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Economic stimulus package affects Oakland

Helena Guan

The 2009 economic stimulus package, passed and signed by President Obama on Jan. 28, sparked a discussion about how it will affect Oakland, and Mills College students in particular.

The American Recovery and Readjustment Act is an $819 billion stimulus plan that will use government spending and tax measures to support the economy during the recession, according to a Jan. 28 New York Times article.

Government professor Martha Johnson said the economic crisis is going to be long-term so the U.S. needs more than a quick fix.

“This crisis with the U.S. economy stems from major consumption and no savings, along with high levels of inequality that have been rising,” she said.

Julia Sudbury, an ethnic studies professor, said, “This package should be used to give a boost to the Oakland community.”

“This bill will hopefully support scholarly research at Mills towards promoting national science grants that target a specific focus, and promote more Pell Grants,” she added.

According to CNN Money, the plan provides a $15.6 billion increase to the Pell Grant program, which helps the lowest-income students attend college. This means an extra 800,000 students will qualify for Pell funding.

The stimulus also offers $15 billion for scientific research, and increased funding for National Institutes of Health in university research facilities.

Sudbury said, “Mills College, being a part of the East Oakland community, [has] been massively affected with unemployment and [the] mortgage crises.”

The Bureau of Labor Statistics reported that in December 2008, the San Francisco-Oakland-Fremont area had an unemployment rate of seven percent, the highest jobless rate since June 1983.

Sudbury believes that by creating jobs in East Oakland, “it will help so our community members have enough money to send more students to Mills.”

Sophomore Simone Wilson, who is a psychology and economics double major, has hopes and doubts about using big spending to help the economy.

She said that the largest part of the gross domestic product is consumption, so she hopes the huge package will help people purchase more things.

“We would need people to consume, consume, consume to save the economy,” Wilson said.

However, Wilson questions how effective this package will be based on what happened with the last package.

The January 2008 stimulus plan, worth over $150 billion, offered federal rebates or stipends as a quick relief to homeowners losing their home, according to a Jan 24. 2008 New York Times.

“I just feel that people only saved it for short-term things to pay off debts, instead of long-term goals,” Wilson said.

Katie Mamlok, the night manager of the Tea Shop, did not reap the benefits from the previous stimulus package since she was a dependent and thus ineligible for a check.

Mamlok hopes to receive some of the stimulus package money this time around, however, she will do what Wilson had feared most people would do.

“If I do get some finances, then it’s gonna go straight to a savings account,” she said.

Junior Jennifer Stoney said she believes that state and local budgeting would decrease federal tax breaks.

According to a Feb. 28 Los Angeles Times article, some of the stimulus package’s positive effects on the California budget will be lost because the state has raised taxes by $12.5 billion in order to pay debts from a $41 billion budget deficit.

Kelly Alonzo, a worker for Café Suzie’s, felt more optimistic about the stimulus package and getting more money. “I just think every little bit counts in helping us,” he said.”Obama’s the man,” he added. “He’ll save us; it just might take a while.”