The Royalists Make Their Move February 8, 2009Posted by Dwight Furrow in Current Events, Dwight Furrow's Posts.
So the House passed an $800 Billion stimulus package with no Republican votes. The Democratically controlled Senate proposed a $900 Billion package, but can’t pass it because Senate rules allow the minority party to prevent a vote. So a group of conservative Democrats and Northeastern Republicans (so-called centrists) got together and hacked roughly 100 Billion out of the Senate proposal and proudly announced that their sober, responsible negotiations have produced a deal with enough Republican support to barely pass.
So what was gained and lost? The Senate bill was larger than the House bill in large part because it included a modification of the Alternative Minimum Tax. But they produce this modification every year as part of the budget process. It has nothing to do with stimulating the economy and need not be part of this bill. The Tax Policy Institute claims that cutting the AMT tax increases the incomes of Americans in the top 20% by 1.3%, and the benefits drop off from there, doing nothing for Americans in the bottom 40%.
Did the fearless “centrist” negotiators eliminate the modification to the AMT? Why no. They eliminated 40 Billion dollars in aid to the states, $20 billion proposed for school construction; $8 billion to make federal buildings more energy efficient, 1 billion for early childhood education, and $2 billion devoted to expanding broadband data networks in rural and underserved areas.
It is beyond crazy to starve state government of much needed support. State revenues are plummeting and thousands of teachers, police and fire personnel, and state workers face furloughs and lay offs. Most economists agree that preventing state cutbacks is the quickest and most effective form of stimulus spending.
So to give the wealthy a few thousand dollars, we allow state governments to collapse, hastening the downward spiral of unemployment and reduced revenue that may land us in an economic depression. In this country, we can never improve the general welfare (let alone the worst off) without paying “Rents and Obligations” to the manor Lords. And like feudal Lords they need not provide coherent justification for their thievery. The leader of the Republicans said last week that state jobs are not real jobs. Why are we still listening to these people!
If the Senate bill passes, it will go to conference committee where the drama will center around whether the House conferees and/or Obama will exert sufficient pressure to reinstate this aid to the states. But modifications will be time consuming and Obama seems determined to make this happen quickly.
Update: Dumb mistakes corrected