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"Corporate Welfare" Salvos Largely Spare S&T

January 31, 1997

Calls for an end to "corporate welfare" increased this week with an unusual coalition unveiling a list of targeted programs and nine senators calling for a commission to review federal subsidies to companies.

A coalition of liberal and conservative organizations has agreed to a list of twelve federal programs, including three technology-related programs, that should be terminated or modified because they are "corporate welfare."

Members of the Stop Corporate Welfare Coalition include the National Taxpayers Union, Friends of the Earth, and Ralph Nader's Public Citizen. The Coalition has worked with Rep. John Kasich (R-OH), chairman of the House Budget Committee, to identify target programs.

Among the programs targeted for elimination are three conducted through the Department of Energy: research on clean coal technology; fossil energy research; and, a pyroprocessing program that reprocesses spent nuclear fuel.

"The groups on the right would not allow tax breaks to be eliminated, and environmental groups allowed only programs that harm the environment to be included on the list," according to a statement by the U.S. Public Interest Research Group.

At the same time, a Senate bill (S.207) has been introduced that would create a commission to perform a "comprehensive review of ...unfair corporate subsidies" and make recommendations on "the reform or elimination of such subsidies."

The Corporate Subsidy Reform Commission Act of 1997, sponsored by Sens. McCain (R-AZ), Thompson (R-TN), Kerry (D-MA), Feingold (D-WI), Kennedy (D-MA), Coats (R-IN), Glenn (D-OH), Lieberman (D-CT), and Brownback (R-KS), would establish a process to identify, review, reform, and eliminate "unnecessary and inequitable subsidies, including tax advantages" provided to businesses.

The bill specifically says that payments or tax advantages that are "awarded for the purposes of research and development in the broad public interest on the basis of a peer-reviewed... procedure" and "research and development that the private sector cannot reasonably be expected to undertake without federal support..." are not to be considered inequitable federal subsidies.

A similar bill was approved last session by the Governmental Affairs Committee, but not considered by the full Senate.