President Obama’s American Recovery and Reinvestment Plan

President Barack Obama delivered his first weekly address to the nation on January 24 2009, just four short days after taking office. The topic? The US economy.

President Obama’s American Recovery and Reinvestment Plan is designed to “immediately jumpstart job creation as well as long-term economic growth.” But what does that really mean to you and me?

Obama, A Republican's View – Obama, A Democrat’s View

According to President Obama’s address (check it out below), the American Recovery and Reinvestment Plan breaks down like this:

• Energy:

1. Build a whole new electricity grid using “clean” electricity like solar and wind
2. Make “75 percent of federal buildings more energy efficient”
3. 2.5 million homes will be weatherized (thereby increasing energy efficiency and the protection against the elements)

• Health care:

1. Over the next five years, computerize health records
2. Protect individual and family health plans from being cut or cancelled

• Education:

1. Upgrade schools (new computers, improve classrooms, labs and libraries)
2. Make college more affordable (increased investment in Pell Grants, a tax credit for 4 million students and triple science fellowships)

• Infrastructure:

1. Improve/rebuild roads and bridges
2. Increase mass transit
3. Improve the communication system for local police and public safety officials
4. Expand broadband access across the nation

Again, what does all of this mean to you and me? A lot, actually. President Obama’s economic plan will affect everyone. The new electrical grid, the upgraded schools and the infrastructure improvements mean new jobs created. New jobs mean that more people have more money.

More money means that those people can pay bills, like their mortgage. The housing and banking markets will improve as mortgages get paid and foreclosures drop. Also, the economy in general will upswing as the newly re-employed spend their money, not just for necessities, but for meals out, clothing, shoes, books and so on.

Read the full address here: American Recovery and Reinvestment

Expanded broadband not only increases jobs for installing and troubleshooting, but also provides for a larger audience to which small-business owners can market and sell their products. In fact, through Obama’s plan, not only will we see immediate results, but long-term gains as well.

As far as the individual goes, let’s put it this way:

• You’ll pay less for energy (maybe not tomorrow, but within three years, according to Obama’s address) - especially if your home is one of the 2.5 million to be weatherized - as clean energy is cheap energy, and energy-efficient federal buildings mean fewer tax dollars going to government electricity bills.
• Computerized health records can save your life. Say, if you are in an accident and knocked unconscious, the hospital can access your records quickly and let the staff know about any health conditions you have (including allergies to medicine).
• A protected health plan - well, that one is pretty obvious. Health coverage means less out of pocket for medical bills.
• For those students out there, improved classrooms, a Pell Grant, a tax credit and a fellowship can mean your future is that much more accessible.
• Mass transit means you can get places faster, cheaper and more efficiently.

President Obama even has a leading economist on his side. Mark Zandi of moodyseconomy.com, formerly of the McCain-Palin campaign, believes this plan is the best chance for economic recovery.

Speaker of the House Nancy Pelosi wants Congress to act on the American Recovery and Reinvestment Plan by President’s Day (February 16, 2009); she stated, “The time is now to act on the legislation Mr. Zandi estimates will create and save more than 4 million American jobs by the end of 2010” (source: Office of the Speaker of the House). Needless to say, if you are one of those 4 million people, this plan will impact you in a positive way.

Speaker Pelosi pointed out that this plan will help everyone from blue-collar workers to small-business owners to white-collar workers. Also, America will become more energy-independent in the future.

Not only will this energy efficiency impact the American economy in the short term, but it will also improve the future for our country. More fellowships in science mean that the next generation of great scientists will have the necessary education and experience to bring about the next great wave of technological and scientific advancements. Also, the additional Pell Grants and the tax credit will help students who wouldn’t be able to afford college actually get the chance to go. This may provide us with an American educational and intellectual revolution.

According to a recent New York Times article referencing Mr. Zandi, the stimulus package will have a bigger impact on the economy than the bailouts given to the bank and auto industries. Since business bailouts only affect individual markets, it “has little direct impact on economic growth or job creation.” Also, packages using tax cuts or tax rebates don’t positively impact the economy as most people either save the money or pay bills with it.

In fact, the only type of stimulus plan that will positively impact the current economy is one like the American Recovery and Reinvestment Plan. With this type of plan, each dollar spent for the plan “generates a $1.50 or more in economic activity” (source: above-referenced New York Times article).

In short, President Obama’s economic stimulus plan will do what it says. It will stimulate the economy and positively impact each and every one of us.