Fiscal Stimulus Packages During Financial Crisis

in the US and Switzerland in Comparison by

Dr. Felix Hörisch and Jakob Weber

Mannheim Centre for European Social Research (MZES) University of Mannheim

A5, 6 68159 Mannheim, Germany

Contact:

Felix.hoerisch@mzes.uni-mannheim.de jakweber@mail.uni-mannheim.de

Tel: +49 621 181-2847

Work in Progress / Preliminary Results

Please do not cite without the permission of the authors

Abstract

From 2008 to 2010, economic disruptions swept across OECD-countries with an apparent

disregard to government party colours and national economic philosophies. In late 2008 and

2009, the affected countries reacted with economic stimulus packages. In this paper we have a

closer look from a Varieties of Capitalism-perspective (supplemented with arguments of party

ideology) at the packages of the USA and Switzerland. On grounds of the revisionist welfare

state debate and the claim that skill regimes differ considerably between Liberal Market

Economies (LMEs) and Coordinated Market Economies (CMEs), we find strong theoretic

arguments for education/training and healthcare programmes being more generous in states with

high degrees of economic coordination. We investigate whether there is a factual empirical

relationship through a qualitative research design. Our analysis includes the archetypical LME

USA and Switzerland – a border case tending to the CME-spectrum.

Key words:

Financial Crisis, Fiscal Policy, Varieties of Capitalism; Party Effects, Fiscal Package

1

1 Introduction The international financial and economic crisis confronted all OECD member states with similar

economic challenges. A lot of valuable insights have been won from large n-Analyses

considering explanatory factors for attributes such as the revenue- and spending shares, the sizes

and the compositions of fiscal stimuli. This paper wants to add to this research by qualitatively

analysing the composition of stimulus design in two OECD nations, namely Switzerland and the

USA in the years 2008 and 2009. We present the Revisionist Welfare State Debate-argument that

Coordinated Market Economy (CME)-employers join alliances rallying for social insurance

policies to allow the national workforces to make sunk human capital investments and provide

their employers’ need for special skills. On grounds of this theory, the support for such measures

is also plausible for conservative parties in CMEs while it is not plausible for those in Liberal

Market Economies (LMEs). Therefore, we argue that in CMEs both, left and right parties are for

the sake of the CME-model more likely to put a special emphasis on education/training-spending

and healthcare investment while in LMEs solely left parties should push forward social policies.

We also claim that the improvement of network structures between companies should find the

support of all types of CME-parties. We investigate whether our assumptions are justifiable in

empirical terms by taking a look at select measures within the stimulus packages of the USA – a

paradigmatic case of a LME – and Switzerland – a border case tending to the Coordinated

Market Economy spectrum.

The remainder is organised as follows: Chapter 2 provides a brief overview of fiscal policy

responses to the financial crisis, chapter 3 introduces our theoretical arguments and hypotheses,

in chapter 4 we justify of our case selection. In chapters 5 and 6 we discuss the Swiss and the

US-American fiscal stimulus packages before chapter 7 concludes.

2 A Brief Overview Over OECD-Fiscal Policy Responses to the Crisis Reacting to the international financial crisis and the ensuing economic slump between late 2008

and early 2009, most OECD-states passed extensive economic stimuli (OECD, 2009a, p. 68)

Unfortunately, quantitative data on the cross-national distribution of the policy measures under

regard in this paper is scarce. However, the reader may get an impression of the immense socio-

economic relevance fiscal stimulus packages bore during the crisis and still bear during its

2

aftermath through the sheer package sizes of which we present an OECD-overview in Figure 1

below. The implemented of packages of the six frontrunners – South Korea, USA, Australia,

Japan, Turkey and Canada –amounted to between 4% and 6% of their respective GDP and also

the adoption of austerity measures as a reaction to the immense fiscal pressure in place measures

went beyond 6% of GDP in four countries (Greece, Iceland, Hungary and Ireland). In the crisis

years, most countries increased their debt for expansive economic-growth packages (cf.

Wagschal & Jäkel, 2010).

Figure 1: Size and composition of the fiscal policy reaction of OECD states (% of GDP)

Annotation: This figure was designed on the basis of OECD-data (OECD 2009a: 62). *= No data was available on the balance between the revenue- and the expenditure-side in Portugal. Therefore, the fiscal package amounting to

0.8% of the GDP is displayed as including equal amounts of revenue- and expenditure.

While the advantages and disadvantages of different package designs are discussed elsewhere1

this paper does not aim at a normative assessment of policy designs. We rather make the claim

that from a VoC-perspective certain policies seem to be more feasible than others and were 1 See OECD (2009b, pp. 105-107) for a discussion-overview. It is also claimed that public revenue stimuli can be carried out more quickly than public spending, as tax cuts can be applied much faster than expenditure increases and are also easier implemented administratively (Zohlnhöfer, 2011, p. 234). On the other hand the multiplier effects of tax cuts are only approximately half as large as the effects of additional public spending or investment (cf.OECD, 2009b, p. 106), Also note that generally the multiplier effects of fiscal stimulus packages are assumed to be lower in more open economies than in sheltered economies (cf.OECD, 2009b, p. 106).

Composition of fiscal stimulus packages (in % of gdp)

3,2 2,44,1 4,2

2,91,7 2,2 1,6

-0,31,7 2,6 1,6

0,5 0,3 0,9 0,4 1,2 1,1 0,7 0,4 0,8 0,9 0,6 0 0,3 0,3 0-1,6

-7,5

-2,2

-10

-8

-6

-4

-2

0

2

4

6

8

Sou

th K

orea

US

A

Aus

tral

ia

Japa

n

Turk

ey

Can

ada

Spa

in

Luxe

mbo

urg

New

Zea

land

Sw

eden

Den

mar

k

Ger

man

y

Finl

and

Cze

ch R

epub

lic

Net

herla

nds

UK

Mex

ico

Bel

gium

Slo

vaki

a

Aus

tria

Pol

and

Nor

way

Fran

ce

Por

tuga

l

Sw

itzer

land

Ital

y

Gre

ece

Icel

and

Hun

gary

Irel

and

Public spending Public revenue

3

therefore more likely to be implemented than others. The research into the empirical grounding

of theoretically relevant policy determinants will be made for the USA and Switzerland. In the

following chapter we are going to outline why these two countries are of a special relevance for

our research.

