Less than stimulating

Less than stimulating

Milwaukee Journal Sentinel: The midterm election campaign is on. How else to explain the comments of House Minority Whip Eric Cantor, who griped the other day that, “Clearly, the stimulus bill has failed.”

Cantor would have more credibility if he had argued for a larger, faster-acting stimulus bill. But the Virginia congressman wanted tax cuts.

And Cantor and the other GOP critics would do well to recall the painful early months of President Ronald Reagan’s first term. Reagan had inherited an economic basket case from Jimmy Carter: pathologically high unemployment, slow growth and general malaise. Unemployment continued to rise for 23 months after Reagan’s inauguration. It finally peaked at 10.8 percent in December 1982 before beginning to decline. Deep recessions take months, if not years, to resolve.

A critical miscalculation

President Barack Obama underestimated the severity of the problem — his vice president and resident occasional truth-teller, Joe Biden, has acknowledged as much. But the bigger problem seems to be execution. Stimulus spending so far has been maddeningly slow — only 7 percent of stimulus funds have made it out the door — and there is evidence that it might not be going to the hardest-hit states.

A recent Wall Street Journal analysis of about $200 billion in stimulus commitments showed that Wisconsin only expected to received $561 per resident — 45th among the states — despite an unemployment rate of 8.9 percent in May. Montana, a state with an unemployment rate of 6.3 percent, had been allocated the equivalent of $1,015 per person. Nothing against Big Sky Country, but come on.

While it’s too early to pronounce the stimulus a failure, it is time to execute better. First, speed up the flow of dollars to projects likely to have the greatest impact. Second, if another stimulus bill is contemplated, it must be better designed. Who wouldn’t like a tax cut? But the record so far shows that the tax cuts are being saved — not spent. Money should be injected directly into the economy through infrastructure and other spending.

This is Obama’s problem to fix.