Talk of tax cut lures army of lobbyists

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Lobbyists from almost every economic sector are converging on Capitol Hill in force, from the concrete and equipment manufacturers to the hotel and tourism corporations, and from the car rental and insurance companies to the public schools.

It's tax-cut time on Capitol Hill.

Some are backing tax breaks for vacationers, others want money to build new highways and others want a direct infusion of cash to bail out faltering businesses.

With the House set this week to take up legislation aimed at easing the economic damage resulting from the Sept. 11 terrorist attacks, lawmakers face a smorgasbord of appeals.

"There's probably a bucketful of money here that we can use and there's a whole truckload of ideas out there," House Speaker Dennis Hastert (R-Ill.) said. "Anytime you whisper a tax bill, you've got thousands of people lining up."

Though it is common practice for lobbyists to swarm when a tax bill is being written, some say it is unseemly for industries untouched by the events of Sept. 11th to seek help.

Grover Norquist, president of Americans for Tax Reform, was particularly disdainful of car rental companies looking for a bailout and Amtrak asking for cash to upgrade security.

"It's just outrageous and disgusting for people to say, `Oh, people were killed, give me money,'" Norquist said. "They should be taken out and horsewhipped. It's shameful to exploit this."

Of course, what is pork barrel spending to some is a dire need to others.

"It's a brutal, brutal time," said Barry Sternlicht, chairman and chief executive officer of Starwood Hotels and Resorts Worldwide Inc., with 120,000 employees.

Spurring tourism

Sternlicht and other hotel executives have visited lawmakers and White House officials, urging them to consider ways to spur Americans to travel again.

Although Congress spent $15 billion to bail out the airline industry after the terrorist hijackings, the airline, hotel and restaurant industries are still seeing fewer customers.

Sternlicht wants lawmakers to consider allowing businesses to fully deduct meals, entertainment and expenses, as well as the cost of taking a spouse on a business trip. He contends the deferral of hotel employees' payroll taxes would help the industry, as would loan guarantees for hotels with debt troubles.

In a similar vein, former House Speaker Newt Gingrich has written to members of Congress asking them to pass a six-month, $1,000 per-person tax credit for 50 percent of the cost of personal travel to revive the tourism industry.

"The crisis is real and the help is needed, but giving money directly to companies is the wrong approach," wrote Gingrich, whose spokesman said he is not working on behalf of any industry or corporation.

Immediate help sought

Some businesses, however, say they need cash now, not tax credits later. Several small car rental companies said they might be forced to fold without some government assistance.

Insurance companies that expect to deplete their reserves soon have been lobbying for the government to establish a fund they could use in case more terrorist attacks occur.

Many public schools--including Chicago's--are seeking billions for construction projects to create jobs and jump-start the economy.

"No matter how arcane the provision, somebody will be pushing it," said Chuck Pizer, a lobbyist for the Chicago Public Schools.

The House Ways and Means Committee on Friday approved a $100 billion economic stimulus package containing tax rebates for 30 million low-income workers and tax relief for businesses.

The measure is expected to pass the House, but members of the Democratic-controlled Senate want to make changes before the bill is sent to President Bush.

The two parties are sharply divided over the best way to help the economy heal. Republicans, for the most part, want to institute broad tax cuts, while Democrats advocate spending for construction projects and for security for ports, dams and water supplies.

Hastert said that finding the right balance is the challenge facing Congress as it tries to craft and pass an economic stimulus bill over the next week.

"This is like a fine old clock that's just not keeping time right anymore," he said of the economy. "Instead of taking a hammer to it or trying to paint over it, you have to take it very precisely and change those gears so it gets going again."

Copyright © 2014, Los Angeles Times
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