Coble votes against helping low and middle income America.

Mark Binker did the legwork, so I might as well just steal his blockquote. Follow the link for the whole thing.

Even though it was endorsed by a Republican president, along with Democratic and GOP leadership in the House, U.S. Rep. Howard Coble (R-NC) today voted against a $150 billion economic stimulus package calling it "deficit spending at its worst."

Congressman Coble stated that he voted against the legislation because it was "applying a Band-Aid to a problem that requires major surgery."...The stimulus plan passed the House by a vote of 385 to 35 with 1 present. The Senate is looking at different proposals for its own economic recovery plan, so the legislation still has additional hurdles to cross. Rep. Coble was the only member of the North Carolina congressional delegation to vote against the bill...

Hopefully Jay Ovittore will be able to make it on the evening news to tear Coble to shreds. He should mention that the bill means $1200 for hard-working middle class families and $300 for any and all children in ALL families. Talk about out of touch.

Where is stormbear, I sense a cartoon coming....

Comments

Bada-bing!!!!

One of the pitfalls of childhood is that one doesn't have to understand something to feel it. - Carlos Ruiz Zafon

Jesus Swept ticked me off. Too short. I loved the characters and then POOF it was over.
-me

...he's actually expecting the Spanish Inquisition.

...he still hasn't installed Microsoft Office because his computer's at home.

...he's still bitching about being forced to use only unleaded gas.

...when his doctor told him he needed to cut down on starch, he started showing up with wrinkled shirts.

:)

That stimulus package

I don't think it's an unvarnished good. Maybe Coble is politically dumb for rejecting it, but come on. What we need are tax cuts? That's so 2001.

The problem right now is the credit crunch, and the US government just borrowed $150 billion more out of the market.

I'd rather see that $150 billion spent on infrastructure.

Shhhhh.....

Republicans want to dump money on middle America, Coble is against it.

Wait until 2009 to start talking about Presidential policies that make sense.

One of the pitfalls of childhood is that one doesn't have to understand something to feel it. - Carlos Ruiz Zafon

Jesus Swept ticked me off. Too short. I loved the characters and then POOF it was over.
-me

Right, sorry...

Not sure what got into me...

I would have voted no as well.

I would be the first person to stand up and cash a free check from the government. Rebate checks will help middle-class and working families for one month, or even worse one bill gets paid. What then? What happens when the same problems will persist and the economy still fails?

I would not have voted no because of the rebate checks, it's the least the DC Elitist could do to pay back all those gross corporate profits or no bid contracts to their cronies.

My no vote would have stood against the added corporate welfare tacked into the bill, allowing corporations to write off 50% of their spending. My no vote would have stood up against the lack of added funding for programs like Medicaid, Food Stamps, Unemployment, etc..., which the Democratic Leadership failed to include at the Bush Administration's behest. My no vote would have stood up for those who need it most and won't qualify for a rebate. Those folks on Social Security benefits and Disability. Robert, would your grandmother have qualified?

I wrote on this issue almost a week ago at my campaign blog and Coble's comments after his vote seem to echo what I stood up and said to begin with. I can say that it is one of the very few times that I agree with my opponent. In my piece, I offer some solutions to the long term problem that will plague our country and will not go away until it is fixed. They aren't the only solutions by any means, but I didn't see my opponent offering up his "major surgery".

I am all for the middle class. It is what I fight for in all of my core issues and principals. I will not, however, rubber stamp the Democratic agenda. I will always do what I think is best for the people. It does not matter if your voter ID card has a D, an R, or says unaffiliated, my constituents are human beings and will be treated as such.

I have said in the past that I am not a typical DC elitist running for office, I am a blue collar worker who feels the same crunch as all of you. Free money is great, I agree. Pulling the wool over our eyes to hide a larger problem is down right wrong!

Jay Ovittore
Candidate- 6th Congressional District

“The will of the people is the only legitimate foundation of any government, and to protect its free expression should be our first object.” Thomas Jefferson

Jay Ovittore

“The will of the people is the only legitimate foundation of any government, and to protect its free expression should be our first object.” Thomas Jefferson

Good answer Jay!

Sorry Robert, I too have a problem with this band-aid when a tourniquet is required. I understand that the Senate will be adding more for Seniors and possibly lengthen unemployment benefit. But will that be the Bush "deal breaker"? Now that he has found his veto pen he really likes using it.

