WASHINGTON, DC - First District Congressman Paul Ryan today voted in favor of the Economic Security and Recovery Act of 2001, H.R. 3090. This legislation addresses our  lagging economy by improving incentives to invest that will stimulate economic growth.  The legislation passed in the House of Representatives by a vote of 216-214.

“I supported this bill because I believe it will help grow the economy, put people back to work, and help people keep the jobs they have,” Ryan said.  “It will encourage more investment, which is the key to improving our economy. I’ve talked to many constituents who are worried about how long this economic downturn will last and whether they will be able to keep their jobs. Today’s action in Congress is a big step toward helping these folks by speeding up our economic recovery.”

“The bottom line is - we need to keep people working in this country.  Consumer confidence and spending will rebound only if people have job security, and if we are to face the challenge of saving Social Security and Medicare and paying down our debt we need to grow this economy and regain the surpluses that will help us do this,” Ryan said.

The Economic Security and Recovery Act of 2001 includes the following provisions:

Individual Provisions:

Rate acceleration - Working families get immediate help by advancing the effective date of the 25 percent marginal rate cut from last spring’s tax bill.

Payments for Individuals - People who received a partial rebate under this spring’s tax bill will have their payments topped up to the full $300 for individuals and $600 for couples. Those who filed a tax return in 2000 but were not eligible in the previous round will now get a payment of $300 for individuals or $600 for couples.

Unemployment and health -  Three billion dollars in additional social services block grant funding to provide states with the flexibility to supplement current unemployment health benefits. Nine billion in additional unemployment insurance funds to states to allow the extension of unemployment benefits. Under this legislation, according to the House Ways and Means Committee, the state of Wisconsin would receive an additional $254 million in unemployment health benefits and unemployment insurance funds.

Deductions for capital losses for individuals - The current $3000 deduction will be increased for two years, $4000 in the first year and $5000 in the second, allowing individuals who have suffered losses in the current economic environment to minimize the impact of those losses.

The bill offers incentives for businesses to create jobs, spur innovation, and invest in our country’s future through the following measures:

30 percent expensing of investment in most forms of depreciable property during a three-year period - This will create jobs and promote business investment. Small business, where most jobs are created, will particularly benefit.

Five-year carryback of net operating loss write-offs for corporations and individuals -  This provision will help stabilize businesses affected by the current downturn by allowing them to claim refunds based on losses they’ve suffered. They can deduct against their income tax liability over the past five years, putting cash back into businesses to help them stabilize or expand.

End the corporate alternative minimum tax - Permanently repealing the AMT and allowing employers to recoup their AMT credits immediately rather than over an extended period in the future. The AMT has caused businesses to give the government interest-free loans in exchange for write-offs in the future. Repeal of the AMT will return to the employer this investment. This will provide more business investment for over 17,000 of the nation’s largest employers.

Allow additional expensing for small businesses -  Small businesses will be able to write off even more of their capital investments - $35,000 annually for two years. That money can be directly invested in paying salaries and keeping their businesses afloat through tough economic times.

Simplify capital gains taxation - By repealing the five-year holding period, businesses face a lower tax burden and less paperwork.

The Economic Security and Recovery Act of 2001 has a ten-year cost of under $160 billion in exchange for $99.5 billion in stimulative effect in fiscal year 2002, providing a major, immediate boost for our economy.