3 Theory and Hypotheses Our theoretic expectations are based on the Varieties of Capitalism theory (VoC),2 an actor-

centred approach claiming that the success of a political economy depends on companies solving

their coordination problems in various economic subsystems, e.g. industrial relations, education

and vocational training, corporate finance/governance or inter-firm relations (Hall & Soskice,

2001, pp. 6-7). VoC finds that the corporate strategies to overcome problems within the various

subsystems are substantially influenced by the institutional design of a political economy. The

respective nature of these strategies stands at the core of the VoC-classification of political

economies. Hall and Soskice differentiate between two ideal types: Liberal Market Economies

(LMEs) in which strong market forces dominate, and Coordinated Market Economies (CMEs) in

which coordination mechanisms play a major role between the various market participants. In

LMEso, companies coordinate their activities in all of the mentioned subsystems primarily by

free competition on the market, orientation on price signals, and marginal cost analysis as

described by the neoclassical school of economics (Hall & Soskice, 2001, p. p. 8). In CMEs,

however, non-market based relations play a major role and are crucial for the development of

corporate core competencies: Coordination leads to long-term relations based on informal

contracts and insider networks, monitoring activities which are based on private information and

make personal contacts economically vital. The core competencies of firms are developed on

coordination mechanisms between several economic groups, e.g. employers’ associations and

unions. On this classification system VoC develops a concept of institutional complementarity

claiming that “[w]hat is wise for governments to do depends upon the type of market economy in

which they find themselves” (Wood, 2001, p. 274): LMEs should “sharpen” their market

mechanisms while a CME should support “the institutions and networks of coordination that

2 For the Varieties of Capitalism theory as a theory of public policy see Höpner (2009). For further discussion on the assumptions of the Varieties of Capitalism theory see Hancké, Rhodes, and Thatcher (2007),

4

connect companies” in order to enjoy a comparative advantage over the respective other

economic system (ibd.). As a first conclusion from these findings, we can thus say that in CME-

stimulus packages, policies improving the network character of company relations should be

central.

Furthermore, we want to take into consideration what Höpner (2009, p. 303) calls a historic

revision of the welfare state evolution and was in fact intended as a theory resulting in the

necessity “to rewrite social history” (Estevez-Abe, Iversen, & Soskice, 2001, p. 182). Opposing

the stance that social welfare generally is the result of employee power resources overwhelming

the interests of employers, VoC-scholars claim that in CMEs also the particularity of “the work

practices and production regimes” (Hall & Thelen, 2009, pp. 13-14) may make the granting of

employment and unemployment protection a rational capitalist deed. In the case of CMEs, so

goes the argument, a production regime has risen that relies on a workforce with “industry- or

company-specific skills conducive to incremental innovations” (Hall & Soskice, 2001, p. 40). As

CMEs evolved, CME-employees acquired or were granted unemployment benefits, “[l]ong-term

employment contracts” and “supervisory boards, which include employee representatives as well

as major shareholders” (Hall & Soskice, 2001, p. 24). These served as insurance mechanisms and

as an incentive to make time- and money-consuming investments into the acquisition of working

skills specialised on one industrial sector or even to working processes existent in only one

single company. Since these are of little value outside of the respective industry or even

company. VoC-scholars argue that employees in the low level insurance-LMEs act economically

rational and invest in general skills which are transferable between sectors and companies. Given

this human capital focus of VoC, we can at this point say that stimuli in CMEs, to improve the

national economic standing in the sense of comparative institutional advantages, should include

policies that in coordination with the respective sectors or companies but also the employees

foster the advancement of specialised skills. In LMEs, however, we expect the fostering of

general skills without the involvement of any economic parties. With the economic importance

of skill-insurance in CMEs at hand, however, conservative parties - representing the interests of

the upper income population – should in this context not propose the lowering of social

protection mechanisms as these are part of the “overarching institutional infrastructure” (Hancké

et al., 2007, p. 189) enabling their voters’ employees to acquire specific skills. Iversen and

Stephens find such an effect for conservative parties during the evolvement of the Swedish

5

welfare state: They did not prioritize social policy issues during the evolvement of the welfare

state but rather concentrated on their “constituents’ (upper income groups) main interest”

(Iversen & Stephens, 2008, p. 7) being to profit from its affluence through low levels of taxation.

However, since the incentives for right parties to strengthen systems of social protection are not

given in LMEs, we would in accordance with Wagschal (1996) rather expect social contribution

cuts and lower taxation.3 Our research hypotheses are the following:

Ha1: In CMEs, human capital policies will aim at improving the employees’ pool of specialized skills. Employers and employees will be involved in the process of implementation. In LMEs, the focus will lie on the fostering of general skills in the workforce. An involvement of employers and employees is unlikely.

Hb1: In CMEs, both left and right parties will favour social policies to strengthen the CME-typical skill regime.

Hb2: In LMEs, left parties will promote the strengthening of social policies while they should be of no interest for right parties.

Hc1: In CMEs, all types of governments will implement policies strengthening the network character of businesses.

While the Swiss package is very concise, the US-stimulus consists of such a large number of

measures that their discussion would go beyond the scope of this paper. For pragmatic reasons

but also for the sake of giving deeper insights into the distinctive processes of national policy

making, we are therefore going to investigate into the plausibility of our hypotheses in three

policy fields: education, corporate coordination networks (i.e. the detection of CME-networking

in Switzerland) and healthcare (especially of interest due to the innovation Obama’s health

concept constitutes for the USA).

4 Case selection: USA and Switzerland – A VoC-Prototype and a Hybrid The classification of national economies as CMEs or LMEs by Varieties of Capitalism stands at

the core of our case selection. As Table 1 shows, Hall and Gingerich (2004) provide a

classification of national economies in which some cases are classified as definite ideal types and

others have a more peculiar in-between position. Our approach is – in accordance with Campbell

3 Given the focus on Health, Education and Coprorate Coordination, however, taxation will not of prime concern in this paper.

6

and Pedersen (2007); Crouch et al. (2005, p. 34) and Katzenstein (2006)4 - not to understand

VoC as a dichotomic approach. We will deliberately include Switzerland into our case selection

– a hybrid case leaning to the CME spectre. Comparing the Swiss model with the clearly

allocated case of the USA, we hope to gain new insights on the argumentative strengths and

weaknesses of the dichotomous categorization of the VoC-school and derive further insides on

how the partisan effect on fiscal policy may differ between different varieties of capitalism.5

Table 1: Case selection

LMEs More liberal than

coordinated economies

More coordinated than liberal economies

CMEs

USA, Canada,

New Zealand,

UK

Australia, Ireland, Ice-land, Korea,

Mexico, Turkey

Switzerland, Belgium Denmark,Finland, France, Japan,

Netherlands, Portugal, Spain, Sweden, Czech Republic, Greece, Hungary,

Luxembourg, Poland , Slovak Republic

Germany, Italy, Norway, Austria

Overview on the basis of the index of economic coordination of Hall and Gingerich (2004) and own classifications Not only the economic systems but also the fiscal stimulus packages of the two states under

regard are designed very differently: While Switzerland provided one of the smallest fiscal

impulses in the OECD, looking at the US-stimulus package means looking at the second-largest

package in this group amounting to a total of 5.6% of GDP. To give the reader an overall

impression of the package composition, we list below figures on fiscal stimulus package (FSP)

sizes and compositions published by the OECD (2009c).

4 For metric concepts of measurement of the degree of coordination within a political economy see Hicks and Kenworthy (1998), Hall and Gingerich (2004), as well as Höpner (2007).

5 This paper is work in progress. The final paper will also include the CME-case Germany and Australia as an in-between case leaning to the CME-side.

