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Corporate America Should 'Get off Welfare,' Labor Secretary Says

By Frank Swoboda
The Washington Post
WASHINGTON

U.S. companies should be stripped of billions of dollars in tax breaks and other special subsidies and the money used to help train anxious American workers for new jobs, Labor Secretary Robert B. Reich said Monday.

"If we're asking middle-class people to work smarter and welfare mothers to play by the rules, it seems important to ask corporate America to get off welfare and play by the rules as well," Reich said in an interview in which he outlined the themes of a major economic policy speech he is scheduled to deliver Tuesday to the Democratic Leadership Council.

Reich said Congress could save an estimated $225 billion over five years by cutting such things as tax breaks for pharmaceutical firms operating in Puerto Rico; credits for producers of ethanol; subsidies to help airlines expand airport facilities, and subsidies to farmers whose commodities sell at below government-set prices.

The speech will be Reich's first economic policy statement since Republicans won control of Congress in elections two weeks ago. The DLC is a moderate to conservative group that served in an important economic advisory role during Clinton's presidential election campaign.

An aide to one of the top Republican legislators in the House of Representatives would not comment for the record, but suggested that his party might agree to cutting some targeted corporate subsidies. Reich said that Americans are angry at the economic displacement taking place as they see their jobs disappearing and their standard of living eroding.

The answer, Reich said, is not to try to hold back technological change or seal off the borders from mounting foreign competition. Instead, he said the government must help American workers upgrade their skills for the work world.

"At the center of the issue here is a moral question about what we owe as a society to the people who work hard and play by the rules," Reich said. "I think there was, and still is, an explicit moral compact that work pays."