Congress: Time to Take a Stand
Here's an idea: Throw all the lobbyists out of Washington for the duration of the war against terrorism. It's bad enough seeing special interests dominate the U.S. political system in times of peace, but the spectacle of lobbyists pleading for their clients under the guise of national security is unseemly at best, and perhaps even repellent. It's simply unacceptable to see lobbyists waving the flag to get a piece of the emergency economic stimulus bill for their clients. Corporate America would do well to show restraint in this moment of national crisis.
Take the insurance industry, for whom September 11 is proving a bonanza. Companies are raising rates 20%, 50%, even 100% on some lines of industrial and commercial insurance, even as their lobbyists press to get the government to pick up most of the claims from future terrorism. True, insurers may pay out $40 billion to $70 billion in claims related to the World Trade Center attacks. But they have $300 billion in capital and are busy raising more--a sign that, even in the face of the most terrible disaster, they are financially sound. To raise rates by the amounts being contemplated, while asking government to bear much of the risk, is unjustified.
Alas, the insurance industry isn't alone in mining for disaster gold. Partisanship runs rampant on both sides of the congressional aisle, and politicians seem to be fighting to satisfy loyal political constituencies, not help the country as a whole. Many narrow tax cuts and spending programs originally proposed when the nation was at peace are being recycled as wartime necessities.
For example, companies are lobbying hard for the abolition of the corporate alternative minimum tax, claiming that it would stimulate the economy and boost earnings. Moreover, some companies are pushing for retroactive refunds of AMT payments for past years, which would cost billions more. But neither change would boost growth, since neither refunds of past AMT payments or elimination of future minimum tax payments would give corporations much of a reason to increase investment.
On a smaller scale, other special interests have taken the opportunity to load their self-interested tax cuts into the stimulus bills. One provision in the Senate bill would extend a tax credit, due to expire this year, for electricity produced from wind, biomass, and even poultry litter. Financial-services firms are looking to extend a tax break on foreign profits.
The nation came together after September 11 as it hadn't for decades. It put aside its differences to stand on common ground to face a common enemy. Washington can do no less. Exploiting national security for private gain is not in the national interest.