Despite Obama’s Repeated Claims That Enacting $787-Billion Stimulus Was Urgent, 78 Percent of Money Remained Unspent by End of Fiscal 2009 Says Federal Auditing Agency

November 23, 2009 - 7:18 PM
After his election last November and until the $787-billion American Recovery and Reinvestment Act was passed in February, President Obama repeatedly insisted that it was urgent for Congress enact his economic "recovery" bill immediately. Yet, by the end of fiscal 2009 78 percent of the federal spedning authorized by that bill had not yet taken place.

President Barack Obama pauses as he speaks during a meeting with members of his Cabinet in the Cabinet Room of the White House in Washington, Monday, Nov. 23, 2009. Seated at the table are Secretary of Sate Hillary Rodham Clinton, left, Defense Secretary Robert Gates, behind Obama, Commerce Secretary Gary Locke, second from right, and Transportation Secretary Ray LaHood. (AP Photo/Susan Walsh)

CNSNews.com - After his election last November and until the $787-billion American Recovery and Reinvestment Act was passed in February, President Barack Obama repeatedly insisted that it was urgent for Congress to enact his economic “recovery” bill immediately. Yet, by the end of fiscal 2009 fully 78 percent of the federal spending authorized by that bill had not yet taken place, according to the Government Accountability Office.

In the meantime, the national unemployment rate climbed 26 percent, from 8.1 percent in February to 10.2 percent in October.

“As of September 30, 2009, approximately $173 billion of the $787 billion—or about 22 percent—of the total funds provided by the Recovery Act had been paid out by the federal government,” the GAO revealed in a report released November 19. Seventy-eight percent of the money remained unspent.

Over and over again in the weeks before Congress passed the bill, President-elect and then President Obama repeatedly and emphatically insisted that the fate of the U.S. economy rested on getting the bill enacted immediately so that federal funds could be spent to create jobs for Americans.

In their rush to pass the legislation, House Speaker Nancy Pelosi (D.-Calif.) and Senate Majority Leader Harry Reid (D.-Nev.) both called floor votes on the proposal less than 24 hours after the final text of the bill—which was more than 1,000 pages long—had been completed and posted on the Web site of the House Appropriations Committee.

Members of Congress were forced to vote on one of the largest stand-alone spending bills in the history of the country without having actually read it.

Sen. Frank Lautenberg (D.-N.J.) candidly told CNSNews.com at the time that he did not believe any of his colleagues would have the time to read the full text of the bill. When the bill was debated on the House floor, House Minority Leader John Boehner asserted that no Member of Congress had actually read it.

“But as we meet, Congress is now poised to act,” Obama told a business group about the $787-billion bill on the day Congress held its hurried vote. “And one of the reasons we've come so far is because so many of you have recognized the urgency and necessity of taking action.”

In a speech at the White House on February 6, Obama had pointed to Labor Department figures that indicated 3.6 million Americans had lost their jobs to that point since the start of the recession. He argued that the job losses underlined the need to push the stimulus legislation through Congress immediately.

“That's 3.6 million Americans who need our help,” said Obama. “I am sure that at the other end of Pennsylvania Avenue, members of the Senate are reading these same numbers this morning. I hope they share my sense of urgency and draw the same, unmistakable conclusion: the situation could not be more serious. These numbers demand action. It is inexcusable and irresponsible to get bogged down in distraction and delay while millions of Americans are being put out of work. It is time for Congress to act. It is time to pass an Economic Recovery and Reinvestment Plan to get our economy moving again.”

On January 16, before his Inauguration, Obama had stressed the urgency of enacting the stimulus bill while visiting a manufacturing facility in Ohio.

“The way I see it, the first job of my administration is to put people back to work and get our economy moving again,” said Obama. “That's why I've moved quickly to work with my economic team and leaders of both parties on an American Recovery and Reinvestment Plan that will immediately jump-start job creation and long-term growth. And I'm pleased that Congress has seen the urgency as well and is moving quickly to consider such a plan.”

At George Mason University in Northern Virginia on January 8, Obama said that every day Congress waited to enact the stimulus bill “more Americans will lose their jobs.”

“We should have an open and honest discussion about this recovery plan in the days ahead, but I urge Congress to move as quickly as possible on behalf of the American people,” he said. “For every day we wait or point fingers or drag our feet, more Americans will lose their jobs. More families will lose their savings. More dreams will be deferred and denied. And our nation will sink deeper into a crisis that, at some point, we may not be able to reverse.”

In a January 3 radio address, Obama said that if Congress did not act “swiftly and boldly” to stimulate the economy it could “lead to double digit unemployment.”

“These are America's problems, and we must come together as Americans to meet them with the urgency this moment demands,” said Obama. “Economists from across the political spectrum agree that if we don't act swiftly and boldly, we could see a much deeper economic downturn that could lead to double digit unemployment and the American Dream slipping further and further out of reach.”

On December 7, on NBC’s “Meet the Press,” Obama said that he had met with the governors and that “all of them have projects that are shovel-ready” that are “already lined up” to get stimulus money spent and create jobs.

“Well, I think we can get a lot of work done fast,” said Obama. “When I met with the governors, all of them have projects that are shovel-ready that are going to require us to get the money out the door, but they have already lined up the projects, and they can make them work.”

In a December 6 radio address, Obama said he needed to work with Congress to pass a stimulus plan “immediately” in order to “save or create at least two and half million jobs.”

“When Congress reconvenes in January, I look forward to working with them to pass a plan immediately,” said Obama. “We need to act with the urgency this moment demands to save or create at least two and a half million jobs so that the nearly two million Americans who've lost them know that they have a future. And that's exactly what I intend to do as President of the United States.”

At the signing ceremony for the bill, which was held February 17 in Denver, Vice President Joe Biden vowed that now that the bill was enacted the Obama administration would be “working day and night” to create jobs and help the unemployed.

“Starting today, our administration will be working day and night to provide more aid for the unemployed, create immediate jobs, building our roads and our bridges, make long-term investments in a smarter energy grid, and so much more,” said Biden.

The GAO reported that of the $787 billion in spending authorized by the Obama stimulus plan, only $173 billion (or 22 percent) had been spent by Sept. 30, 2009, the end of the fiscal year. Of this $173 billion, only $47 billion (or 25 percent of the 22 percent) went to contracts, grants or loans for projects. The rest of the money went to federal entitlement programs such as Medicaid and to immediate tax relief.

In November 2008, when Obama was elected, the national unemployment rate was 6.8 percent, according to the Bureau of Labor Statistics. In January, when Obama was inaugurated, the unemployment rate was 7.6 percent. In February, when Obama signed the his urgent $787-billion stimulus law, unemployment was at 8.1 percent. By October, eight months after Obama signed the stimulus law, the unemployment rate had risen to 10.2 percent—equal to the double digit unemployment Obama predicted the country would see if Congress did not immediately enact his stimulus plan.