Economist Disappointed With Stimulus Plan

By Justin Duckham-Talk Radio News Service

The recession may be coming to a close, but according to Barry Bosworth, the Senior Fellow in the Brooking Institution's Economic Studies Program, the stimulus plan may not be responsible. In Bosworth's judgement, the $787 billion measure to jumpstart the U.S. economy has been a disappointment.

"The problem with the stimulus program has been that it has taken too long to get it going. The crisis hit in mid September [of 2008], Congress never acted until the Spring, and then it takes a couple of months for the government agencies to get it set up," said Bosworth during a panel discussion at the Brookings Institute Thursday.

However, Bosworth added, the stimulus plan can still prove useful.

"Most of the money is going to be spent in the future. It is going to be a big plus in driving us out of the recession," Bosworth said. "Don't give up on it, but what's really disappointing is that recession after recession the same thing happens: we can not get the political process to act fast enough."

Bosworth criticized provisions of the stimulus that were not intended for immediate economic relief, claiming that individual interest groups had capitalized on the crisis to push unrelated agendas.

Arlington County (Va.) Board member Christopher Zimmerman, who joined Bosworth on the panel, disagreed with Bosworth's assertion. Zimmerman responded that while not all of the aspects of the stimulus plan provided an instant boost to the economy, many will provide long term benefits.

"All that stuff that's being done that may not be great for stimulus are things that we actually need in this country to generate the economy that will take care of things like deficits and other expenditures we need to make in the future," Zimmerman said.

Chilean President Touts Chile’s Successful Economic Policies

By Celia Canon - Talk Radio News Service

During an address on Latin America and the economic crisis at the Brookings Institute yesterday, Chilean President Michelle Bachelet discussed her country's comparatively strong economy, explaining that the 1980’s economic crisis in Latin America taught the region to take measures to insulate itself from global financial crises.

“This time in Latin America, fundamental [institutions] were better and policy responses were swift,” Bachelet said. "Central banks move quickly to offset the lack of liquidity in dollars using either sovereign funds or international reserves accumulated during the commodity boom earlier this decade.”

Chile's current financial stability is largely due to the fact that it has moved away from American policies in recent years, eschewing the Washington Consensus, a set of American recommendations to Latin American states on how to rebuild their economies in 1989. The recommendations focused on maintaining a free market economy with little to no government involvement.

“This approach of no regulation is an approach that we have come to call in Chile the 'Paradigm of Passivity,' " Bachelet said. "The crisis has taught us what we should have known all along: that the state is not and cannot be passive when it comes to economic activity or financial regulation."

The Chilean president added: “When I talk about not being passive, I’m not talking necessarily about [an] interventionist state. I’m not calling for a government involved in all sectors of the economy or prone to over-regulating markets.”

Bachelet also compared Western states and Chile with regard to the policies implemented to reduce the impact of the global financial crisis.

“Unlike the U.S. and much of Europe, in 2009, tax payers have not have to pay the burden of bailing out” national companies, said Bachelet.

Additionally, the Chilean government has produced its own stimulus package, which aims to maintain the population’s purchasing power, rather than bail out industries.

“This [stimulus] package was designed to inject resources directly into the pockets of the most deprived families to promote employment by increasing public investment, and by granting subsidies to youth employment and to encourage private investment with temporary tax rebates,” Bachelet said.

Bachelet, a moderate socialist, is currently in Washington, D.C. to meet with President Barack Obama in hopes of increasing bilateral ties and improving trade partnerships. During her speech, she was quick to empathize with the Americans, echoing Obama's frequent calls for an economic restructuring to lead to “lasting prosperity."

States should not “go back to the same situation that we were in before, because that would mean we haven't learned the lessons of the crisis,” Bachelet said.

Pelosi Cautious On Climate Meeting With China

By Celia Canon- Talk Radio News Service

U.S Speaker of the House Nancy Pelosi was reserved in her choice of words today at the Brookings Institution as she reflected on her recent bipartisan trip to China to discuss the communist country’s climate efforts.

“This trip was very important for us because the U.S and China are the biggest emitters of gases and we have to come to terms in order for us to come to a multilateral agreement in Copehagen.” said Pelosi

The U.S delegation made the May trip after an invitation from the Chinese government. The meeting may have also given the U.S an ally against the growing threat that North Korea poses since its alleged nuclear and missile tests.

Bruce Klingner, an analyst for the Heritage Foundation, said that the Obama administration is “trying to press China to be less obstructionist, to allow for a greater punitive measure against North Korean government agencies.”

