{"id":355017,"date":"2010-02-23T09:48:47","date_gmt":"2010-02-23T14:48:47","guid":{"rendered":"tag:www.southernstudies.org,2010:\/\/5.12152"},"modified":"2010-02-25T10:40:04","modified_gmt":"2010-02-25T15:40:04","slug":"arra-as-a-corporate-rescue-plan","status":"publish","type":"post","link":"https:\/\/mereja.media\/index\/355017","title":{"rendered":"ARRA as a corporate rescue plan"},"content":{"rendered":"

By Phil Mattera, Dirt Diggers Digest<\/a><\/i><\/p>\n

A war of words is raging over the impact of the Obama administration’s $787 billion stimulus program, which is now one year
\nold. Conservative members of Congress are mounting a relentless assault
\non what they see as an abject failure, even as many of them unabashedly<\/a>
\npromote and at least implicitly take credit for individual American
\nRecovery and Reinvestment Act (ARRA) projects in their home districts.<\/p>\n

Meanwhile, the office of Vice President Joe Biden has issued a report<\/a>
\ninsisting that ARRA has created or saved 2 million jobs and has brought
\nmany states back from the brink of fiscal disaster. The stimulus
\neffort, Biden insists, “is going well.”<\/p>\n

The debate boils down to an age-old disagreement between those
\nopposed to allegedly wasteful social spending and those who believe
\ngovernment has to reinforce the social safety net during a time of
\neconomic distress.<\/p>\n

Both sides are ignoring the fact that ARRA, to a significant degree,
\nis a rescue plan not just for unemployed workers and struggling state
\ngovernments, but also for parts of corporate America. This goes far
\nbeyond the roughly $50 billion in business tax breaks that Republicans
\nlast year insisted be part of the plan.<\/p>\n

The Recovery Act represents a big step in the direction of what was
\nonce called industrial policy. Billions of ARRA dollars are being used
\nby the federal government to encourage the development of new
\nindustries in areas such as renewable energy and health information
\ntechnology that are seen as the foundation of future economic growth.
\nBillions more are being spent on traditional procurement contracts to
\nboost private-sector activity.<\/p>\n

Here are some examples of larger injections of ARRA funds going directly to the corporate sector:<\/p>\n

ADVANCED ENERGY MANUFACTURING TAX CREDITS<\/em><\/p>\n

Hemlock Semiconductor<\/strong>, a joint venture of Dow Corning (itself a joint venture of Dow Chemical and Corning Inc.) and two Japanese companies: $141 million<\/a> for the production in Michigan of polycrystalline silicon used in solar panels.<\/p>\n

Wacker Polysilicon North America LLC<\/strong>, a subsidiary of the German chemical company Wacker Chemie: $128 million<\/a> for a plant in Tennessee that will produce polysilicon for solar cells.<\/p>\n

United Technologies Corporation<\/strong>, the big military contractor: $110 million <\/a>for new equipment at its Pratt & Whitney plants to help produce more energy-efficient jet engines.<\/p>\n

Alstom<\/strong>, the big French power and transportation equipment firm: $63 million<\/a> for a Tennessee facility that will produce the world’s largest steam turbines for nuclear power plants.<\/p>\n

GRANTS FOR DEVELOPMENT OF ADVANCED BATTERIES FOR ELECTRIC VEHICLES<\/em><\/p>\n

Johnson Controls<\/strong>: $299 million<\/a> for work on nickel-cobalt-metal battery cells<\/p>\n

A123 Systems Inc.<\/strong>: $249 million<\/a> for work on nano-iron phosphate cathode powder and electrode coatings.<\/p>\n

General Motors<\/strong>: $105 million<\/a> for production of high-volume battery packs for the GM Volt.<\/p>\n

“CLEAN” COAL POWER INITIATIVE<\/p>\n

American Electric Power Company<\/strong>: $334 million<\/a> for the development of a chilled ammonia process to capture CO2 at a power plant in West Virginia.<\/p>\n

Southern Company Services<\/strong>: $295 million<\/a> for the retrofitting of a CO2 capture installation at a coal-fired power plant in Alabama.<\/p>\n

BROADBAND EXPANSION<\/em><\/p>\n

ION HoldCo LLC<\/strong>, a partnership led by Sovernet Communications: a $39 million<\/a> grant to expand fiber-optic broadband in rural areas of upstate New York.<\/p>\n

Biddeford Internet Corp.<\/strong> (dba GWI): a $25 million<\/a> grant to extend a fiber-optic network to rural and disadvantaged parts of Maine.<\/p>\n

ENERGY LOAN GUARANTEES<\/em><\/p>\n

Solyndra Inc.<\/strong>: a $535 million<\/a>
\nloan guarantee to support the construction of a commercial-scale
\nmanufacturing facility for cylindrical solar photovoltaic panels.<\/p>\n

PROCUREMENT CONTRACTS<\/em><\/p>\n

Lockheed Martin<\/strong>: $165 million<\/a> to work on the crew vehicle for NASA’s Project Orion.<\/p>\n

Clark Construction Group<\/strong>: $152 million<\/a> to design and build a new headquarters for the U.S. Coast Guard in Washington, DC.<\/p>\n

General Motors<\/strong>: $104 million<\/a> to supply light trucks, station wagons and alternative fuel vehicles to the General Services Administration.<\/p>\n

GlaxoSmithKline<\/strong>: $62 million<\/a> from the Department of Health and Human Services to do research on the H1N1 flu vaccine.<\/p>\n

To this list can be added the thousands of contracts that states
\nhave awarded to private companies to carry out ARRA-funded activities
\nsuch as highway repair, school construction and environmental
\nremediation.<\/p>\n

It is surprising that there has been so little debate on the
\nrelative merits of all these projects and programs — as well as on the
\nwisdom of providing direct subsidies to profit-making entities. Are
\nthese grants, contracts, tax credits and loan guarantees a smart
\ninvestment in the future or nothing more than business boondoggles?<\/p>\n

With a significant portion of the Recovery Act going to aid
\ncorporations, we also have a right to ask why they are not creating
\nmore jobs with the taxpayer funds they have received. It would also be
\nhelpful to know — though the limitations of ARRA data collection make
\nthis difficult — how good are the jobs that have been created (in terms
\nof wages and benefits) and whether those jobs are being equitably
\ndistributed among different portions of the population.<\/p>\n

If we are ever going to reach any meaningful conclusions about the
\nwhole stimulus endeavor, we’ve got to go beyond tired debates about Big
\nGovernment versus the Free Market. Like the bailout of the banks and
\nthe auto companies, ARRA is changing the relationship between the
\npublic and private sectors. Now we need to know whether the new
\narrangement is working and who is reaping the benefits.<\/p>\n","protected":false},"excerpt":{"rendered":"

By Phil Mattera, Dirt Diggers Digest A war of words is raging over the impact of the Obama administration’s $787 billion stimulus program, which is now one year old. Conservative members of Congress are mounting a relentless assault on what they see as an abject failure, even as many of them unabashedly promote and at […]<\/p>\n","protected":false},"author":4533,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7],"tags":[],"class_list":["post-355017","post","type-post","status-publish","format-standard","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts\/355017","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/users\/4533"}],"replies":[{"embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/comments?post=355017"}],"version-history":[{"count":0,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts\/355017\/revisions"}],"wp:attachment":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/media?parent=355017"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/categories?post=355017"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/tags?post=355017"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}