Thu January 26, 2012
Was The Stimulus Package 'Money Well Spent?'
Originally published on Thu January 26, 2012 10:39 am
No issue will be more important in the upcoming presidential election than President Obama's handling of the nation's economy. Critical to that debate is an assessment of the Obama administration's economic stimulus program. Republicans claim it was a costly failure. Supporters maintain it saved the U.S. from a depression.
ProPublica investigative reporter Michael Grabell's new book Money Well Spent is an expansive account of the stimulus programs. Grabell scoured federal records and traveled to more than a dozen states across the country for the book, which details how the 2009 "American Recovery and Reinvestment Act" was passed and how the stimulus money was spent. Grabell assesses Republican complaints that the program funded silly projects like a tunnel for turtles in Florida. He describes families thrown into poverty by the recession and looks at whether the plan made a difference in their lives. And he tries to answer some of the big questions — how many jobs the plan saved or created, and whether it was a sound investment of tax dollars.
On Thursday's Fresh Air, Grabell explains why the stimulus plan became what he calls "one of the most reviled pieces of legislation in recent memory." Grabell also offers his own assessment of President Obama's $825 billion stimulus plan, which was designed to jump-start the ailing economy. It remains the largest recovery plan in American history.
"You look at all these major programs in history — the moon race, the Manhattan Project, the WPA [Works Progress Administration] — the stimulus was bigger than all of these things," he tells Fresh Air's Dave Davies. "And so it begs the question: What did we accomplish with all of this money?"
On the New Deal Programs being larger than the stimulus, relative to the size of the government at the time
"When you look at the size of the federal government back in the 1930s, it was much smaller than [it is] today. Now the government is constantly involved in health care, in supporting a defense manufacturing industry, supporting education in a way they weren't previously. When you compare, relative to the size of the federal budget, the WPA was really many times what the federal budget was at the time. And we look at the stimulus and it was about 25 percent of the whole federal budget when you include Social Security and health care. So when people think of the New Deal, they think of, 'Wow, we really went from 0 to 60.' And when you think of the stimulus, a lot of people didn't notice it. It was really like we were going from 35 mph to 50 mph."
On why the Obama administration didn't make the stimulus plan bigger
"They didn't seek a bigger stimulus plan mainly because of politics. There was definitely the feeling that Congress would not stomach a package over $1 trillion. And if they went in with a number like that, they would have been seen as this new liberal administration where spending was out of control. So they were looking at a smaller package."
On the purpose of a stimulus
"In almost every recession and economic downturn that we have had in this country, some stimulus effort in some way was tried. And the idea is the government has the ability that maybe the private sector doesn't have: to borrow money and stimulate the economy. You spend money on food stamps and infrastructure projects, and that will pay off because people now have money in their pockets that they can spend somewhere else. So you get this multiplier effect, that one dollar creates more economic output."
DAVE DAVIES, HOST:
This is FRESH AIR. I'm Dave Davies, in for Terry Gross. No issue will be more important in the presidential election than President Obama's handling of the nation's economy. And critical to that debate is an assessment of the administration's economic stimulus program.
To Republicans, it was a costly failure. Supporters say it saved us from a depression. Our guest, investigative reporter Michael Grabell, has written an expansive account of the stimulus program. He assesses Republican complaints that the program funded silly projects like a tunnel for turtles in Florida and whether the administration's efforts to fund clean energy and high-speed rail systems panned out.
He describes families thrown into poverty by the recession, and looks at whether the plan made a difference in their lives. And he tries to answer some of the big questions: how many jobs the plan saved or created and whether it was a sound investment of tax dollars.
Michael Grabell is an investigative reporter for the nonprofit ProPublica. His new book is called "Money Well Spent? The Truth Behind the Trillion-dollar Stimulus, the Biggest Economic Recovery Plan in History."
Well, Michael Grabell, welcome to FRESH AIR. What is the scale of the stimulus program by historic standards? Just how big was it?
MICHAEL GRABELL: The stimulus package was the largest economic recovery plan in history. You look at all these major programs in history - the moon race, the Manhattan Project, the WPA - the stimulus was bigger than all of these things. And so it begs the question, you know: What did we accomplish with all of this money, which it turns out to be about $800 billion, more than a trillion when you consider all the extensions and the eventual interest.
