What Happened to the Stimulus?

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But the sheer complexity of the stimulus measure makes it difficult to bird-dog. Though the Recovery Act was a single piece of legislation, it included thousands of funding streams for tens of thousands of projects. About $144 billion is allocated directly into state coffers for continuing existing programs that have been heavily burdened by the recession, like Medicaid. Hundreds of billions more have been set aside for tax cuts and continuing benefits to the poor and unemployed. The most visible part of the program, and the most politically explosive, is the roughly $152 billion for infrastructure investment, for which no one had a road map. In some cases, states and localities could spend those funds pretty much any way they liked. And that's where Biden's bloodhounds have been sniffing around.

Some silly projects are sure to be built. In Long Beach, Calif., local and state officials bucked the orders from Washington. The city council unanimously approved a $620,000 skateboard-park renovation in a rough neighborhood, half-pipe and all. "It's an incredible opportunity," says local councilman Robert Garcia. "This is near and dear to my heart," noted California Senator Barbara Boxer on the Senate floor. Biden's staff has battled to kill the project behind the scenes, and the outcome is still unclear. Meanwhile, on other requests, Republicans quibbled with Biden's definition of prudent. Some $3.4 million will be spent on a Florida wildlife crossing at a highway with one of the highest rates of turtle mortality in the world. "Why did the turtle cross the road?" Oklahoma Senator Tom Coburn, a leading Republican critic of the stimulus, teased in his report on the spending. "To get to the other side of a stimulus project." (See the top 10 unfortunate political one-liners.)

What really haunts the White House is the fear that much of the money might be spent less efficiently than it could have been. For example, studies have shown that more jobs are created when cities and states repair existing roads than when they build new ones. Highway-maintenance projects not only put more people to work more quickly than building new roads does but also keep costs down in the future. But according to one recent study by a nonprofit smart-growth advocacy group, roughly 31% of the state-certified first-round transportation funding in one $27 billion highway fund will go not to maintaining existing roads but to building new highways or adding lanes to old ones. Kentucky, where 38% of roads are in poor condition, is spending 88% of its stimulus money on new additions. Then there is the sheer scale of the challenge. In many of these same states, the biggest concern is not the type of stimulus spending but the amount of it. "Of course it's not creating enough jobs," Senator Sherrod Brown, an Ohio Democrat, says of the stimulus. "We're not going to have enough [jobs] because we lost so many." (See 10 perfect jobs for the recession -- and after.)

Hanging over all these concerns is the prospect that a second stimulus bill may be needed to bail out states in late 2010 or 2011. State budgets have been drowning in red ink as jobless claims and Medicaid bills have skyrocketed; few expect those trends to ease soon. In June, White House counselor David Axelrod left open the possibility that a second stimulus may be needed. The White House is confronted with the prospect of having to ask for more money early next year — even as a group of voters is ready to dump the first stimulus right now.

That helps explain why managing the stimulus story has become a full-time White House preoccupation. On a typical day recently, Treasury Secretary Timothy Geithner appeared in the Bronx to announce $90 million in inner-city financing; Michelle Obama revealed $851 million in new health-center grants; and the President, in the Grand Foyer, hailed stimulus jobs "building wind turbines and solar panels." Biden announced plans to fly to Pennsylvania, where he will "highlight Recovery Act broadband investments," while other agencies rolled out press releases regarding new dump-truck engines in Montana, North Dakota school grants and diesel tractors in Utah. (See pictures of Michelle Obama behind the scenes.)

Meanwhile, behind the scenes, Biden has ordered his staff to return any call or e-mail from states and localities seeking guidance within 24 hours. "It's so important you make sure — don't get mad at me — that there are no water parks, golf courses or anything that doesn't pass not only the test of the law but the smell test," Biden tells the mayors during the conference call. "Because we've got to do this thing really well."

—With reporting by Sophia Yan

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