Stimulus package about to pass

The U.S. Senate will pass the Democrats’ stimulus package later tonight. Right now, the legislation has 59 votes. Senator Brown will make it 60, probably in about two hours when he is expected to return from Ohio. He was was attending a memorial service for his mother there.

I suspect that nearly all of the spending in the stimulus package would eventually have been appropriated by the Democrats; it is essentially their Christmas list and they have always had the votes to get it done. However, the economic crisis gave them the opportunity to appropriate the money all at once. Other than timing, the two main differences are (1) more will be wasted given the absence of any real deliberation and (2) there are probably more tax cuts than otherwise would have been enacted.

Politically, there are also differences due to the way this has played out. The stimulus package becomes the symbol of Democratic rule. The Democrats would have been judged on the state of the economy in any case, but the stimulus package raises the stakes. Because it so unabashedly steers money to Democratic interests, and because so many stories of waste are almost certain to emerge, passage of this legislation will likely increase the intensity of the populist backlash if the economy is slow to recover. If the economy recovers quickly, a few more Republicans will go down to defeat for having opposed the package than would have been the case absent a one-time vote on something this dramatic.

Finally, if an economic recovery is followed by massive inflation, and/or another slowdown due to high debt and/or tax increases, it will be particularly easy for the Republicans, having warned against precisely these events, to pin the blame on the Democrats.

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