is set aside for a "levitating train" to Disneyland is untrue. That total is for unspecified high-speed rail projects, and some of it may or may not end up going to a proposed 300-mph "maglev" train connecting Anaheim, Calif., with Las Vegas.

There's no money in the bill specified for butterfly parks, Frisbee golf courses or water slides, despite a GOP congressman's claim that the bill "will fund" those projects. He culled those silly-sounding items from a list of 18,750 city projects that the U.S. Conference of Mayors cobbled together as examples of "shovel-ready" projects.
Don't look to us to defend any particular item in the bill, or to criticize it. We will, however, call out politicians for delivering trumped-up descriptions of the bill's contents.

Analysis
The partisan fight over the $787 billion stimulus bill signed into law by President Barack Obama on Feb. 17, also known as the American Recovery and Reinvestment Act of 2009, rages on, with some Republican governors even vowing not to take all the funds to which their states are entitled.

There are serious concerns about this measure from serious people, conservative and liberal alike. Harvard economist Martin Feldstein, for example, a Republican who endorsed the idea of a stimulus, calls it an "$800 billion mistake," saying its spending measures are the wrong ones to "do much for employment." University of Texas economist James Galbraith, a liberal, predicts that the stimulus is too small to "really have an impact" and thinks larger steps will be necessary. The bipartisan Concord Coalition worries that "[c]ommitting to large and persistent deficit spending beyond the recession – even for apparently worthy purposes – would be detrimental to longer-term economic growth through reduced national saving." And as we pointed out in our Feb. 13 article, "Stimulus Bill Bravado," President Obama's claim that the bill will produce millions of jobs rests on unusually uncertain economic assumptions.

However, many Republicans have been focusing their critiques not on the big issues, but on blaming the Democrats for allegedly stuffing the legislation with that lip-smacking, crowd-agitating snack of heathens: pork! As we detail below, some prominent claims of porcine characteristics are either untrue or wildly exaggerated.

American Issues Project TV Ad: "Every Single Day"
Announcer: Congress just spent nearly $800 billion of your money. How much is that? Well, suppose you spent one million dollars every single day starting from the day Jesus was born – and kept spending through today. A million dollars a day for more than two thousand years. You would still have spent less money than Congress just did.

So what did you get? Economists say most of the money won't help this year. The non-partisan Congressional Budget Office says the plan will actually hurt the economy in the long run.
On Screen: Billions for Pork and Pet Projects. Golf Carts. Fish Hatcheries. Remodeled Federal Offices.
Announcer: And what about the billions wasted on pork and pet projects?
On Screen:Sen. Charles Schumer (D-NY).
Announcer: Congressional Liberals say:
Schumer: Let me say this, to all of the chattering class that so much focuses on those little tiny, yes, porky amendments – the American people really don't care.
Announcer:Is this change you can believe in? Tell Congress to stop the wasteful spending.

What Would Jesus Spend?
Back on the scene is a group that made a splash in the 2008 election with an ad tying Obama to former Weather Underground radical Bill Ayers. (We wrote about Obama and Ayers back in October.) After disclosing at one point that most of its funds came from a Republican billionaire Texan, Harold Simmons, it has managed to keep its funding sources confidential.

The group says its new ad will be running on FOX News, CNN, CNN Headline News, CNBC and FOX Business Network. The ad gets some things right. It's correct, for example, that the stimulus package totals more than you would get by spending $1 million a day since the birth of Christ (2009 x 365 x 1 million = $733.3 billion).

And there is some truth – though not a lot – to the ad's claim that the Congressional Budget Office says the bill "will actually hurt the economy in the long run." What the CBO said in a Feb. 4 letter to Republican Sen. Judd Gregg of New Hampshire was this:

CBO, Feb. 4: [T]he Senate legislation would reduce output slightly in the long run, CBO estimates, as would other similar proposals. The principal channel for this effect is that the legislation would result in an increase in government debt. To the extent that people hold their wealth as government bonds rather than in a form that can be used to finance private investment, the increased debt would tend to reduce the stock of productive capital. In economic parlance, the debt would "crowd out" private investment.

But what the ad omits is that the CBO also said, in the same letter, that productive government investment could lead to increased output and that overall, the effect on output down the road would be quite small:

CBO, Feb. 4: Including the effects of both crowding out of private investment (which would reduce output in the long run) and possibly productive government investment (which could increase output), CBO estimates that by 2019 the Senate legislation would reduce GDP by 0.1 percent to 0.3 percent on net. H.R. 1, as passed by the House, would have similar long-run effects.

Not for Golfers
The ad then turns to what the narrator claims is "the billions wasted on pork and pet projects," while examples of these supposedly wasteful ventures appear on the screen, including "golf carts." Now there's something to raise a skeptical taxpayer's hackles – the prospect of a fleet of golf carts to zip members of Congress and other government officials around the links for their weekly nine holes.

Some of the Army's new Neighborhood Electric Vehicles
But there's nothing at all in the bill about golf carts. What is part of the stimulus package is $300 million for the acquisition of government vehicles with better fuel economy than the current fleet:

American Recovery and Reinvestment Act of 2009: For capital expenditures and necessary expenses of acquiring motor vehicles with higher fuel economy, including: hybrid vehicles; electric vehicles; and commercially-available, plug-in hybrid vehicles, $300,000,000, to remain available until September 30, 2011.

The "electric vehicles" mentioned in the legislation could include what are known as "neighborhood electric vehicles." Though described by some as "streamlined golf carts," NEVs are not actually for golfers. They are vehicles that can go up to 25 mph and are powered by batteries that plug into electrical outlets to recharge, thereby emitting no carbon dioxide. Some do resemble golf carts; others look more like mini-cars.