Archive for June, 2009
Reports of the demise of the F-22 stealth fighter may have been a bit premature.
The House Armed Services Committee, by a single vote, recently ordered the Pentagon to keep the program alive over the objections of Secretary of Defense Robert M. Gates, top Air Force brass and the Obama administration.
The administration’s plan to kill the Lockheed Martin F-22 project in favor of funding for needs it sees as more immediate has sparked outrage among lawmakers from both parties who argue the decision will threaten national security and cost tens of thousands of American jobs.
While the Pentagon has said it does not consider jobs when making procurement decisions, members of the committee said repeatedly that the federal government cannot afford to make spending decisions in a vacuum that excludes potential impacts on the economy.
“There are three reasons for doing this, priorities, jobs and our national defense,” said Rep. Rob Bishop (R-Utah), adding that cutting the program will cost jobs at both the prime and sub-contracting levels.
“We are talking about jobs all the time, unemployment is rising. There are 25,000 jobs directly impacted by the decision we make on the F-22. There are 70,000 jobs that are implied with it, they have a connection to it. That means we have the opportunity of creating and saving 95,000 jobs,” he said.
Rep. Neil Abercrombie (D-Hawaii) said the new language, which would continue the program with the production of 12 new F-22s through 2011, is a modest investment that will keep the program alive as new technologies mature. He also chided the free-spending Pentagon for its new-found fiscal conservatism.
“Mr. Gates lecturing us on fiscal responsibility in the context of procurement is like listening to lessons of spiritual renewal from Jimmy Swaggart. It’s a little late in the game for the Pentagon to start lecturing us on what constitutes proper spending,” Abercrombie said.
During a briefing two days later, Gates said the bill’s F-22 language is “a big problem. I have a big problem with it,” though he stopped short of saying it could prompt a veto from President Obama.
Gates went on to say he is determined to continue to push for the cuts. His plan to scrub the F-22, he said, will not jeopardize national security and the F-35 Joint Strike Fighter will be a worthy substitute.
“You know, a trillion dollars for the Joint Strike Fighter, a fifth-generation fighter that has some capabilities the F-22 is not a trivial investment in the future…And, frankly, to be blunt about it, the notion that not buying 60 more F-22s imperils the national security of the United States I find completely nonsense,” he said.
Facing a year-end deadline, Senators propose a permanent, enhanced tax credit for research and development.
A bipartisan group of members of the Senate Finance Committee is proposing a new plan that would enhance and simplify the way the federal government uses the tax code to reward companies for investing in research and development.
Without action, the tax credit is set to expire at the end of this year.
Under current law, companies can use what is known as the traditional structure that bases R&D tax credits on increases in spending over a base period of 1984 through 1988. Alternatively, they can use a base level derived from their R&D spending for the previous three years.
Under the new plan – unveiled by Finance Committee Chairman Max Baucus (D-Mont.), Sen. Orrin Hatch (R-Utah) and eight others – the traditional credit would expire at the end of 2010 and the alternative method would be enhanced to increase the amount of covered qualifying expenses from 14 percent to 20 percent.
The bill also would make the tax credit permanent, something companies with significant R&D investments have long sought. President Obama also backs making the credit permanent, but has not supported any changes to the way the program works.
The R&D Credit Coalition, which represents hundreds of companies large and small that invest in R&D, has been pushing for an extension of the tax credit and an increase in the amount companies can claim. Enhancing the credit, the coalition says, will help stimulate the economy
“Continued growth of the U.S. economy is closely tied to the ability of our companies to make a sustained commitment to long-term, high-cost research. The R&D tax credit is a positive stimulus to U.S. investment, innovation, wage growth, consumption, and exports — all contributing to a stronger economy and a higher standard of living for American workers,” the group said.
In a letter to Obama earlier this year, representatives of Boeing, Microsoft, Dow and the National Association of Manufacturers applauded the President for backing a permanent R&D tax credit, which they said is critical to U.S. economic growth.
