And Michael Boskin reports the following in this mornings WSJ:
The strongest case for stimulus is increased military spending during recessions. But infrastructure spending, as the president proposes, is poorly designed for anti-recession job creation. As Harvard economist Edward Glaeser has shown, the ARRA's transportation spending was not directed to areas with the highest unemployment or the largest housing busts (and therefore the most unemployed construction workers). Indeed, last September Wendy Greuel, the City of Los Angeles controller, shocked the country when she revealed that the $111 million in ARRA infrastructure money her city received created only 55 jobs—that's a whopping $2 million of federal stimulus per job created.And the WSJ also reports "Pentagon Loses War to Zap Airborne Laser From Budget" which documents the various weapons systems that three Republican Defense Secretaries had tried to end, but which hang on via Congress and friends doing what comes naturally.
I had previously blogged that I was worried that there were no constituencies in the world for austerity. But many of the Europeans as well as several U.S. governors (Cuomo, Christie, Brown and others) have seemingly proven me wrong. Now it's the U.S. Congress (and friends) that are the problem.
Several economics bloggers have recently mentiond that public choice economics remains underappreciated. How about ignored?
I should say ignored by the many stimulus optimists.