The main method Obama and many politicians seek to stimulate the economy is through deficit spending.
What is lost on those who engage this method is that for deficit spending to actually work, it has to be funneled into truly useful production, projects which will yield massive value. Without getting into the problems inherent in all deficit spending, some might make a case that government related spending may yield benefits. It's a stretch to say that the TVA or the Hoover Dam was best provisioned by the government. Fact is, private industry would have managed these projects much more efficiently.
But these are examples of the sort of project which could make the government look better than it does right now by spending massive amounts of money with little to show for it. I'm not saying I support these projects, just that better options exist than Obama's current path. He made a moderately good show by using some funds to try and build a train tunnel under the Hudson which would have saved me 15 minutes on my commute each day. That tunnel, however, was going to be built with limited oversight, meaning costs would've spiraled and New Jersey would have overspent on it, thus losing all the value it would provide.
More importantly, these types of projects are difficult to begin today. Why? Regulation. It would be virtually impossible to build the Tappan Zee Bridge today, and even the current upgrade of the facility has faced massive problems which have increased the cost dramatically. A study of the region around the Hoover Dam, with today's regulatory environment, would end up killing this sort of project altogether due to environmental concerns. My perspective is simply that the Left has hung themselves on their own petard. They want the government to spark job growth, but they want to regulate all sorts of things, not realizing they hamper job growth.
The Competitive Enterprise Institute has issued its annual report on the regulatory environment, outlining the economic costs of current Federal regulations. Today, these economic costs are greater than all corporate profits. In other words, one of the fastest and best ways for Obama to earn tax income to drive down the deficit would not to be raising taxes - but by reducing regulation. Of course, this would mean admitting his previous approach was incorrect and flawed.
