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Saturday, February 14, 2009

What The Obama Stimulus Plan Will Do For America and Black Folks

CNN has a great article and breakdown of who gained, who lost and who survived in the final economic stimulus bill:

Winners

  • High-speed and inner-city rail: Went from $300 million in House bill to $2.25 billion in Senate to $8 billion in final version. There also is a $6.9 billion provision for public transit.
  • Amtrak: Picked up $500 million from both House and Senate versions to total $1.3 billion. The bill stipulates that no more than 60 percent can go to the Northeast Corridor.
  • National Institutes of Health: Ends up with $10 billion in the final bill. The House proposed $3.5 billion and the Senate wanted $10 billion -- $8.2 billion goes to the NIH director for his discretion.
  • Government oversight: Board to oversee stimulus bill spending will get $84 million to do the job. House bill allocated $14 million while the Senate bill called for $7 million. There is also more than $100 million more for various inspectors general in different agencies.
  • NASA: Banked just more than $2 billion, including $400,000 for science/global-warming research.

  • Losers

  • Veterans: Nearly all items for Veterans Affairs were reduced and the $2 billion the Senate wanted for VA construction was wiped out altogether. The VA did get one thing: $1 billion for medical facilities renovation and retooling.
  • Military construction: Cut and put into a general pot, a change from targeted money for each branch of the services. Army construction alone went from $600 million in the Senate and $900 million in the House to $180 million in the final bill. But negotiators compromised over a general military construction fund -- the House wanted $3.75 billion while the Senate allocated $118 million and settled on $1.45 billion for all services.
  • FBI: Senate had allocated $475 million but all was cut out of final bill.

  • Survivors

  • Pandemic flu research: Although senators agreed it wouldn't produce jobs, it's getting $50 million in the final bill, down from nearly $900 million. Watch the latest on the stimulus bill »
  • Damage control

  • Foreclosures: $2 billion is set for a neighborhood stabilization program that helps areas plagued with foreclosures by buying back properties and preventing blight.
  • Homeless: $1.5 billion is directed to homelessness prevention.
  • Passports: $90 million is going to the State Department to deal with domestic facilities that deal with passports and training.
  • Social Security: $500 million goes to replace its 30-year-old computer system.
  • Tax breaks

  • Car buyers: Anyone who buys a new car in 2009 gets to deduct the sales tax. To qualify, buyer must make less than $125,000 individually or $250,000 jointly. Cost is $1.7 billion.
  • Homebuyers: First-time homebuyers who purchase this calendar year get an $8,000 tax credit which does not have to be repaid like a similar measure last year. This phases out for people making more than $75,000 individually or $150,000 jointly. "First-time homebuyer" is defined as someone who has not owned a home for the past three years. Cost: $6.63 billion.
  • Paying for college

  • Pell grants: will increase to a maximum of $5,350 per student in 2009-2010 year thanks to two provisions in the stimulus.
  • Tax credits: Individuals making less than $80,000 or families making less than $160,000 can get up to $2,500 in tax credits for college tuition. 40 percent ($1,000) of the credit is refundable. Cost: $13.9 billion over 10 years. More at CNN

  • The Stimulus Plan and Black Folks:

    As reported by New America Media.org, responding to an inquiry by the editor of The St. Louis American newspaper, Secretary of Transportation Ray LaHood last week outlined portions of the $827 billion American Recovery and Reinvestment Plan that he says will specifically impact the Black community.


    The White House response came after a telephone press conference with Midwest reporters during which NNPA award-winning editor Alvin A. Reed asked LaHood about the minority participation aspects of the act, which President Obama has implored Congress to pass this week.

    Initially, LaHood hedged, responding, “That’s a point I have really not considered. We’ll have to get back to (him,) rather than give an answer I don’t really know.”

