THE LATEST GOOD NEWS/bad news story is that the federal stimulus package, adopted in February, has finally begun to arrive in the form of commitments by Washington to pay for a handful of long-overdue local public works projects.
The bad news comes from officials who know what the stimulus package—a.k.a. the American Recovery and Reinvestment Act of 2009—doesn’t have: enough money for a whole lot of other worthy projects. So does this mean the stimulus plan is a failure?
The answer requires a look at facts, starting with employment. Columbia County is on the outer edge of the Capital District, a region once considered inoculated against unemployment because of state government jobs and all the spinoff businesses. As recently as 2001 the county unemployment rate was 3%, a figure many economists consider no unemployment at all.
By May of last year, the county’s unemployment rate had crept up to 4.5%, which was still consistent with recent experience. Then the economy went haywire or, more accurately, the haywire behavior of the geniuses in the finance and housing industries, among others, burst the economic bubble. By February of this year, the unemployment rate had risen to 8.1%. This May it was down slightly to 7.4%, but overall the rate has nearly doubled in the last two years. That’s below the current national level of 9.7%, but unemployment that high is quite literally off the charts for at least the last two decades in this county. So much for our immunity to major economic crises.
The state labor department says that there are currently 2,300 people unemployed in Columbia County. That would be bad enough, but as most experts acknowledge the statistics track only those who currently receive unemployment benefits. It misses everybody who has given up looking for a job or who holds down a part-time job when he or she really needs a full-time position—the so-called underemployed.
The stimulus money getting attention lately won’t put many people to work around here. A few will repair and rebuild sewer plants in Hudson and Greenport, and that’s welcome news for those individuals and their families, as well as for the businesses where those folks shop. But no one should expect this part of the stimulus package to pull the county or the nation out of this recession.
And if the shovel-ready public works projects were the only—or even the major—aspect of the Recovery Act, then it would qualify as a failure. Fortunately there’s more.
One of the reasons that nobody yet has a real number for how much Recovery Act money the county will receive is that the money comes from so many directions, most of it channeled through the state (uh oh). The act allots the state more than $16 billion for more than 80 different programs, all of them listed online at www.recovery.gov. Some of that money has already had an impact here, one that people will really notice at the end of the summer, when school tax bills arrive.
The rotten economy could have forced either deep cuts in school programs or huge increases in property taxes. But neither occurred, because Recovery Act funds gave kids and taxpayers a break. Surely that money should be acknowledged as having bolstered the local economy.
Stimulus funds have also allowed the state to extend unemployment benefits. That too has had a direct local impact, because until the economy once again creates new jobs, 2,300 or more of our neighbors will depend on unemployment insurance benefits to support themselves.
Some folks argue that the federal government would have done better by simply returning the $787 billion in the Recovery Act to taxpayers, who would then spend it, causing the economy to recover on its own. Well, the act includes $288 billion in tax benefits, so even that idea wasn’t left out of the mix.
No program this big can escape criticism, nor should it. But the federal government’s first response to a crisis that was years in the making and global in scope already has had a positive impact on this county. People who say it isn’t working haven’t looked hard enough to see its effects, though they’re probably right in one respect. The nation is likely to need more and bigger recovery acts before we can pull ourselves out of this mess.