Pace of new stimulus spending slows

WASHINGTON -- The government handed out stimulus money far more slowly this summer than it had in the first weeks after the massive economic recovery plan started, even though President Obama and other members of his administration had vowed to hasten that aid.

Facing criticism from some economists that the stimulus was not moving quickly enough, Obama told his Cabinet in June that he was "not satisfied" with the speed with the government distributing more than $500 billion, and that his administration was "in a position to really accelerate."

But in the months that followed, even though more construction projects began, the pace of new spending dropped.

In the 101 days after Obama signed the stimulus package in mid-February, the government allocated an average of more than $1.3 billion a day to new grants and projects. Since then, that pace has fallen to an average of about $1 billion a day, a drop of about 25%, according to federal agencies' financial reports, current through Sept. 4.

The Obama administration said last week that if tax cuts are included, the amount of stimulus aid reaching the economy increased slightly during the summer. And Obama's Council of Economic Advisers estimated that the stimulus had saved or created more than 1 million jobs, significantly more than the target Obama set in June.

White House spokeswoman Liz Oxhorn said examining only spending cannot measure whether the White House met the president's target. Doing so, she said, is "selective accounting" that "fails to measure the actual progress" of the stimulus. The administration, she said, has "met and exceeded every goal set to speed up the Recovery Act."

Economists said some spending slowdown was inevitable. Many of the government's first stimulus payments went in huge sums to states to help them pay for schools and medical care for the needy. Increasingly, stimulus efforts have shifted to tens of thousands of grants and building projects.

"Those takes longer. You have to monitor the projects, you have to get them going," said Donald Marron, an economic adviser to former president George W. Bush.