Today they lowered interest rates, another tweak.

Leaders in Eur/Asia are meeting to "discuss" the mess. What we are doing is affecting the global economy. Do you think they're going to just wait around and hope that the next President we elect isn't another village idiot?

No matter that patriotism is too often the refuge of scoundrels. Dissent, rebellion, and all-around hell-raising remain the true duty of patriots.

Progressive Discussions

Thanks MoMo

It was wonderful to meet all the BlueNCers that went down to Hamlet for the SEC. I appreciate the kind words above.

Jay Ovittore
Candidate- 6th Congressional District

“The will of the people is the only legitimate foundation of any government, and to protect its free expression should be our first object.” Thomas Jefferson

Jay Ovittore

“The will of the people is the only legitimate foundation of any government, and to protect its free expression should be our first object.” Thomas Jefferson

I had hoped that this "stimulus" deal would

include food stamp increases and extending unemployment payments but all we have is maybe a couple thousand bucks. Whoopee snot. Most folks will go out and buy some 54 inch tv made in China and sold by our buddies - Wal Mart.

Pelosi folds again and Reid is sure to follow. Do they have any vertebrae between them?

I would like to see 150 billion go to the beginnings of an electric infrastrucure or to green energy subsidies for corporations.

Or hey, here's an idea, build some roads, fix some bridges, build some schools, you know all those things that we are so busy doing in Iraq.

If Coble wants to vote against this turkey, I have no problem with it. It's image versus reality.

Person County Democrats

I actively oppose gerrymandering. Do you?

And an infusion of funds to child care subsidy programs

so that families could get off of waiting lists and actually get to work and not have to pay more for their child care arrangement than they do for their house payment. That would have real impact on the economy.

As for Coble, I have a problem with him. I don't care about this one vote. He has been hanging around for too long. He's apparently belatedly decided that Bush is a wacko, but it doesn't excuse more than 20 years of Republican bs in our district.

Be the change you wish to see in the world. --Gandhi

I Agree

It was very weird to see myself agreeing on this vote with my opponent. He did have 6 days to see what I wrote on the subject. It was a surreal day all around as I agreed with the executive order to get rid of pork even though it was more political election year fodder. It was the right thing to do none the less.

Jay Ovittore
Candidate- 6th Congressional District

“The will of the people is the only legitimate foundation of any government, and to protect its free expression should be our first object.” Thomas Jefferson

Jay Ovittore

“The will of the people is the only legitimate foundation of any government, and to protect its free expression should be our first object.” Thomas Jefferson

Sign of strength

It's a sign of strength in a candidate to be able to say "I agree with my opponent." Regardless - Coble needs to retire. We've got lots of great golf right here in his district. Dude needs to be playing golf.

Be the change you wish to see in the world. --Gandhi

If Enough Folks ActBlue

on my behalf I will buy him a nice set of clubs as a send off! My ActBlue page.

Thanks for the kind words Mrs. Cloud!

Jay Ovittore
Candidate- 6th Congressional District

“The will of the people is the only legitimate foundation of any government, and to protect its free expression should be our first object.” Thomas Jefferson

Jay Ovittore

“The will of the people is the only legitimate foundation of any government, and to protect its free expression should be our first object.” Thomas Jefferson

Bush is trying to leave a legacy

Even Jesse Helms tried to clean up his act in his final days in office. THIS is our happy little idiot's style of pol-i-ticken....


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No matter that patriotism is too often the refuge of scoundrels. Dissent, rebellion, and all-around hell-raising remain the true duty of patriots.

Progressive Discussions

Weighing in...

I agree with Jay, and Howard, and share his concern for the middle class:

http://blog.lawsonforcongress.com/2008/01/25/loaves-to-the-masses/

... although for the working Americans who do get this "shot in the arm", I sincerely hope they will use it to pay down debt instead of visiting Circuit City or Best Buy. Or what kind of small business can you start for $1,200?

It would be most ironic to have the government borrow $150 billion, and then for the recipients of said funds to send them straight back to China for more manufactured goods.

BJ

William (B.J.) Lawson, M.D.
Congressional Candidate, North Carolina's 4th District

Jeez, BJ

Now I'm scared. My candidate (Ovitorre), Coble, and you agreeing on something. Watch out folks, my head is about to explode.

