Steve, I think you're conflating the stimulus package proposals coming out of Washington with the bailout proposals.

Well I think you are drawing a false distinction. Government spending is government spending. The bailout is the government spending money to either:

1. Jump start the economy be un-freezing credit (best case scenario/belief).
2. Prevent a major economic recession by un-freezing credit (most likely scenario/belief).

It is still spending though, just not on infrastructure or make-work programs.

The stimulus package proposals I've seen, relative to the size of our economy, have been quite puny.

That certainly shows what you can do when you’re an unanswerable autocracy, you run a trade surplus with practically every country in the world, and you’ve got trillions in reserves sitting in the bank.

Why does it show that? Sounds alot like some the stimulus plans coming out of DC. Of course, that they have trillions lying around in their treasury means such a bailout might actually work, unlike the ones coming out of DC.

Thomas Jefferson refused DeWitt Clinton's request for funds to build the Erie Canal largely on the grounds I'm giving. Look up the definition of rent-seeking: any pursuit of money from the government is rent-seeking behavior. It's definitional.

Additionally, is majority funder the same as major role? I don't think so, especially with respect to projects that aren't interstate ones and that don't have noticeable national impact.

The point I think you're missing is that people in the states are better positioned to determine the priorities for their states and if they don't find particular infrastructure projects sufficiently important to pay for with their own money why should it be paid for with mine? Illinois has plenty of infrastructure problems of its own.

Finally, I think you're giving state governments too much credit. State politicians don't want to take the heat for raising taxes. It's much safer to go to Uncle Sugar for the dough.

Contrariwise I’m skeptical about stimulus packages for the United States. We don’t have trillions in cash (or effectively in cash) sitting around, borrowing at the rate we’re starting to is bound to have some impact on interest rates eventually, our Congress has shown no willingness to run surpluses during times of economic growth to offset Keynesian stimuli during economic slowdowns, and as I see it the complaints about infrastructure here are mostly rent-seeking. It’s one thing for the citizens of Minnesota (for example) to tax themselves to re-build their bridges. It’s something else altogether for the citizens of Mississippi (for example) to be taxed to re-build a bridge in Minnesota.

One thing, though, Dave - the federal government has played a major role in infrastructure projects like this since, well, forever (witness the highways, or canals before that, or railroads). It's hardly "rent-seeking" unless federalism itself is rent-seeking; it's the federal government using its revenues to promote better and more economic integration where the states alone can't pull it off.

But if you really want to blame something, blame the Balanced Budget Amendments in the states for not being well-constructed enough for something like this. The reason why they want to lend the states money is because when an economic downturn comes around, state tax revenues decline. Since they have to have balanced budgets, this means they are required to either raise taxes or cut services - both bad in a recession.

With a $14 trillion economy, we borrow and give $2.5 trillion to the banks who sit on it, which will cause more companies to fail, more people to be laid off, fewer goods and services to be purchased, and prices to drop.

Someone paid attention in class and someone didn't or was it the $32 million that the poor banks spent on campaigns to get the bank bailout bill passed. When the population recovers and starts buying things again, the banks will start handing out the money and it will cause inflation.

We deserve it. We re-elected the people who voted for the bill.

Finance

"our Congress has shown no willingness to run surpluses during times of economic growth to offset Keynesian stimuli during economic slowdowns,"

Sigh....

Sigh....

Trying to come up with something more to say, but that says it all. Wait a minute... Every single paycheck I get, I put aside 1/8 (40 hr/wk) to 1/2 (if I get that much overtime) of to help hold me thru the inevitable lay-off. Why can't we do the same?

And I say "we" in the strictest sense. How many said "Thanks, but no thanks" to Bush's tax cuts? How many said "Thanx, but no thanks" to the recent tax rebate?

I thought long and hard about what to do with the money I got from the "China Economic Recovery Act"... Finally decided on just giving it to my sons. They were going to pay for it, they might as well get it.

Any Neocon still got my ticket to China from 4 years ago??