So let me get this straight: we have this little problem here where a bunch of people borrowed money to buy houses and lifestyles that they couldn't afford and the resulting debt has choked up our financial system. Now it seems like a good solution for the government to borrow a whole bunch more money and spend it on things that we may or may not need? We won't have any of those nasty earmarks; instead, we'll just hand billions of dollars over to state and local governments to spend how they want. Yeah that sounds like a good idea, that way in five years the contractors and construction companies that benefit from this largess can replace investment bankers as the new national whipping boys.
The main problem the simulus is trying to avoid is capital destruction. At some point, if enough people get laid off, it becomes a self-reinforcing cycle. Now, instead of a few people being laid off for a couple of months, companies start to shut down operations for good because there is reduced demand (Google Austin, anyone?). Once you shut down an office (or factory, or mall, or whatever), it can take years before anything pops up to replace it.
There really is no benefit to having a bunch of unemployed people lying around.
I think it is fair to argue about the best way for the government to stimulate the economy, but doing nothing is not really an option.