DAVIES: Right. Now, so it was bigger than the Marshall Plan in Europe, for example, bigger than the WPA, the New Deal program, right?
DAVIES: But it's interesting, you make the point that relative to the size of the government, the New Deal programs were actually larger. Explain.
GRABELL: Right. When you look at the size of the federal government back in the 1930s, it was much smaller than we have today. Now we - you know, the government is constantly involved in health care, in supporting a defense manufacturing industry, supporting education in a way they weren't previously.
So when you compare, relative to the size of the federal budget, the WPA was really many times what the federal budget was at the time. And we look at the stimulus, we're - it was about, you know, I think 25 percent of the whole federal budget when you include Social Security and health care.
So when people think of the New Deal, they think of: Wow, we really went from zero to 60. And when you think of the stimulus, a lot of people didn't notice it. It was really like we were going from 35 miles per hour to 50 miles per hour. So it was a very kind of slight increase from what people were seeing.
DAVIES: Now, of course, the Obama team came into office winning the 2008 elections and knew the economy was in a downward spiral, and you describe a series of meetings in December 2008 between Obama and his team. And they were thinking about what kind of stimulus program, how to spend the money, how big it should be, and one of the things you note, that there was a tension in these meetings between a goal of hitting the economy quickly and having an immediate impact on the one hand, and on the other hand doing something bold and dramatic; a moon shot, if you will. What exactly is the tension there?
GRABELL: Right. So there was this critical meeting in December 2008, where all of the advisors gathered in Chicago to talk about, you know, the stimulus plan; talk about, you know, a lot of economic issues at the time. But the stimulus was a big part of it.
And so, at the table, Christina Romer, you know, opened up the meeting to talk about how dire things had gotten and the risks of doing too little or doing too much. And the president and the vice president kept coming back to we want to do a moon shot, we want to think bigger, think bolder.
What about a smart grid? What about - why can't we build an entire high-speed rail system? And a lot of the economic advisors said, you know, while those are good policy things, they might not - they might take a long time to get off the ground.
Smart grid, for example - Peter Orszag was one of the people in the meeting - the White House budget director - who said, you know, really the problem with smart grid is that it's not money, it's that there's all these overlapping jurisdictions.
And the vice president spoke up and said, well, wait a minute, surely the president and I can get everybody in a room and work these things out, get all the mayors and all the different people in the room. And, you know, they went back to the Hill and said can we accomplish this? And the reaction was essentially, are you crazy? You know, thinking you could spend all this money in smart grid in a short amount of time.
So this was a constant tension in the stimulus program. How much money do you dedicated to get the money - economy moving quickly? And how much money do you spend on the long-term aspects of rebuilding an economy to be stronger and built to last, as the president said in the State of the Union?
DAVIES: And, you know, maybe this would be a point to just explain the basic underlying kind of economic principle of stimulus, the Keynesian idea here, yeah.
GRABELL: Right, and it's counterintuitive because you think - you know, someone said to me, and I quote it in the book, you know, if we were really tight on - if I had just lost my job, and my wife said to me let's go remodel our kitchen, I'd say what? You know, we can't afford that.
But this is a very - this is a very strong theory that in almost every recession and economic downturn that we have had in this country, some stimulus effort in some way was tried.
And the idea is the government has the ability that maybe the private sector doesn't have to borrow money and stimulate the economy by spending money, you know, you spend money on food stamps and infrastructure projects, that will pay off because people now have paychecks in their pockets that they again can spend somewhere else. And so you get this multiplier effect; what's called a multiplier effect, that, you know, one dollar creates more economic output.
DAVIES: Right, so getting money into people's hands generates demand, gets the economy moving again. Now there's an interesting moment you describe here when they're talking about planning the stimulus, Obama and his team, that shows how sometimes you need to think about the public perception from the very beginning.
And this involves a statistic inserted into a document by Christina Romer. Do you want to just explain what happened here?
GRABELL: Sure. Early on in the Obama administration - I'm sorry, in the transition team. They were discussing trying to really explain the stimulus and what effect it would have to the American public. So Christina Romer and Jared Bernstein, who were two of the more liberal members of the economic team, but at the same time two of the best known for explaining complicated policy procedures, they put together this thing called the American Recovery and Reinvestment Plan.
