Latham hopes to reclaim unused stimulus dollars

U.S. Rep. Tom Latham (R-Iowa) believes the federal stimulus plan put in place two years ago has been a miserable failure, and that any unspent monies that remain connected to the project can be better used elsewhere.

“Supporters of the Stimulus bill promised in early 2009 that the legislation would cap unemployment at 8 percent and spark an economic recovery,” Latham said. “Nearly two years later, all the Stimulus has to show for itself is an expanded federal government and a national unemployment rate of nearly 10 percent. The recovery we were promised didn’t materialize, and Congress is long overdue to correct its mistake.”

This week Latham agreed to co-sponsor HR 6403, the American Recovery and Reinvestment Rescissions Act. The proposed measure, which is not anticipated to find support on the President’s desk even if approved by Congress, would essentially stop all spending associated with the earlier American Recovery and Reinvestment Act, otherwise known as the stimulus bill.

Those untapped stimulus dollars, some earmarked for future or continued projects, have also been the focus of U.S. Sen. Chuck Grassley (R-Iowa), who suggested that Senate Republicans might accept a plan that would utilize such monies to offer a temporary extension of long-term unemployment benefits. When asked about the possibility on a conference call with reporters, U.S. Sen. Tom Harkin (D-Iowa) referred to such a suggestion as misguided.

“It is interesting that Sen. Grassley wants to take money out of the stimulus to pay for unemployment benefits, but wants to increase the deficit just to give tax breaks to the wealthiest Americans,” Harkin said, referring to an ongoing standoff in the U.S. Senate over the Bush-era tax cuts. “What I would like to ask my friend and my colleague is if that is his sense of fairness.

“That stimulus money is still being used to provide jobs. So, let’s get this straight, my colleague from Iowa says we will take money out of pot that is still being used to create jobs to pay for unemployment benefits. … But, in order to give tax breaks to the wealthy, we’ll just increase the deficit by $700 billion dollars (over 10 years).”

Latham contends, however, that the stimulus package is a failure because it focused more on creating and expanding government programs than on private sector employment opportunities.

“[T]he legislation would have been far more effective if there had been a greater emphasis on infrastructure projects such as road and bridge repair, airport enhancements, water and sewer line repair, as well as a number of other national products that would have immediately put Americans to work,” Latham said. “Of the legislation’s $814 billion total, a meager 7 percent was allocated to transportation infrastructure, and only 3.8 percent of the funds went to highway needs. In the short time that my colleagues and I were given to review the bill, I worked to quadruple those amounts.”

Latham indicated that he wants to change “the culture in Washington to encourage private sector job growth and fiscal restraint.”

In April, the White House Council of Economic Advisers released estimated that the stimulus increased total employment by between 2.2 and 2.8 million jobs — with tax cuts and income support saving or creating approximately half of those jobs.

Studies conducted by the nonpartisan Iowa Fiscal Partnership found that federal recovery dollars for Iowa’s unemployment insurance system, food assistance and Medicaid boosted the state’s economic activity in both jobs and income.