Unleashing the power of Keynes

by Russ Roberts on August 20, 2010

in Stimulus

It turns out that the project that President Obama highlighted the other day–a police station renovation–was not a police station and wasn’t funded by the stimulus package. The Columbus Dispatch explains (HT: Drudge):

A local project that President Barack Obama cited during a visit Wednesday to Columbus as an example of how the federal stimulus package has worked isn’t actually being funded with stimulus dollars.

It turns out it’s just “regular” federal spending:

The president spoke at the North Side home of architect Joe Weithman, and both Obama’s comments and information from the White House touted Weithman’s work on a project that the president said was being at least partially funded by the $787 billion stimulus bill passed last year.

“What we’ve been trying to do is to build infrastructure that puts people back to work but also improves the quality of life in communities like Columbus,” Obama said in his remarks. “So Joe is an architect, and he’s now working on a new police station that was funded in part with Recovery Act funds.”

But although federal money is being used for the project in question, there are no stimulus dollars involved, said Columbus Finance Director Paul Rakosky, a Democrat.

Rakosky said the project is not a police station but rather the renovation of an abandoned warehouse that the city purchased on the South Side in 2007 to house the city’s police crime lab and property room.

Weithman’s firm, Mull & Weithman Architects, is handling the $300,000 in design work for the crime lab as part of the project, and the $300,000 is coming from a congressional earmark, Rakosky said.

That it wasn’t funded by stimulus money isn’t the real scandal. The real scandal might be why you and I are paying to renovate a Columbus warehouse. Or in the economics:

Background information the White House provided before the president’s visit didn’t identify the stimulus bill as the source of funding for the work, but it said the architectural firm that Weithman runs “was able to keep two of their employees that otherwise would have been laid off due to work on a police station renovation that received infrastructure funding.”

It also said Weithman hopes to hire an additional employee as the economy improves and as “additional projects, some of which could be funded by the Recovery Act, are secured.”

This is the best the President could come up with? A project that saved two existing jobs and might create one net job in the future? That Keynesian stimulus sure is powerful.

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