How Effective Was The 2009 Stimulus Program?

[mardi gras skin]

http://blogs.forbes.com/nickschulz/2011/07/05/how-effective-was-the-2009-stimulus-program/

Eisenach and Caves looked at three areas that received stimulus funds, in the form of loans and direct grants, to expand broadband access in Southwestern Montana, Northwestern Kansas, and Northeastern Minnesota. The median household income in these areas is between $40,100 and $50,900. The median home prices are between $94,400 and $189,000.

So how much did it cost per unserved household to get them broadband access? A whopping $349,234, or many multiples of household income, and significantly more than the cost of a home itself.

Sadly, it’s actually worse than that. Take the Montana project. The area is not in any meaningful sense unserved or even underserved. As many as seven broadband providers, including wireless, operate in the area. Only 1.5% of all households in the region had no wireline access. And if you include 3G wireless, there were only seven households in the Montana region that could be considered without access. So the cost of extending access in the Montana case comes to about $7 million for each additional household served.

[Stew]

It was pretty good for me. I got a new house, and 8K just for buying it. Piad off my destination wedding with that. I realize the article isnt talking about the housing stimulus in my area necessarily, im just saying.

[gbear]

So it's 7 million per house already built...but in the longer term are new houses likely to be built in this area? Does having access increase the value of existing homes? I know the last is a small part of 7 million, but it's parts like it which make me question some of the cost/benefit analysis in this peace.

I liken it some what to roads. How many developments spring up the moment there is easy transportation to work sites? It would be easy to say, "I'm not building a road there. Nobody lives there." I think most of the DC area can attest to housing values and new developments resulting from roads to a place which was a farm in the not too distant past. Heck, just look at Frederick MD.

I'm not saying I expect Montana to gain a new metropolis as a result of this new infrastructure, but the increasing the capability across the US is like spreading seeds on the ground or even over seeding a lawn. Many seeds fatten the birds or just not produce, but so long as a threshold is met to cover my front yard, I can live with the wasted seeds. In many ways, articles like this one seem to be focusing on the plight of one seed which was suspect before being spread.

[mardi gras skin]

I'm not saying I expect Montana to gain a new metropolis as a result of this new infrastructure,

I'm glad you aren't saying that.

The 1.7% of Montana's population without internet access didn't move out to the most desolate regions of the US in hopes that rural Montana would turn into a thriving suburb.

[Ellis]

Let's see... I bought a house in 2008. When I filed my taxes in 2009, I received the $8K stimulus as cash in a tax return. I kept $3K for myself to spend and invested the other $5K. In the 2 years of investing, I've pretty much doubled my money.

This year, when I filed my 2010 return, I had to make the first repayment of that $8K. The payment was $500. It didn't hurt.

I'm not upside down in my mortgage. I feel pretty comfortable.

Just got married and my wife and I are about to buy a new house on the cheap by the end of the year.

I don't consider myself "lucky" given the conditions of our economy. I consider myself competent.

[Hubbs]

So it's 7 million per house already built...but in the longer term are new houses likely to be built in this area? Does having access increase the value of existing homes? I know the last is a small part of 7 million, but it's parts like it which make me question some of the cost/benefit analysis in this peace.

I liken it some what to roads. How many developments spring up the moment there is easy transportation to work sites? It would be easy to say, "I'm not building a road there. Nobody lives there." I think most of the DC area can attest to housing values and new developments resulting from roads to a place which was a farm in the not too distant past. Heck, just look at Frederick MD.

I'm not saying I expect Montana to gain a new metropolis as a result of this new infrastructure, but the increasing the capability across the US is like spreading seeds on the ground or even over seeding a lawn. Many seeds fatten the birds or just not produce, but so long as a threshold is met to cover my front yard, I can live with the wasted seeds. In many ways, articles like this one seem to be focusing on the plight of one seed which was suspect before being spread.

On the other hand, the Bridge to Nowhere was also a road.

[gbear]

Funny, I thought of the bridge to nowhere as I was writing. All I can think of in defense of it and Montana is maybe some pork has to be spent to get permission to use the bad of seeds and the spreader? Maybe it's the equivallent to throwing some seeds in the corner which is already covered with gravel and gets no sun or water.

I also cringe at using one project from the stimulus bill to label all of it. What's more, I thought most of the money was spent bailing out the states. I thought the better check for efficacy is to question what would have happened to the state governments without it.

[Riggo-toni]

Personally I think in an age of currency derivatives and electronic transfers, not to mention oil imports, that stimulus bills do more damage than good to the national economy, even in the short term. It widens the spread between the fed short term rates and gov't long term bond rates,encouraging banks to borrow from the fed and lend the $ back to Uncle Sam at a profit rather than lending to businesses, and the depreciation of the dollar drives up the price of oil, which shakes consumer confidence and drives up the price of food.

[Hubbs]

Funny, I thought of the bridge to nowhere as I was writing. All I can think of in defense of it and Montana is maybe some pork has to be spent to get permission to use the bad of seeds and the spreader? Maybe it's the equivallent to throwing some seeds in the corner which is already covered with gravel and gets no sun or water.

I also cringe at using one project from the stimulus bill to label all of it. What's more, I thought most of the money was spent bailing out the states. I thought the better check for efficacy is to question what would have happened to the state governments without it.

Probably the same thing that's happening to them anyway. That's the problem with kicking the can. Eventually it's right in front of you again.

[Stew]

Let's see... I bought a house in 2008. When I filed my taxes in 2009, I received the $8K stimulus as cash in a tax return. I kept $3K for myself to spend and invested the other $5K. In the 2 years of investing, I've pretty much doubled my money.

This year, when I filed my 2010 return, I had to make the first repayment of that $8K. The payment was $500. It didn't hurt.

I'm not upside down in my mortgage. I feel pretty comfortable.

Just got married and my wife and I are about to buy a new house on the cheap by the end of the year.

I don't consider myself "lucky" given the conditions of our economy. I consider myself competent.

you had to repay the 8K? bummer.