Watchdog website critiques "Assistance for American Corps. Act"

Press Release
For Immediate Release - November 8, 2001
Contact: Betsy Leondar-Wright
(617) 423-2148 x113

"How would YOU spend $100 billion?"

Recovery Watchdog website critiques "Assistance for American Corporations Act"

Neither the $67 billion Senate Finance Committee bill released today nor the $100 billion House version would be as effective in stimulating economic recovery as the alternatives in United for a Fair Economy’s new website,

"At this time of national crisis, we don’t have the time or money to waste throwing bones to corporate campaign donors. Perhaps a better name for the Senate bill would be the ”˜Assistance for American Corporations Act’," says Chris Hartman, Research Director of United for a Fair Economy. "It spends more on business tax breaks than on any single real stimulus measure. All its relief measures for workers and individual taxpayers are too small to be effective."

For example, the 13-week extension of unemployment benefits would likely run out long before the recession is over. While some of the extremist measures in the House bill are thankfully missing from the Senate bill (such as the Alternative Minimum Tax repeal and capital gains tax cut), others remain, including a smaller expansion of depreciation allowances. The tax breaks for investment in lower Manhattan would do little besides line Wall Street pockets. Over $23 billion of the bill’s $67 billion 2002 price tag goes to corporate welfare. The full Senate is expected to vote on the bill next week.

Members of UFE’s Responsible Wealth (RW) project, who are in the top 5% of wealth or income, have doubts about the investment incentives in the Senate bill. "The sponsors of these bills are either naí¯ve about how business incentives work or just captive to cynical, self-serving special interests," said Amy Domini, founder of the $1.1 billion Domini Social Equity mutual fund. "Accelerated depreciation and operating loss carrybacks won't do anything to boost consumer demand for everyday items like sofas, storm windows, and snow blowers. Getting money into consumers' hands fast is the only way to create jobs and lead us out of recession."

UFE’s website asks taxpayers to submit comments on how they would allocate $100 billion, the cost of the House bill. The website will be one-stop-shopping for analysis of all proposed industry bailouts and economic recovery bills in terms of their effects on consumers, workers, and taxpayers. The alternatives on the site include an original proposal for a better airline bailout bill based on distributing travel vouchers to American households. United for a Fair Economy is a national organization based in Boston that spotlights growing economic inequality.