US HOUSE OF REPRESENTATIVES COMMITTEE ON APPROPRIATIONS
Dave Obey (D - WI), Chairman
15 January 2009
Contact: Kirstin Brost - (202) 225-2771
American Recovery and Reinvestment: A Summary
Action, and action now. The economy is in a crisis not seen since the Great Depression. Credit is frozen, and consumer purchasing power is in decline. In the last 4 months the country has lost 2 million jobs. We stand to lose another 3 to 5 million in the next year.
The economy is shutting down.1
In the next 2 weeks Congress will consider the American Recovery and Reinvestment Bill of 2009. This package is the first crucial step in a concerted effort to create and save 3 to 4 million jobs, jumpstart our economy, and begin the process of transforming it for the 21st century. The package includes $275 billion in economic recovery tax cuts and $550 billion in thoughtful and carefully targeted priority investments. Unprecedented accountability measures have also been included.
The package contains targeted efforts in each of the following core areas:
• Energy - $54B
• Science and Technology - $16B
• Transit Infrastructure/Transportation - $90B
• Education - $142B
• Healthcare - $24B
• Worker Protection - $102B
• Public Sector - $91B
Unemployment rates are expected to rise to between 8% and 9% this year (and by some estimates to as high as 12%). Tough choices have been made in this legislation, and fiscal discipline will demand more tough choices in the future. We will face a large deficit for years to come. Without this package, those deficits could be devastating. We face the risk of economic chaos.
Since 2001 US worker productivity has risen, and 96% of the income growth has gone to the wealthiest 10%. While the wealthiest reaped the benefits from record high worker productivity, the remaining 90% of Americans struggled to sustain their standard of living. They sustained it by borrowing … and borrowing … and borrowing. When they could borrow no more, the bottom collapsed.
Our immediate aim is to prevent the loss of millions of jobs. Our ultimate aim is to make the investments that restore the ability of average middle income families to increase their income and build a decent future for their children.
A historic level of transparency, oversight, and accountability will help guarantee taxpayer dollars are spent wisely and Americans can see the results of their investments. In many instances funds are distributed through existing formulas to programs with proven track records and accountability measures already in place. How funds are spent, all announcements of contract and grant competitions and awards, and formula grant allocations must be posted on a special website created by the President.
Program managers will also be listed so the public knows who to hold accountable. Public notification of funding must include a description of the investment funded, the purpose, the total cost, and why the activity should be funded with recovery dollars. Governors, mayors, or others making funding decisions must personally certify that the investment has been fully vetted and is an appropriate use of taxpayer dollars. This will also be placed on the recovery website.
A Recovery Act Accountability and Transparency Board will be created to review management of recovery dollars and to signal and investigate any potential problems. The seven-member board will include Inspectors General and Deputy Cabinet secretaries. The Government Accountability Office and the Inspectors General will be provided with additional funding and access to conduct special recovery funding reviews. State and local whistleblowers who report fraud and abuse will be protected.
This plan targets investments to key areas that will create and preserve good jobs while strengthening the ability of this economy to become more efficient and produce more opportunities for employment.
There are no earmarks in this package.
To put people back to work today and reduce our dependence on foreign oil tomorrow, we will strengthen efforts directed at doubling renewable energy production and renovate public buildings to make them more energy-efficient. Investments include the following:
• $32 billion to transform the nation’s energy transmission, distribution, and production systems by allowing for a smarter and better grid and focusing investment in renewable technology
• $16 billion to repair public housing and make key energy efficiency retrofits
•$6 billion to weatherize modest-income homes
Science and Technology
We need to put scientists to work looking for the next great discovery. We need to create jobs in new and expanding technologies, making smart investments that will help businesses in every community succeed in a global economy. For every dollar invested in broadband the economy sees a ten-fold return on that investment. Investments include the following:
• $10 billion for science facilities, research, and instrumentation
• $6 billion to expand broadband Internet access so businesses in rural and other underserved areas can connect to the global economy
To build a 21st-century economy, we must engage contractors across the nation. We must create jobs to rebuild our crumbling roads and bridges. We must modernize public buildings and put people to work cleaning our air, water, and land. Investments include the following:
• $30 billion for highway construction
• $31 billion to modernize federal and other public infrastructure
• $19 billion for clean water, flood control, and environmental restoration investments
• $10 billion for transit and rail to reduce traffic congestion and gas consumption
To remain prosperous and competitive, we must enable more children to learn in 21st-century classrooms, labs, and libraries. Investments include the following:
• $41 billion to local school districts through Title I ($13 billion), IDEA ($13 billion; see http://idea.ed.gov), a new School Modernization and Repair Program ($14 billion), and the Education Technology Program ($1 billion)
• $79 billion in state fiscal relief to prevent cutbacks to key services, including $39 billion to local school districts and public colleges and universities distributed through existing state and federal formulas; $15 billion to states as bonus grants as a reward for meeting key performance measures; and $25 billion to states for other high-priority needs such as public safety and other critical services
• $16 billion to increase the Pell grant (http://www.ed.gov/programs/fpg/index.html) by $500
• $6 billion for higher education modernization
We will lower the costs of healthcare. To save not only jobs but also money and lives, we will update and computerize our healthcare system to cut red tape, prevent medical mistakes, and help drastically reduce healthcare costs (by billions) each year. Investments will include the following:
• $20 billion for health information technology to prevent medical mistakes, provide better care to patients, and introduce cost-saving efficiencies
• $4.1 billion to provide for preventative care and to evaluate the most effective healthcare treatments
High unemployment and rising costs have exceeded what most Americans earn. We will provide direct tax relief to 95% of American workers and spur investment and job growth for American businesses. We will also help workers train and find jobs and help struggling families make ends meet. Investments include the following:
• $43 billion for increased unemployment benefits and job training
• $39 billion to support those who lose their jobs by helping them to pay the cost of keeping their employer-provided healthcare under COBRA2 and providing short-term options to be covered by Medicaid
• $20 billion to increase the food stamp benefit by ~13% to help defray rising food costs
We will provide relief to states so they can continue to employ teachers, firefighters, and police officers and provide vital services without having to unnecessarily raise middle class taxes.
• $87 billion for a temporary increase in the Medicaid matching rate
• $4 billion for state and local law enforcement funding
natalnorg note: The reader should be advised that the outline of this economic stimulus package has been modified (in some cases quite considerably and creatively so) from http://appropriations.house.gov/pdf/PressSummary01-15-09.pdf. Changes apart from standard mechanical copyediting include rewording, reformatting, and restructuring. The Editor of alchemy strongly believes, however, that no substantive changes have been introduced here. The bill in its 647-page entirety deserves some perusal as well and is thus made available here: http://big.assets.huffingtonpost.com/HR1.pdf. Refer back to the outline from the House of Appropriations for a more accessible, detailed review of the American Recovery and Reinvestment Act of 2009. As for the Act itself, the Editor renders no judgment except to say that we will be talking about this legislation for as long as we are a nation. That is the natalnorg promise and guarantee. This is the New Deal for our time, ladies and gentlemen. God bless you for reading. A good Sunday to you. And to the survival of the planet, I say Amen.
- vl1 Conservative economist Mark Zandi. See http://www.economy.com/mark-zandi/default.asp.
2 See employee's guide at http://www.dol.gov/ebsa/pdf/cobraemployee.pdf for detailed information regarding this act.