Be the change you wish to see in the world. --Gandhi

you say ironic

I say expected. And sad. And a big giant waste of cash.

"Keep the Faith"

"Keep the Faith"

Okay, you might all be correct.

This plan stinks, but so does Coble. The economy has been driven to the brink by Bush, but now we might have to live with it. Will this bolus of money fix the long-term economy? No. Hell, will it keep us out of recession? Maybe.

How many of you remember the 1970s recession? Gas lines, alternating days for getting gas, 18% interest rates on houses, unemployment in the double-digits. The people hit hardest by this are the working class, the lower levels of the working class. We need something to keep from dropping into a recession like that again. Working class people haven't been this close to sliping into lower-class/poverty since WWII. If we don't do something, now, we won't be talking about 20some million people in poverty, we'll be talking about 40some million.

Long-term, I agree with Edwards and the Apollo Alliance, we need to turn to green industry. Short term, we need to put money into the hands of people who will spend it. Yes, I think the Democrats should focus the money on the poorest amongst us, because they will spend it locally. But, we do need the money.

One of the pitfalls of childhood is that one doesn't have to understand something to feel it. - Carlos Ruiz Zafon

Jesus Swept ticked me off. Too short. I loved the characters and then POOF it was over.
-me

Depends how you define locally, I spose.

Buying a cheap Chinese-made toaster at Walmart may keep Walmart employees in their jobs, but it doesn't help the larger issue: if that toaster were made in the States, more folks would have jobs. The toaster would cost more, but the benefit of higher employment would outweigh that, I think.

(I know, I'm preaching to the choir here.)

Wal-mart is a fact of life.

Until they are unionized, there isn't much we can do besides not shop there.

One of the pitfalls of childhood is that one doesn't have to understand something to feel it. - Carlos Ruiz Zafon

Jesus Swept ticked me off. Too short. I loved the characters and then POOF it was over.
-me

I agree with Robert

that initiatives like Apollo Alliance are a definite step in the right direction.

One challenge is making sure the investment capital for is allocated to groups or companies that are poised to do the most good.

Here I'm speaking as an entrepreneur, as well as a candidate...

We absolutely need to strengthen our economy. To do so, we must start saving, creating, and producing, instead of just borrowing, buying, and consuming.

There are people and organizations who have savings to invest. Those folks should be put in a position to to do well by doing good, and make investments that will put people to work, make our country stronger, and allow them to KEEP people working by making a profit.

So what is government's role? Should government provide funds to make those investments? I've been on both sides of this question -- we didn't seek government funding when we were starting our software company, and instead we found knowledgeable folks who were willing to take a risk with their own money. That worked pretty well for all involved, after lots of hard work and sleepless nights. And it was also a lot of fun.

I've also been involved with a high-tech incubator that helps young companies get SBIR (federal government) startup grants. That process is downright maddening from a predictability and transparency standpoint. Not only is it an opaque process, the folks on the "giving" end aren't spending their own money... so they aren't really incented to be careful with how they spend it. They have a LOT of paperwork, process, and bureaucracy... instead of a personal interest in the success of the venture. Most importantly, they don't bring value to the table beyond just a check -- they're not an "investor", they aren't motivated to get involved and help out, and they don't offer wisdom and guidance at monthly board meetings.

I am absolutely in favor of initiatives like Apollo that help raise awareness and build momentum for domestic, green companies that help "build our base" again. I am also absolutely in favor such initiatives nourishing true capitalism, as opposed to politicized crony corporatism (that's PCC for short).

We cannot, however, rely on federal government funding for such initiatives. Why not? Well, first of all, the federal government has no more money. Sorry, all gone. No more money. And trying to borrow/print more just makes our economic situation worse. We need to create WEALTH, not money. Governments can create "money", but *people* create wealth through ingenuity and effort. So let's free folks to make their own good investments, and keep the fruits of their labor.

How can we help initiatives like Apollo take flight? We've been working on an economic action plan, but one key factor is ensuring that the entrepreneurial playing field is level -- no more corporate welfare, and no more corporate protectionism. Most importantly, we need to answer a new question:

"How can we meet the needs of government while making America a 'tax haven', and great place to start and grow a business?"

