Misuse of stimulus funds by states

From USA Today July 8, 2009
“WASHINGTON — Under pressure to spend stimulus money quickly, many states are using the federal funds for short-term projects and to fill budget gaps rather than spending on long-term improvements, according to a report by congressional investigators.

The report, scheduled to be released Tuesday by the Government Accountability Office (GAO) at a House oversight hearing, also says many states aren’t meeting some goals and requirements of the economic recovery program. Some states, for example, are not sending transportation funding to the most economically distressed areas, and they are using education funds to prevent layoffs rather than fund innovative new programs, the report says.”

The power of the public employee unions is pervasive. While private sector workers continue to lose jobs, health care and pensions, the public workers can rely on state governments to raise taxes and fees and to misuse stimulus funds.


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