It is the famous plan that now people talk about as, you know, Obama promised that we would be at 8 percent unemployment by - you know, we would never go over 8 percent unemployment if we passed the stimulus package.
And ultimately, if you read the actual report, the prediction was right. They predicted that the change in the unemployment rate would be about 2 percentage points with the stimulus package, and that's what we resulted in if you look at economic forecasts.
So at the time, you know, the publicity folks and the politics folks were saying we need to get a chart, we need to put a - you know, something simple for people to see. So they inserted this chart that essentially drew the line at what the current predictions would be, saying if we pass the stimulus package, we won't go over 8 percent, and we'll probably drop down by now, you know, to about 6.5 percent.
Well, by the time the stimulus passed, we had already gone over 8 percent, and so this was done very quickly. Dr. Romer was - had told me that this was essentially her and her computer, her and her laptop, and when a younger aide said, you know, why don't we insert a chart, she said, oh, that's pretty easy, I can just do this in Excel, and didn't put too much thought into it.
And she'd actually asked her husband, another esteemed economist, and showed this report to him, and he said, you know, you're making a fundamental mistake by putting an actual number in this economic forecast. And her response to that was, well, you know, if we make a mistake on this economic forecast, and we're at 8 percent unemployment, I think we're going to have a lot bigger problems, you know, to deal with than that I got the chart wrong.
DAVIES: Right, but in the end, that number got cited by the administration's opponents again and again, right?
GRABELL: Exactly. That became the central thing, where people have said, you know, that the stimulus package did not - the stimulus package failed. You know, that's the thing they have pointed to.
DAVIES: Now a lot of Democrats say the original sin, I mean, the kind of fundamental flaw with the stimulus program, that it was too small to have the kind of big impact that was necessary to fight this recession. Now, this was, you know, a point of view not unknown to the Obama team that was crafting this. Why didn't they seek a bigger stimulus plan?
GRABELL: They didn't seek a bigger stimulus plan mainly because of politics. And a lot of it was true; definitely the feeling that Congress would not stomach a package over $1 trillion. And if they went in with a number like that, they would have been seen as this new liberal administration that - where spending was out of control. So they were looking at a smaller package.
You know, there's been a lot of talk about how Obama had ignored a suggestion from Dr. Romer to put in, you know, to pass a $1.2 trillion stimulus package. But it didn't really receive a lot of attention in the early meetings.
In the book, you know, I make the argument that the real problem was not that Keynesian economics, the whole stimulus theory, is an outdated theory, as the right would argue, and it's not that the stimulus was too small, as people on the left argue. It's really that it was poorly designed.
If they had come in with a package that was much better designed and better received, there might have been room for another stimulus effort that could have gotten us to over $1 trillion in the fall of 2009. But they didn't take advantage of that.
DAVIES: Now the Republicans in Congress had their own ideas for a stimulus plan, mostly tax cuts, I guess. Did the Obama team include them? And how did that work out?
GRABELL: The Obama team came in with this gesture of saying we're going to make the package a third tax cuts, and it was seen as, you know, the showing of good faith to bring Republican votes over. But it was offered a little bit too soon. The Republicans - you know, there was this big meeting with Eric Cantor, and he, you know, laid down, you know, some key things they wanted in the stimulus package. No taxes on unemployment benefits is one of them, a homebuyer's tax credit was one of them.
Both of these things were included in the stimulus package. So the administration did listen and accept those ideas, and Congress did. However, you know, there was this - you know, Senator Durbin told me that, you know, they really sacrificed this key bargaining chip by including...
DAVIES: That's Dick Durbin, the Democrat from...
GRABELL: From Illinois.
DAVIES: From Illinois, yeah.
GRABELL: And he said, you know, they gave this bargaining chip up too quickly and didn't make the Republicans push for this. So it was sort of a given, and they lost that opportunity.
DAVIES: Right. And so, in return for including these Republican ideas, did that in the end get Republican support for the plan?
GRABELL: No, absolutely not. We saw only three Republican senators vote for it. The House was entirely, you know, entirely Democrats with no Republicans. So despite this effort, they really received not only no political support for it, but they really received no credit from consumers for passing - for including that in the stimulus bill.
