Newspaper article The Christian Science Monitor

Stimulus Package: Needed Kick or Corporate Giveaway? ; Congress Gets Down to Details on Reviving the Economy - and Critics See Lots of Pork

Newspaper article The Christian Science Monitor

Stimulus Package: Needed Kick or Corporate Giveaway? ; Congress Gets Down to Details on Reviving the Economy - and Critics See Lots of Pork

Article excerpt

Coming soon to the school lunch trays of America: More asparagus, spinach, bison meat, peas, cabbage, cauliflower, cucumbers, cranberries, pumpkins, prunes, and sour cherries. (Message to parents: Pack lunch.)

That's if a bill to be debated on the Senate floor today becomes law. The cafeteria creativity is just one sign of how congressional measures ostensibly aimed at economic revival will also mean massive windfalls for specific industries and companies.

From $1 billion in tax rebates for global corporations to school- lunch subsidies for crops that are having bad years, businesses have clamored for a stunning range of subsidies and bailouts in a stimulus package that could add up to more than $100 billion in new spending.

The fact that companies, as well as taxpayers and consumers, stand to benefit from so-called fiscal stimulus measures is not surprising. Both parties agreed early on to assist certain hard-hit industries, and even the more controversial handouts could help the economy even as they aid favored firms.

But some critics say the process has run amok, as bipartisanship has given way to a special-interest free-for-all.

"We've been subjected to a rather disgusting tendency to try to shoehorn every deferred special-interest proposal into current legislation on the grounds that it will promote current recovery or fight terrorism," says Henry Aaron, a senior fellow at the Brookings Institution here.

War profiteers?

The shape of the final package is unclear, with the Senate plan still taking shape. But the fight over who gets help is prompting charges of war profiteering from public-interest groups. It's also redrawing partisan lines that had been kept largely under wraps since President Bush declared a war on terrorism.

After uniting to pass billions in aid for rebuilding Manhattan and bolstering ailing airlines, lawmakers early on approached something like consensus on the terms of the stimulus package.

At the urging of Federal Reserve Chairman Alan Greenspan, budget- committee chairmen and ranking members in both houses agreed that any stimulus plan should be short term - no more than 12 to 18 months - and focus on getting more spending into the economy as soon as possible.

But then, the wheels started coming off the bipartisan cart. House Republicans pulled out of discussions with Democrats and pushed their own stimulus plan through on a near party-line vote. That bill was heavily loaded with tax cuts for business, including:

* A $25 billion repeal of the corporate alternative-minimum tax, plus a refund of all payments since the law was passed in 1986.

* A $21 billion extension of a tax provision that allows US companies to avoid taxes on profits from overseas operations.

* $39 billion in tax breaks for business to write off new investment at a faster rate, especially for computers and technology. …

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