Thursday, January 29, 2009

Economic Recovery

Economic Recovery Act Needs:
More Infrastructure Spending
No Tax Cuts for Business

Despite President Obama’s efforts and the inclusion of specific measures designed to appeal to Republicans, not a single GOP House member voted for the Economic Recovery Act, popularly known as the stimulus bill, that passed in the House of Representatives by a vote of 244 to 188 yesterday. Just 12 Democrats voted against the bill, which authorized $607 billion in direct spending and $212 billion in various tax cuts over two years to stimulate the economy.

Democratic Socialists of America (DSA) has been gravely concerned about these politically motivated tax cuts, largely sweetheart deals for business that will benefit the very financial institutions whose high-flying speculation created the economic crisis in the first place. They are bad legislation, and certainly have no place in a stimulus bill.

We believe the federal government should minimally allocate:
$200 billion in block grants to state and local governments to make up for the annual loss in state and local revenue
$100 billion to pay for half of the increased Medicaid costs states will face
$100 billion to pay for COBRA coverage for laid-off workers and to allow people over 55 to buy into Medicare
$50 billion to increase unemployment insurance and expand eligibility. (Currently only one-third of unemployed workers receive unemployment insurance!)
$100 billion to increase Pell grants and expand the number of its recipients.
$450 billion to the Social Security Trust Fund so that workers would receive a one-year respite from paying the regressive FICA tax. Such a measure would radically stimulate consumer demand.

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