Benefits of stimulus program merit its speedy extension

Eighteen months ago in the dawn- ing days of the administration of President Barack Obama, legislators approved a national experiment called the American Recovery and Reinvestment Act designed to lift the United States out of its deepest economic funk since the Great Depression of the 1930s.

Eighteen months later, the experiment must be viewed as a qualified success for our Valley, our state and our nation.

Last week, respected economists Mark Zandi and Alan Blinder issued a report showing that stimulus programs prevented a catastrophic economic collapse.

Zandi and Blinder concluded that the U.S. response to the financial crisis likely prevented a depression, slowed a free-fall in gross domestic product and saved about 8.5 million jobs.

“Eighteen months ago, the global financial system was on the brink of collapse and the U.S. was suffering its worst economic downturn since the 1930s,” Blinder and Zandi said in their report. “The Great Recession gave way to recovery as quickly as it did largely because of the unprecedented responses by monetary and fiscal policymakers.”

IMPACT IN THE VALLEY

In the Mahoning Valley, the impact of the stimulus has been clear. Most visibly, it played a role in two of the region’s largest industrial resurrections in decades — namely the $650 million investment by French steelmaker Vallourec to expand its V&M Star steel mill in Youngstown and the return to full three-shift employment at the General Motors Lordstown Complex to produce the much ballyhooed Chevrolet Cruze.

Stimulus funding also funneled its way to the Valley in millions of dollars’ worth of highway and other infrastructure projects and in assistance to scores of local communities and school districts that avoided massive layoffs and seas of red ink in their budgets.

All of which is not to say the Recovery and Reinvestment Act — as well as its spin-off legislation and programs — has not had its flaws. Indeed Republicans, led by former presidential candidate John McCain of Arizona, were quick to pounce out a vindictive response to the sunny Zandi and Blinder report this week.

The GOP report, titled “Summertime Blues,” singles out 100 separate “dubious” stimulus projects that Republicans say demonstrate misguided priorities and few new jobs.

We’ve also noted with disdain stimulus funding targeted to communities with nonexistent ZIP codes and stimulus aid for an Ohio company that oursourced jobs to Central America.

On balance, however, the success stories of the American Recovery and Reinvestment Act far outnumber its horror stories. That is why it is critical that this economic elixir continue to jolt our still-ailing economy, particularly in our region where unemployment still stands at an intolerable 12 percent.

Son of stimulus is snaking its way through Congress. It cleared a major hurdle in the Senate on Wednesday when several Republicans broke ranks to end a filibuster to lead to passage of the $26 billion measure that will funnel hundreds of millions of dollars in Ohio to preserve the jobs of teachers, law enforcers and other public servants. It does so without deepening our budget deficit through spending cuts and a tax increase on U.S. companies operating overseas.

The House is expected to convene in emergency session next week to approve and send the package to the president. We urge expeditious action as the stimulus program clearly has proven its worth.