“In this challenging economic climate, some may view research spending as an unnecessary expense. Like you, we believe that investments in research are critical to the nation’s future economic expansion,” the group wrote
“Much of our economic vitality comes from the innovation, research, and intellectual property stemming from this tax credit,” he said. “Our bill would make it easier to access the benefit, making the credit work even more effectively and continue to lead the way to new technologies, domestic job growth and, ultimately, a stronger U.S. economy.”
Other co-sponsors of the bill are Sens. John Kerry (D-Mass.), Blanche Lincoln (D-Ark.), Ron Wyden (D-Ore.), Chuck Schumer (D-N.Y.) Maria Cantwell (D-Wash.), John Ensign (R-Nev.), Robert Menendez (D-N.J.), and John Cornyn (R-Texas).
Seeking congressional action this summer, the President says reform is “a necessity we cannot defer.”
Working with congressional Democrats, President Obama is pushing a plan to meet the long-elusive goal of providing high-quality, affordable health care coverage for all Americans and he wants a bill on his desk within months.
While lawmakers from both sides of the aisle recognize the urgency of America’s health care crisis, Republicans are lining up to oppose a pillar of the Obama plan that would provide a government option for those who cannot afford to purchase their own private health care coverage.
The plan will have broad impacts on businesses that could be required to provide health insurance for all their employees as one means of expanding coverage to the nation’s 46 million uninsured. Obama has said he could support mandated health coverage as long as there is an exemption for small businesses.
Obama’s plan also includes $19 billion already set aside under the stimulus package to digitize medical records, a program aimed at adding efficiency and ending duplicate or unnecessary treatments. This is one of the few areas on which the president has been specific.
Other options are less clear. The plan could, for example, include taxes on health insurance benefits of the richest Americans or on those with the most valuable insurance plans. Also on the table: New taxes on alcohol and sugary beverages.
Sen. Max Baucus (D-Mont.), the chairman of the Senate Finance Committee said his version of the bill could be unveiled next week and the measure will include new taxes on at least some employer-provided benefits.
Meanwhile, Sen. Edward Kennedy (D-Mass.), who chairs the Senate Committee on Health, Labor and Pensions, unveiled his own bill that would require all Americans to be covered, set up insurance exchanges to help them obtain coverage, increase government oversight of the insurance industry and reward the best performing doctors and hospitals.
Though Obama has been meeting with Democrats on the issue, he has promised to include Republicans and other stakeholders as debate heats up this summer.
“We simply cannot afford to postpone health care reform any longer. This recognition has led an unprecedented coalition to emerge on behalf of reform — hospitals, physicians, and health insurers, labor and business, Democrats and Republicans. These groups, adversaries in past efforts, are now standing as partners on the same side of this debate,” Obama wrote in a recent letter to lawmakers.
But the president’s plan faces a tough sale on Capitol Hill, where Republicans are already bridling at the idea of a government run option.
“Now, there’s lots of room for improvement in this current system, but boy, if we go to a government plan, the government will be setting prices. They’ll be telling people what they can do. They’ll be injecting themselves between your doctor and yourself. I can’t even begin to tell you what a lousy rotten thing it will be, and it will be tremendously costly,” said Sen Orrin Hatch (R-Utah), a senior member of the Senate Committee on Health, Labor and Pensions.
“So I just don’t understand what’s happening with the president,” Hatch said on Fox News
Even before he returned from his trip to the Middle East and Europe on Sunday, Obama used his weekly Saturday radio and Internet address to press for change. He said he envisions a plan that cuts the cost of health care across the board, while at the same time improving the quality of health care in America.
“Some of these costs are the result of unwarranted profiteering that has no place in our health care system, and in too many communities, folks are paying higher costs without receiving better care in return,” he said, pointing to the Mayo Clinic in Minnesota and the Cleveland Clinic in Ohio as examples of institutions that provide high quality health care at reasonable prices.
“We should learn from their successes and promote the best practices, not the most expensive ones. That’s how we’ll achieve reform that fixes what doesn’t work, and builds on what does,” Obama said.
Before entering a closed-door session with some two dozen Democratic senators at the White House last week, Obama stressed the critical nature of health care reform.
