3/25/2009

Thank you for contacting me regarding the state of our nation’s economy and the economic stimulus package recently approved by Congress. I appreciate knowing your views.
As you may know, H.R. 1, the American Recovery and Reinvestment Act, was signed into law on February 17, 2009. I voted against this legislation because I am concerned that it will do far too little to stimulate our economy, yet imposes one of the largest price tags any legislation has ever cost the American taxpayers. The stimulus plan is estimated to cost taxpayers $789 billion–or over $1.1 trillion once interest expenses are included, more than any government program in history after adjusting for inflation. Congress and the Administration had an opportunity to craft a bill that would have provided real relief to the American people in a time of great economic uncertainty. But once again, parochial, partisan, and special interests have taken precedence over the interests of the American people.
It is unfortunate that even in these difficult economic times, Members of Congress couldn’t resist the temptation to lard up this bill with billions of dollars in unnecessary spending that will do nothing to truly stimulate the economy. Some of the provisions in this stimulus include $1 billion for “wellness programs,” reported to include smoking cessation programs and STD prevention. It also provides $25 million for the Smithsonian, $50 million for the National Endowment for the Arts, and $165 million for U.S. Fish and Wildlife Service fish hatcheries and wildlife refuges. While these may be worthwhile projects, they will not help to grow the economy or create new jobs.
This stimulus also includes the protectionist “Buy American” and costly Davis-Bacon requirements. The “Buy America” provisions will prove harmful to both the American worker and the world economy. These anti-trade measures may sound welcome to Americans who are hurting in this economy, but short-sighted protectionist measures risk greatly exacerbating our current economic woes. Additionally, if we are trying to create new jobs, then we should repeal the Davis-Bacon provisions which will inflate the construction costs of the bill by $17 billion. Davis-Bacon imposes heavy regulatory burdens and unnecessary costs on government contractors – not to mention the taxpayers who have to foot the bill for the inflated costs.
Remarkably, this stimulus does little to actually address the core issue that brought us to the point of needing a stimulus bill in the first place, and that is the housing crisis. This final agreement gutted the only significant housing provision in the measure. Many of my colleagues and I had supported a tax credit of $15,000 or 10 percent of the purchase price of a house used as a principal residence. Such a generous tax credit would help the market recover swiftly. But, instead, the only housing provision in the bill that was roundly supported by members of both parties and millions of potential home buyers was substantially changed in the final hours of negotiations, making the provisions almost no different than current law already provides.
Many on the other side of the aisle have accused me and my party of opposing a plan for economic recovery. This could not be further from the truth. In fact, I offered a good-faith alternative to this plan, which received the support of all of my Republican colleagues. Our proposal would have cost about half as much as the enacted measure, but would have provided the American taxpayers with a stimulus bill devoid of wasteful and excessive spending on programs that fail to create jobs. This plan included targeted, fiscally responsible provisions to invest in our nation’s infrastructure, stabilize the housing market, and reduce taxes on individuals and businesses. Additionally, this alternative would have put in place long-term mechanisms to help us control future spending and balance our budget. Unfortunately, my amendment failed on a party-line vote.
America’s strength has always been our ability to come together and address the threats to our great nation. It is so often at those times that our elected officials have put aside parochial interests – regardless of what they were, or what party we were from, and put America first. The problems we face at this time are difficult and we all agree must be addressed, but we have faced greater challenges in the past and prevailed. My belief in the American people – and especially the American worker — is unwavering. Our economy will prosper again soon – of that I have no doubt. Sadly, this legislation does not move us closer to that shared goal.
Again, thank you for sharing your thoughts on this very important matter. Please feel free to contact me on this or any other issue of concern.
Sincerely,
John McCain
United States Senator
JM/dkr