Echos of Yesteryear

President Obama may be the best thing that could have happened to the Republican Party. For the first time in years, it seems that the party has regained its focus. Once again the Republicans are talking about spending restraint (remember that?) and tax cuts (remember those?) The key now is not to sell out in the name of "working with" the new President or bipartisanship.
A proposed trillion dollars in spending tends to refocus the mind. Democrats were especially helpful in proposing spending for studies of sexually transmitted diseases, arts and crafts and refurbishing of federal buildings (I guess under the theory of if we are going to dramatically grow government, the offices need to look nice). Democratic Senators are now touting their "fiscal responsibility" by listing the items removed from the bill. Of course none of these had anything to do with stimulating the economy in the first place.
Everyone agrees the economy is in dire straights. Everyone agrees that the American people are struggling. The markets are worried. Job losses continue to mount. It is not a pretty picture. That said, rather than focus on the types of things that would stimulate the economy, and more importantly lay a foundation for the future, Democrats in the House went on an old school binge. Democrats in the Senate seem willing to trim a little fat, but every time I see Harry Reid standing arm in arm with Nancy Pelosi I don't believe it is all that sincere.
The debate her really comes down to how you believe that the economy works and who best is able to stimulate it. We have people and companies that are over leveraged and weighted down by the debt. This stimulus package does nothing to address that central problem. Spending more money to prop up failing businesses (see the big 3 auto makers) does not address their underlying problems. Continuing to get a paycheck from a business that is ultimately doomed only prolongs the inevitable.
Much of this bill is bricks and mortar. The infrastructure of this country is need of repair. However, unless we are going to embark on an endless cycle of roads projects, this is only a temporary fix. Those bridges will get repaired, then what do the workers do?
We hear politicians, particularly this President, talk about moving this economy into the 21st century, yet this stimulus bill is right out of the 1930s with a mix of the 1960s. It is not new, it is not innovative. It is the same thing government has always done: expand its reach and control. The government is going to pick winners and losers and favored industries.
So what should the stimulus do? We need to understand that we are in a new world. We need to start with thinking about how we educate our future work force. The models of public education have not changed in 200 years. The school year and schedule is based on an agrarian economy. The bureaucracy limits who can teach, thereby locking out some of our brightest minds who might bring a different perspective to the classroom. The divide between rich and poor in education continues to grow. The on education funding however, only focuses on spending more and how much more without regard to how we spend it, where we spend it and why we spend it that way.
When young adults emerge from the schools they often go to work in companies whose model has not changed in decades. "This is the way we have always done it" is a mantra amongst senior executives and even in the face of evidence that it is not working, they continue to chant it. The first round of TARP money, a cool $350 billion, did nothing to encourage reform or looking at new models. It simply went to fund operations as they always had been done.
Where is the stimulation to modernize? This means not just your equipment, but your workforce. Politicians crow about jobs being shipped overseas, but institutional knowledge has value to a business. Where are the incentives to retrain people in house? Democrats want to make the government the "retrainer", but how does government know what retraining is needed, or is government simply going to decide?
Democrats in Congress have fallen back into their tried and true formula of more government, more money. This bill could have been written 75 years ago. This is a new world, unfortunately Pelosi and Reid are not living in it. The debate and the stimulus need to enter the 21st century, the rest of us are already there.