Obama’s Ohio Trip Undermined, Businesses Didn’t Really Need ObamaBucks
From the Youngstown Vindicator on President Obama’s trip to V&M Star in Youngstown with Gov. Strickland. Senate candidate Lee Fisher was notably absent:
During his speech, Obama discussed the $787 billion federal stimulus package, signed into law in February 2009, saying it had to be passed or the country would have faced the serious possibility of going into a depression.
The nation is seeing positive results from the economic stimulus policies, Obama said.
Without government help, “the GM plant over in Lordstown would not be there because GM would have liquidated.”
Obama’s last visit to the Valley was to the GM complex in September 2009.
Acknowledging skepticism about his visit, Obama said: “A lot of people — let’s be blunt — aren’t always real impressed when a governor or a president comes swooping in and talking about the economy because the only headline they want to see is the headline that says, ‘You’re hired.’”
The president then discussed the $19 million in stimulus money that is going to the V&M expansion, saying “as a result of this investment,” the $650 million project is moving ahead.
Without the stimulus package, “the steady progress we’re beginning to see across America would not exist and neither would the plant that you’re about to build,” Obama said.
The expansion will create 400 construction jobs. When the plant opens, there will be 230 employees working directly for V&M and 120 contract workers at the new facility. V&M makes seamless tubes for the oil and gas industry.
U.S. Rep. Tim Ryan of Niles, D-17th, has been insistent that without the stimulus money, the V&M project would have never happened.
Joel Mastervich, V&M’s president and chief operating officer, said the stimulus money “helped propel the project forward.” But he added that “the project would have proceeded” without the money.
Also, Philippe Crouzet, chairman of the management board of Vallourec, V&M’s Paris-based parent company, said: “You don’t make such a big decision based on just a [government] subsidy.”
But he added the money was a great benefit to the project.
When asked if the company would have approved the local expansion without the stimulus money, Crouzet said, “I’m not sure we would have made our mind up so rapidly” without it.
During Obama’s speech, he criticized those who opposed the stimulus package, but never mentioned anyone by name. Also, he only used the word “Republican” one time in his 20-minute speech.
In response to Obama’s visit, Ohio Republican Party Chairman Kevin DeWine said, “The economic recovery we were promised hasn’t happened, and the president’s policies clearly aren’t working. Unfortunately, neither are thousands of Ohioans.”
Thanks to the stimulus program, every Ohioan now owns an inefficient car company that, instead of going through a healthy bankruptcy will now continue to fund endless pension liabilities while making the sort of efficient, green cars that Nancy Pelosi commands you to buy.
Mastervich and Crozet should expect a call from Rham Emanuel or someone else in the White House, as on the big trip to Ohio to brag about the $19 million dollar handout for jobs (jobs which don’t even exist yet) that they would of expanded without the help of the Federal government.
This is the sort of backward Keynesian logic that massive government spending in that famous formula (The G in Y=C +I+ G + NX) will boost aggregate demand and stimulate economic growth. But such models are short term, encourage the misallocation of resources (ie, a handout to a French company in Ohio that really didn’t need it), burden future generations with incredible debt, and do not encourage real sustained growth.
But who cares about all that… Unemployment is 11% in Ohio and Ted Strickland has a tough campaign to win!