We’ve talked a lot about how the bill the House came back into session to pass yesterday afternoon saves hundreds of thousands of jobs and prevents cuts in important public services.
Not everything about how it was paid for was good – there was a lot of bowing to deficit peacockery involved. But there’s one thing I do want to highlight about how it was paid for:
Closing Loopholes That Encourage Corporations to Ship Jobs Overseas (Offset of $9.8 Billion)
Eliminates tax provisions that encourage companies to ship jobs overseas, beginning in 2011.
The foreign tax credit is designed to prevent double taxation (i.e., full taxation by both a foreign country and by the United States) of income earned abroad. However, companies have devised schemes essentially shifting the burden of their foreign income tax onto the U.S. Federal government. These transactions enable companies to operate offshore with essentially little or no tax liability to either the U.S. or the foreign government.
This abuse of the foreign tax credit encourages companies to move jobs offshore to avoid U.S. taxation.
Foreign tax credit abuse is among the IRS’s top compliance concerns for large corporate taxpayers.
In 2004, U.S. multinational corporations paid an effective U.S. tax rate of just 2% on their $700 billion of foreign active earnings.
Includes Obama Administration provisions to crack down on corporations that split foreign tax credits from the income subject to foreign tax, allowing them to take advantage of the foreign tax credit to reduce their U.S. taxes even though the foreign income remains overseas.
Also eliminates unintended tax incentives for companies to move U.S. assets overseas, ensuring that foreign tax credits are not provided for income that is not subject to U.S. tax.
Limits the use of aggressive tax planning techniques that take advantage of anti-abuse rules in the tax code to avoid U.S. tax and generate additional foreign tax credits.
Republicans have fought to keep, and even expand, these kinds of loopholes for years.
Naturally, Republicans spent a lot of time talking about how this bill would raise taxes.
To which I say: Yes. Yes, it does raise taxes. ON CORPORATIONS TRYING TO SHIP JOBS OVERSEAS.
So Medicaid funding that will help elderly people in nursing homes and save the jobs of tens of thousands of teachers and other school employees and firefighters and other first responders is on its way to being passed. Cause for celebration, right? Jobs are saved, needed services (and lives) are saved, and our next generation gets a decent education.
House Minority Leader John Boehner sees this as a payoff to special interests. Who are the special interests here? Grade school students or their teachers? The janitors who clean their classrooms or the lunch ladies? Firefighters or the people they pull from burning buildings?
Other Republicans voted against it because it closed corporate tax loopholes. No, really. Senator Scott Brown looked at this bill and decided that because it closed loopholes that major multinational corporations exploit to avoid paying their fair share, he wouldn’t support jobs and services for Massachusetts.
This is how today’s Republican officeholders think: working people and children are special interests, multinational corporations should be defended at all cost.
After the extension of Medicaid funding to the states reached cloture in the Senate this morning (with the votes of Senators Snowe and Collins), the Senate bill should be passed by the end of the day tomorrow. Which leaves the House, which was scheduled to be out of session until September.
And then Speaker Nancy Pelosi went on Twitter to say this:
I will be calling the House back into session early next week to save teachers’ jobs and help seniors & children #FMAP
Within hours, the Senate will vote on a crucial bill to extend Medicaid assistance to the states. Like so many bills these days, its passage will probably hinge on the decision of Maine Senators Snowe and Collins.
Adequate, stable and consistent Medicare and Medicaid funding was and always will be directly linked with high quality care and staffing and employment stability.
Elderly Mainers residing or recuperating in skilled nursing facilities across our state need and deserve immediate help, and Gov. John Baldacci desperately requires extended federal financial assistance to help bridge the funding gap as our state economy recovers.
Extending FMAP assistance an additional six months is a fundamental, central step towards protecting the foundation of quality care every Maine resident deserves, and preserving the jobs of the front line care staff that help improve Maine’s seniors’ quality of life.
We urge our congressional delegation in the strongest possible terms to fight for continued funding for FMAP.
The FMAP emergency fund package to be voted on today is paid for with offsetting budget cuts elsewhere, thus addressing one of the concerns raised by Sen. Snowe and others earlier this summer. We encourage our two senators to approve the measure and thereby save jobs, and also protect critical health services, for hundreds of Maine families.
Snowe and Collins have already weakened so many bills that would have funded jobs and desperately needed services in their state. Indeed, they’ve weakened this one. But it remains vital to their state’s budget and economy—vital to their state’s working families. What will their answer be?
Congress has finally passed a bill to restore extended federal unemployment insurance to more than 2.7 million jobless workers, continue the program for millions more, and allow those unemployed for more than 26 weeks to file for the program through the end of November.
President Obama is scheduled to sign the unemployment extension later today.
The House passed the measure this afternoon, with the Senate having approved it last night by a vote of 59 to 39. Even after their two-month filibuster was finally overcome, Senate Republicans delayed a final vote for an additional 30 hours by refusing to give back any post-cloture time. The added delay caused another 60,000 long-term jobless workers to have their benefits cut off temporarily.
Now those benefits will begin to be paid out retroactive to June 1 when the Republican-led obstruction caused them to expire.
The victory on unemployment insurance comes just one day after President Obama signed a landmark Wall Street Reform and Consumer Protection Act which was passed by the Congress despite strenuous opposition from Wall Street’s lobbyists and conservative Republicans — the very folks whose disastrous policies caused the Great Recession and our debilitating high levels of unemployment.
The agonizing two-month struggle to pass an unemployment insurance extension exposed the Republicans as deficit frauds who want to block any measures to improve the economy and support a recovery. In their calculations, the more pain working families are in, the better the Republicans’ chances are politically.
That’s why renewed efforts are needed now to press the Congress to take up the critical measures that were put aside during the unemployment extension struggle. Congress needs to extend FMAP funds to help states pay for Medicaid and avoid mass layoffs; and it needs to provide critical state aid to help keep teachers in classrooms in the coming school year.
