How Recovery Works

Let's say President Obama signs a recovery plan that includes money to build a bridge...

Money goes to a bridge builder. He hires an accountant to handle the books, a company to handle payroll, and a lawyer to look over contracts. He buys concrete and tools from a local supplier. Finally, he hires dozens of construction workers to start the project.

Weeks later, a construction worker, back on the job, has a little extra cash. He starts grabbing breakfast from a local diner, brings his truck to a car wash, and takes his family to the movies.

Over time, with business growing again, the payroll company, the accounting firm, the law firm, the supplier, the diner, the car wash, and the movie theater all start hiring new employees. New jobs boost the economy, tax revenues grow, and the recovery continues.

Soon, the effects multiply. With more customers coming in, the cook at the diner feels ready to buy a new car; the car dealer, expecting a big month, hires painters to repaint the showroom, the painters go to the accountant to help with their growing income, and the accountant, now working late, winds up at the diner, eating the country fried steak made by the cook.

This one piece of the recovery plan started with a bridge project, but its effect rippled through the community and helped get the economy moving forward again.