Since September 11th, we have learned a lot about the courage, generosity and resilience of the American people. Unfortunately, monumental tragedy can bring out the worst in people as well. For example, there is the shameless greed of American corporations that have taken advantage of this tragedy to stuff their pockets with everything they can get their hands on while most Americans are distracted by grief, anger and anxiety.
Abraham Lincoln, our first Republican president, said, "Worse than traitors in arms are the men who pretend loyalty to the flag, [but] feast and fatten on the misfortunes of the nation." It's a pity that today's Republicans reject Lincoln's values and rush to fill the war profiteer's wish list of tax breaks and rebates. Shamefully, they wrap this gift to their largest campaign contributors in the flag in the hopes of stifling opposition.
There are two monumentally outrageous provisions in the Republican stimulus proposals. One little mentioned provision allows U.S. banks and moneylenders to avoid paying taxes by shifting their profits to off-shore subsidiaries as long as they never invest the money in the United States. It's obvious that this tax break has nothing to do with economic stimulus and everything to do with rewarding the people who fund their campaigns. Forcing economic investment outside the United States isn't economic stimulus; it's economic sabotage.
The repeal of the Alternative Minimum Tax (AMT) is a huge tax giveaway. The AMT is a failsafe tax levied on companies that make a profit, but through a combination of tax breaks and incentives, would pay little or no corporate income tax. The AMT was passed in 1986 in response to public outrage that many of America's most profitable corporations paid nothing in taxes. For example, in 1998 GE made 9.6 billion in profits and with the AMT their tax rate was 8%. Without the AMT, their tax rate would have been 2.3%. Most of us pay a higher rate than 8%, but even that much is too much for GE. The House Stimulus bill and the Senate Republican stimulus package both repeal the AMT. Worse, they refund every penny corporations have paid in the last 15 years.
So, what about the recession? It's clear that the recession that began in early 2001 has only worsened since September 11th. More American workers were laid off in October than in any other month in the last 21 years. Nearly 1 million people have been laid off this year and with the recession deepening, their hope of finding work is dim. The American public supports extending unemployment benefits to laid off workers — and Republicans are putting a small unemployment extension into their bill as politically expedient gift wrap covering their much larger Christmas present for America's richest corporations.
Unhappy about doing even that much for the unemployed, House Republican leader, Dick Armey, said that extending unemployment benefits was "not commensurate with the American spirit." The stimulus packages reflect their sense of the American spirit. Only 17% of the economic stimulus package benefits the bottom four-fifths of Americans - the fiscal equivalent of a lump of coal in our stockings.
There is an alternative. The Senate Finance Committee proposal extends unemployment benefits for 13 weeks, adds coverage for part-time and temporary workers, provides subsidies of 75% of laid off worker's COBRA health insurance premiums and gives states temporary additional funds for Medicaid. Without this last provision, states will be hard pressed to deal with the increased demand for Medicaid while tax revenues fall thanks to the recession.
The House has already passed the shameless profiteering stimulus package. The Senate must stop it. Let's hope that Senators Wyden and Smith will do the right thing: they must support real economic stimulus by supporting the Senate Finance Committee plan and oppose the House and Senate Republican plans.
RuthAlice Anderson
President, Oregon Action