7

Table 2: FSP-Size and Composition in Germany, Switzerland, Australia and the US

FSP-Size in % of GDP

Revenue Share Spending share

CH 0,5 0,2 (40% of FSP) 0,3 (60% of FSP)

USA 5,6 3,2 (57,1% of FSP) 2,4 (42,9% of FSP)

Reference: OECD (2009c)

Table 3: Composition of spending measures Total in %

of GDP State Con-sumption

Investment Transfers to households

Transfers to business

CH 0,3 0,3 0 0 0

USA 2,4 0,7 0,3 0,5 0

Reference: OECD (2009c)

5 The Fiscal Stimulus Packages in Switzerland (2008/2009)

5.1 Elections in Switzerland The federal parliamentary elections of October 21, 2007 preceded the budgetary reactions of

Switzerland to the financial crisis. At the first legislative chamber (the Nationalrat) the rank of

the largest fraction remained with the national-conservative SVP, followed by the social-

democratic SPS, the CVP/EVP/glp–fraction of confessional parties and a green party, the liberal

FDP and finally the Green fraction. Switzerland’s traditionally conservative lead second

chamber (the Ständerat) however, was dominated by the CVP/EVP/glp-fraction, followed by the

FDP, the SPS, the SVP, and the green fraction.6 Due to the exclusion of Eveline Widmer-

Schlumpf and Samuel Schmid from the SVP ensuing the events of the irregular nomination of

Widmer-Schlumpf for the department of justice and police, the Bundesrat was made up by two

members without party-affiliation, two SP-Bundesräte, two FDP-Bundesräte and one CVP-

Bundesrätin. The facts given above evidently complicate a categorization of the Swiss

government in early 2008 on partisan spectres. However, we argue that the then Bundesrat was a 6 The order of appearance follows the order of the then fractional sizes. For a complete overview of the actual numbers, please see: (Cusack & Beramendi, 2006, p. 48).

8

centre-right government of the moderate kind. For 2009 we see the Bundesrat swinging back to

the political right since Schmid announced his retirement in summer 2008, Schmid and SVP-

nominee Ueli Maurer was appointed his successor on December 10, 2008. Maurer officially took

Schmid’s place on January 1, 2009. Another change within the Bundesrat remained without

ideological repercussions: FDP-Bundesrat Pascal Couchepin stepped down from the department

of inner affairs in summer 2009 and was replaced from within his party, making FDP-nominee

Didier Burkhalter a Bundesrat. For 2009 we see the Bundesrat swinging back to the political

right since Schmid announced his retirement in summer 2008, Schmid and SVP-nominee Ueli

Maurer was appointed his successor on December 10, 2008. Maurer officially took Schmid’s

place on January 1, 2009. Another change within the Bundesrat remained without ideological

repercussions: FDP-Bundesrat Pascal Couchepin stepped down from the department of inner

affairs in summer 2009 and was replaced from within his party, making FDP-nominee Didier

Burkhalter a Bundesrat.

5.2 The Swiss Type of Market Economy In contrast to the USA and Australia, Switzerland is classified as a CME in the Varieties of

Capitalism literature (Hall & Soskice, 2001). But, as Börsch puts it „in several respects,

Switzerland bears striking similarities to the Anglo-Saxon LMEs” (Börsch, 2007, p. 185).

Untypical for a CME, Switzerland has very high levels of stock market capitalization (Hörisch,

2007, pp. 40-42), medium levels of employment protection and no codetermination rights in the

private sector (Jäkel & Hörisch, 2009). Hancké et al. (2007) argue that the pressure of stock

markets and the fear of hostile takeovers is dampened anyway due to “ownership concentration

and the network-type character of the relations among managers and between managers and

bankers” (ibd. 183) and the “minor importance of stock options in management compensation”

(ibd. 190). They find employer-employee coordination to be much “more informal and

voluntary” (ibd. 174) than common for CMEs but resembling the agreements made in German

firms, however solely “at the micro level” while “macro-level industrial relations institutions are

different” (ibd. 187). Generally, for subsystems such as the skills taught in the educational

system, they find that coordination occurs and allows for a typical CME-like specialization on

“medium-high-tech industries […] characterized by incremental innovation patterns” (ibd. 174)

and diversified quality production. However, they point out that the construction of these

arrangements has a considerable bias towards employee associations, which “largely determine

9

the content of the apprenticeship programmes” (ibd. 188). Due to the limited role employees play

for the Swiss economic coordination, the classification as a moderate CME-type by Hall and

Gingerich (2004) seems adequate. We will treat Switzerland as a hybrid case, being closer to a

coordinated market economy than to a liberal market economy.

5.3 Overview: Select Measures of the Swiss Fiscal Packages The years 2008 and 2009 in Switzerland saw three fiscal impulses – the

Stabilisierungsmassnahmen - on the federal level. According to the Swiss secretary of economy

(SECO), these fiscal stimuli added up to a total of approximately CHF 2 billion (approximately !

1.31 billion in August 2009) (SECO, 2012, p. 2). Depending on the respective references this is a

share of GDP lying between approximately 0.35% of the Swiss GDP 2008 (calculation based on

OECD 2012, p. 44) and 0,5% of Swiss GDP (OECD 2009b, p. 63). Either way, the Swiss

stimulus package constituted the smallest reaction of all OECD-fiscal packages with a positive

net effect (OECD 2009b, p. 64). This might be explained by a Swiss preference of comparably

robust automatic stabilisers over discretionary measures of financial stabilization due to positive

experience in the past (SECO, 2012, p. 2).

Table 4: Select Measures of the Swiss Fiscal Packages Name of Measure

Amount (Planned/

Distributed) CHF in m

Sector Fiscal Package Number

Percentage of…

Package Size

GDP in

2008

Early VAT-Reform

CHF 150m/ CHF 150m

Health extra-measure during summer-session of

2009

N/A 0.026

Export Platforms

CHF 25m/ CHF 25m

Corp. Coor-dination

3 6.25% 0.004

Further Education in STW

CHF 30m/2m Education 3 7.5% 0.005

Further Education (Energy Efficiency)

CHF 15m/9.7m

Education 3 3.75% 0.003

Reference: EFK (2012)

10

Another important factor certainly is the Swiss brake on debt in place since 2001. The table

above outlines the features of the Swiss fiscal stimulus under regard in this chapter.

5.4 Analysis of the Swiss Fiscal Packages from the VoC-Perspective

5.4.1 Education-Policies in the Swiss Fiscal Packages Switzerland invested subsidies of CHF 30 million for measures of further education during short

time work-programmes when the third fiscal package took effect. Being an important element of

Switzerland’s automatic stabilizers, the extent of Kurzarbeitsentschädigung (short time work-

reimbursement) increased massively from 2008 to 2009 as a reaction to the crisis.7 In March

2009, SECO encouraged employers to supply measures of further training and made clear that

reimbursement would continue when reduced working hours were used for measures of further

education (Schweizer Parlament, 2009). When the third fiscal package was adopted on

September 25th 2009, it included an additional subsidy of CHF 30 million (EVD & SECO EFK,

2012; 2009c). It was intended as a co-financing of self-assessments and further education

accounting for 50% of the cost per employee (going to a maximum of CHF 5 000). The measure

was supplemented with the possibility of academic work (scientific or educational) for short time

workers under the maintenance of unemployment insurance payments (EVD & SECO 2009a).