DAVIES: We're speaking with Michael Grabell. He is an investigative reporter for the nonprofit ProPublica and has written a new book about the economic stimulus plan. We'll talk more after a break. This is FRESH AIR.
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DAVIES: If you're just joining us, our guest is Michael Grabell. He's an investigative reporter for the nonprofit ProPublica. He's written a book looking at the economic stimulus plan. It's called "Money Well Spent?" That's with a question mark at the end.
A lot of people think of the economic stimulus plan as being infrastructure: roads, bridges, construction. Let's just go over kind of how it broke down. In the broadest terms, how was this $800 million divided?
GRABELL: The stimulus was really two bills, if you think about it. There was this part of the stimulus package that tax cuts, safety net spending, money for states to close budget holes and then some short-term infrastructure projects.
The second part of the package was more about this long-term investment in things like clean energy, high-speed rail, education reform, electric cars, broadband. So the stimulus package broke down like that.
And the idea was that a flood of money in tax cuts, food stamps, unemployment checks, would get consumers spending. Then we would see this money in education, health care money help the states out who were really struggling, you know, with budget gaps. And then the shovel-ready infrastructure projects would kick in, creating new jobs, repaving roads and making homes more energy efficient.
And then as the economy got churning again, and we started to recover, these new investments in wind farms, solar panel factories, electric cars, broadband, high-speed rail would lead America, you know, maybe not charging out of the recession but in a much stronger position to be competitive with the rest of the world.
DAVIES: OK, and in big, broad terms, how much of the plan was tax cuts? How much as aid to state and local governments? How much was, you know, infrastructure?
GRABELL: There was about $300 billion for tax cuts, then about $200, a little over $200 billion went for safety net spending, and you saw, you know, another $100-and-something billion for - to help the states out. Then in terms of pure infrastructure and discretionary spending, it was in the neighborhood of $200 to $250 billion.
So a quarter of it or so, yeah.
DAVIES: Now you write that a lot of the stimulus spending was invisible. What do you mean?
GRABELL: Yeah, a lot of the - you know, the administration took a lot of effort to promote public works projects; talking, you know, holding events at infrastructure, highway projects. And that really created this impression that this was going to look and feel a lot like the New Deal.
And what the package really had was that more than $500 billion, the vast majority of this package, was invisible, in things like safety net spending, unemployment checks, food stamps, tax cuts. These eventually created jobs down the line, you know, for a supermarket cashier.
But it really was difficult for the public to see this. The other part of the stimulus package that was invisible was in keeping things as status quo. And what I mean by that was, you know, a great accomplishment of the stimulus was that it saved a lot of teachers' jobs.
But when a teacher was in the classroom, you know, the public didn't think, well, that's because of the stimulus package. They thought, you know, well, that's my teacher. So the administration really didn't get a lot of credit for that. No one really said that teacher is there because of the stimulus.
DAVIES: And then what about, like, the smaller payroll tax cuts that a lot of people got but somehow didn't notice or give the administration credit for?
GRABELL: Right. In the past, in the Bush administration, we saw these big checks come out in 2001 and 2008 that everyone got, and there was a lot of frenzy about how are you going to spend it? But the administration saw that and saw the report that most of this was saved or guzzled, you know, in gas.
DAVIES: Now, that was the early Bush plan, which was essentially a tax rebate for most people, right?
GRABELL: Exactly, tax rebate checks. And so the administration wanted to do this differently, and they decided to essentially dribble out the money in about $10 - it worked out to be about $10 a week over two years. Unfortunately for the administration, it was too small to really counteract the other forces of the fear of losing a job, the fear of losing a home, the fear of, you know, what the economic crisis had done to your 401(k).
So it didn't do a lot to change the behavior of people. And the other aspect is that it was so small, people didn't notice it. So whereas a rebate check, people noticed it, you can immediately draw the connection, you know, many people I spoke with didn't even realize it was happening.
DAVIES: You know, one of the social safety programs that the stimulus increased some funding to was food stamps. And one of the things we're hearing Newt Gingrich say is that Obama is the food stamp president, more people on food stamps than ever before. What do you make of that critique?
GRABELL: Well, a lot of that was because of the recession. Before the president took office, there was already 30 million people on food stamps, the most in history. So through the stimulus, the president increased the amount of money for food stamps and made it easier for people to apply.
