Wash. Post reported investor concern over partial analysis of recovery package, but not rebuttal
Research ››› ››› HANNAH DREIER
The Washington Post reported, "Ed Yardeni, president and chief investment strategist at Yardeni Research, said he was skeptical of the stimulus package because much of the spending in it may come well after the crisis is over, as a report from the Congressional Budget Office has suggested." But the Post did not include a response from the Obama administration or the Democratic leadership anywhere in the same edition of the newspaper.
In a January 24 Washington Post article, staff writer Peter Whoriskey mentioned investor attitudes toward President Obama's economic recovery package and wrote: "Ed Yardeni, president and chief investment strategist at Yardeni Research, said he was skeptical of the stimulus package because much of the spending in it may come well after the crisis is over, as a report from the Congressional Budget Office has suggested." However, Whoriskey did not include any response from the Obama administration or the Democratic leadership to the CBO analysis in the article or anywhere else in the January 24 print edition of the newspaper.
As Media Matters for America noted, in a January 22 letter, Office of Management and Budget director Peter Orszag -- who formerly headed the CBO -- refuted the Republican claim based on the partial analysis that most of the money would not be spent until after 2010. Orszag stated that the CBO "analysis, however, did not assess the overall package." He added: "Our analysis indicates that at least 75 percent of the overall package (including its tax component and the other spending provisions that were not analyzed by the Congressional Budget Office) will be spent over the next year and a half."
Indeed, in a January 23 article posted on washingtonpost.com, the Associated Press noted that in response to Republican criticism of the recovery package based on the CBO analysis, "[t]he administration countered with a promise that 75 percent of the entire measure would reach the economy over the next year and a half, according to a letter sent by White House Budget Director Peter Orszag to top lawmakers."
Nor did Whoriskey's January 24 article note the Democratic leadership's criticism of the CBO analysis, which the Post previously mentioned in a January 21 article:
House Democrats and administration officials said that by leaving out the tax cuts and spending on the poor, the CBO report focuses on the slowest-spending parts of the proposal. Even there, small changes to the measure could have a huge effect, they said. For instance, Democrats said that if states were given a different deadline for spending highway money, analysts predict the spend-out rate would be accelerated significantly.
"The new CBO report does not take into account the fastest spending provisions in the bill, leaving the false impression that the overall spend-out rates are slower than they actually are," said Brendan Daly, a spokesman for House Speaker Nancy Pelosi (D-Calif.). "These provisions will go out quickly to give the economy a jolt while others will represent down payments on crucial priorities for our economic future -- investments in clean energy, health care, education and repairing our nation's infrastructure."
From Whoriskey's January 24 Washington Post article:
At least some of the high hopes leading into January grew out of anticipation that the incoming Obama administration would fix things -- and fast.
But at least some analysts said investors have been disappointed by the $825 billion economic stimulus package that has been proposed and by the ongoing uncertainty over what the government will do to prop up the banks.
Ed Yardeni, president and chief investment strategist at Yardeni Research, said he was skeptical of the stimulus package because much of the spending in it may come well after the crisis is over, as a report from the Congressional Budget Office has suggested.
He criticized its varied components -- some for health-care technology, some for energy, some for tax breaks, and so on -- as amounting to a "kitchen sink" approach.
"I don't think there's a great deal of confidence that the fiscal stimulus program that's being put together will do much good," Yardeni said. "While I hate to say the honeymoon is over this early, it certainly seems that way given the way that the stock market and bond market are behaving."