Let's get America working again, and let's kickstart the entrepreneurial growth our country needs. Entrepreneurs LIKE to blur the lines between "owner" and "employee" -- profit sharing, stock options, and restricted stock grants incent employees to think like owners, and help everyone focus on serving the market, and the customer.

William (B.J.) Lawson
Congressional Candidate, North Carolina's 4th District

William (B.J.) Lawson, M.D.
Congressional Candidate, North Carolina's 4th District

I like the way

you think! I ask you all for your support of my campaign. Please ActBlue.

Jay Ovittore
Candidate- 6th Congressional District

“The will of the people is the only legitimate foundation of any government, and to protect its free expression should be our first object.” Thomas Jefferson

Jay Ovittore

“The will of the people is the only legitimate foundation of any government, and to protect its free expression should be our first object.” Thomas Jefferson

Jay, You're Wrong

Jay, both you and Howard are wrong on this one.

First off, when faced with a looming national challenge or crisis, it is important that Congress move swiftly to do what it can to reduce the negative impact on the American people. A recession is not an event upon which political ideology should be espoused, but one in which practicality must reign.

Economists tell us that the best way to deal with a recession is to increase spending. The government could increase its spending, although it would most likely increase spending primarily in the military sector and not really spur the overall economy. The alternative is to increase consumer and business spending where the impact on the overall economy is likely to be much greater.

Secondly, when you have such strong bipartisanship in Washington, you really need to look at a piece of legislation not in terms of what it doesn’t do, but in terms of what it does do. You can’t throw the baby out with the bath water. If you have strong support for something that does good, you need to go with it. Come back tomorrow and try for the rest. But don’t lose your opportunity for at least some small success today. Progress in Washington is evolutionary not revolutionary.

This is not the perfect bill. It will not end poverty. It will not put the unemployed back to work. It will even stop the recession.

But it will help lessen the pain. If spending increases, the recession will either end sooner or be less severe. And if the recession is milder or shorter, while today’s unemployed may not get jobs, fewer working people will lose them. That’s economic reality, Jay, not political ideology.

So, let the working men and women of this county have a rebate – to spend as they please, but in any case, to spend, to help spur an otherwise deflating economy, and, perhaps most importantly, to help raise the confidence of the American people in their economy.

And let businesses participate here too. You’re against a tax break for business? This isn’t really a tax break, Jay. Businesses aren’t going to get a deduction they wouldn’t get anyway. All this bill does is change the timing on the deduction for depreciation in an effort to get business to spend money on capital items now rather than later. They get the same deduction over time. So in the long run, this is what they call “revenue neutral.” We get earlier spending and perhaps, a stronger economy sooner. The deficit stays the same.

There’s nothing to lose here, Jay, and more to gain than apparently you and Howard realize.

Pete

Increase spending? Or increase wealth?

On the consumer side, I respectfully disagree.

Economists tell us that the best way to deal with a recession is to increase spending.

Many economists disagree with that assertion. Here's another way to think about it:

Relying on consumption spending to raise living standards is like arguing that the only way to avoid a famine is to eat more. We all know that famines are avoided by producing more food, not consuming it. Investing in factories, for example, is basically the same thing. It’s not the consumption of cars, refrigerators, computers, etc., that raises living standards but the means to produce them.


A final note: consumption doesn’t drive an economy, entrepreneurship does that while savings fuel it.

The fact that consumer spending is ~70% of our GDP (and does "drive" our current economy) is NOT a healthy thing. It is a structural weakness that we need to address. Think of our economy as an engine revving at 7,000 RPM... we need to shift into a more productive "gear" where we are more balanced between production and consumption.

We need to get back to saving, creating, and producing. Giving the American people $300-$1,200 checks of *borrowed money* that will be spent at Wal-Mart, Best Buy or Circuit City will be borrowing money from China just to give it back to China, and then needing to pay the interest.

The more important question is what happens if that person loses his or her job? $300-$1,200 in "stimulus" doesn't help confidence once Fidelity starts laying people off that it just brought down to the area. At every level of government, we need to make it easier, and more rewarding, to be an entrepreneur, serve your community, and create your OWN job.

There’s nothing to lose here, Jay, and more to gain than apparently you and Howard realize.

Well, we can lose our economic sovereignty as we borrow more and more money and further weaken our currency. And there is very little to gain if the consumers take those borrowed dollars and just spend them instead of investing them in wealth creation.