    Only hours after a story reporting the inquiry and response was posted on stlAmerican.com Feb. 5, LaHood issued the following detailed strategy, titled, “African Americans and the American Recovery and Reinvestment Plan” (The response has been lightly edited for style and clarity by the NNPA News Service):

    • General: The majority of the provisions in this recovery and reinvestment plan will assist African-Americans, who have been dramatically impacted during these tough times, in making it through this period with tax cuts for 95 percent of families, programs including extension of unemployment benefits, COBRA healthcare benefits, and food stamps and temporary assistance for needy families (TANF), while also preparing them for new opportunities with training for new jobs in existing and emerging industries.

    • Tax Cuts: This plan seeks to put money in the hands of consumers as quickly as possible through tax cuts for 95 percent of families. This is especially important for African-Americans who have experienced a reversal of fortune in the gains in wages and salary reached during the 1990s compared to others in the workforce. This immediate infusion of resources will not only allow them to purchase the items they need for their families, but also help rebuild our economy.

    • Job Creation: The unemployment rate for African-Americans was 12.1 percent and had risen to 12.6 percent when new job numbers were announced Feb. 6. This plan will create jobs with its investments in rebuilding roads and bridges and retrofitting government buildings while also working to help prepare job seekers for the 21st century economy with training for new “green jobs” and other emerging industries. The key is ensuring that African-Americans have access to information about all of these opportunities.

    • Education: Right now 95 percent of African-American children rely on public schools in America, yet a great number of these systems lack the funding they need to deliver the education that our children deserve and the facilities themselves are generally inadequate. This plan makes a historic investment in school modernization sufficient to renovate and modernize 10,000 schools, which also saves or creates jobs.

    The plan also invests in our children’s future by doubling the Early Head Start program which will provide additional pre-k services to more than 350,000 children and create at least 15,000 new teaching and teaching assistant jobs. Efforts are also being made to increase the Pell Grant maximum award above $5000 making college affordable for 7 million students. Finally, understanding that we are living during a time when tough choices have to be made, state and local governments should not have to cut education to make their budgets work. This plan provides resources so that potential education cuts can be bypassed in the immediate future.

    • Healthcare: African-Americans suffer from higher percentages of chronic diseases such as heart disease, kidney disease and diabetes while also suffering from a lack of access to quality care. Therefore during a time when many who rely on receiving healthcare through their employers are losing jobs, access to quality healthcare is an even greater concern. This plan offers a new tax credit to help families keep their health insurance through COBRA as well as a new option in Medicaid for low-income people who lack access to COBRA. Adjustments will also be made in funding formulas for state Medicaid programs so that Medicaid and SCHIP are not impacted by state budget shortfalls, protecting 20 million people whose eligibility might be at risk. More HERE

    AAPP: There are doubts in many quarters of the African American community to whether the Obama Stimuus plan will provide minority owned businesses and minorities a fair shake. I agree with, Ernesta G. Procope, who said, "The stimulus program will pump some $800 billion into the economy over the next two years. Ultimately, most of it is expected to go to businesses that will rebuild our infrastructure and create renewable energy resources, as well as to the firms that provide services to them—from accounting to food service to insurance. If minority-owned businesses don’t receive their fair share, President Obama would be wasting a golden opportunity to accomplish the many changes he has envisioned for our great country."

    AAPP: What do you think? Will blacks get any of these jobs and business opportunities through the Obama Stimulus Plan or will the states give contracts and jobs to their buddies? One only has to be reminded about FDR and Blacks.

    As Jim Powell over at the CATO Institute Noted, Good intentions are over-rated. Franklin Delano Roosevelt's New Deal, for instance, has been hailed for its lofty goals of reforming the American economy and helping the under-privileged. Yet mounting evidence, developed by dozens of economists across the country, shows that the New Deal prolonged joblessness for millions, and black people were especially hard hit.

    The flagship of the New Deal was the National Industrial Recovery Act, passed in June 1933. It authorized the president to issue executive orders establishing some 700 industrial cartels, which restricted output and forced wages and prices above market levels. The minimum wage regulations made it illegal for employers to hire people who weren't worth the minimum because they lacked skills. As a result, some 500,000 blacks, particularly in the South, were estimated to have lost their jobs. MORE HERE.

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