Corporate Junk Economics Return to Capitol Hill
By Robert Weissman
Focus on the Corporation: January 4, 2011
Watch out for corporate junk economics on Capitol Hill.
Rep. Darrell Issa, chair of the House Oversight and Government Affairs
Committee, has reportedly asked more than 150 trade associations,
corporations and think tanks to provide a wish list of public health,
environmental and other public protections that they would like to see
eliminated. The purported rationale for such an effort is to spur growth,
but in fact this is the cutting edge of a movement to trade away public
health, clean air, and a stable economy to gin up corporate profits already
at record highs.
If Rep. Issa actually wants to focus on job preservation and growth, he
might consider the following:
* Business is plenty good for business right now, just not for workers.
Corporations earned record profits in the past quarter -- U.S. corporations
raked in profits at an annual rate of $1.659 trillion in the third quarter
of 2010. Corporations' failure to hire has nothing to do with public
protections.
* Corporations and their apologists routinely overstate the costs of public
protections and ignore their benefits. To take one example, the Heritage
Foundation attributes more than a third of all costs of regulation issued in
2010 to fuel economy standards. Yet Heritage fails to mention that the
National Highway Traffic Safety Administration found those rules would
confer benefits three times as great as the costs.
Indeed, even the Bush administration found that major regulations' benefits
far outweigh their costs, concluding that the totals cost of major
regulations issued from 1997-2007 was between $46 billion and $53 billion,
while benefits were, at minimum, more than twice that: $122 billion to $656
billion.
* We need to regulate Wall Street and other big corporations in order to
save jobs. The failure to regulate Wall Street, and to enforce existing
regulations, led directly to the Great Recession and the loss of 8 million
jobs (most of those in the small business sector). An oversight committee
concerned about job preservation and growth should prioritize looking at the
ways Wall Street and the big banks are under-regulated, and push hard for
more controls on the reckless financial sector.
* We need to regulate Big Business to stop rampant criminality and
wrongdoing. Example: in the last five years alone, Big Pharma has paid $14.8
billion in penalties for allegedly violated federal and state laws,
primarily for cheating the federal and state governments on price, and for
improperly marketing medicines for purposes for which they had not been
approved.
* Clean air, healthy workplace and other rules regularly force innovation,
creating new jobs and economic dynamism. Responding to the existential
threat of climate change is an extraordinary economic opportunity to build
whole new industries and lower energy input costs across the board. But
we'll never capture those benefits -- nor, more importantly, prevent climate
catastrophe -- unless rules are set down to force private sector action.
Rather than providing a platform for presentation of a corporate wish list,
Rep. Issa should be subjecting corporate claims to the withering scrutiny he
promises for the Obama administration. These claims collapse under
examination.
It's time we ended the Kabuki theater of corporate whining, and got on with
the serious business of creating jobs and making America safer and cleaner.
Robert Weissman is president of Public Citizen, <www.citizen.org>.
(c) Robert Weissman
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***
Most Americans say tax rich to balance budget: poll
Kristina Cook
Reuters: January 3, 2011
NEW YORK (Reuters) - Most Americans think the United States should raise
taxes for the rich to balance the budget, according to a 60 Minutes/Vanity
Fair poll released on Monday.
President Barack Obama last month signed into law a two-year extension of
Bush-era tax cuts for millions of Americans, including the wealthiest, in a
compromise with Republicans.
Republicans, who this week take control of the House of Representatives,
want to extend all Bush-era tax cuts "permanently" for the middle class and
wealthier Americans. They are also demanding spending cuts to curb the $1.3
trillion deficit.
Sixty-one percent of Americans polled would rather see taxes for the wealthy
increased as a first step to tackling the deficit, the poll showed.
The next most popular way -- chosen by 20 percent -- was to cut defense
spending.
Four percent would cut the Medicare government health insurance program for
the elderly, and 3 percent would cut the Social Security retirement program,
the poll showed.
Asked which part of the world they would fix first, the largest proportion
of respondents -- 36 percent -- chose Washington, compared with 23 percent
who picked the Middle East and 14 percent who chose Haiti.
The poll included a random sample of 1,067 adults across the United States
from November 29 to December 2. The margin of error may be plus or minus 3
percentage points, 60 Minutes/Vanity Fair said.
(Reporting by Kristina Cooke; Editing by Daniel Trotta and Peter Cooney)
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