On the business side, yes, we need more business investment. We need more good jobs, and healthy companies not dependent on corporate welfare.

It's time to get back to work. I'm voting with Jay on this one :-).

William (B.J.) Lawson
Congressional Candidate, North Carolina's 4th District

William (B.J.) Lawson, M.D.
Congressional Candidate, North Carolina's 4th District

Oh, and I'm not "blaming" China

It is wrong to blame China's wage rates and currency exchange for U.S. trade deficits and manufacturing decline, since Japan and Germany each have higher wage rates and a stronger currency exchange rates yet still realize larger trade surplus versus the U.S.

Citizens of China, Germany and Japan have high rates of personal saving, whereas U.S. savings are nil. They produce and save while Americans consume and increase debt instead of save.

Great reference here.

William (B.J.) Lawson
Congressional Candidate, North Carolina's 4th District

William (B.J.) Lawson, M.D.
Congressional Candidate, North Carolina's 4th District

We'll have to agree to disagree...

on this Pete. I am not the kind of guy who will pull the wool over the sheep's eyes and hope it all works out. So a middle class family gets a 1200 or 1500 check from the government and they make one back mortgage payment. What then? When the economy doesn't correct itself and bank profits and large corporate profits increase, who wins? If we accept a tiny little bribe from the Federal Government now, what is the cost later?

And why does government progress have to be evolutionary? Why can't we fix problems and not just talk about it while throwing a little of our own taxpayer money back at it?

The only direct question you asked me is if I was against a tax break for business. I am! While corporate America reaps record profits, pays employees near slave wages and hides their money in tax shelters...it is me and you who pay for their luxury CEO lifestyles. I'd like to drive a Porsche too! What the hell does vacation mean again? It is insulting to me as an American citizen to see the outsourcing of jobs for expanded profit and the corporations who do this continually get more tax breaks and subsidies. It is appalling.

I can not just go along with something I know is wrong for this country because it has strong support from the establishment in DC. We'd all be jumping off bridges to nowhere if that was the mentality.

I will always do what I think is best for the people. I don't toe party lines and I don't follow the leader. What creates change is someone standing up and screaming for it, it takes the courage of Martin Luther King and the like(and I'm not comparing myself) to address and create change.

That is where I stand and I can not apologize for my position.

Jay Ovittore
Candidate- 6th Congressional District

“The will of the people is the only legitimate foundation of any government, and to protect its free expression should be our first object.” Thomas Jefferson

Jay Ovittore

“The will of the people is the only legitimate foundation of any government, and to protect its free expression should be our first object.” Thomas Jefferson

Jay.

IF this is the only thing that is done to fix the economy, then I agree it is a mistake. An influx of spending now doesn't change anything physical, it's voodoo, but it is the kind of voodoo that makes consumers more confident and Wall Street less tense. Down the line, we need a restructuring of our economy - especially the tax structure. But, that will take years. If we do nothing now, then it is likely we will be in a deep recession by that time.

Maybe best case scenario, let the feds restructure taxes today. But, that won't happen and Bush won't sign it.

One of the pitfalls of childhood is that one doesn't have to understand something to feel it. - Carlos Ruiz Zafon

Jesus Swept ticked me off. Too short. I loved the characters and then POOF it was over.
-me

I'm not real happy with this

bill either, but we are headed for hard times and must take some steps. The housing situation is on the verge of dragging down several other sectors with it, and a retail collapse would be devastating. I'm not a big fan of consumerism, mainly because of the trade deficit as well as the amount of packaging that ends up in landfills. But we have to be weaned off.

If they had included food stamps and an extension of unemployment benefits, I would be soundly behind this bill. As it is, I'm not sure the expense will be worth it. But to do nothing in the face of our looming crisis would be a huge mistake.

Include food stamps, unemployment benefits

more funds for child care subsidy in all states. Increase home heating assistance, especially in the states where it gets really cold.

I'm not saying an extra $1200 would be turned down in this household, we've got a lot of bills, and a child headed to college next year. But I don't think that borrowing money to give everyone a bonus is a good idea. No business in their right mind would do it.

Now, if they found the money by cutting the budget by say ....bringing troops home...I'd be happier with it.