There was a lot - you know, there was this big enrollment, but how much of that is due to the stimulus, and how much is due to the larger impact of the recession? I did speak to a lot of people who said, you know, thank God for the food stamps I did receive because I lost my job, and I was able to put food on the table for my kids because of it.
DAVIES: One of the things that the administration promised was that there would be an unprecedented level of transparency and accountability with this massive spending plan. How was that going to be accomplished?
GRABELL: That was going to be accomplished with a website, where the public could go online and track stimulus dollars, look up their community and find out exactly how the money was spent, see if it was a local bridge, and they'd be able to - you know, John Q. Public could go down to the local bridge and say hey, they haven't built it, or that's the mayor's brother-in-law, and I need to tell somebody.
So it took a long time for this website to get up and running, but when it did, it really did create this transparency that we had not seen in government programs. It's very difficult now, you know, to call up a contractor and say hey, I'm a taxpayer, you got millions of dollars in taxpayer money, how did you spend my money.
I don't think any of your listeners would find that very receptive. But here the recipients of the money were, you know, had the burden to say, to tell the public how they spent the money, and if you figured out, you know, the ways to work the website, which was not always very easy for the public, you could find those local projects and see exactly how the money was supposed to be spent, exactly how many jobs were supposed to be created and decide for yourself whether that was a good use of taxpayer money or not.
DAVIES: So despite the early reports that the site had little information, it eventually got to the point where you really got some meaningful accountability here.
GRABELL: Yes, yes, and early on, it was almost comical because you'd see these reports that would come out, saying, you know, $650 million for NTIADATCBD.
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GRABELL: And what that meant, you know, when you really boiled that down, that was the converter box coupons. You know, TVs were going from an analog to digital signal, and they wanted to encourage people to trade in these things so that their TVs wouldn't black out when this happened. But they used this sort of arcane language that made sense to government bureaucrats but made no sense to the public.
DAVIES: Michael Grabell is an investigative reporter for ProPublica. His new book about the economic stimulus plan is called "Money Well Spent?" He'll be back in the second half of the show. I'm Dave Davies, and this is FRESH AIR.
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DAVIES: This is FRESH AIR. I'm Dave Davies, in for Terry Gross. We're speaking with investigative reporter Michael Grabell, who has written expansive account of the Obama administration's economic stimulus program. The book looks at communities hit hard by the recession and whether the plan made a difference and assesses criticism that the plan funded silly projects and created few jobs. Michael Grabell's book called "Money Well Spent?"
Let's talk about some of the bigger kind of building and infrastructure projects that the stimulus program funded. And one of the things we heard early on was that these projects would be ready to go. The phrase was: shovel ready. Were they all shovel ready?
GRABELL: Well, no. You know, there was this famous scene - and I write about it in the book - in Tuscumbia, Missouri where the minute the stimulus package is signed there's a makeshift board meeting, they bang the gavel and sparks fly on this Depression-era rusty truss bridge. But a lot of projects were not like that. A lot of projects took six months to a year to get off the ground.
The way highway projects work is that first the local area has to go to the federal government and say this is what we want to do with the money, they have to get the stamp of approval. Then and only then can they go bid out the project, which can take months, and then they can get the contract signed, which can take some time as well. Once that happens they then have to go back to the administration and say this is what we're doing and get a notice to proceed. Only then can the contractor go ahead and hire his workers and muster his equipment and begin work.
When the stimulus package was passed in February, to get a lot of this to happen pushed people, you know, past the summer construction season and they had to sort of wait through the winter until 2010 to really begin.
DAVIES: Right. And I guess sort of at the heart of this is the fact that government doesn't spend money very quickly and fluidly because there are all these protections that were designed when government use to do that and give it away to friends and cronies, right?
DAVIES: I mean the competitive bidding, auditing, all these checks really slow things down.
GRABELL: This is the stuff that we criticize as red tape. And if you think about what red tape is; it's environmental clearances to ensure that you don't pollute the river. The idea that anyone can bid on a project as long as they're qualified, and it's not doled out to a friend or, you know, without competition. The idea that workers will get a fair wage, rather than, you know, just hiring people at, you know, minimum wage or below minimum wage, which often happened in the past. So all of these protections have been built in, but they also do slow down the work. And the president, in the State of the Union this week, had mentioned, you know, an executive order that's coming dealing with red tape and infrastructure projects. So it'll be interesting to see what he decides they can do to speed things up.
