FROGS

FROGS

In the annals of counter intuitive reality, I thought nothing could top the frogs in the gradually warming water.

It seems that a frog, like you and me, will react immediately to the touch of boiling water, bolting from the offending hot stuff in a split second. Put the reptile in a bucket of gradually warming water, however, and it will literally sit there until it is boiled to death.

So, as I said, I thought nothing could top the frogs. 

And then I heard the Republican position on the current economic crisis and the stimulus package winding its way through the halls of Congress. 

And realized I was wrong. 

In a Back to the Future moment that only true conservative believers can revel in, the GOP is telling us that the solution to our current problems is some combination of tax cuts, a spending freeze, reduction of the deficit, and the condemnation of anything else as that most hated of political beasts, the "earmark." Never mind that the first and second will not stimulate, the third would actually make things worse at this precise moment, and the fourth is merely a rhetorical sponge -- and a mostly inaccurate one at that -- there to absorb anything at odds with one through three. 

It is very easy to pick apart the stimulus package, and this makes for great political theatre, however de minimis the actual dollars are when it comes to any particular nit. Whoever added the line for contraceptive funding to the House bill obviously had stimulus in mind, but not the sort we are looking for. Nevertheless, as Obama pointed out earlier this week, the specific spending now criticized amounts to about 1% of the overall package, a lot of money to be sure, but hardly more than a rounding error in the context of our multi-trillion dollar economy. 

The real problem is that the President is being way too apologetic and should stop it. The bill is more than defensible in almost all its particulars.

But you do have to read the fine print. 

And ignore the Rush Limbaugh echo chamber. 

For example, among the items in the House bill criticized recently on the op-ed pages of The Wall Street Journal were $6 billion to construct, alter and repair federal buildings, $325 million to repair trails and "remediate mines" on federal lands, $462 million to construct, renovate and repair laboratories leased by the CDC, $427 million to construct research facilities for the Oceanic and Atmospheric Administration, $75 million for salaries and expenses at the FBI, and $6.2 billion for weatherization assistance. 

All of this is directly stimulative. The vast majority is for new or retrofit construction projects which create local jobs with obvious economic multiplier effects. If you doubt this, just look for a construction project in any urban neighborhood and then ask the local deli owner what he thinks of it. Those sold pastrami sandwiches will tell you all you need to know. And whether they are swinging steel girders on high risers or weatherizing the suburban mansions of any remaining yuppies, the hard hats won't care. Both jobs will pay the bills. Equally stimulative are the much derided line items for "salaries," notwithstanding the fun had by those who play the conservative parlor game of bashing government employees as undeserving leeches sucking off the tit of their ostensibly more productive private sector brethren. What the parlor pundits miss is that, unlike the upper echelon taxpayers favored by conservatives and the GOP, those FBI agents and employees will actually spend whatever portion of the $75 million goes to salaries. 

Even the more esoteric stuff is perfectly appropriate for these less than perfect times. Stealing a page from Franklin Roosevelt's book, the House bill provides hundreds of millions to repair trails on public lands. This is merely the Civilian Conservation Corps (CCC) of the 1930s come back to life. In the Depression, the CCC took tens of thousands off the streets and gave them work on federal lands. And the modest equivalent now proposed could today provide work for an army of college students and others. 

In truth, conservatives are not bitching about whether the expenditures are sufficiently stimulative. Were they doing so, a credible claim could be made that too much of the spending extends into fiscal years 2010 and 2011 when it should instead be front loaded, and an even stronger claim could be made that the overall amount spent is way too low. My guess is that as the bills make their way through both chambers and then to conference, the first problem will be addressed. Nevertheless, the conservatives will not come along. 

Because it's the second problem that really scares them. 

In 1993 and 1994, as the Clinton Administration teed up universal health care and sought to craft legislation to make it a reality, conservative pundit William Kristol famously advised Republicans to say nothing but "No." Kristol thought that any universal health program would cement the middle class' allegiance to the Democratic Party for another generation or two and that, as a consequence, when it came to universal health care, Republicans couldn't bargain, negotiate or compromise. All they could do was oppose. 

Something similar but much bigger is at work today. Conservatives cannot afford to let the government forestall this crisis. They cannot allow an insufficiently funded Round I stimulus package to lay the groundwork for more money later on. If that occurs and works, they will be out of business for quite some time, their laissez faire trickle down ideology in tatters, their second Gilded Age gone the way of the first.

The stakes, of course, are much higher now than they were in the '90s with health care. Then, it was about a program. Today, it is about the world's economy. Consumers aren't spending. Real estate developers are moth balling planned commercial investments. Businesses are not expanding capacity because they either can't sell what they have already produced or do not think they will sell what they could now produce. And Nobel economist Paul Krugman is warning of the "possibility" of a "prolonged deflationary trap," which is econo-talk for a Depression. 

But in the face of all this, the party of W marches on. 

Obliviously.

Just like the frogs.