When the Democrats are in charge, the rich just get richer. Wait — isn't that what we're supposed to say about Republicans? Not so when federal stimulus funds are being spent.
Washington has taken trickle-down economics to a whole new level of inefficiency. Those closest — literally — to the seat of federal power get the most. By the time the funds make their long journey to paychecks for people doing productive work, there's not a whole lot left.
Take the example, revealed this past week, of how $111 million in stimulus money has so far funded a paltry 55 public-works jobs in Los Angeles. City Controller Wendy Gruel says two municipal departments, Public Works and Transportation, plan eventually to create or retain 264 jobs with that money, but the contracting process is so slow that most of the money is still waiting to be spent. So the price tag per job is $2 million at this point. Even if the city departments meet their target of 264, it will drop to only $420,000. This is still several times what workers will actually get paid.
So where does all the money go in cases such as this? In part it goes to the capital costs and profit of the contractors. But much of it also gets absorbed into the normal process of government contracting, in which public employees are paid to ensure (ideally) that the taxpayers are getting the most for their money and aren't being cheated by favoritism.
Of course, bureaucrats typically feel no need to rush things along. They don't get paid any less if a street gets repaved a few months late. L.A. may be worse than most at getting people to work, but its low return on stimulus spending is certainly not unique. Even projects touted by the Obama administration have this problem.
Vice President Joe Biden on Friday cited one in which the New York City Department of Transportation is spending $175 million to renovate bridges and a parking lot, putting all of 120 people to work. That's $1.46 million per job. Another job on Biden's list, a highway project in Ohio, has created 300 jobs and costs $138 million — $460,000 per worker.
Tags: Obama, Recovery, fails, Investmentor's Business Daily To share or post to your site, click on "Post Link". Please mention / link to the ARRA News Service. Thanks!
0 comments:
Post a Comment