DAVIES: Now, you note that there were some challenges, some problems in the way the money was distributed. I mean for example, assistance for airport projects, you ended up funding construction at airports. And I guess to some extent on roads that didn't get very much traffic. Why was that?
GRABELL: Well, so with the airport program there was this maximum put on airport grants for $15 million. Didn't matter the size that you were; if you were JFK Airport or Atlanta - the busiest airport in the world, or if you were the little village of Ouzinkie, Alaska - home to about 167 people. So some of the largest grants went to build entire new airports for this small community that has a general aviation airport important for that local community, and you saw big airports like Atlanta that were shut out in the first round or Newark International Airport as a result of kind of, you know, these rules that were put in limiting the amount of money that could be spent on each project.
DAVIES: So that was a case where big projects require big money but this program was designed to chop it up smaller pieces, and so it was hard to distribute it in a way that had an impact.
GRABELL: Right. You know, $15 million, if you look at a major runway is barely going to cover a part of it. You can't build a runway for $15 million. But when you look at a small airport you can build an entire, you know, gravel strip for a community.
DAVIES: One of the interesting issues that you discuss in the book is that a lot of the money went to particular companies who had an interesting or innovative idea and, you know, and a promising plan. And whatever its value, one of the issues that arises in doing that is that, you know, you are subsidizing a company that, and giving an advantage over its existing or potential competitors.
Probably the best-known kind of case here is Solyndra, which is this energy firm in California that had this idea for a unique way of solar energy, that would be these rotating panes on roofs. Do you want to just talk a little bit about why that was such an attractive idea and what kind of money went into it?
GRABELL: Right. Solyndra, you know, this famous example of government waste. When the project started it was really a lot of enthusiasm about it. Silicon prices had really gone through the roof and Solyndra made a cylindrical-shaped solar panel is a different type of material. And so the future for this looked promising. It could, you know, reflect or receive solar energy in many different ways that traditional solar panels could not.
A lot of attention has been paid to the politics of this. This guy, George Kaiser, a big Solyndra investor. And what my reporting has shown the real story is, is this over-enthusiasm on the part of the administration to create clean energy success stories. But the memos and emails show is that the administration wanted to have a clean energy success story in the first few months of the administration. However, at the time, silicon prices were already dropping. The whole concept of why Solyndra would be a great example was fading away because the silicon prices were dropping. And...
DAVIES: And silicon was the material they weren't using. In other words, they had a cheaper material that presumed a high price of silicon, right?
GRABELL: Right. So, yes, exactly. So once that economic advantage faded away, Solyndra was really selling its panels for lower than it cost to make them. And so the whole concept was that if they can get a bigger factory, if they can get things up to scale, they could reduce the cost it takes to produce these and make their product competitive. However, you know, the market caught up to them before they could really accomplish this. And when they got onto tough times the administration made an effort to support Solyndra even further. And you can take this into ways. As, one, as the government is doubling down on a bad investment, or the government is trying to protect the taxpayer dollars. We haven't really seen clearly which way it was going.
DAVIES: Well, how much money went into it in the end?
GRABELL: So, more than $500 million went into this in the end. The company went bankrupt. There's real questions now about whether taxpayers will ever see that money back.
DAVIES: OK. They're bankrupt and operating, or bankrupt and closed?
GRABELL: They're closed. All 1,100 workers have been laid off. And the biggest risk that happened with Solyndra, and I don't think the administration realized this, was that so much about the clean energy plan that they had and others had depended on Solyndra. This was the clean manufacturing story that they wanted to tell. And when it failed it really doomed clean energy as a whole for now and for a long time forward. If plans are brought up for an energy plan that includes renewable energy Republicans and opponents will say: remember Solyndra? Don't forget Solyndra. We're not going to be spending another a hundred million dollars to create more Solyndras.
DAVIES: Right. So when you say it doomed it, it doesn't mean that it's never going to be viable again but it's just going to have this terrible public relations problem.
