mlarue says:

While musing about the stimulus package, I’d like to add some things to consider:
1. I’m not sure I understand the overall point this musing is intended to make.
a. If the point is that we’re better off doing nothing, it appears to discount the reality that asset values (stock market, housing, etc.) have plummeted like rocks and here is a paralysis of fear in the capital and lending communities. More importantly, unemployment continues to rise and (it seems) is rising at an increasing rate as employers try to conserve what little capital they have left while searching for light at the end of a seemingly long tunnel.
b. If the point is that we could improve the package by further study and negotiation of the next couple of months, you may be right. But the recent celebration of Capt. Sullenberger’s successful landing of an Airbus with 155 souls on board demonstrates that emergencies (and we’re unarguably in one) don’t provide time to argue about the absolute best option. Emergencies with the lives of people on the line require smart, quick, decisive action before the ground (or disaster) rises up to smite all of us. In my experience, a mediocre plan with quick and competent execution is far better than a great plan with poor execution or (worse) execution that takes place too late to be of any use.
2. The thing about projects that take some time to complete is that (a) an irrevocable commitment to such projects begins a process of hiring, contracting, budgeting and spending and – most importantly – a degree of light at the end of the tunnel that encourages activity and discourages the paralysis of fear and uncertainty. For example, the commitment to build a major office building doesn’t result in a completed building (or spending of the entire cost for that building) right away as such a project can take a year or two to complete, but it does result in employing architects, engineers, and other up-front personnel; it quickly results in employing excavators, utility and foundation contractors; and then results in …. But you get the idea. It sets in motion a chain of activity that encourages the companies and people who may be employed later in the process to have work in the pipeline which can encourage continued investment in (and continued operation of) those companies.
3. Upgrading the electric grid is a wonderful idea. And burying power lines would add a great deal to the aesthetics of any area. But the most important part of grid upgrading is the development and implementation of a smart grid that will help the US in working toward energy independence by improving distribution efficiency and leveling demand so as to minimize the construction of power generating plants that are only needed for a few peak times each year. A great source of information on that subject is Thomas Friedman’s book Hot, Flat and Crowded”. More to the point, improvements in the energy grid and investments in smart grid technology are already a part of the Obama administration’s key goals.
4. Burying power lines (particularly major transmission lines) is extraordinarily expensive. Encouraging the burial of new installations usually makes a great deal of sense but that’s old news. Most any new development project includes underground utility feeds rather than overhead. The fact is that we experience relatively few power outages and even fewer large-scale outages. When did you last have an outage that had a meaningful effect on your life – or your day?
5. Squirrels? Anyone who walks around outside will occasionally see squirrels walking across power lines. It’s a cool demonstration of their ability to give circus performers a huge case of envy. The fact is, a squirrel waking on a power line won’t result in much of anything. One getting into ground-based equipment (transformers, capacitors, etc.) and causing a short to ground while being electrocuted may have an effect. Out of curiosity, can you provide details of (or an article referencing) the squirrel incident that resulted in disruption to power to nearly the entire eastern seaboard?
6. You’re absolutely right about grid improvements to support electric vehicles. And that’s another area where smart grid comes in. Some significant efficiencies in generation and distribution are available by better coordinating the timing of load demand (see Friedman).
7. Encouraging burial of overhead utility lines during road reconstruction is an excellent goal.
8. Encouraging addition of fly ash to concrete is an excellent approach to disposing of an otherwise problematic by-product of coal-fired power. Fortunately, American industry has gotten on that bandwagon and about 45% of domestic fly ash is currently being recycled. But because coal combustion is one of the largest sources of CO2 emissions in this country (and in China), the phase-out of coal as an energy source is something we should be diligently working toward with wind, solar and nuclear seeming to be the most logical alternatives.
9. While fly ash may improve the longevity of concrete pavement, the more frequent cause of failure is below the surface – literally. Skimping on base preparation (excavating weak soils, compacting loose soils and adding sufficient rock as a base to support heavy loads that tend to crack pavement lying on a flexible base) is usually the most important component affecting pavement longevity. Ever notice how Wisconsin roads seemed to last longer than Illinois roads? I suspect differences in engineering standards may have been a principal factor.
10. Is there something about the stimulus package that causes you to believe it will result in generation of a disproportionate number of public sector jobs at the expense of private sector jobs? Have you found a part of the package that calls for doubling the number of people at (say) the motor vehicle bureau? But then, not all public sector jobs are a bad idea. Do we need more or better police or fire department personnel? Is the reduction of class size in some schools from (say) 28 students per classroom to 20 per classroom a bad idea? It is my hope and belief that the stimulus package which is still in negotiation between the house and senate will result in the development of “stuff” (infrastructure, hospitals, school improvements, etc.) The vast majority of such work may be paid for by the public, but is carried out by private contractors. Even some of the things that piss some off (repair of the mall in DC) would have employed people working for private contractors.
11. Are private sector jobs likely to be a better thing than government jobs? Absolutely. Few would argue that. But the tenor of this musing seems to leave the impression that the stimulus package will be aimed at public sector jobs at the expense of private sector jobs. What have you seen that causes you to believe that?
12. And I certainly agree that wealth is not a zero-sum game. But the goal of a stimulus package is to get people moving (and providing services and creating stuff which is the source of wealth) again.
13. I’ll leave discussion of SCHIP for another day. I do, however, wonder how a bill that is focused on enabling lower-income families better access to health insurance for their kids is (on balance) a bad thing. Almost by definition, lower income families are far more likely to be without insurance coverage for their kids and, therefore, show up at emergency rooms as uninsured persons who place even greater burdens on already stressed hospitals. But that’s another discussion, just like encouraging smokers to quit is another discussion. It might be an interesting one, though…