Business

Five job-killing stimulus projects

Republican Sens. Tom Coburn of Oklahoma and John McCain of Arizona issued a report in early August highlighting about 100 examples of wasteful spending in the $862 billion — the cost as tallied in the senators’ Summertime Blues report — 2009 American Recovery and Reinvestment Act. The Daily Caller has put together its own list of five job-killing stimulus projects, below.

According to the senators’ report, 18 months after its passage, the stimulus has contributed to a 23 percent increase in the national debt (now at a record $13.2 trillion), and while President Obama told the American people that such a vast injection of cash would assist economic recovery, the result has been far different. Coburn and McCain’s report revealed a wealth of foolish projects, including half a million dollars to replace windows at an already-shuttered visitor center at Mount St. Helens, $71,623 to study the effects of cocaine on monkeys and $2 million to photograph ants in the Southwest Indian Ocean and East Africa.

“We owe it to every American to rebuild our economy without doing additional harm and in a manner that expands opportunities for future generations of Americans,” Coburn and McCain wrote. “Job creation should be a national priority, but torrential, misdirected government spending is not the way to do it.”

TheDC has come upon a number of additional examples of stimulus projects which have directly and tangibly harmed area businesses. Here are five examples of entrepreneurial harm:

1. Highway 66 in Sevierville, Tenn.

In Sevierville, Tenn., at a cost of more than $38 million, construction on a four-mile stretch of Highway 66 has significantly reduced the amount of traffic to area businesses. Local enterprises that prospered a year ago are now under severe strain due the impediments the stimulus construction on the road has inflicted.

Larry Bower, manager at Buddy’s Bar-B-Q told TheDC that business has dropped off precipitously since construction began in October. Business has declined to such an extent that he has had to halve his staff, going from an average of 26 employees to 12. “Supposedly this project will be done in November of next year,” Bower said. “If only they could get this danged road finished my business might survive.”

A Zaxby’s restaurant on the highway has been hit hard. “We have lost 40 to 50 percent of the business we had been doing historically,” owner Fred Ware told TheDC. “We did not hire as many for the summer season and we’ve been having to get creative to keep people on … I doubt it will be done by November of next year. They haven’t even started on the bridge which will take a year, year and a half.”

Rick Arnold, owner and manager of Jersey Mike’s on the same highway told TheDC that he has lost upward of 50 percent of his business, had to cut staff hours and now must close on Sundays. “I’ve tried to contact some of my congresspeople,” he said. “This is not how the stimulus was supposed to work. It is literally driving our businesses into the ground.”
2. Lake Avenue to Burden Avenue streetscaping in Wisconsin

In Wisconsin, the federal government has spent nearly $1 million in stimulus funds to reconstruct a major traffic artery from Lake Avenue to Burden Avenue. The construction has hurt shops in the area which depend on foot traffic to generate business.

Jane Bodi, owner of Bodi’s Bake Shop told TheDC that since the project began she has lost a third of her business, has been forced to cut staff hours and could not hire summer staff. “I still have five employees but I couldn’t hire any of the high school and college girls looking for summertime work,” Bodi said. “Supposedly they are going to finish around November 1, but we’ll see.”

Joseph Donile, owner of J. Croz tavern, told the Kenosha News that the construction could put him entirely out of business.“I don’t know if I’m going to make it until October and I’ve been in business for 26 years,” Donile said. “I’m contemplating whether or not to eliminate the night shift. My nights are down to nothing.” An employee at J. Croz told TheDC that since construction started “business has absolutely just been going downhill.”

3. Zion National Park, Utah

In Utah, the government has spent $6 million in stimulus money to renovate a road at the eastern end of Zion National Park connecting Highways 9 and 89. The road construction has impeded traffic around the park.

Paul Bingham, founder and president of the Thunderbird Foundation for the Arts, told TheDC that since construction started, the number of customers to his gallery and tour post has dropped from 10 to 20 a day to one or two in the last week. “You don’t want to ask me about the project,” Bingham said, “I’ll just start cursing.” According to Bingham, the future is not bright for the Thunderbird.

Terry Grifiths, owner of Terry Food and Drug, the largest grocer in the area, told TheDC that despite being 18 miles away, when the project first started he lost $1,500 to $2,000 a day. In recent weeks, since the entrance to the park has been opening more frequently, his business is starting to pick back up.

4. Ming Avenue and Coffee Road construction, California

Road construction in Bakersfield, Calif., between Ming Avenue and Coffee Road created similar problems for area businesses. Regina Payne told TheDC that the diverted traffic due to the construction hit her Chevron station hard. “My numbers between all of June and July were tremendously lower than any other month. People were just taking different routes and it has really hurt,” she said.

The outlook was better for other area outlets. While employees at establishments such as Daddyo’s ice cream parlor complained to TheDC about their inability to get home easily due to the construction, other businesses such as Cafe Crepes said that their business was not harshly affected by the construction.
5. Sandusky Avenue Road construction, Ohio

Former Struble Drugs owner Bob Blankenship told TheDC that the downtown area of Bucyrus had seen a large drop-off in traffic as money from the stimulus went to widen Sandusky Avenue. He said area businesses had felt the pinch of limited access, as Routes 19, 100, 4 and 98 all funneled into that main thoroughfare.

Etter’s Flowers has felt the harm first-hand. Owner Judy Etter told TheDC that since construction began more than a year ago, business has decreased substantially. “Business is not good, it is really just hurting everyone in town,” she said. “We were shut down most of last and this year. … We’ll be mighty lucky if they finish it by October because they forgot to order a lot of things, there aren’t any traffic lights for goodness sake.”

Doug Godwin, owner Midwest Furniture told TheDC that he has worked hard to avoid a large decrease in his business by renting our parking places behind his shop. He said he had to do a lot of planning to keep his business on track.“I have a sign in front of my store that says, ‘We are not participating in this recession,’” he said. “But a lot of other businesses in the area are really hurting from this road construction.”

“These examples show just how poorly conceived and executed some stimulus projects have been,” Coburn wrote in an email to TheDC about the list. “Many projects are not failing to create jobs but are harming existing jobs. The best stimulus program the government could do right now is reduce our debt burden and keep tax rates low so businesses and entrepreneurs can plan, invest and hire.”

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