Notably, VoC would expect a special emphasis on specialized sector- or firm-specific skills.

However, SECO, among others, especially encouraged the development of general skills

improving employees’ chances on the labour market such as language courses and IT-

technological qualifications (EVD & SECO 2009c). In the end, solely CHF 2 million were used

so that one can hardly speak of a relevant impulse for the national pool of skills. It is most

probable that the low usage of the policy was due to the general decline in STW-usage at the

beginning of 2010 (EFK, 2012, p. 44).

Also the subsidisation of apprenticeship and further education in the segment of house

construction and energy efficiency (worth CHF 15 million) contained in the third fiscal package

constitutes an interesting case of national economic skill coordination. Since there was a lack of

specialists for the refurbishment of buildings and the installation of green technology in

households, a programme of vocational re-training and internships was proposed. The

7 In 2008, solely CHF 19 million had been spent, while in 2009 CHF 997 million were made available (SECO, 2012, p. 19).

11

programmes for domestic engineering (demand of 400 employees, provision of CHF 4 million)

and the construction of roofs, walls and windows (demand of 300 employees, provision of CHF

3 million) were solely coordinated between two state departments and branch/trade associations

(UVEK&BFE 2009). The installation programme, however, also involved employee-

organisations. CHF 1 million were invested in the expansion of the platform energiewissen.ch

serving for the acquisition of costumers, the coordination of (re)training and the publication of

professional articles (UVEK&BFE, 2009, p. 2). This policy package again is an example of how

the Swiss state assists its national economy in ensuring the availability of special skills. While

the coordination of vocational programs between the state and economic players is typical for a

CME, the minor role of trade unions may serve to promote the thesis that the Swiss market-

economic coordination rather lies in the hands of the employers than in that of the employees.

In addition to that, CHF 40 million were budgeted for further education of the young

unemployed with a concluded apprenticeship. Federal contributions to measures of further

education lasted up to 12 months and lay at 50% of the costs (limited at a maximum of CHF

5,000). SECO expected that the skill demands of the eligible apprentices would vary very much

just as our theory would expect in the context of CME-special skill demands (EVD & SECO

2009b). However, also here the acceptance was very moderate (Usage of CHF 3.4 million, partly

due to a positive development on the labour market and partly due to the subsidy only covering

50% of the costs) which might also be the reason why there are no comprehensive evaluations of

the skill demands served.

Summing up these measures, one can say that Switzerland’s fiscal impulse included measures

fostering the development of general skills and such measures fostering specialized skills in its

crisis training policies. Where the policies aimed at the provision of special skills, robust state-

economy coordination networks were used. In accordance with VoC-literature on Switzerland,

there was a predominance of employer associations’ shaping power over that of trade unions.

5.4.2 Health-Policies in the Swiss Fiscal Packages The reform of Switzerland’s Invalidenversicherung, was an important modification of a human

capital insurance mechanism typical for CMEs. The Value Added Tax Reform worth CHF 150

million (SECO, 2012, p. 21) was the last revenue-sided measure allocated to the 2009 crisis-

measures by SECO. Among other things, it was meant to finance the Invalidenversicherung (IV),

12

Switzerland’s disability pension offering partial insurance of the time- and money-consuming

apprenticeship procedure against invalidity. In 2009, the IV was a matter of political discussion

since it was experiencing soaring costs and deficits. Increasingly, the Swiss old age and

survivor’s insurance (AHV) had to help out the IV financially. To put pressure off both

insurances while avoiding higher social contributions, all Swiss parties – except for the SVP,

which called for other steps of IV-reform – demanded that the value added tax be raised by 0.4%

from 2010 on and the benefits be distributed to the IV (Forster, 2009). The parties in favour of

the bill undertook considerable efforts to make it appeal to the public since the tax reform

implied a revision of the Swiss constitution through a referendum: Firstly, the Bundesrat

postponed the referendum from May 2009 to September 2009. Didier Burkhard (FDP), in charge

of the Federal Department of Home Affairs,8 argued that this would enable the Swiss public to

evaluate the concept uninfluenced by the critical economic situation (ibd.). Secondly, on 12th

June 2009, the Nationalrat agreed to a one year-delay of the originally planned implementation

date after considerable pressure had been put on the parliament by the two biggest parent

organisations of Swiss employers: sgv and economiesuisse. The latter argued for the delay

mainly on grounds of the need to adopt prices to the new tax situation and the economic tension

in 2009 (Schweizer Parlament, 2009). While Caspar Baader and his SVP deemed the permanent

corrections of the bill as an outright constitutional scandal (SRF, 2009),9 the Swiss economy

widely supported the altered bill and Edi Engelberger of the sgv thanked the parliament for

making “the bullet to bite (Swiss: ‘the turd to swallow’) as tasty as possible” (swissinfo.ch,

2009). Interestingly, he grounded his support for the measure on the need to avoid higher

contributions for employers/employees, the protection of Swiss jobs and the claim that stable

social insurance strengthened Switzerland in the international competition (ibd.). The Value

Added Tax Reform was adopted after the referendum on 27th September 2009 with 54,5% of the

8 This Swiss department is not concerned with inner security affairs but with matters such as “pension provision, healthcare, education and research” (EDI, 2013).

9 In fact, the accusation that the postponement was little more than a tactical consideration to gain the support of the Swiss employer organisations is not far to seek. Anyway, SECO counted the postponement – together with the Value Added Tax Reform discussed below – as a measure meant to stimulate the Swiss economy during the crisis (SECO (Staatssekretariat für Wirtschaft), 2012, p. 21). However categorized, the reform remains an interesting showcase of how a financial crisis as a contextual factor alters the paths welfare state reform takes.

13

voters in favour of it and 45,5% of them opposing the bill (EVD & SECO, 2009). Even though

the conservative SVP spoke out against the measure, it is evident that in the case at hand

employers promoted an institutional mechanism of social insurance since they saw it as a

comparative institutional advantage. This supports the claim that Switzerland tends to the CME-

spectre.

5.4.3 Corporate Coordination in the Swiss Fiscal Packages In the framework of the third fiscal package, CHF 25 million were released for the creation of

export platforms. This is an outstanding example of a CME-measure strengthening “institutions

and networks of coordination that connect companies” (Wood, 2001, p. 274). For the years 2010-

2012 the measure included the successive founding of cleantech switzerland, medtech

switzerland and ingenious switzerland (for architecture, engineering and design).10 According to

SECO, access to the public-private partnership could be granted to all companies, branch

associations and boards of trade in case they belonged to the target branch, their products were

demanded abroad, they were in need of support to improve their exports, showed readiness to

share experience/contacts with potential competitors on the home market and to independently

continue the platform after an end of public support (Roth & Schlup, 2010). The marketing

activities of the platforms are centred around branding/supporting Switzerland as an export

nation for the respective firms and the participation in trade fairs, matchmaking, support through

trade delegations and exchange through panels and publications (Schweizer Bundesrat, 2009, p.

5746). SECO potentially saw the danger of market bias but was confident to avoid it through

mostly supplying general support and bringing to account measures for single companies (Roth

& Schlup, 2010). All these facts considered, the export platform neatly fits into the world of

CME-coordination where the intermingling of state and economy are accepted as mutual

benefiting and firms are willing to enter into non-competitive long-term commitments.

