Thune Introduces Targeted Alternative Stimulus Plan

February 5th, 2009 - Washington, D.C. - Senator John Thune yesterday introduced the House Republican Substitute as an amendment (S. AMDT.#197) to the stimulus bill currently being debated before the Senate. Joining as cosponsors are Senator Jon Kyl (R-AZ), Senator Jim DeMint (R-SC), and Senator Mike Johanns (R-NE).

"The debate surrounding the stimulus bill has gone from good to bad to worse. What started out with bipartisan agreement on the need for a timely, targeted, and temporary stimulus package has since degenerated into a slow, unfocused, and an unending spending bill filled with every kind of pet and pork project imaginable," said Thune. "This targeted amendment creates twice the amount of jobs at half the cost.

"South Dakotans are tired of business as usual here in our nation's capital. They expect and deserve to have their hard-earned tax dollars used wisely to get the economy moving again. This trillion-dollar-plus spending spree, which represents the largest inter-generational transfer of debt in history, will not put our economy on the road to economic recovery, but it will put us on a bridge to nowhere."

Amendment Highlights:

Total Cost: Approximately $440 billion in tax relief for middle-class families and small businesses - approximately $40 billion in unemployment benefits.

Using the economic models of President Obama's top economic advisor, this amendment is projected to create 6.2 million jobs, or twice the jobs at half the cost of the House-passed bill. It does not include wasteful pet or pork projects and it ensures that the funding goes into effect immediately.

Using President Obama's economic models, Senator Thune's plan would create 9,000 more jobs in South Dakota.

Immediate Tax Relief for Working Families:

This proposal reduces the lowest individual tax rates from 15 percent to 10 percent and from 10 percent to five percent for 2009 and 2010. As a result every taxpaying-family in America will see an immediate increase in their income with an average benefit of $1,250 each year. A married couple filing jointly could save up to $3,400 a year in taxes.

Help for America's Small Businesses:

Small businesses (those employing less than 500 individuals) employ about half of all Americans and represent 99 percent of all businesses in the U.S., yet they can be subject to tax rates that siphon away one-third or more of their income. Among other small business tax relief provisions, this proposal would allow small business to take a tax deduction equal to 20 percent of their income. This will immediately free up funds for small businesses to retain and hire new employees.

Stabilizing Home Values:

The real-estate market is paralyzed as potential buyers wait on the sidelines for prices to fall even further. In order to encourage responsible buyers to enter the market and stabilize prices, this proposal would eliminate the requirement to repay the current $7,500 homebuyer tax credit for those buyers who can make a minimum down-payment of five percent.

No Tax Increases to Pay for Spending:

Faced with record levels of deficit spending and a growing national debt, this proposal states that tax increases now or in the future should not be used to pay for this new spending.

Assistance for the Unemployed:

Rather than taxing unemployment benefits as income, which only adds to the pain of those individuals already struggling, this proposal would make unemployment benefits tax free so those individuals between jobs can focus on providing for their families. The plan would also extend unemployment benefits from March to December, 2009.

"South Dakota families and businesses, and in other places across America, not government bureaucrats, know how best to reinvigorate our economy," Thune said.