Business & Economy
Harkin Statement on the Debt-Ceiling Vote in the Senate PDF Print E-mail
News Releases - Business & Economy
Written by Harkin Press Office   
Tuesday, 02 August 2011 16:23

WASHINGTON, D.C. – Senator Tom Harkin (D-IA) today issued the following statement after the U.S. Senate voted 74-26 to approve the debt-ceiling deal.  Last night, Harkin delivered a floor speech in opposition to the measure. To view his video, click here.

“To say that this is the wrong policy at the wrong time is a gross understatement.  This deal will destroy millions of jobs in both the public and private sectors.  And by shutting off Federal funding and investment – a critical engine sustaining our sputtering economy – it could easily plunge America back into recession.

“I have advocated a balanced approach to deficit reduction, including both spending cuts and revenue increases.  But this deal expressly rejects a balanced approach.  It offends people’s basic sense of fairness that Congress would slash funding for things like student loans and cancer research, essential funding for seniors, people with disabilities, and the most vulnerable people in our society but ask not one dollar of shared sacrifice from millionaires and billionaires, who have received huge tax breaks over the last decade.  

“Since the 1930s, Congress has routinely raised the debt ceiling 89 times, including seven times during the presidency of George W. Bush, and 18 times under President Reagan.  Yet, this time, Congressional Republicans held the economy hostage, threatening to default on our national debt and plunge America back into recession unless their demands were met.


“This deal was not about reducing the deficit; first and foremost, this deal was about preserving hundreds of billions of dollars in tax breaks for corporations and for the wealthiest people in our society.”

 

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Q & A: Tax Expenditures PDF Print E-mail
News Releases - Business & Economy
Written by Grassley Press   
Tuesday, 02 August 2011 16:17

Q.  What are tax expenditures, and why are they in the news?

A.  Tax expenditures are defined in the Congressional Budget Act of 1974 as lost federal income due to provisions in the tax code that exempt or reduce taxes for certain groups, products or activities.  Tax expenditures were intentionally passed by Congress for certain policy goals, such as encouraging employer-provided health insurance or home ownership, so they are also called tax incentives.  Since they help achieve goals set by Congress, they are not loopholes. The debate in Washington over reducing the federal debt has invoked whether certain tax expenditures should be ended.  Stopping these tax expenditures would raise money for the federal Treasury but also would take away tax incentives that are used by tens of millions of middle-income taxpayers.  There’s also controversy over whether the amount of revenue raised by ending some of the tax expenditures is overstated and whether the revenue gained would be worth ending policies that support widely desirable behavior, like pension plan contributions.  

Q.  What are the biggest tax expenditures?

A.  An analysis by Senator Orrin Hatch of Utah, who serves as Ranking Member of the Senate Committee on Finance, which is responsible for tax legislation, determined these top 10 largest tax expenditures.  The analysis was based on data from the nonpartisan Joint Committee on Taxation, Congress’ official estimator for the cost of tax legislation.

Exclusion for Employer-Provided Health Insurance.
Representing 13 percent of tax expenditures, it’s the single largest tax expenditure.  To do away with this would threaten access to health care for families and individuals that have health insurance through their employers.

Home Mortgage Interest Deduction.
Having helped millions of Americans achieve home ownership, this expenditure accounts for nine percent of all tax expenditures.

Preferential Rates for Dividends & Capital Gains.
Take away this tax expenditure which accounts for eight percent of tax expenditures, and the rate on dividends will almost triple in less than 18 months, and the rate on capital gains will go up 59 percent, also in less than 18 months.  This will discourage investment in stocks and bonds.

Exclusion of Medicare Benefits.
Accounting for seven percent of tax expenditures, its elimination would increase taxes seniors’ Medicare benefits.

Pre-Tax Treatment of Defined Benefit Pension Plan Contributions.
This is a tax benefit that reduces the cost for those workers who save for retirement.  It represents six percent of tax expenditures.

Earned Income Tax Credit. 
Designed for low-income people, the Earned Income Tax Credit accounts for five percent of all tax expenditures.

Deduction for State and Local Taxes. 
This deduction would hit high-tax states hardest, driving up the marginal rate of taxpayers who take this deduction by as much as 35 percent.  It represents five percent of all tax expenditures.

Pre-Tax Treatment for Contributions to a 401(k).  
At four percent of tax expenditures, this is a significant incentive to families and individuals to save for retirement.

