Environmental Groups Slam Stimulus
Wednesday, January 21, 2009 at 2:09 pm
To hear the Democrats tell the tale, the $825 billion economic stimulus proposal unveiled by House leaders last week would usher in a new era of energy efficiency and green jobs in America. Yet a growing chorus of environmental groups says it falls short of those goals, providing too much funding for new roads and too little for public transportation and other green initiatives.
Under the current proposal, new road construction could consume three times as much funding as public transportation. The environmental groups hope more public transit money will be added when lawmakers make changes to the proposal in committee, an amendment process which began Wednesday afternoon.
“At a time of erratic energy prices, Congress should use this opportunity to move America away from highways and toward railways and mass transit,” said Karen Wayland, legislative director for the Natural Resources Defense Council, an environmental advocacy group. “The transportation component of the stimulus package underfunds mass transit in deference to highways and bridges.”
The debate arrives as the nation’s economy, after months of decline, continues to slump. Home prices are falling; unemployment is rising; stocks continue their erratic jump-and- plummet cycle; and foreclosures continue to plague communities nationwide.
To battle these trends, Democrats have proposed roughly $550 billion in new federal spending and $275 billion in tax cuts to businesses and individuals. President Barack Obama has vowed to make the spending package the first priority of his newly installed administration.
On the green spending side, the biggest items in the proposal would provide $32 billion to revamp the nation’s energy grid; $31 billion to modernize existing infrastructure like roads and bridges; and $16 billion to make public buildings more energy efficient.
Democratic leaders say the provisions address the troubled economy, advance the move toward energy independence and tackle global warming — a trifecta designed to prepare the country for the 21st Century world economy.
“The state of our economy calls for action: bold and swift,” Obama said yesterday during his inaugural speech. “We will build the roads and bridges, the electric grids and digital lines that feed our commerce and bind us together…We will harness the sun and the winds and the soil to fuel our cars and run our factories.”
House Speaker Nancy Pelosi (D-Calif.) echoed that sentiment last week, saying the bill will “transform our economy” by investing in science, technology and infrastructure modernization.
Many environmentalists, however, say there’s plenty of room to improve the Democrats’ blueprint. At the forefront of their criticism, the proposal includes $30 billion for highway construction but dedicates only $10 billion to public transit and rail — a discrepancy prioritizing new roads at the expense of public transportation.
Brent Blackwelder, president of Friends of the Earth, says the spending on new roads will only act to increase pollution and fuel consumption — two problems the Democrats’ proposal was designed to alleviate.
“It is particularly disappointing to see that, unlike highway funds, public transportation and passenger rail funds have been cut below the levels suggested by the House Transportation Committee, limiting job creation in these areas,” Blackwelder said in a statement. “Public transportation investments create 19 percent more jobs per dollar spent than investments in new highways.”
Daniel Becker, head of the Safe Climate Campaign, said the proposal is a significant step in the direction of cutting pollution and increasing energy efficiency, but there are notable holes that could use plugging. “There’s a lot of new asphalt-laying [in the bill],” Becker said, “and that will undercut a lot of the green efforts.”
Marchant Wentworth, legislative representative for clean energy with the Union of Concerned Scientists, agreed that the $10 billion for public transit is insufficient to accomplish the Democrats’ goals. “You could triple that and still have needs out there for relieving congestion,” he said.
Still, Wentworth was quick to support the overall package, calling the criticisms from other environmental groups “ludicrous” and “quibbling.” The Energy Dept.’s entire renewable energy budget was just $4.1 billion in fiscal year 2008, Wentworth pointed out. “This is a massive, massive increase in [green] spending,” he said.
There will be plenty of opportunity for lawmakers to amend the proposal. The House Appropriations Committee will take up the bill this afternoon, with the Energy & Commerce and Ways & Means committees scheduled to consider it later this week. House leaders expect the bill to reach the chamber floor next week.
Republican leaders are poised to fight the proposal tooth and nail. Appearing last week on PBS’ Newshour, House Minority Leader John Boehner (R-Ohio) said the stimulus proposal “looks like 14-years worth of liberal Democrat ideas that were stuck in the back of a cabinet somewhere.”
“It’s not the kind of spending,” he continued, “that will stimulate our economy, create jobs, and … preserve jobs that are out there today.”
Boehner and other Republican leaders are pushing instead for larger and more permanent tax cuts as a way to right the economy by getting consumers spending again. On Wednesday, they sent a letter to Obama promoting that plan.
Many economists, however, oppose the tax cuts in the stimulus proposal, arguing that they won’t produce nearly the number of jobs of green investments and infrastructure spending.
An analysis conducted last year by Robert Pollin, co-director of the Political Economy Research Institute at the University of Massachusetts Amherst, found that 16.7 domestic jobs are created for every $1 million invested in the green sector. Tax cuts, by contrast, create 14.0 jobs per $1 million.
“It is therefore difficult to overspend in these [green] areas,” Pollin said in an email, “especially in energy conservation measures, such as building retrofits, mass transportation, and upgrading the energy grid. In these areas, the technologies are known and the payoffs are short-term. So if the projects are backed up by four months, that’s okay. It injects certainly into the economy, and it has long-term benefits.”
On Wednesday, the Congressional Budget Office complicated the Democrats’ plans, issuing a report revealing that less than half of the infrastructure spending found in the stimulus package would go out the door before October 2010 — when many economists expect the economy will already be on the rebound.
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