Be the change you wish to see in the world. --Gandhi

Watch Out

The only direct question you asked me is if I was against a tax break for business. I am! While corporate America reaps record profits, pays employees near slave wages and hides their money in tax shelters...it is me and you who pay for their luxury CEO lifestyles.

Jay,

It is so easy to fall into this whole "evil corporate America" speak. Don't forget the vast majority of corporations in this country are SMALL BUSINESSES. Small businesses employ most of of the people in this country. Small businesses bear the brunt of the backlash against the misbehavior and excesses of a handful of huge corporations.

I could go on and on about the staggering load government compliance and taxation places on small businesses like mine. I won't even get into the enormous insurance costs.

I pay my employees all I can and still be able to keep the doors open and lights on. If it cost less to do business, I could and would pay my employees more. Most small businesses would probably do the same. Please don't assume giving breaks to business would only mean more oney for Porsche-driving CEO's.

Let me be clearer

I am against tax breaks for business, meaning conglomerates. I too own a small business and unless they clarify small businesses, I wouldn't expect the same treatment. We often do not get the same treatment. We are the foundation of this county, we do employ more people then the large companies do, we do not get equal treatment. My problem with incentives and tax breaks for business is that they do not include the small guy. If we want to lower unemployment in this country we will need to turn to small businesses like mine and yours to create jobs and opportunities for the folks that have been left out to dry by Corporate America.

I hope that clears that up.

Jay Ovittore
Candidate- 6th Congressional District

“The will of the people is the only legitimate foundation of any government, and to protect its free expression should be our first object.” Thomas Jefferson

Jay Ovittore

“The will of the people is the only legitimate foundation of any government, and to protect its free expression should be our first object.” Thomas Jefferson

Hi Pete!

I hope you're able to support the 6th district with as much enthusiasm as always, and facilitate communication between counties and candidates like you did you last time with Rory Blake.

Nice to see you here on BlueNC - hope you stick around.

Be the change you wish to see in the world. --Gandhi

psalassi, I agree that it would help businesses

but how would $500.00 pp help for more than a day or week? If it's just the $150B that is going into the economy for a sort of shock to the heart, why not put that money where it will do some real good?

No matter that patriotism is too often the refuge of scoundrels. Dissent, rebellion, and all-around hell-raising remain the true duty of patriots.

Progressive Discussions

Do some real good?

And where would that be? If you have a better way to deal with the recession in the short-term, I'm all ears.

Pete

Handing a person $500.00 and telling her to spend

will do what for this recession? The ones that feel this the most...the ones that had the least to do with causing this will go shopping at a store that probably purchased their inventory from China. I bet that this will certainly stimulate their economy, how would it stimulate ours?

No matter that patriotism is too often the refuge of scoundrels. Dissent, rebellion, and all-around hell-raising remain the true duty of patriots.

Progressive Discussions

Same thing that interest rate changes do...

fool some of the people, all of the time. Enough so that they start investing and buying again.

One of the pitfalls of childhood is that one doesn't have to understand something to feel it. - Carlos Ruiz Zafon

Jesus Swept ticked me off. Too short. I loved the characters and then POOF it was over.
-me

This is all about smoke and mirrors?

OT but Hillary just had a great line...."It took one Clinton to clean up after the first Bush, it'll take another Clinton to clean up after this Bush." Is she electable?

No matter that patriotism is too often the refuge of scoundrels. Dissent, rebellion, and all-around hell-raising remain the true duty of patriots.

Progressive Discussions

A Recession is a Different Animal

I want to assure you that I’m as much a yellow dog as the next guy, although I’m more gray now that anything else. And I believe that there are major issues here that must be addressed – at least in the long term, if not sooner.

But a recession is a different animal. And if you are going to play the recession game, you simply have to let practicality trump ideology – as distasteful as that may be. Economics 101 may not be ideologically sound, but it works.

The reality is that spending is the best medicine for an economic downturn. You can curse Keynes but you can’t argue with success. And, as I said before, you can let the government spend some extra money or you can let the American people and American businesses spend some extra money. But in either case, you have to spend to lessen the impact of recession and the “extra” money is going to come from Washington because no one else has anything “extra”. Other than your nemesis CEO’s, Jay!

You’ll remember that the last recession was rather mild. Why? Was it the infamous tax cuts for the rich? Well, while some Republicans may say it was, we must also remember that there were tax rebates in the stimulus program then as well as a general increase in government spending. And last time, there were not immediate extensions to things like unemployment benefits, but they came with time. And they will come with time this year.