Exclusion of Capital Gains at Death.  
If this one goes, death would be taxed twice.  First, the decedent’s estate might get hit with the death tax.  Then the decedent’s heirs would be subject to tax again on the gain embedded in any inherited asset, should they decide to sell it.  This accounts for four percent of tax expenditures.

Deductions for Charitable Contributions. 
This is the tax benefit for donations to charities other than education and health care institutions, including donations to religious institutions.  This charitable deduction represents four percent of tax expenditures.

Source: Joint Committee on Taxation, “Estimates Of Federal Tax Expenditures For Fiscal Years 2010-2014,” December 21, 2010. http://www.jct.gov/publications  

 

Q.  Are tax expenditures the same as tax loopholes?

A.  Despite some political arguments to the contrary, tax expenditures are neither spending nor tax loopholes for millionaires, yachts or corporate jets.  Less than one-tenth of one percent of all tax expenditures benefit corporate jet owners.  Tax expenditures are used by many families and individuals.  Consideration of them by Congress should be done in a comprehensive tax reform debate to make sure the tax code is made more efficient and no more burdensome than it is today.

 
Patt Englander Appointed Quad City BBB Leader PDF Print E-mail
News Releases - Business & Economy
Written by Laura Chavez   
Monday, 01 August 2011 09:34

The Better Business Bureau is pleased to announce that Patt Englander has accepted the position of Quad City BBB Community Representative.  Patt will be responsible for implementing a new vision and strategic direction for the BBB in the Quad Cities.  She will lead a decade-old office by reenergizing the local BBB brand and promoting the 450 Quad City BBB Accredited Businesses.  

“We are thrilled to have Patt serving the BBB.  We are a 99 year old organization and Patt’s skills will propel us in to our second century of work.  She is a proven and recognized Quad City leader,” stated Chris Coleman, President of the BBB serving Greater Iowa, Quad Cities and Siouxland Region. 

Former President and Chief Executive Officer of the Mississippi Valley Regional Blood Center, Patt has also served in leadership positions at the American Red Cross of the Quad Cities and Center for Active Seniors.    She has a MBA from St. Ambrose University and recently helped create a local Dress for Success affiliate.

In recent years, the BBB system has embraced the benefits of technology with consolidation of services.   The new vision for the Quad Cities reverses that trend by reopening the Bettendorf office and focusing exclusively on the Quad Cities and surrounding areas.  The BBB will still provide state-of-the-art online and phone services to residents of the Quad Cities.  The re-tooled office will add a local flavor and enable the BBB to effectively promote its Accredited Businesses, warn consumers of pending scams, and provide tips and advice to the community.

Englander stated, “The mission to advance trust– right here in the Quad Cities is why I was attracted to this position.  In tough economic times like we are in today, I know the BBB is needed more now than ever.   I look forward to building our brand and our membership.”

The BBB’s mission is to be the leader in advancing marketplace trust. The BBB accomplishes this mission by creating a community of trustworthy businesses; setting standards for marketplace trust; encouraging and supporting best practices; celebrating marketplace role models, and denouncing substandard marketplace behavior.  The BBB is the resource to turn to for objective, unbiased information on businesses. Our network of national and local BBB operations allows us to monitor and take action on thousands of business issues affecting consumers at any given time.

 
The Impact of Immigration Reform on Americans Seeking Jobs PDF Print E-mail
News Releases - Business & Economy
Written by Grassley Press   
Tuesday, 26 July 2011 13:54

Prepared Statement of Ranking Member Chuck Grassley  

Senate Committee on the Judiciary  

Subcommittee on Immigration, Refugees and Border Security  

“The Economic Imperative for Enacting Immigration Reform”  

Tuesday, July 26, 2011    

For years, our country has struggled to find a way forward on immigration reform.  Since the debate reached its peak in 2007, our economy has experienced turmoil comparable to the Great Depression.  Americans are out of work, families are being foreclosed on, and businesses are suffering.  I agree we must do all we can to improve our economic situation.  However, I have concerns with the notion that increasing immigration levels and enacting legalization programs is the answer to the current economic downturn.  

We know it’s unlikely that this Administration will push immigration reform in the next year and half.  However, it’s my firm belief that we can find agreement on reforms for high skilled workers – and this hearing is a good first step in starting the discussion. 

