Murkowski criticizes wasteful spending in stimulus package

February 13, 2009
04:37 PM
FEBRUARY 13, 2009                                                    ANNE JOHNSON (202) 224-7875   
WASHINGTON, D.C. – U.S. Senator Lisa Murkowski, R-Alaska, today made the following remarks on the Senate floor regarding her objections to the $790 billion stimulus bill:
Mr. President, today we vote on the conference report for the American Recovery and Reinvestment Act. I was one of 37 Senators to vote against the bill earlier this week, and have come to the floor to discuss some of the reasons why I was unable and unwilling to support it. 
My principal concern was the scope of new spending – none of which was paid for through initiatives to raise revenues or reduce spending,
As the media has reported, the cost of the bill is $790 billion, however, when you account for interest, the cost increases to more than $1 trillion. Even if it actually creates the 4 million jobs that the White House once promised, those jobs will come at a cost of roughly $300,000 apiece. However, even the most optimistic economists now estimate that it would create or save less than 2.5 million jobs.  
Others have talked about the need to fix housing first, and I strongly agree with that approach. But as ranking member of the Committee on Energy and Natural Resources, I would like to spend some time on another aspect of this bill – an area where millions of new jobs have been promised – and that’s energy. 
There’s no question that we must facilitate the development of renewable resources, increase energy efficiency, and pursue innovative solutions to the many challenges we face. But I was not satisfied that the energy provisions in the bill are “timely,” “targeted,” or “temporary.” By adopting this conference report, we will miss significant opportunities that would revive our economy and improve our energy security at little or no cost to taxpayers.
My first criticism is not of the items that were included in the stimulus, but the items that were left out. Simply put, this package made no effort to increase domestic production of traditional resources such as oil and natural gas. 
By focusing only on new technologies, and to the total exclusion of those tried and true, this bill creates a false dilemma. Clean energy is viewed as the only viable option for energy development and job creation, when in fact it may not even be our most effective option. 
Consider the benefits that could be brought about by greater production of oil and gas here in America. According to one recent study, the full development of domestic oil and gas resources could generate up to $1.7 trillion in revenues for the federal government and create as many as 161,000 new jobs by 2030. 
The revenues from production could be used to provide a tremendous down payment on the long-term strength and security of our nation. Instead, as a result of this bill, American taxpayers will ultimately pay more than $1 trillion because of decisions those of us in the Senate chose not make.     
Setting aside my concerns about the priorities of this bill, it is also highly uncertain that the funds provided by it can be spent in a rational, cost-effective manner. 
Perhaps the best example is the Department of Energy, which is set to receive roughly $45 billion. DOE’s total budget for fiscal year 2008 was $24 billion. Assuming the department receives similar funding through fiscal year 2009 appropriations – which we will debate after the recess break – DOE will have received almost triple its historical level of funding in less than a month. 
For the most part, the amounts allocated to programs specified in the bill are completely unprecedented. The Congressional Budget Office reached the same conclusion when it determined that DOE would only be able to spend 24 percent of its funding before the two-year deadline. The Energy Department simply does not have time to gear up and properly spend so much money over so short a period.
So, will this level of funding become a new baseline for the department? If it does, we will have significantly expanded federal spending at a time of unprecedented federal deficits. If it does not become part of the baseline, that crashing sound you will hear will be the gears grinding back down as funding returns to normal. Such wild swings in funding are disruptive and one of the most ineffective ways to spend taxpayer dollars. 
The stimulus, by giving government agencies completely unprecedented amounts of money for non-existent programs, also sets forth near-perfect conditions for waste, fraud and abuse. 
Consider the $3.2 billion provided for block grant programs for energy efficiency.  The conference report provides $400 million for a competitive grant system that does not currently exist, and for which there is no administrative process. Making matters worse, it provides an additional $3.1 billion to state-run energy programs, but imposes conditions to receive funding that are currently met by only a handful of states.
Perhaps the most unprecedented amount is the $4.95 billion allocated to the Weatherization Assistance Program, which represents a nearly twentyfold increase from the past fiscal year. This is a good program, but the state government entities that administer it will face the same allocation problems. How do you ramp up to spend almost twenty times more money over the course of two years, only to have the money slow down to a trickle thereafter? 
The bill also allocated $4.5 billion for the smart grid program. Smart grid was authorized at $100 million in the 2007 energy bill, and has received zero funding to date. But the government has still not promulgated standards to establish an interoperability framework. Is it possible to expect that this program can spend $4.5 billion in two years in a rational way? 
One last example is the brand new $6 billion loan guarantee program available only for “commercial renewables and transmission.” We already have a loan guarantee program that we authorized in 2005 that is available for all clean-energy technologies, but has yet to issue a single loan guarantee despite billions in pending applications. We should have focused on making the existing program work rather than allocating billions more to a start-from-scratch initiative.
The energy provisions within this bill crystallize the reasons why I opposed the passage of this package. Rather than work to reform the systems first, we are spending money - lots of money -in the hopes that it works. I don't think the public objects to their tax dollars being spent, but they want accountability. They want to know it will work. They want to know we have done our homework first.
Nearly every senator in this body supports the development of renewable resources and the more efficient use of energy. Likewise, almost all members realize that at this juncture the government must take action to stimulate demand and our staggered economy. 
The divide we saw on this bill was not a disagreement over the goals for our country. By and large, those goals are the same across party lines. Instead, it was a disagreement over how we can accomplish those goals as soon as possible, as safely as possible and at as little cost as possible. 
The stimulus bill simply did not chart the right course. At a time when every dollar counts, we went overboard – and by limiting our options throughout the process, we came away with a product that I simply can not vote for.
For further information, please contact Robert Dillon at 202.224.6977 or or Anne Johnson at 202.224.7875 or