Some CU students and staff say they’re not happy with the economic stimulus plan President Barack Obama introduced within his first month in office.
In an effort to lead the country out of the economic recession, Obama signed a stimulus bill costing nearly $800 billion Feb. 17 at the Denver Museum of Nature and Science. The two-year plan includes tax breaks to most students and others who don’t earn enough to pay income tax.
The plan’s design is to increase economic activity through a raise in short-term demand. In a letter to Sen. Judd Gregg, officials from the Congressional Budget Office (CBO) explained the stimulus program and the uncertainty of it.
“Large fiscal stimulus is rarely attempted, so it is difficult to distinguish among alternative estimates of how large the macroeconomic effects would be,” the letter said. “Most of the budgetary effects of the legislation would occur over the next few years, and as those effects diminished the short-run impact on the economy would fade.”
Conversely, the long-run effects may be more hazardous than helpful.
According to the CBO, “…the legislation would reduce output slightly in the long run…the principal channel for this effect is that the legislation would result in an increase in government debt.”
Brooke Segerberg, a freshman international affairs major, said she agrees with the CBO’s statement.
“It seems like they’re digging a deeper hole—it’s a quick fix,” Segerberg said.
Lapo Salucci, a political science instructor at CU, said the bill has problematic consequences. He said that although no one wants to be out of a job or lose a house, the plan is bad for the market as a whole.
“The flip side [to the package] is rewarding bad behavior [and] punishing people that do well,” Salucci said. “The state bails you out no matter what.”
Some businesses are looking to prosper and expand in the next few years as a result of the bill. Namaste Solar, a Boulder-based firm, has installed over 500 solar systems in Colorado since 2006. Chief Executive Blake Jones gave the president a tour of solar panels above the museum before the signing.
The White House recently created a Web site, www.recovery.gov, which provides a breakdown of where taxpayers’ money is going. Students can see how, where and when money is spent in each state.
Robert Orr, a sophomore chemical and biological engineering major, said he likes the new government Web site. He said it will generate more action and less talk among politicians, thus improving state response.
“It’s about time,” Orr said. “I thought I knew where my money went but apparently I was wrong. It’s good to see firsthand what’s being done, and what isn’t.”
Contact CU Independent Staff Writer Adrian Kun at Adrian.email@example.com.