STIMULUS SPENDING

On February 13, 2009 the American Recovery and
Investment Act of 2009 was passed by the United
States Congress. The act is also known as President
Obama's stimulus package and was only approved by
three Republicans in all of Congress. The package,
composed of $787 billion in tax reductions and
expenditures for education, energy, infrastructure, health
care and many other projects, was created to help get
the U.S. economy out of the recession by creating
several million jobs and replacing money in the
economy. Read on to learn more about the major ups
and downs to the stimulus package.
Stimulus Spending Debate Pros
The biggest pro for the stimulus package is, of course,
that if it works it can pull the U.S. economy out of a
terrible recession. The stimulus package has the ability
to upstart the economy and provide millions of jobs.
This would stop the ever-increasing unemployment rate.
Additionally, the stimulus package has the backing of
economic historians, who argue that the Keynesian-
style spending inherent in the package has shown
previously great success in ending the Great Depression
and propelling economic growth during the 1950's and
1960's.
There are also a number of smaller, more specific pros
that come out of the stimulus package. First, the
package calls for a great deal of repair to U.S.
infrastructure. The repairs are certainly needed and
affect roads, power, bridges, airports, sewage systems
and more. Next, the package provides a great deal of
aid to school districts. The package works to expand
public transportation, with funds dedicated to a high-
speed rail system. There are increased unemployment
benefits. The package increases food assistance for
Americans with low-income and increases medical
coverage for military members, families and veterans.
Criticisms of the Stimulus Spending Debate
There are a great deal of critics of the stimulus
spending debate as well. Those who criticize the
package consider a number of cons. First, the money
funding the package must come from outside sources,
increasing the national deficit. Economists predict that
within a few years the hole in the economy will triple the
amount spent in the package, so the package is
potentially not nearly enough to do anything worthwhile.
Among the biggest criticisms of the bill by those who
lean right politically is about the nature of government
involvement in economics itself. Many Republicans feel
that the federal government was already too large prior
to this crisis. They objected to the stimulus on the
grounds that the federal government should get reduced
in size, scope and responsibility. They argue that this
government contraction would create breathing space
for the economy to correct and revive itself.