I’ve spent a lot of time and effort into rooting out fraud and abuse in our visa programs, specifically the H-1B and L visa programs.  I have always said these programs can and should serve as a benefit to our country, our economy and our U.S. employers.   However, it is clear they are not working as intended, and the programs are having a detrimental effect on American workers.  Thankfully, the H-1B visa program has an annual cap as a stop-gap measure. But frankly, we need to act immediately to enact true reforms.  For this reason, and for many years, Senator Durbin and I have worked on legislation to close the loopholes in the programs.  Our legislation would ensure that American workers are afforded the first chance to obtain the available high paying and high skilled jobs.  We have worked together to make sure visa holders know their rights.  We have worked to increase oversight by the executive branch and have advocated for the Departments of Labor and Homeland Security to implement tighter controls.  The bill we have written would strengthen the wage requirements, ridding the incentives for companies to hire cheap, foreign labor.  Our bill would require companies to attest that they have tried to hire an American before they hire a foreign worker.  

The attention that Senator Durbin, I and others have put on H-1B visas has had an impact.  Our efforts have increased scrutiny and have forced bad actors to find other ways to enter, live and work in the United States under false pretenses.   The increased oversight of the H-1B program, for example, has caused businesses to “think creatively” to get around the program, using both the L and B-1 visa to bypass the requirements and protections under the H-1B visa program.  

On February 23, 2010, an employee of Infosys filed a complaint alleging that his employer was “sending lower level and unskilled foreigners to the United States to work in full-time positions at Infoysys’ customer sites in direct violation of immigration laws.”  The complaint further states “Infosys was paying these employees in India for full-time work in the United States without withholding federal or state income taxes.”  Infosys, one of the top ten H-1B petitioning companies, has worked to “creatively” get around the H-1B program by using the B-1 business visitor visa in order to bring in low-skilled and low-wage workers.  However, B-1 visa holders are not able to receive salary or income from a U.S. based company and thus, Infosys is being accused of visa fraud. That plaintiff, Jay Palmer, has written a statement to be placed into the record.  The courts will decide if the activities of Infosys were illegal.  But I can definitely say that their actions don’t comport with the spirit of the law.  

In addition to using the B-1 visa to get around the H-1B, companies are looking at ways to increase their use of the L intercompany transfer visa.  The L visa program has no annual cap.  It does not hold employers to wage requirements.  It provides flexibility and allows businesses to bypass the red tape that comes with other work programs.  On March 29, 2011, I wrote to the Acting Inspector General at the Department of Homeland Security with my concerns on the L intracompany transferee visa program and requested the office investigate the fraud and abuse.  The last review of the program was completed over five and a half years ago with recommendations that have yet to be implemented.  Serious loopholes continue to exist and be exploited to the detriment of the system. 

That brings me to another program that is undermining American workers, and one that gets very little attention from bureaucrats and investigators.  The Optional Practical Training – known as OPT – is a program that was created entirely through regulation.  There’s nothing in the Immigration and Nationality Act that allows the executive branch to run the OPT program.   

But, it’s high time that we start taking a closer look at the impact this program has on American students and workers.  Originally, OPT was created to give foreign students the ability to further their knowledge before returning to their home country.  However, today it is being used as a bridge to an employment visa or other immigration status.  Students are allowed to work in any field for an extra 12 to 29 months.  There is no limit on how many can apply for OPT, and more importantly, it is the schools and universities that principally administers the program.  There are very few checks and balances when it comes to the schools and employers.  The Department of Homeland Security may not even know where the student is being employed, creating a substantial national security risk.  More scrutiny must be placed on this program.  This past January, Senator Durbin and I wrote to Secretary Napolitano in regards to this, and other immigration issues.  The Secretary in response provided figures which were quite surprising.  U.S. Citizenship and Immigration Services approved 95,259 OPT petitions in fiscal year 2010 alone.  She did not, however, give any reassurances that the Department would add any safeguards nor will they commit in this economy to reduce the amount of time these foreign students are working in the U.S.  I will continue to press the Department for this much needed reform to protect American students and workers.    

Finally, I’d like to address the idea being pushed by many immigration advocates and some members in the House of Representatives.  As part of the solution to America’s immigration problem, some policy makers have proposed the idea of giving immigrants a green card upon graduation.  In their opinion, this would prevent the loss of all the resources put into these students if they are forced to return home.  While it is important to keep the best and the brightest, getting a degree from a U.S. institution should not equate to a fast track to citizenship for all.  Should this happen, the demand for enrollment in U.S. universities by international students would only increase and further erode the opportunities for American students.  

