President Obama is scheduled to give a speech on job creation this morning at the Brookings Institution. The administration has been toying with the idea of using leftover bailout (TARP) money to fund a second stimulus to boost employment. Theoretically, no one's against more jobs--particularly if there's an easy way to pay for them. Yet critics from both the left and right are bringing up their beefs with the plan hours before the speech has been given. Some Republicans doubt that diverting leftover TARP money is legal, some pundits think we should sprinkle the excess money into the private sector, and some don't think the measures Obama intends to announce go far enough. Here's what they're saying:
- Bad If We're Recovering, Bad If We're Not The editors of the National Review repeat the well-worn argument that if the economy is beginning to recover, "then increasing government borrowing" through another stimulus "is a terrible idea. The private sector will need that capital and would allocate it far more efficiently." If we are not on the brink of a recovery, firms may need the TARP money the Obama administration was planning to reallocate to the stimulus.
- The Wrong Man for the Job Time's Barbara Kiviat argues that "drumming up new jobs on short notice isn't exactly in the government's wheelhouse." The government is quite important for long-term "health of the labor market," which it affects through trade policy and corporate tax, but has very little to recommend it as a short-term job creator. A Cash for Clunkers type program, Kiviat explains, "has a good shot at doing what it sets out to do," but is difficult to expand--one needs a new program for each section of the economy. Paying companies to hire workers is another option, but didn't work particularly well in the 1970s. Kiviat also notes that direct hiring by the government can be inefficient, while giving credit to new businesses is risky.
- Not Enough Stuff, Not the Right Stuff At left-leaning blog Firedoglake, David Dayen reacts to the announced components of Obama's speech. He laments the omission of "job creation tax credit," direct government hiring ("a kind of mini-WPA"), and state aid. He also thinks the "price tag ... a bit low" and wonders if that is because "the President may not be interested in investing beyond what was saved through TARP."
- Cutting Jobs with One Hand, Creating with Another Jennifer Rubin at conservative Commentary magazine and the editors of The Washington Times chime in with a common conservative talking point: what is the point of attempting job creation while, according to Rubin, "the list of stupid things that are likely to retard innovation, growth, hiring, and investment ... includes the key priorities in Obama's domestic agenda"? Rubin mentions, as do others, carbon regulations through the EPA or Congress, as well as health care reform.