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Economic rescue package means 23,000 jobs and much more for Nebraska
Nebraska is often insulated from bad economic times, but we are definitely feeling the effects now of the recession with job layoffs and business closings. The economic recovery bill passed into law, while not perfect, will help prevent a further deepening in Nebraska while tossing a lifeline to millions of Americans who are already hurt by the sinking economy.
The stimulus plan will create or save 3 to 4 million jobs nationally, including 23,000 in Nebraska. It will send about $1.1 billion to Nebraska not including the tax cuts and unemployment insurance improvements. As its effects ripple through our economy it will help teachers, health care professionals, construction workers, small businesses and many other Nebraskans from across the state impacted by the worsening economy. Additionally, new tax cuts for families and businesses will brighten our future.
Many respected economists said we had to something to avoid a depression. That said, I was concerned about the scope of the initial plan and worked with a bipartisan group of moderates to successfully cut $108 billion from the bill so it will more effectively create jobs and stimulate the economy.
The end result won the support of the National Governors Association, the National Association of Manufacturers, United States Chamber of Commerce, the Omaha Chamber of Commerce and many other leading business groups.
Investments
The bill has $48 billion for roads, railways and bridges that will put people to work upgrading our nation's infrastructure. Nebraska will receive over $240 million for these projects.
There's $53.6 billion dollars to help states preserve educational services, rebuild schools, and support critical services in the State Fiscal Stabilization fund and a general purpose fund. Over $280 million dollars will come to Nebraska to directly support our economy from this fund.
The bill also provides funding to support clean water, flood control and environmental projects which will deliver nearly $40 million to our state. It provides $12 million for law enforcement drug task forces to fight illegal drug trafficking.
To help maintain health care services for thousands of low income Nebraskans, the bill provides $310 million in Medicaid funding, which also helps ease the burden on our state budget.
Together, these critical investments will not only preserve jobs and put people back to work, but will make a down payment on our state's growing and unmet educational and infrastructure needs which we stand to benefit from for years to come.
Tax Cuts
Some have complained the plan has only 25 percent in tax cuts, which is not quite right. About 63 percent of the final stimulus plan goes for investments, while 37 percent focuses on taxes. There's immediate tax relief for 95 percent of middle income workers through an income tax cut of up to $400 per worker and $800 per couple. That's money people can use to pay electricity or gas bills, to buy school clothes for children, or fix up a car.
The bill cuts taxes for families by expanding the child tax credit, the Earned Income Tax Credit, increases relief from the marriage penalty and increases the higher education tax credit.
It helps more than 4 million additional students attend college with a new, partially refundable $2,500 tax credit for families.
It protects 26 million middle-class families nationally -- 90,000 of them right here in Nebraska - from being hit by the unfair Alternative Minimum Tax..
It helps homebuyers and the home building industry by providing an $8,000 tax credit for first time homebuyers that does not need to be repaid.
There are "green" tax credits as well to help make the country more energy efficient while creating jobs including tax breaks to weatherize homes. In addition, the auto industry gets a big boost by allowing people who buy new vehicles to deduct the sales tax.
Tax Incentives for Business
The bill assists companies to reduce debt and provides incentives to create new jobs with tax credits for hiring recently discharged veterans and youth who've been out of work for 6 months. All told, the tax incentives for businesses in this bill are worth $76 billion in 2009 and 2010.
When effects of the bill kick in and the economy comes back firing on all eight cylinders I will work hard to make sure the revenue generated from all the new jobs is devoted to paying off the debt. The tools are now in place for economic recovery setting the stage for a promising future.