The caller wanted to know why Latta would vote no on the bill when there was a sod company in his district that might have benefited by one of the provisions in the bill - to spend $20 million on sod for the National Mall.
Latta explained that the bill as a whole was bad and wouldn't do what was promised - but there's an even better answer that demonstrates the reason why conservatives don't support government spending as 'economic development.' However, given time constraints, Latta probably wouldn't have been able to give it.
Suppose, for instance, that the local sod company decided to go through all the headaches and red tape of doing business with the federal government and then actually got part of the contract for supplying the sod. The owner would have a single large order paid for with tax dollars.
Now, those tax dollars have to come from somewhere, so either the government borrows the money (increasing our debt and subtracting dollars from future projects in order to meet the interest payments) or it taxes us more in order to raise the funds. It could also print up more bills, leading to inflation.
Regardless, the government 'takes' (in one form or another) the money from us. That means that none of us have the funds to replace our own sod. The local company has the single order which probably won't be duplicated. Potential customers in this area are left with less funds so they won't be ordering from him. Government - in spending this way - creates the appearance of economic growth, but no growth has actually occurred.
Now, if the government gave every taxpayer (not every citizen, but everyone who actually pays taxes) a reduction in their tax rates, every taxpayer would have more money. Those taxpayers would then either spend it, invest it or save it. If they spend it, they generate the activity that leads to economic growth, creating a demand for products and services. If they invest it, it provides the equity and funds for companies to do capital projects, like upgrading equipment or facilities. Again, that generates the activity that then leads to economic growth. If they save it, the bank they use has higher assets and can loan more.
And the local sod company would have many potential clients with more disposable income to provide a long-term customer base for their own growth.
And all of this would happen without government spending a dime - all government would have done is change a policy.
So which is the best way to 'stimulate' the economy?
I'd say the tax cuts, but then we're dealing with a Speaker of the House who believes that food stamp handouts "bring a bigger return than the tax cuts." No wonder the stimulus bill passed.
Of course, I'm reminded of the quote from President Ronald Reagan who said:
"The trouble with our liberal friends is not that they're ignorant: It's just that they know so much that isn't so."