You are all absolutely right in that a few hundred per family isn’t enough in itself to make a difference of more than a day or two. But we must never underestimate the role of consumer confidence when it comes to the American economy. In fact, confidence applies to more than just the economy. Every time the American people have been confident in something, we have made it happen. And if all it takes is a few hundred dollars to restore confidence in our economy, then it will be well worth the price.

Confidence will help restore the strength of our economy. And while it may not add jobs, it may very well help prevent us from losing any more than we have to. As Howard said, it’s a band aid. But sometimes, that’s exactly what the doctor orders.

Guys, this is not the time to quibble about more deserving social initiatives. We will have our day for that next year. President Clinton or President Obama will make sure of that.

A recession is a very real threat. People are losing their homes. People will lose their jobs. The ranks of those who need our help will grow as the recession deepens. None of your CEO’s are going to lose their jobs, Jay. The people who will suffer will be the working men and women. The economic indicators are bad, very bad. We simply must do whatever we can do to reduce the impact of this recession. We can't afford to lose ground simply because we want to gain ground instead.

Economists tell us and have shown us that spending is the best way to work ourselves out of a recession. And deficit or not, that is what we must do. We need to let the American people regain confidence in their economy. We must let the American people restore our economic strength. And this, Howard and Jay, is deficit spending at its best.

Pete

I agree with most of this, Pete,

but the real danger in our situation is not being properly addressed, that being the wave of mortgage defaults. Bush's freeze on interest rates only applies to about 140,000 borrowers, which is a fraction of the loans that are in jeopardy. Congress has some other potential cures for this in the pipe, but (as usual) they're stuck in committee.

In the 4th quarter alone, California had 88,000+ default notices. Property values are dropping like a stone, which means even those who can afford their loans are defaulting to get out of a negative equity situation. The government can pump billions into the economy, but if these defaults don't stop, recession is inevitable.

Guys, this is not the time to quibble about more deserving social initiatives. We will have our day for that next year. President Clinton or President Obama will make sure of that.

Hillary has said she would freeze all mortgage rates if elected, but even if she's sincere, that won't happen until mid 2009 at the earliest. By that time it will probably be too late.

And I agree too

My comments were limited strictly to HR 5140 (Recovery Rebates and Economic Stimulus for the American People Act of 2008). I agree completely that the mortgage/equity/housing situation, the extension of unemployment benefits and a host of other pending legislation is also important. My point is that this one piece of legislation is worth passing even though it is not the end-all, be-all, cure-all solution to our nation's ills. We must urge passage of these other initiatives as well and continue to work for change, although most of what we want will not be accomplished under this president.

Thanks for inviting me to clarify my comments.

Pete

We do need some of this, but

I'm not sure if this legislation isn't also a clever vehicle for inserting permanent tax loopholes for the wealthy. For instance, this section of 5140:

SEC. 102. TEMPORARY INCREASE IN LIMITATIONS ON EXPENSING OF CERTAIN DEPRECIABLE BUSINESS ASSETS.

(a) In General- Subsection (b) of section 179 of the Internal Revenue Code of 1986 (relating to limitations) is amended by adding at the end the following new paragraph:

`(7) INCREASE IN LIMITATIONS FOR 2008- In the case of any taxable year beginning in 2008--

`(A) the dollar limitation under paragraph (1) shall be $250,000,

`(B) the dollar limitation under paragraph (2) shall be $800,000, and

`(C) the amounts described in subparagraphs (A) and (B) shall not be adjusted under paragraph (5).'.

(b) Effective Date- The amendment made by this section shall apply to taxable years beginning after December 31, 2007.

The title of this section claims to be temporary, but the wording (my bolding) appears to make it permanent, changing it from this (Wiki summary):

First, there is a dollar limitation. Under section 179(b)(1), the maximum deduction a taxpayer may elect to take in a year is currently (2007) $125,000.[7]. However, this is set to revert to $25,000 after 2010.

