Dear Fellow Rhode Islander:
Executive Compensation
I applaud the White House pay czar’s recent efforts to reign in exorbitant salaries and bonuses for financial executives. While millions of Americans look for work, it is an outrage that these financial institutions, propped up by taxpayer dollars, continue to award their executives excessive compensation. Mr. Feinberg is not backing down on the promise to hold these banks accountable to the taxpayers. We promised the American people oversight and transparency, and it is critical that the pay czar continue to use the tools at his disposal to ensure that financial institutions are held accountable.
Facing the worst economic crisis since the Great Depression, the 111th Congress acted decisively to pass the American Recovery and Reinvestment Act (ARRA). This was a crisis eight years in the making. When the Clinton administration left office in 2001, they left a budget that projected a $5.6 trillion surplus from 2002-2011. Through tax cuts for the wealthiest Americans, two wars, an unfunded Medicare prescription drug program, and lax oversight that led to the collapse of the housing and financial markets, that surplus became a $5.8 trillion deficit.
President Obama inherited an economy that was losing 700,000 jobs each month. It was in that climate that the ARRA was passed and signed into law. Since the bill went into effect, the ARRA has brought us back from the precipice. Over 400,000 Rhode Island working families take home a larger paycheck each month because of the Making Work Pay Tax Credit. Additionally, more than 50 million Social Security and Supplemental Security Insurance (SSI) beneficiaries received a one-time payment of $250.
As part of the unprecedented levels of transparency requested by the Obama administration and Congress, every recipient of ARRA funding was required to submit a report detailing exactly how they used the money that they received and how many jobs they directly created. All of this information has been received, was verified by an independent organization, and was made available on Recovery.gov on October 30, 2009.
I would like to stress the point that the numbers released on October 30th reflect just a portion of the jobs created and saved by the American Recovery and Reinvestment Act. These numbers count only those jobs created directly through the projects and activities that have been awarded ARRA funds. These projects account for only one-third of the Recovery Act (with the other two-thirds including the tax relief and payments previously mentioned), of which about half has been obligated
More importantly, the jobs counted are only those created directly. For example, a transportation construction project may subcontract to a small business owner who hires 14 employees for the project. While these 14 jobs will be counted, it does not account for the local asphalt company who has retained a dozen workers to meet the demand for several ARRA construction projects, or the family-owned restaurant that adds a couple employees each shift to accommodate the construction workers. Taking into account these indirect jobs, the Council of Economic Advisers has determined that the ARRA was responsible for 1 million jobs created or saved by the end of August.
I know that our state has borne an undue burden of the economy’s woes, reflected in our high unemployment rate. I know Rhode Island families struggling to make ends meet will find little solace in the fact that the economic climate would be even worse had Congress failed to pass the Recovery Act. But I believe that the numbers released October 30th on Recovery.gov show that after just eight months and only 18% of the funding spent, we are on the right path to turn around our economy and create real jobs for Americans and Rhode Islanders.
In 1851, brothers Benjamin and Robert Knight began producing cotton cloth and textiles at their mill in Warwick. Placing on their labels paintings of fruit by Ms. Skeel, the daughter of one of their customers, they adopted the name “Fruit of the Loom.”
Thank You,
Patrick J. Kennedy
Member of Congress
Washington Office
407 Cannon House Office Building
Washington, D.C. 20515
Phone: (202) 225-4911 Rhode Island Office
249 Roosevelt Avenue, Suite 200
Pawtucket, RI 02860
Phone: (401) 729-5600
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