DAVIES: Right. And while we're on criticisms, you mean the administration knew that there would be critics in Congress and elsewhere just waiting to pounce, you know, when money was, you know, wasted or stolen. And there were several reports written by Republicans seizing on examples of waste. There was the turtle tunnel in a southern state, I guess, or for turtles migrating across the highway. How do you evaluate these critiques overall?
GRABELL: Right. You know, there were all these projects that were, it sounded very silly; turtle tunnels, electric fish orchestras, you know, monies to spend, you know, to research cocaine in monkeys. I have a chapter in the book called "One Man's Waste," and it deals with this issue of what is waste? And one man's waste is really another person's treasure.
Every time I found a project that someone had called silly, there was somebody else to stand up and say this is money well spent. This is money that we need. It's absolutely essential for research or other reasons. But I think the bigger thing that it shows is how, you know, the central design weakness in the stimulus plan, that the Republicans can make it seem so ridiculous. The money was spread so thinly and money was going to so many different places that it was difficult for the public to really grasp what the stimulus was about. But it was easy for these small projects to capture the media coverage day after day after day and overwhelmed the narrative that the administration wanted to create.
DAVIES: We're speaking with Michael Grabell. He's an investigative reporter for the nonprofit ProPublica. He's written a new book about the stimulus program.
We'll talk more after break. This is FRESH AIR.
(SOUNDBITE OF MUSIC)
DAVIES: If you're just joining us, our guest is Michael Grabell. He's an investigative reporter for the nonprofit ProPublica. He's written a book looking at the stimulus program. It's called "Money Well Spent?" That's with a question mark at the end.
All right. Now we hear two drastically different evaluations of the program. I mean, some people say it was another failure, created only a handful of jobs. And, you know, the administration says it kept us out of a depression. You spent all this time looking into this. What are the best estimates of the jobs impact of the stimulus bill?
GRABELL: Nonpartisan economic forecasting firms have generally agreed that it created and saved more than two million jobs.
DAVIES: And put that in the context of the recession.
GRABELL: So in the recession we lost many millions of more jobs. So we're still stuck at 9 percent unemployment. But these forecasting firms and economists have said if we didn't have the stimulus we probably would have peaked at 12 percent unemployment, not 10 percent and still be in double digits today.
DAVIES: And it's interesting that people who criticize the plan, you know, do have numbers and statistics to point to. And I guess one of the problems here is that it's not so easy to calculate jobs created and saved. What are some of the challenges in getting those numbers?
GRABELL: Sure. I think one of the difficulties is that you'll never be able to get all of the workers in a room and tap hardhats and find out exactly how many people were employed. In addition to the direct, you know, people who were hired directly, they're all these indirect jobs and induced jobs that were created because someone had more money in their pocket to spend at the supermarket or the mall because, you know, a construction worker got hired and was then able to take his family out to dinner on a Friday night. This depends somewhat on economic modeling and there are, you know, two very different schools of economic thought about how much stock to place in those modeling. So even though these nonpartisan economic forecasting firms are say more than two million jobs, there are some economists on the conservative side who reject those ideas completely and say that it's really, you know, it's really voodoo science here, voodoo economics, and you can't calculate it like that.
DAVIES: Things that go wrong get so much attention. But when you look at it overall, did the stimulus spending on infrastructure have a generally positive impact? Did some good things get done?
GRABELL: Well, yes. And I think that, you know, there's this notion that the stimulus will have no lasting impact. But I think it will have a lasting legacy. It created this buzz around clean energy that has led to, you know, these new solar farms and wind farms out West. It created the small pot of education money for Race to the Top, led 32 states to enact education reforms. When all is said and done, 41,000 miles of roads we paved, 600,000 homes weatherized and 3,000 rural schools connected to high-speed Internet. So even though it didn't bring out the recovery we were expecting, there will definitely be a lasting legacy that we can point back to and say that was because of the stimulus package.
DAVIES: Well, Michael Grabell, thanks so much for spending some time with us.
GRABELL: Thank you very much.
DAVIES: Michael Grabell is an investigative reporter for ProPublica. His new book about the economic stimulus plan is called "Money Well Spent?" You can read an excerpt on our website, FRESH AIR.NPR.org. Transcript provided by NPR, Copyright NPR.