Michael Steele on the stimulus:

STEELE: You’ve got to look at what’s going to create sustainable jobs. What this administration is talking about is making work. It is creating work.

STEPHANOPOULOS: But that’s a job.

STEELE: No, it’s not a job. A job is something that — that a business owner creates. It’s going to be long term. What he’s creating…

STEPHANOPOULOS: So a job doesn’t count if it’s a government job?

(CROSSTALK)

STEELE: Hold on. No, let me — let me — let me finish. That is a contract. It ends at a certain point, George. You know that. These road projects that we’re talking about have an end point.

As a small-business owner, I’m looking to grow my business, expand my business. I want to reach further. I want to be international. I want to be national. It’s a whole different perspective on how you create a job versus how you create work. And I’m — either way, the bottom line is…

STEPHANOPOULOS: I guess I don’t really understand that distinction.

STEELE: Well, the difference — the distinction is this. If a government — if you’ve got a government contract that is a fixed period of time, it goes away. The work may go away. That’s — there’s no guarantee that that — that there’s going to be more work when you’re done in that job.

STEPHANOPOULOS: Yes, but we’ve seen millions and millions of jobs going away in the private sector just in the last year.

STEELE: But they come — yes, they — and they come back, though, George. That’s the point. When they go — they’ve gone away before, and they come back.

This prompted the Yglesias headline: Steele: Cops, Firefighters, Soldiers, Postmen, Teachers All Secretly Unemployed

Seriously though, I can’t seem to keep all this straight.  First it was full of Republican sweeteners.  Then it wasn’t fast enough.  Then it was just a “spending” bill.  Now it’s too temporary.

There’s no real argument here.  It’s just pure unadulterated media cycle blather, and it shows that the GOP is legitimately uninterested in governing.

And guess what?  Americans are sick and tired of it:

Krugman:

I’m still working on the numbers, but I’ve gotten a fair number of requests for comment on the Senate version of the stimulus. The short answer: to appease the centrists, a plan that was already too small and too focused on ineffective tax cuts has been made significantly smaller, and even more focused on tax cuts.

According to the CBO’s estimates, we’re facing an output shortfall of almost 14% of [a year's] GDP over the next two years, or around $2 trillion. Others, such as Goldman Sachs, are even more pessimistic. So the original $800 billion plan was too small, especially because a substantial share consisted of tax cuts that probably would have added little to demand. The plan should have been at least 50% larger. Now the centrists have shaved off $86 billion in spending — much of it among the most effective and most needed parts of the plan. In particular, aid to state governments, which are in desperate straits, is both fast — because it prevents spending cuts rather than having to start up new projects — and effective, because it would in fact be spent; plus state and local governments are cutting back on essentials, so the social value of this spending would be high. But in the name of mighty centrism, $40 billion of that aid has been cut out.

My first cut says that the changes to the Senate bill will ensure that we have at least 600,000 fewer Americans employed over the next two years.

State aid should be the abslote last thing to cut out of this bill.  According to the Center on Budget and Policy Priorities, 46 states are currently facing budget shortfalls.

Many of these states are also required to balance their budget, which means less jobs, less aid for people who’ve lost their jobs, less cops, less teachers, and a worse economy.  States are the front line in the recession; they get hit first and hardest.

To cut $40 billion in aid to states form this bill is severly counterproductive.

publius:

It honestly boggles my mind to see so much money taken out of this particular category.  Again, these cuts would be palatable if there were some semblance of a policy rationale for doing so.  But there’s none.  Instead, the fate of state budgets everywhere must take a backseat to the desires of Senators Nelson and Collins to be perceived as very serious centrists.   Forty billion dollars is a lot to pay to help protect two Senators’ ideological self-image.  Perhaps the two Senators could write a sympathy card to laid-off state workers reminding them of how important abstract concepts like centrist budget hawkery are to the nation’s well-being.

To repeat the main point – state budget aid is an important stimulus.  It should not be cut.  Let’s hope Pelosi hangs tough on this.

In Arizona, we’re facing a $1.6 billion shortfall, and Republicans are going to town with cuts.  In a budget that’s half education, there’s going to be some awful choices.  Tuition at public universities will increase, research is being halted, and state workers are losing their jobs.

State aid is one of the most needed parts of the stimulus bill.  I’ve been calling for it for months.

So let’s not gut it just to polish a political image of centrism.

[Update]

I missed this scathing post from Ezra Klein:

Nor have they argued that the $40 billion in state aid and $20 billion in school construction will be less stimulative than the $70 billion Alternative Minimum Tax patch, of which exactly 0.5% goes towards the bottom 60 percent of the income distribution (which are, of course, the folks most in need of relief, and most likely to spend it quickly). In fact, they haven’t really argued anything at all. They haven’t argued that their cuts are good or that they’re necessary. Rather, it’s been a dazzling display of the most analytically bankrupt strain of centrism: The belief that the right answer lies, by definition, somewhere between the answers that are already on the table. The Nelson-Collins bill hasn’t been justified in terms of virtues so much as in terms of abstract numerical positioning. It’s a neat trick, and widely applicable. If one party announced a bill mandating that all Americans must bathe themselves in mud and brambles, and the other party opposed the “Mud and Brambles Bathing Act of 2009,” Collins and Nelson would be right there to explain that the American people are tired of dogma and interest group politics and they have brokered a compromise mandating that all Americans take a monthly mud and brambles shower instead.

I love it when he gets all ornery:

Of course, they’re actually talking about real economic theory, but how can it compete with this brilliant piece of CW from some dude in governor of South Carolina:

Gov. Sanford, unlike most of his colleagues, speaks out against any federal bailouts, including a fiscal stimulus bill that is likely to include state aid. “When times go south you cut spending,” Gov. Sanford said. “That’s what families do, that’s what businesses do, and I don’t think the government should be exempt from that process.”

Because, you know, if everyone cuts back on spending, that will help the economy.  Hey, it makes sense when you equate the giant federal government with virtually unlimited borrowing power to a family of four.  Who needs economic theory, right?

Oh, and btw, Matthews barely lets Krugman talk here…it almost like he’s auditioning for something…