10 Apart from clean technology, medical technology, architecture, engineering and design, the Bundesrat’s initial plans also were to include infrastructure companies and car part suppliers (Schweizer Bundesrat, 2009, p. 5746).

14

6 The Fiscal Stimulus Packages in the USA (2008/2009)

6.1 Elections in the USA The time frame under regard for the US-American fiscal packages reaches from February 2008

to February 2009. At the beginning of 2008, Republican president George W. Bush Jr. was in

office. In Congress, the Democratic Party held the majority in both chambers at that time (51-49

in the Senate,11 236-199 in the House of Representatives), furthermore the majority of the

governors were Democratic (28-22). November 2008 saw the Democrat Barack Obama win the

presidential elections against Republican John McCain. The Democrats also enlarged their

majorities in the simultaneous Congressional Elections (57-41 in the Senate, 257-178 in the

House of Representatives), moreover they could also increase their number of governors (29-21)

(cf. Library of Congress, 2013). While labelling the Republican Bush administration a right

government should go uncontested, the classification of the Obama government is a bit more

complicated. It would in the LME-context at hand certainly be absurd to equate the Democratic

Party with socialist or social democratic parties of the continental European kind. However,

especially Obama’s emphasize on “health coverage for all” (Obama & Biden, 2008) lets it

appear plausible that his government is located further left than that of Bush. Instead of drawing

generalizing comparisons between the US and Europe or intending an exact quantitative

ideological positioning,12 we claim that in Obama’s fiscal stimuli a stronger preference for social

redistributions – i.e. more left-leaning policies than under Bush – should be visible.

6.2 The US-American Type of Market Economy VoC categorizes the USA as the LME-prototype (Hall & Soskice, 2001). This is plausible since

market forces are the dominant principal in all major subfields of the economy. The labour

market of the US is characterized by very low levels of employment protection (Hall & Soskice,

2001, p. 19; Jäkel & Hörisch, 2009) and there are no codetermination rights (Felix Hörisch,

2009, p. 48; Felix Hörisch, 2012). The companies finance their undertakings primarily via the

stock market and even in spite of high employment rates there are high levels of inequality (Hall

& Soskice, 2001, pp. 19-22). 11 Two independent candidates supported the Democratic fraction.

12 Whatsoever, the reader may be informed that the CPDS-database categorizes Obama’s cabinet as a right-leaning centre government (Armingeon, Engler, Gerber, Leimgruber, & Beyeler, 2010).

15

6.3 Overview: Select Measures of the US Fiscal Packages During the years 2008 and 2009, three fiscal packages were signed into law in the USA: Under

George W. Bush Jr. the Economic Stimulus Act amounting to $152 billion (February 2008) and

the Emergency Economic Stabilization Act (October 2008) amounting to $700 billion. Under

Obama the American Recovery and Reinvestment Act (February 2009) that had amounted to

$821 billion by October 2011 (Levit, 2011, pp. 9-10) was signed into law.

Table 5: Select Measures of the US Fiscal Packages

Name of Measure Amount ($ in millions)

Measure Fiscal Package

Percentage of…

Package Size

2008-GDP

Education Spending under EESA

10,1201 Education EESA 1.5 0.07

Education Spending under ARRA

92,800 Education ARRA 11.3 0.64

Paul Wellstone Mental Health and Equity Act

N/A Health ESA N/A N/A

Health Spending under ARRA

150,0002 Health ARRA 18.3 1.03

Reference: U.S. Government (2009);

1: While the ARRA-education expenses are comprehensively listed on recovery.gov, this amount is based on our own calculations including the following measures: Teacher Expense Deduction, Hope Scholarship, Lifetime Learning Credit, , Enhanced Charitable Deduction for Qualified Computer Contributions, Qualified Zone Academy Bonds and finally the Secure Schools and the $3,3b Community Self Determination Act which was intended for schools and infrastructure, which bloats the estimated spending amount considerably. 2: Of the measures amounting to $150b, only Medicaid and COBRA are discussed in this paper (amounting to a total of $106.3b).

6.4 Analysis of US Fiscal Packages from the VoC-Perspective

6.4.1 Education-Policies in the US Fiscal Packages Firstly, we are going to track measures altering the availability of human capital in the USA.

While the non-bailout spending measures under ESA (credit market programmes and investment

in the Auto Industry) had no repercussions in the US-American educational system, EESA

provided several education-measures. The most prominent one in this regard was the Qualified

Tuition Deduction ($5.333 billion) allowing for deductions for “qualified higher education

16

expenses” of $4,000/$2,000 (depending on tax category). Apart from that, teachers profited from

an Extension of the Teacher Expense Deduction over 2007 until 2009 ($410 million) and

individuals in major disaster areas were aided through a doubling of most of the provisions of the

Hope Scholarship and Lifetime Learning Credit in 2008 and 2009 ($121 million). However,

there were also infrastructural investments in the education system: rural schools, so it was

decided, could profit from a Reauthorization of the Secure Rural Schools and Community Self-

Determination Act of 2009 and Payment in Lieu of Taxes even though this measure had been

meant to end in 2007 ($3.3 billion for investment in infrastructure and schools). The Enhanced

Charitable Deduction for Qualified Computer Contributions allowed for $356 million in tax

deductions for “computer equipment and software to elementary, secondary and post-secondary

schools” and the extension of Qualified Zone Academy Bonds (QZABs) beyond 2007 implied

that also in 2008 and 2009 $400 million be distributed to “school districts with low-income

populations” to “save on interest costs associated with public financing school […] renovations

and repairs (cf. U.S. House of Representatives, 2008, p. for this passage).

In Obama’s American Recovery and Reinvestment Act (ARRA), education ranked as the 4th most

important investment (U.S. ED, 2009; Government, 2009, p. 1). The emphasis was moved

further into the direction of infrastructure investment. Financial support for the use in education

institutions was available through three programs with the following extent (cf. Duncan, 2009):

Qualified School Construction Bonds (QSCBs) Issuing of $11 billion in 2009, $11 billion in 2010 and additionally $200 million in both years for schools associated with the Bureau of Indian Education Extension of Qualified Zone Academy Bonds (QZABs) Extension from $400 million in 2007/2008 respectively to $1.4 billion in 2009/2010 respectively Build America Bonds (BABs) $2.4 billion for the years 2009 and 2010, among others also available for schools Solely under the QZABs the training of school staff was permitted, while the focus of the

programmes rather was to encourage the modernization of buildings, the conversion of “obsolete

non-school buildings into modern school facilities” with a special emphasis on “green buildings”

and synergetic effects of the buildings as “centers of their communities” (Duncan, 2009). The

recipients of the tax exemptions – states and local educations agencies in QZABs and QSCB,

17

municipal bond issuers in BABS13 – were able to write off against tax 100% of the interest on

bonds for their investments (35% in case of BABs). Especially the investment in socially

underprivileged areas and/or charter schools was encouraged, e.g. through eligibility criteria

determined by the amount of pupils under the poverty line or being recipients under the National

School Lunch Act (cf. Duncan, 2009 for this passage).