“This issue, health care reform, is not a luxury. It’s not something that I want to do because of campaign promises or politics. This is a necessity. This is something that has to be done. We cannot avoid bringing about change in our health care system,” Obama said.
In a letter to Kennedy and Baucus, Obama said much of the reforms he has in mind can be paid for through new efficiencies in the system and the elimination of waste, fraud and abuse.
The president said he has “set aside” $635 billion in a health reserve fund to help pay for reform, which includes $309 billion in cuts from Medicare and Medicaid. Obama also said he hopes to cut another $200 to $300 billion from the programs over the next 10 years.
Rahm Emanuel, the president’s chief of staff said in an interview with NBC that White House staffers will be busy readying a health care package for presentation to lawmakers while Obama is vacationing, but before Congress embarks on its summer recess in August.
“We’re trying to get health care…done. And get all of that done in these work periods, so when he’s gone, while they (lawmakers) are here, you’ve got to get a lot of work done, try to fit it all in and get all of the policy choices made,” he said.
Subcommittees See Spending Boosts
By Greg Wright
The members of the House Appropriations Committee are some of the most powerful lawmakers in Congress. That’s because they decide how trillions of federal dollars will be spent each year.
On June 10 Chairman Dave Obey (D-WI) and other members divvied up how much subcommittees will get in discretionary spending for fiscal year 2010 for a dozen appropriation bills. The grand total came to $1.086 trillion.
That is about $10 billion less in discretionary spending than President Obama originally asked for, according to news reports. Still it is an increase of about $73 billion over what was sought in fiscal 2009, news reports said. So everyone could end up having more money to work with.
The Defense subcommittee as usual got the lion’s share of the pie – about $508 billion. That is about $20 billion more than was allocated during the last fiscal year.
Other subcommittees that snagged large pieces of the spending allocation included Labor, Health and Human Services (about $160.7 billion, or a $7.5 billion increase over fiscal 2009); Military Construction/Veterans Affairs ($76.5 billion, or a $3.8 billion increase); Transportation/Housing and Urban Development ($68.8 billion, or a $14 billion increase); and Commerce, Justice and Science ($64.3 billion, or a $7.5 billion increase).
For more information on discretionary spending allocations visit the House Appropriations Committee Web site (http://appropriations.house.gov), click on “press releases,” and then click on the link for “subcommittee allocations-302(b)s.Read Full Post | Make a Comment ( None so far )
Caren Z. Turner, Esq.
Domestic suppliers, including over 25,000 employees who work directly on the F-22, are still trying to absorb an intense body blow dealt by Secretary Gates. Read more
Caren Z. Turner, Esq.
2008 is drawing to an end, and for many people it’s about time. The stock market had a dismal year, the economy is teetering on disaster and Ponzi schemes are in the news. 2009 is upon us and many questions linger in the air.
The United States is going through a period of transition, or “change.” One of the issues that President-elect Obama is considering changing is the F-22 Raptor program. The F-22 has been around for some time. However, it is only now growing into maturity.
This week it was announced that Senator Hillary Clinton was picked to become the next Secretary of State. This pick is an intriguing move by Barack Obama, one that gives a political observer pause. During the campaign for the Democratic nomination, Mr. Obama repeatedly belittled Senator Clinton’s experience. Moreover, his campaign stated that Clinton’s foreign policy wasn’t the type of change Americans wanted. However, he is now lauding Senator Clinton’s experience and expertise. Another interesting aspect to this nomination is why Mrs. Clinton would even want to accept such a posting.
Candidates have recently done much to distance themselves from lobbyists: the DNC announced its decision to ban lobbyist contributions and McCain has established strict rules for lobbyists working on his campaign that have caused several of his volunteers to resign.
Sure, we all know the term lobbyist is an easy word to throw around. It’s like “Halliburton” or “bureaucrats” – highly recognized as a bogyman term, yet vaguely understood. The tainted lobbyist name is painful, but an example of a few bad actors tarnishing the image of a respectable profession.
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