The battle over who gets and who doesn’t from an economic stimulus package is now underway in the Senate as a coalition of labor, civil rights and other community organizations mobilized to prevent Congress from passing another corporate giveaway under the guise of stimulating the economy.

By mid-week the AFL-CIO and other organizations had organized activity in all 50 states, demanding that Congress enact a stimulus package that addressed the needs of working families.

The battle, where Democrats can command a 51-49 majority with the help of James Jeffords (I-Vt.), revolves around two pieces of legislation – a $100 billion package, nearly 90 percent of which is tax breaks for the rich and large corporations, and a $67 billion package crafted by the Democratic majority on the Senate Finance Committee. Bill Samuels, AFL-CIO legislative director, said the Senate legislation “goes far” in meeting the needs of the nation’s 7.7 million unemployed workers.

“It provides an additional 13 weeks of coverage and relaxes eligibility requirements and provides a 50 percent subsidy for health insurance under COBRA, as well as tax rebates for 50 million taxpayers who did not get the full amount earlier,” he said.

Samuels hastened to add that the AFL-CIO does not endorse the bill’s tax breaks for corporations or the rich. William McNary, president of Citizens Action, agreed that the proposal of the Finance Committee was light years ahead of the House-passed measure.

“But let’s be clear – it’s not enough and that’s why we are rallying people to take the battle for passage of a stimulus package that stimulates to the streets.” He said the nationwide activity on Nov. 13 was the start of that campaign. (See Connecticut story, page 8.)

“It seems as though people in Washington, D.C. have lost their way. Now we have to remind them to put first things first,” which, McNary said, begins with providing for those who have lost their jobs and others who will lose them.

“We need a long-range program to provide the security needs of the country, be it airport security, Social Security or a prescription drug program under Medicare.”

Christian Weller, an economist at the Economic Policy Institute, dismissed the GOP proposal. “Neither tax breaks for the rich nor accelerated write-off of the cost of new plant and equipment will do much to get the economy rolling again,” he told the World.

“Any stimulus worth the name has to get money into the hands of those who will spend it. No one needs money more – or will spend it faster – than people who have lost their jobs.”

The distorted priorities of the GOP package become apparent in a side-by-side comparison with the Senate Finance Committee proposal.

According to the Senate Joint Economic Committee, the House bill provides $1 billion to bolster unemployment insurance at the state level and another billion dollars to help unemployed workers pay the cost of maintaining employer-paid health-care benefits. The same analysis says the Senate Finance Committee legislation allocates $16 billion to meet the problems of the unemployed.

Although the AFL-CIO has not endorsed any legislation, it outlined its demands in a “Blueprint for Economic Recovery” early last month. The Blueprint calls for increased unemployment benefits covering more unemployed workers for a longer period of time and federal assistance to help laid-off workers maintain their health benefits.

It also calls for tax rebates for low- and moderate-income families, increasing the minimum wage and requiring that federal contractors pay a living wage and for a boost in aid to state and local governments faced with declining revenues that threaten cuts in essential services, such as food stamps, federal housing assistance, child care subsidies and low-income energy assistance.

Both the Economic Policy Institute and the Congressional Progressive Caucus have developed tax and spending proposals to meet the nation’s needs as the economic situation continues its year-and-a-half downhill slide.

The Progressive Caucus measure differs from other proposals in two important aspects: (1) It would spend $200 billion in its first year, large enough to give a jolt to mass consumption and thus, to jobs creation, and (2) its tax cuts are targeted to those with low and medium incomes.

It would postpone tax breaks to the rich that will come into effect in the next few years. A briefing paper prepared by the caucus says these cuts are fair because the rich benefited the most from the “boom” of the late 1990s.

An article in The New York Times says corporate lobbyists played a prominent role in shaping both stimulus proposals, invoking “patriotism” to justify their thievery. The list of outrages is endless but one stands out: Investment banking firms near the devastated World Trade Center are on tap to receive $4,800 for every employee, using a tax credit originally designed to defray the cost of training former welfare workers and the disabled.

Joelle Fishman, chair of the Communist Party’s Political Action Commission, said the program, put forward by the AFL-CIO and the Congressional Progressive Caucus “represents true patriotism.”

Congress must not be permitted “to bankroll the obscene wealth of giant corporations at the expense of the unemployed,” she told the World. “Only a huge public outcry can change this course.”


Fred Gaboury
Fred Gaboury

Fred Gaboury was a member of the Editorial Board of the print edition of  People’s Weekly World/Nuestro Mundo and wrote frequently on economic, labor and political issues. Gaboury died in 2004. Here is a small selection of Fred’s significant writings: Eight days in May Birmingham and the struggle for civil rights; Remembering the Rev. James Orange; Memphis 1968: We remember; June 19, 1953: The murder of the Rosenbergs; World Bank and International Monetary Fund strangle economies of Third World countries