While President Obama used Caterpillar to promote the $787 billion stimulus plan, the world’s biggest construction equipment maker isn’t too pleased with the results.
Caterpillar CEO Jim Owens says the plan compares unfavorably to China’s $587 billion stimulus package.
“Their [China’s] stimulus package, as you might know, is probably one of the largest in the world, next to the U.S. in absolute dollar terms,” he said in the company’s conference call on earnings.
“And actually, theirs was much more focused on hard infrastructure.”
China, an economy one-third as big as the United States, allocates more than three times as much money to infrastructure than the United States, Caterpillar officials say.
Owens is particularly impressed with China’s speed.
“When they say shovel ready, they mean nine weeks, not nine months or a year, and we are seeing a significant pickup.”
Obama visited Caterpillar’s Peoria headquarters Feb. 12, the last day of his campaign to pressure Congress to approve the stimulus. Owens is a member of the president’s Economic Recovery Advisory Board
Still, Caterpillar is disappointed with the package. Company officials say that while spending on infrastructure will increase, the total impact on construction spending will be limited.
Caterpillar isn’t alone in criticizing the U.S. stimulus package for inadequate spending on infrastructure.
Experts ranging from liberal economist Paul Krugman to conservative publisher Steve Forbes have registered the same complaint.
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