Second, § 179(b)(1) requires taxpayers who place more than $500,000 worth of section 179 property into service during a single taxable year to reduce, dollar for dollar, their 179 deduction by the amount exceeding the $500,000 threshold.[8] For example, if a taxpayer put $550,000 worth of 179 property into service during 2006, then he or she would be required to reduce his or her 179 deduction by $50,000 ($550,000-$500,000=$50,000) so that his or her 179 deduction could be no greater than $75,000 ($125,000 - $50,000 = $75,000). Again, this limit is also set to revert after 2010 to $200,000.

Finally, § 179(b) provides that the 179 deduction in any given year may not exceed the taxpayer's total taxable income in that year.[9] If, for example, the taxpayer's taxable income was $75,000 in 2006, then his or her 179 deduction could not exceed $75,000. However, the 179 deduction not taken can be carried over. [10].

As I said, this section appears to be worded as a change to the tax code itself (taxable years beginning), but the personal rebate section has some pretty clear one year sunset provisions like:

first taxable year beginning in 2008

and

No refund or credit shall be made or allowed under this subsection after December 31, 2008.

Needed quickly or not, this bill should have been examined and debated more thoroughly.

Depreciation totals are the same either way

As I understand it, all this does is change the timing on the deduction for depreciation and the maximum allowed in one year, not the total amount you're allowed to deduct.

In other words, if your business spends $50,000 on an asset, you will get $50,000 in depreciation deductions over some period of time. This accelerates the timeframe in an effort to get business to spend money in 2008 rather then later. It doesn't allow you to deduct anymore than you would otherwise over time. I don't consider this a new loophole. I think it's an incentive for business contemplating major purchases to move them into 2008.

If you check (7) above, you will note it says "any taxable year beginning in 2008". Period. It doesn't say anything about taxable years beginning after 2008. To me, that says it's an offer good only for your 2008 tax year, whether you're a calendar year or fiscal year filer.

By the way, I'm not a tax attorney, so you should remember my advice is worth exactly what you're paying for it!!

Pete

I'm not a tax attorney either, but

I am somewhat familiar with depreciations and amortizations, and (I believe) this code change isn't (necessarily) directed at encouraging businesses to spend money on assets, because depreciations can be claimed on older stuff (for years) until the original cost/value is realized. I think what they're trying to do is allow companies to get more of their taxes back quicker by boosting the max claim allowed, giving the business a stronger capital position in the short term (which I'm okay with). But I still don't like the difference between:

first taxable year beginning in 2008

and

any taxable year beginning in 2008

taxable years beginning after December 31, 2007.

I know it may seem like I'm quibbling, but I've spent hundreds of hours poring over legislation, and these things are rarely innocent wording mistakes.

Section 179 is Current Year Only

Section 179 applies only to assets placed into service during the current tax year. See http://www.irs.gov/publications/p946/ch02.html.

Also, due to the phase-out provisions, Section 179 is very rarely applicable to large corporations. It was a provision added to the code several years ago to help small businesses.

Pete

Pete is Right

The big picture is $150B now, or ten times (or even 20 times) that later.
The quicker the better.

Howard's just posing. The bill passes and He's a sharp pencil, again.
Thanks Pete!

Rory

My take on the stimulus package

There have been some well written and informative comments upthread and the writers should know their efforts have been appreciated.

I still don't like this $150 billion dollar "stimulus" deal. I might like it were this 20 years ago (and so 7-8 trillion less deficit) or if there were good underlying fundamentals that have been temporarily derailed for one reason or another.
It is the nature of economies to cycle between growth and recession. Americans do not save money, in fact our collective savings rate is often negative. Our government will soon be 10 trillion dollars in debt.
Here's the thing - the US was pulled out of the last recession by a huge increase in government (deficit) spending and a housing bubble that as we all know now was based on an incredibly flawed and inherently unsustainable foundation, subprime loans. I heard about a year ago that half of the jobs created from 2002 to 2006 were as a result of the housing bubble. In other words the "up" of the last 4-5 years was an artifice, and the impending recession will ikely make that plain.
Which brings us to the current situation and the 150 billion one time stimulus. Bottom line to me is that this will be like throwing down a few sandbags and expecting them to divert a raging river. If helping the people who will be hurt by a recession is the goal there are much more targeted and probably cheaper ways of going about it.
150 billion dollars could be spent in so many better ways that would improve the long term stability to our economy, but what we are likely to get is just a politically expedient bandaid to be placed over a ruptured jugular. I think it will be a waste of money.

Person County Democrats

I actively oppose gerrymandering. Do you?