Economic Stimulus Transparency & Accountability
On February 17, 2009, President Barack Obama signed into law the American Recovery and Reinvestment Act of 2009. Totaling $787 billion, the Act includes federal tax cuts, expansion of unemployment benefits and other social welfare provisions, and domestic spending in education, health care, and infrastructure. With the national unemployment rate now above eight percent, the goal of the Obama Administration is to move as quickly as possible to stimulate the ailing economy. Throughout this process, government at all levels must demonstrate to the public that their tax dollars are indeed being used in accordance with the purpose of the Act: "for job preservation and creation, infrastructure investment, energy efficiency and science, assistance to the unemployed, and state and local fiscal stabilization."
The Common Cause Stimulus Transparency, Accountability, and Clean Administration project is an important part of a larger collaborative effort to insure this historic government spending program benefits needy communities and promotes smart growth. Common Cause is promoting a model for transparency, accountability, and clean administration of stimulus spending for all levels of government across the country by developing state and local coalitions made up of diverse stakeholders to insist on full transparency of stimulus spending. Working together, environmental, labor, education, health care, and other interest groups will be able to "drill down" to assess spending in their respective areas and press policymakers and government administrators to use the stimulus money effectively.
Economic Stimulus Transparency & Accountability
The importance of transparency and accountability throughout this process cannot be emphasized enough. Last fall, the Bush Administration pushed through a $700 billion bailout for the financial sector without requirements for how the funding was to be spent or tracked. Subsequent reports showed that banks were not using the money for the intended purpose of making loans and were unwilling or unable to say where funds were actually going. This has led to the recent scandals involving AIG and has ultimately destroyed public confidence in the financial bailout and complicated the Obama Administration's subsequent economic recovery efforts. At every step, tax payers must be confident that funds are being well spent and that projects are well managed. Public confidence in the new administration's ability to turn the economy around is itself a critical factor for the success of the recovery effort. Accusations of misused funds and waste will hurt the public's confidence in the stimulus package, resulting in negative long-term effects for the economy and the government.
The stimulus plan is a key part of today's historic moment. The success or failure of the Obama Administration's efforts to rescue our economy will define for a generation the efficacy and necessity of our public institutions. This is a moment when people's relationship with their government is going to change, one way or the other. We want the economic recovery program to succeed, not only because it will help our economy, but because it will emphasize the need for public institutions working in the public interest. If it fails, it will further embolden the cynics whose only goal is to shrink our government down to the size that it could drown in a bathtub. The stakes are huge.
The principal goal of Common Cause's plan is comprehensive state- and local-level reporting on stimulus spending, opening up opportunities for advocacy to insure the best possible use of these billions of dollars. All of the stimulus funds must be trackable at every step of the process. The public should be able to follow the money from the U.S. Treasury, where the funds are initially doled out, all the way down to the sub-contracting level, where the money is finally spent. A failure to "drill down" to publicly account for how the stimulus money is being used will undermine public confidence in the program, just as it has in the bank bailout.
The campaign employs four central strategies:
1. Leveraging national expertise to promote consistent transparency in states;
2. Building broad-based advocacy coalitions at the federal, state and local levels;
3. Creating tools for use in maximizing state-level advocacy; and,
4. Strategic investment in key states.
As stimulus funding begins to reach communities, it is up to state and local officials to build in transparency all the way down to the lowest level of subcontracting for projects. All recipients of federal stimulus funds, including state and local agencies and the contractors and subcontractors they hire, should be required to report information about the work they are doing with our tax dollars, including both the number of jobs created as well as the wages and benefits paid. Every state should make all of this information available in a format that is compatible with the information being reported at the federal level. Only by insisting on complete transparency will lawmakers, the press and the public be able to hold state and local government's feet to the fire in making sure stimulus funds are doing their job.
Some state governments have taken positive steps to make the economic stimulus package as transparent as possible, but have not gone far enough. Many other states do not yet have plans in place to provide the openness required for monitoring contracting at the local level, much less measuring these projects in relation to national criteria. All states must adopt the same rubric and criteria for measuring the impact of stimulus funding on the economy writ large. The public is already anxious to see results from stimulus funding, as well as evidence that funds are being administered free of inappropriate influence from special interests. By creating a scaffolding for public watchdogging of stimulus spending at state and local levels, we can increase the chances that funds will be spent appropriately, which will in turn inspire greater public confidence in stimulus spending decisions, greatly benefiting each state and its efforts to spur the economy.
Economic Stimulus Transparency & Accountability
Economic Stimulus Resources
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