America should continue to be the land of opportunity for those who wish to seek it.  We have a rich history of multiculturalism which has helped us become the strong, proud country we are today.  Our excellent system of higher education boasts many of the best scholars and researchers in their fields.  This system is one of our best resources and should be made available to all American students.  For more and more students, this resource is often not available to them.  As the amount of international students continues to rise, access to this precious resource for American students is lost.  Attaching a green card to each international student’s diploma would only accelerate this process and crowd more and more American students out of a chance to achieve their dreams.      

I will continue to push for more reforms in our immigration system to ensure Americans are the number one priority and are not displaced.  I thank the Chairman and Ranking Member for their courtesies in scheduling this hearing and I look forward to the testimony from our panels of witnesses.    

 

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Governor Quinn Signs Laws to Support Innovation in Illinois and Create Jobs PDF Print E-mail
News Releases - Business & Economy
Written by Laurel White   
Tuesday, 26 July 2011 13:29

New Laws Will Boost Emerging Technologies and Create Illinois Jobs in Technology-Based Fields

CHICAGO – July 25, 2011. Governor Pat Quinn today signed legislation to support the development of the technology industry in Illinois and create jobs. Senate Bill 107 strengthens Illinois’ position to attract technology-based businesses by boosting the state's investment in them. The new law was one of the Governor’s priorities during the spring legislative session, and it represents a major component of his aggressive agenda to support emerging technologies in Illinois, creating the jobs of today and tomorrow.

“Creating jobs throughout Illinois is one of my top priorities, and targeted investments in the technology industry will create jobs today while strengthening our role in the global economy of tomorrow,” Governor Quinn said. “This important new law allows us to invest in the companies that invest in Illinois, creating high-paying jobs for our skilled workforce.” 

Senate Bill 107, sponsored by Sen. Dan Kotowski (D-Park Ridge) and Rep. Daniel Biss (D-Evanston), allows the state to build upon the success of its Technology Development Account (TDA I). The TDA I allowed the state to invest up to 1 percent of its investment portfolio in venture capital firms that invest in technology-based businesses – those providing computer, IT, laboratory or experimental services and products – that are interested in locating or expanding in Illinois.

The new law allows the state to invest up to 2 percent of its portfolio in venture capital firms. This allows to state to invest an estimated $150 million into venture capital funds, generating an estimated $300 million of venture capital investment into Illinois companies. Companies may use the funding for activities such as research and development, marketing new products and workforce expansion.

“The highest priority in Illinois is putting people back to work,” Sen. Kotowski said. “Senate Bill 107 will help create a healthy business climate that ensures economic vitality and spurs job growth. Encouraging the development of innovative Illinois‐based businesses will truly benefit our state. I have been pushing for this legislation for the last three years because I believe these businesses can lead to a stronger Illinois economy.”

“I am proud to be the Chief House Sponsor of Senate Bill 107,” Rep. Biss said. “It is not often that we have the opportunity to pass legislation which simultaneously earns money for the taxpayers and creates good high wage jobs. But this legislation does just that by creating an excellent investment opportunity for the state, while filling a critical venture capital gap that will allow Illinois entrepreneurs to start successful high-tech businesses.”

According to the Illinois Venture Capital Association, the state’s investments into Illinois venture capital firms under the original TDA I, starting in 2002, allowed those firms to invest $115 million in 37 Illinois companies. That in turn attracted more than $450 million in additional private investment. Companies that received TDA I investments created approximately 1,200 direct jobs and around 2,700 indirect jobs in Illinois.

Governor Quinn today also signed legislation that builds upon his commitment to supporting Illinois’ technology-focused entrepreneurs. House Bill 1876, sponsored by House Minority Leader Tom Cross (R-Oswego) and Sen. Linda Holmes (D-Aurora) creates the Higher Education Technology Entrepreneur Center Act. The law enables the board of trustees at the state’s public universities and community colleges to start a technology entrepreneur center. The centers must provide students with the resources to allow them to develop innovative concepts into goods or services they can market. The new law builds on a successful program that was established at the University of Illinois at Urbana-Champaign.

“It is so important to encourage entrepreneurs and innovation in our state,” Rep. Cross said. “We have to constantly be working on legislation that will help our residents explore, cultivate and invent ideas that will grow new businesses and jobs in Illinois.”

Both new laws go into effect immediately.

Today’s bill signing ceremony took place at Chicago TechWeek 2011, a week-long conference and trade show that celebrates the technology, web and interactive communities. The event gathers 2,000 entrepreneurs, business leaders and innovators from across the nation to connect with the latest web and mobile technologies.

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