The program clearly did not plan for modernization of school facilities purely as an economic

stimulus. The US Department of Education announced that the funding should be seen as “a

unique opportunity to jump start school reform and improvement efforts” (ED 2009, p. 1). The

Department of Education’s mission statement was that “all students should graduate from high

school prepared for college and a career and have the opportunity to complete at least one year of

postsecondary education” (ibd.). In order to acquire this goal several policies – which cannot all

be laid out this paper - were proposed: Firstly, the adoption of “rigorous standards and high

quality assessments” (ibd. 2), including the offering of college-relevant advanced courses and

support of “English language learners and students with disabilities” (ibd.). Secondly, the

development of data systems providing feedback “to educators, students, families and the

community in order to improve student and teacher performance” (ibd.) again including a special

program for students with disabilities. Thirdly, training, mentoring, certification and selective

compensation to increase “teacher effectiveness and equitable distribution of effective teachers

(ibd. 4). Fourthly, the “Turning around” (ibd.) of low-performing schools through

restructuring/closing, building of “[s]upport community schools” (ibd. 6), incentives for “highly

effective teachers” (ibd.) to teach at such schools, intense preparation for college etc. (ibd.).

Finally, the improvement of results for all students was proposed, including

“strengthening early learning; extending learning time; strengthening preparation for college and careers; using technology to improve teaching and learning; modernizing school facilities; and

conducting reviews, demonstrations, and evaluations that enhance program effectiveness.”

(ED 2009, p.6)

The results in this section bear relevance both for our hypothesis of general skill-focused

education in LMEs and the promotion of social policies by left LME-parties. Firstly, we can see

that for both governments the overall spending trend went towards the fostering of pre-tertiary

13 Under BABs also the assistance of public postsecondary institutions was possible (cf. Duncan, 2009).

18

education. With regard to the Obama Department of Education’s mission statement shown above

and at our current point of research it appears that the focus lay on the provision of general

skills and an improved access to post-secondary education. However, in future research we

should expand our horizon to measures of further training and try to trace vocational elements in

the secondary education programmes to gain further insights on the relevance of policies aiming

at the provision of specialized skills.

Since the ARRA-education investments outnumber the investments under Bush by far and

emphasize the advancement of the socially disadvantaged to an extent that goes way beyond the

additional investment of $400 million in the 2008 QZAB-programme, they can be analysed as a

social policy benefiting the low-income populations. We can say that in an LME-context ARRA-

education policies embody the classical partisan theory prediction that the more left parties are,

the more they will promote the redistribution of public goods to the lower social strata.

6.4.2 Health-Policies in the US Fiscal Packages VoC finds strong arguments why the Liberal Market Economy USA should not be interested in

the expansion of its Health Provision sector. In fact, the crisis reactions under Bush seem to

promote this claim: The first fiscal stimulus package signed into law in 2008 provided for a

“temporary relief” of $100 billion to “allow Americans to keep or spend more of their incomes”

(House, 2008) and approximately $50 billion to allow American companies an additional

deduction of “50 per cent of the cost of their investment in 2008” (ibd.) but refrained from tax

breaks explicitly designed to make the health sector profit. Vehicle for the second Bush stimulus

in September 2008 was the previously resting Paul Wellstone Mental Health and Addiction

Equity Act praised as “a great step forward in the decade-plus fight to end insurance

discrimination against those seeking treatment for mental health and substance use disorders”

(APA, 2009) by the American Psychological Assocation. However, according to Providence

Journal-writer John E. Mulligan (2008) it is rather unlikely that the bill was then chosen for

policy reasons. It is rather probable that it was picked to overcome the problem arising from the

initial House-opposition to the Defenders of Freedom Tax Relief Act of 2007 which „failed

passage as the original House vehicle for the Emergency Economic Stabilization“ (LoC, 2008).

According to him, the signing of the mental health bill was little more than a “time-honored

stratagem of finding a live but dormant House Bill […] to use as a shell” (Mulligan, 2008). It

19

seems quite plausible that the main intention behind the bill was the saving of time and the will

to stick to the provision that tax bills originate in the House. Apart from this pragmatic inclusion

of a health insurance measure, the “$150 billion in tax breaks for individuals and businesses”

(Associated Press, 2008) show no focus on the health system.

After Obama had successfully run for office, however, the prominent amount of $150 billion of

Health Provisions making up approximately 19% of ARRA was “viewed as the jumping-off

point for the Obama administration healthcare agenda, which seeks to increase access to services

while controlling cost” (Jutkowitz, 2009, p. 1). From the VoC-perspective, two elements of the

bill are of a special relevance: Firstly, the provision of “state Medicaid programs with $87 billion

in fiscal relief, delivered over nine calendar quarters” (cf. Dorn, 2009, p. 1) and secondly a

subsidy of $24.7 billion for laid-off workers (ibd. 2). VoC proposes that LMEs maintain low

rates of social protection since no insurance of specified human capital investments is required.

The increases in state spending mentioned above challenge this assumption. However, the policy

making process leading to the health policies was at least in parts controversial between the two

chambers even though they were both dominated democratically after the November elections in

2008. With regard to the Medicaid subsidies passed on to the federal states, one can say that both

chambers pledged for the approximately identical amount of $87 billion and solely disagreed

upon the “proportion of assistance that was targeted to states experiencing unusually high

increases in unemployment rates” (ibd. 4). However, the House had proposed that the crisis-

induced unemployed should be able to hold on to health coverage through buying into the

Medicaid which was opposed by the Senate due to fear of free-riding effects (Reichard, 2009).

The House, however, managed to enact its proposal of 65 percent subsidies paid through the US

Department of Labor in form of tax benefits for employees eligible for the COBRA program – a

measure comprising continued health insurance payments for the unemployed - or similar policy

packages even though the Senate had pledged for an amount of just 50 percent.

The huge amount of health investments made in the stimulus under Obama are interesting with

regard to our hypothesis that left parties will favour measures of social insurance also in an

LME-context.

20

7 Conclusions In this paper, we carried out research on various VoC-predictions regarding fiscal stimuli in the

USA and in Switzerland during the years 2008 and 2009. Our expectation that Switzerland - an

economy tending to the CME-spectre - would emphasize the provision of special skills over that

of general skills was not quite adequate. Money was put aside for both skill types. However,

where special skill policies were implemented, the shaping procedures relied on tight networks

between the state and the economic actors. As we pointed out, in this process employer

associations played a more important role than trade unions. This supports the claim that the

particularity of the Swiss CME-concept is the limited role of trade unions and employee

representation in the coordination process. Our hypothesis on cross-party support for social

insurance policies seems to be quite adequate in the Swiss case: Solely the conservative SVP

contested the VAT-reform in support of the Invalidenversicherung. As expected, employer

associations supported the measure and saw it as an improvement of the Swiss standing in the

international economic competition. The creation of Swiss export platforms in 2009 is in line

with our expectation of a cross-party driven fostering of business networks and provides

evidence that Switzerland is a CME-type of economy. Such structures of corporate intermingling

are absent in the USA.