Why this (the climate crisis) “is important is we see it as a national security issue to reduce our dependence on foreign oil. We see it as an economic issue to create clean energy jobs and to be competitive in our investments and our innovation and technology so that we can be the world leader,” Pelosi said.

Pelosi spoke about how the American delegation prepared for this trip, saying “We arrived in China, we knew what we were going there to do but of course with our message reinforced from what we had just seen (in Alaska) also equipped with a bill that had passed Congress on Thursday which was a historic, momentous legislation on how we would go forward.”

The House Speaker confirmed that China has already demonstrated efforts to take energy consumption and climate into consideration, as she said “The Chinese have done remarkable things... in terms of closing down coal plants that were inefficient, the investments in research and actual construction of buildings in different ways so they'd use less energy in their construction and on the ongoing.”

But Pelosi reported that, despite efforts towards for climate improvement on a certain level, the delegation was met with a certain resistance from their Chinese counterparts with regards to further resolutions.

“What they wanted to be clear to us is that as they were doing this and they were investing in the technologies and the rest... they were going to be developing still, sustainable development with more of an emphasis on the development side,” said Pelosi.

Every year, “600,000 die of pollution in China,” according to Pelosi.

North Korean Threat Not So Imminent?

By Celia Canon- Talk Radio News Service.

Analysts for the Brookings Institution gathered to assess the North Korean threat on America and its allies in reaction to N.Korea's recent underground nuclear bomb detonation and the launch of two short-range missiles.

The think tank was pressed into discussing the matter following North-Korea’s acceleration in its military activity.

Pyongyang had already caught the international community’s attention in October 2007 by unsuccessfully testing a nuclear weapon.

However the threat posed by the North Asian state has reached new heights after N.Korea announced that it had conducted underground nuclear tests on Monday, followed by two short-range missiles (a ground-to-ship missile and a ground-to-air missile) launched from an east-coast base on Tuesday.

Michael O’Hanlon, a Senior Fellow at the Brookings Institution warned that although “Their options are limited,” threats must be taken seriously, they must be mitigated.

Richard Bush, a Senior Fellow and Director for the Center for Northeast Asian Policy Studies, confirmed that “They have a problem though, and that is that deterrence is not yet credible; their missiles don’t fly far enough and accurately enough, the weapons design is not yet perfect and so they need to test, that's the only way they can demonstrate to others that they have the capability to inflict harm on the United States and on Japan.”

If the production of the missiles is one leap closer to achieving significant nuclear capabilities, O’Hanlon explained that “The real issue is the size of the weapon and how deliverable it would be by the North Koreans, if they were to choose to deliver it some day.”

Additionally, “[The missile] has to survive the stresses of missile flight, which are no trivial,” said O’Hanlon.

However, according to the analysts, this does not mean that a threat is nonexistent but rather that the U.S should not be concerned by missiles coming from North Korea directly.

O’Hanlon said “I would say the most worrisome question is the sale of nuclear material because if they attack South Korea, their regime will end.”

O’Hanlon concluded that “The only thing they can plausibly get way with is the sale.”

Admiral Mullen: Our Future Is Guaranteed If We Take Care Of Our People

By Celia Canon- Talk Radio News Service

“Our future is guaranteed from a national standpoint If we take care of our people,” according to Admiral Michael Mullen, the Chairman of the Joint Chiefs of Staff.

This was one of the central points of Admiral Mullen’s talk on the “Future of Global Engagement” at the Brookings Institution today.

Afghani presidential elections coming up in August are forcing the U.S. military to draft a report on the effectiveness of the U.S.-led coalition in Afghanistan.

In addition, the law passed by Afghani President Hamid Karzai which prohibits a woman from refusing sexual intercourse with her husband may have signaled the need for yet more work and presence from the troops, implying the road is still long for the soldiers who are stationed there.

On his priorities, Mullen said, “The main effort right now is in Afghanistan. Increase the growth of the Army and the Marine Corps. But now those forces must be put together to rotate in the theater.”

Mullen added that because of the need for troops in different missions, “The numbers (of repeated deployments per soldier) we are getting right now are 3 and 4 but we’ve talked to families that are on their fifth and sixth deployment.”

“Even in our eighth year of war we’re in the beginning of getting at what I consider to be a debt that needs to be repaid for those sacrifices (by the troops), it’s for injuries seen but it’s also for injuries unseen,” said Mullen.

Mullen said that “what we should buy for their future is to make sure we get it right for our people, that’s health care, that’s housing, that's benefits, that's the compensation packages, that's the bonuses... that's where I spend an awful lot of my time with the services chief."