Investor’s Business Daily has a great editorial that builds on some of the arguments we made at IWF yesterday (see here and here) for why the President’s latest stimulus plan makes no sense.  As IBD explains:

The [first] stimulus was originally sold to us as a way to create “shovel-ready” jobs on infrastructure. Instead, much of the money was drained away for financially strapped states to keep their public unions and Medicaid programs afloat.

Here’s what President Obama said about the stimulus bill he signed into law Feb. 17, 2009:

“Because of this investment, nearly 400,000 men and women will go to work rebuilding our crumbling roads and bridges, repairing our faulty dams and levees, bringing critical broadband connections to businesses and homes in nearly every community in America, upgrading mass transit, building high-speed rail lines that will improve travel and commerce throughout our nation.”

Sounded great at the time, but few, if any, of those things got done. Moreover, since the recession began, federal employment has jumped by 10%, or nearly 200,000 positions, while private-sector employment has plunged 7%, or 7.8 million jobs. So who really benefited from the stimulus? Big Government and its unions.

The stimulus did do one thing, however: It set the stage for massive spending and an unprecedented expansion of the role of the U.S. government in the American economy. This, in retrospect, appears to be the real aim of the Democratic stimulus – not jobs or infrastructure or any other real-world accomplishment.

IBD goes on to detail the problem with expanded government and just how much debt the government is on pace to create during the next decade.  IBD closes by writing, “Piling on more spending now isn’t just unwise policy, it’s a form of fiscal insanity.” 

Indeed, all this spending may not just be failing to help the economy, but it may be acting as a drag on growth.  After all, businesses know that you can run deficits like this forever without severe consequences.  Many are holding cash instead of making investments in what looks like a bleak economic future.

It’s time for Congress and the President to forget the idea of spending our way out of recession and focus on getting its fiscal house in order to help create a healthy economy for the future.