In the US fiscal packages, education policies seem to emphasize general skills. After the

government had ideologically moved to the left under Obama’s presidency, crisis education

investment took on a rather redistributive character making the less-wealthy profit from broad

education investments. Also the massive health expenses under the Obama administration show

that also in LMEs social insurance can be enlarged in case there is an ideological power shift to

the left. It stands to reason that social policies are not solely dictated by comparative institutional

advantages. Also with regard to the Republican fiscal cliff blackmailing directed against

Obamacare at the time of this publication (October 2013) it is evident that ideologies matter and

institutional change in LME-subsystems is possible even though there may be considerable

political resistance.

8 Literature !"!#$!%$"%$!%$&'(()*%$+,-./0$1,/0.2$"/34.5$/-6$!6647.48-$9:;4.5$!7.%$$$<,.34,=,6$(>?'@?'(@A#$B38C$

http://www.apa.org/helpcenter/parity-law.aspx?item=2$!3C4-D,8-#$E%#$9-D0,3#$F%#$G,3H,3#$+%#$I,4CD3;H,3#$"%#$J$K,5,0,3#$+%$&'(@(*%$!"#$%&%'()*+,"-('(.%-+/%'%+

0*'+123456447%$L-4=,3M4.5$8B$K,3-N$O-M.4.;.,$8B$"804.47/0$F74,-7,%$KP3M72#$!%$&'((Q*%$O-M.4.;.48-/0$R/34/.48-$/-6$S88364-/.48-$"/..,3-M$4-$S+9MN$FT4MM$/-6$G,3C/-$

S83U83/.,$G8=,3-/-7,$4-$S8CU/34M8-%$O-$K%$1/-7VW#$+%$<286,M$J$+%$X2/.72,3$&96M%*#$8*9":;+<%&(*'(*=+">+!%$('%-(=#?+!":>-(.'@+!":'&%;(.'(":=@+%:;+!"#$-*#*:'%&('(*=+(:+'A*+BC&"$*%:+B.":"#9$&UU%$@QA$Y$@)Z*%$[\B836N$[\B836$L-4=,3M4.5$"3,MM%$

S/CUH,00#$]%$I%#$J$",6,3M,-#$[%$E%$&'((Q*%$X2,$R/34,.4,M$8B$S/U4./04MC$/-6$15H346$F;77,MM$^$_,-C/3V$4-$.2,$G08H/0$978-8C5%$!"#$%&%'()*+,"-('(.%-+0'C;(*=@+D4#$A(QYAA'%$$

S38;72#$S%#$F.3,,7V#$`%#$K85,3#$<%#$!C/H0,#$K%#$1/00#$"%$!%#$J$]/7VM8-#$G%$&'((a*%$_4/08D;,$8-$bO-M.4.;.48-/0$78CU0,C,-./34.5$/-6$U804.47/0$,78-8C5b%$0".("5B.":"#(.+E*)(*F@+G&'*#$Aa)%$$

S;M/7V#$X%$<%#$J$K,3/C,-64#$"%$&'((c*%$X/\4-D$T83V%$BC&"$*%:+H"C&:%-+">+,"-('(.%-+E*=*%&.A@+DI&@*#$ZAYQA%$$_83-#$F%$&'(()*%$18T$9BB,7.4=,05$_8,M$.2,$!C,347/-$<,78=,35$/-6$<,4-=,M.C,-.$!7.$1,0U$I/46Y[BB$

`83V,3M$/-6$F./.,M$S8U,$T4.2$1,/0.2$S/3,$S8M.Md$J(#*-9+K:%-9=(=+">+L##*;(%'*+M*%-'A+,"-(.9+L==C*=&+/372$'(()*%$$

_;-7/-#$!%$&"386;7,3*%$&'(()*%$E,5$"80475$I,..,3M$B38C$X2,$96;7/.48-$F,73,./35$83$_,U;.5$F,73,./35%$$9_#$L%$F%$_%$8%$9%$&'(()*%$K#*&(.%:+E*.")*&9+%:;+E*(:)*='#*:'+K.'+">+6442?++

N=(:O+KEEK+PC:;=+'"+/&()*+0.A""-+E*>"&#+%:;+L#$&")*#*:'%$$<,.34,=,6$B38C$http://web.archive.org/web/20090430015951/http://www.ed.gov/policy/gen/leg/recovery/index.html%$

9_O#$9%$_%$6%$O%$&'(@A*%$1,3e0472$T400V8CC,-$4C$946D,-PMM472,-$_,U/3.,C,-.$6,M$O--,3,-$9_O%$$9fE#$9%$f%$&'(@'*%$_4,$E8-g;-V.;3C/MM-/2C,-$6,M$K;-6,M$'((>Y'(@(%$9=/0;/.48-$6,3$E8-e,U.48-$;-6$

LCM,.e;-D$6,3$F./H404M,3;-DMC/MM-/2C,-#$+h3e$'(@'$i"3,MM$3,0,/M,j$9M.,=,eY!H,#$+%#$O=,3M,-#$X%#$J$F8MV47,#$_%$&'((@*%$F874/0$U38.,7.48-$/-6$.2,$B83C/.48-$8B$MV400MN$!$

3,4-.,3U3,./.48-$8B$.2,$T,0B/3,$M./.,$<%&(*'(*=+">+.%$('%-(=#?+JA*+(:='('C'(":%-+>"C:;%'(":=+">+."#$%&%'()*+%;)%:'%O*$&UU%$@ZaY@>A*%$k,T$l83VN$[\B836$L-4=,3M4.5$"3,MM%$

9R_$&946D,-PMM472,M$R80VMT43.M72/B.M6,U/3.,C,-.*#$J$F9S[$&F.//.MM,V3,./34/.$Bm3$`43.M72/B.*%$&'(()/*%$P%.'=A**'?+B(:=Q'R*+(:+P"&=.AC:O+C:;+S*A&*+FQA&*:;+;*&+TC&R%&U*('+VK&'W+IX%$$nm3472N$$<,.34,=,6$B38C$T,H%/3724=,%83D?T,H?'(@'(c'>(@A''Z?http://www.seco.admin.ch/stabilisierungsmassnahmen/03055/index.html?lang=de&download=NHzLpZeg7t,lnp6I0NTU042l2Z6ln1acy4Zn4Z2qZpnO2Yuq2Z6gpJCFdX18gmym162epYbg2c_JjKbNoKSn6A--%$

9R_$&946D,-PMM472,M$R80VMT43.M72/B.M6,U/3.,C,-.*#$J$F9S[$&F.//.MM,V3,./34/.$Bm3$`43.M72/B.*%$&'(()H*%$P%.'=A**'?+P(:%:RA(->*:+>Y&+;(*+Z*('*&U(-;C:O+='*--*:-"=*&+KUOQ:O*&(::*:+C:;+KUOQ:O*&+;*&+U*&C>-(.A*:+[&C:;U(-;C:O+VK&'W+1X%$$nm3472N$$<,.34,=,6$B38C$T,H%/3724=,%83D?T,H?'(@'(c'>(@A''Z?http://www.seco.admin.ch/stabilisierungsmassnahmen/03055/index.html?lang=de&download=NHzLpZeg7t,lnp6I0NTU042l2Z6ln1acy4Zn4Z2qZpnO2Yuq2Z6gpJCFdX19gGym162epYbg2c_JjKbNoKSn6A--%$

