Archive for September, 2010
Moving to create jobs and increase American competitiveness, President Obama is calling on Congress to make permanent the research and development tax credit that it allowed to expire last year.
Unveiled during a recent speech in Ohio, the president’s proposal will expand the tax credit about 20 percent, from about $7 billion to nearly $10 billion a year, over the next decade. It will raise the tax credit to companies for research and development to 17 percent (up from 14 percent) and simplify the tax filing for businesses.
“Instead of tax loopholes that incentivize investment in overseas jobs, I’m proposing a more generous, permanent extension of the tax credit that goes to companies for all the research and innovation they do right here in Ohio, right here in the United States of America,” said Obama in announcing his plan. In total the expanded credit would devote about $100 billion over the 10 years to leverage additional R&D investment.
The President argues that by making the tax credit permanent “businesses could make investments and create jobs today confident that they will continue to benefit from the credit in the future.”
According to a White House release, the R&D credit has been extended 13 times since its creation in 1981 and has a history of bi-partisan support in Congress. However, despite a track record of support in the past, Republicans “are now blocking legislation that would renew this credit.”
The reality of today’s politics probably means that this important piece of legislation will not be acted upon until after the midterm elections.
That is a shame.
Research and development incentives are key to growing American business and putting the country at the forefront of science and technology innovation.
Further, investment in research and development creates jobs now and into the future. Companies working on cutting edge technology will be able to hire engineers, scientists, and technicians to unlock and perfect new technologies. In turn these new technologies will become the foundations of future industries—in areas such as energy, medicine and IT—that will hire future generations of American workers.
Even the Chamber of Commerce, which has not been supportive of the president’s agenda, praises his R&D tax credit proposal. “The R&D tax credit creates high-wage, American jobs…Extensions and expansion of the R&D credit will encourage investment in R&D in the United States that will enhance high-wage job growth and contribute to the revitalization of the American economy.”
An article in the Huffington Post on the R&D tax credit proposal noted: “Besides contributing to global competitiveness, the return on investment is substantial. The (R&D) credit currently costs an estimated $7 billion a year…A permanent credit coupled with just a 25 percent increase could boost real GDP by $206.3 billion, generate 270,000 manufacturing jobs and raise total employment by 510,000 within a decade.”
The president’s research and development tax credit proposal, simply put, is smart policy.Read Full Post | Make a Comment ( 1 so far )
With the midterm elections looming and little to no chance of getting Congress to act on comprehensive climate change and energy legislation, “green” proponents have lowered their expectations and are now looking to achieve more modest goals.
Shifting strategy, a coalition of environment groups is pressing the Obama administration and federal agencies, including the Environmental Protection Agency and the Department of Transportation, to set ambitious pollution control and fuel economy measures.
Increasing the fuel efficiency of cars to 60 miles-per-gallon by 2025 is just one of the demands of the coalition, which includes the Sierra Club, the Natural Resources Defense Council, Clean Water Action, Environment America and more than a dozen other environmental and science organizations.
On September 9, the group sent a letter to President Obama reminding him of his promise to “cut America’s oil dependence and address climate change by making our cars and trucks cleaner and more fuel efficient.”
The letter, noting an approaching deadline for DOT and EPA to release proposals involving the development of fuel efficiency and carbon pollution standards for new cars and trucks, included the following recommendations:
• Reduce the country’s oil dependence by at least 49 billion gallons per year by 2030 and reduce carbon dioxide pollution by at least 535 million metric tons per year by 2030
• Require new light-duty vehicles to meet Corporate Average Fuel Economy (CAFE) standards of at least 60 miles-per-gallon and global warming tailpipe pollution standards of no more than 143 grams-per-mile by model year 2025
• Reduce fuel consumption for long-haul trucks pulling standard van trailers by at least 35 percent by model year 2017
According to the coalition the letter is just “one piece of a new national campaign to build support for strong vehicle standards.” The plan also includes online and media campaigns along with grassroots action.
In addition to calling for increased fuel efficiency standards, the green coalition will urge the EPA and other agencies to enact policies requiring industries to curb emissions.
The strategy shift by environmental groups comes after a disappointing summer that saw the Senate scrap a wide-ranging climate control and energy bill. It also acknowledges an expected power shift on the Hill with Republicans possibly gaining control of the House and Senate, which will make it all but impossible for President Obama to get his agenda through Congress.
With the road leading to the passage of sweeping climate control legislation effectively blocked, it becomes increasingly crucial for green groups to lobby the Administration and federal agencies to impose existing standards, which don’t require Congressional action, as a way to secure climate control and “green energy” victories.Read Full Post | Make a Comment ( None so far )
President Obama recently unveiled a new $50 billion stimulus package to create construction jobs and rebuild the nation’s crumbling infrastructure.
Opponents, including some Democrats, immediately questioned the plan, wondering if this latest stimulus package will have any more success than early packages which have so far failed to rev America’s still idling economic engines.
But what really scared lawmakers on Capitol Hill was a common-sense proposal that was part of the latest plan that would create a National Infrastructure Bank, a panel of independent experts that would weigh each infrastructure program to make sure the funds are not wasted on pork.
Whether or not you believe further stimulus spending will help reverse America’s economic decline, there’s no doubt that the federal government needs to end waste. And basing federal spending decisions on cost benefit analysis rather than politics is clearly a worthy idea. Seriously, do we need any more bridges to nowhere?
Unveiling the plan last week in Milwaukee, Obama said it would rebuild 150,000 miles of roads, maintain 4,000 miles of railway and restore 150 miles of airport runways.
“We want to cut waste and bureaucracy and consolidate and collapse more than 100 different programs that too often duplicate each other. So we want to change the way Washington spends your tax dollars. We want to reform a haphazard, patchwork way of doing business. We want to focus on less wasteful approaches than we’ve got right now. We want competition and innovation that gives us the best bang for the buck,” Obama said.
But lawmakers were unconvinced. Members of Congress are, of course, very protective of their political power and the establishment of an independent agency to oversee federal spending would strip Congress of the power to direct money into projects for their home states and districts.
Opponents have suggested the plan will simply shift the power to dictate pork barrel spending to the White House, which presumably would exercise some control over the decision-makers it appoints to oversee the bank.
Sadly, the plan seemed doomed just a week after leaving the drawing board, with even some Democrats balking at the idea of adding to the deficit to pump more cash into the economy.
Typical of vulnerable Democrats is Sen. Michael Bennet (D-Colo.), who already faced a tough primary challenge this year. “I will not support additional spending in a second stimulus package…. Public-private partnerships that improve our infrastructure are a good idea, but must be paid for, should not add a dime to the deficit,” he said.
If the latest stimulus plan dies as expected, the infrastructure bank idea should be revisited. After all, with America’s opinion of Washington at an all-time low, any plan that would take decision making out of the hands of politicians is worthy of consideration.Read Full Post | Make a Comment ( 1 so far )