9R_$&946D,-PMM472,M$R80VMT43.M72/B.M6,U/3.,C,-.*#$J$F9S[$&F.//.MM,V3,./34/.$Bm3$`43.M72/B.*%$&'(()7*%$P%.'=A**'?+P(:%:RA(->*:+>Y&+Z*('*&U(-;C:O+FQA&*:;+;*&+TC&R%&U*('+VK&'W+DX%$$nm3472N$$<,.34,=,6$B38C$http://web.archive.org/web/20100630095224/http://www.seco.admin.ch/stabilisierungsmassnahmen/03055/index.html?lang=de&download=NHzLpZeg7t,lnp6I0NTU042l2Z6ln1acy4Zn4Z2qZpnO2Yuq2Z6gpJCFdX18hGym162epYbg2c_JjKbNoKSn6A--%$

9R_#$9%$R%#$J$F9S[#$F%$B%$`%$&'(()*%$P%.'=A**'?+P(:%:RA(->*:+>Y&+;(*+Z*('*&U(-;C:O+='*--*:-"=*&+KUOQ:O*&(::*:+C:;+KUOQ:O*&+;*&+U*&C>-(.A*:+[&C:;U(-;C:O+VK&'W+1X%$$nm3472N$$<,.34,=,6$B38C$T,H%/3724=,%83D?T,H?'(@'(c'>(@A''Z?http://www.seco.admin.ch/stabilisierungsmassnahmen/03055/index.html?lang=de&download=NHzLpZeg7t,lnp6I0NTU042l2Z6ln1acy4Zn4Z2qZpnO2Yuq2Z6gpJCFdX19gGym162epYbg2c_JjKbNoKSn6A--%$

f83M.,3#$S%$&'(()#$(c?(>?'(()*%$"/3.,4,-$V34.4M4,3,-$ORY+/-P=,3%+J%O*=%:R*(O*&@$U%$@)%$$G8=,3-C,-.#$L%$F%$&'(()*%$K3,/V68T-$8B$f;-6M$"/46$[;.$K5$S/.,D835%$$$<,.34,=,6$(Q?@@?'(@A#$B38C$

http://www.recovery.gov/transparency/fundingoverview/pages/fundingbreakdown.aspx$1/00#$"%$!%#$J$G4-D,3472#$_%$`%$&'((Z*%$<%&(*'(*=+">+!%$('%-(=#+%:;+L:='('C'(":%-+!"#$-*#*:'%&('(*=+(:+'A*+

\%.&"*.":"#(*=?+K:+*#$(&(.%-+K:%-9=(=$&R80%$a*%$EP0-N$+/\Y"0/-7VYO-M.4.;.$Bm3$G,M,00M72/B.MB83M72;-D%$

1/00#$"%$!%#$J$F8MV47,#$_%$&'((@*%$<%&(*'(*=+">+!%$('%-(=#?+JA*+L:='('C'(":%-+P"C:;%'(":=+">+!"#$%&%'()*+K;)%:'%O*%$k,T$l83VN$[\B836$L-4=,3M4.5$"3,MM%$

1/00#$"%$!%#$J$X2,0,-#$E%$&'(()*%$O-M.4.;.48-/0$72/-D,$4-$=/34,.4,M$8B$7/U4./04MC%$0".("5B.":"#(.+E*)(*F@+]&@*#$QYAZ%$$

1/-7VW#$K%#$<286,M#$+%#$J$X2/.72,3#$+%$&'((Q*%$8*9":;+<%&(*'(*=+">+!%$('%-(=#?+!":>-(.'@+!":'&%;(.'(":=@+%:;+!"#$-*#*:'%&('(*=+(:+'A*+BC&"$*%:+B.":"#9%$[\B836N$[\B836$L-4=,3M4.5$"3,MM%$

147VM#$!%#$J$E,-T83.25#$I%$&@))>*%$S88U,3/.48-$/-6$U804.47/0$,78-8C47$U,3B83C/-7,$4-$/BB0;,-.$6,C873/.47$7/U4./04MC%$K#*&(.%:+H"C&:%-+">+0".("-"O9@+14G#$@cA@Y@cQ'%$$

1PU-,3#$+%$&'((Q*%$S88364-/.48-$/-6$83D/-4e/.48-N$X2,$.T8$64C,-M48-M$8B$-8-04H,3/0$7/U4./04MC%$\,L>[+/(=.C==(":+,%$*&@+4]&@'*#$S808D-,N$+/\$"0/-7V$O-M.4.;.,$B83$.2,$F.;65$8B$F874,.4,M$$

1PU-,3#$+%$&'(()*%$FU4,0/3.,-$6,M$E/U4./04MC;M$/0M$F72;0,$6,3$=,3D0,472,-6,-$F.//.M.h.4DV,4.MB83M72;-D%$^*('=.A&(>'+>Y&+)*&O-*(.A*:;*+,"-('(_F(==*:=.A%>'@+G&'*#$A(AYA'Q%$$

1P34M72#$f%$&'((Q*%$!"&$"&%'*5[")*&:%:.*5,"-('(_+(:+;*&+8C:;*=&*$CU-(_+/*C'=.A-%:;@+[&"`U&('%::(*:+C:;+;*&+0.AF*(R+(#+<*&O-*(.A%$+m-72,-N$G34-%$

1P34M72#$f%$&'(()*%$N:'*&:*A#*:=#('U*='(##C:O+(#+:%'(":%-*:+C:;+(:'*&:%'(":%-*:+<*&O-*(.A+a+B:'='*AC:O+C:;+b_":"#(=.A*+KC=F(&_C:O*:%$K,304-$;-6$+m-M.,3N$I4.%$

1P34M72#$f%$&'(@'*%$_4,$K,M.4CC;-DMB/V.83,-$6,3$94-Bm23;-D$6,3$L-.,3-,2C,-MC4.H,M.4CC;-D$4-$6,-$[9S_YF.//.,-%$94-,$B;ee5YM,.$o;/04./.4=,$S8CU/3/.4=,$!-/05M4M%$^*('=.A&(>'+>Y&+0"R(%-&*>"&#@+I7&@?'(@'*#$AAYaQ%$$

18;M,#$`%$&'((>*%$f/7.$F2,,.%$k,T$G38T.2$"/7V/D,$i"3,MM$3,0,/M,j%$<,.34,=,6$B38C$http://web.archive.org/web/20080218045137/http://www.whitehouse.gov/news/releases/2008/01/print/20080124-3.html$

O=,3M,-#$X%#$J$F.,U2,-M#$]%$_%$&'((>*%$"/3.4M/-$U804.47M#$.2,$T,0B/3,$M./.,#$/-6$.23,,$T8306M$8B$2;C/-$7/U4./0$B83C/.48-%$!"#$%&%'()*+,"-('(.%-+0'C;(*=@+D1&ZYa*#$c((YcAQ%$$

]hV,0#$X%#$J$1P34M72#$f%$&'(()*%$_4,$_,3,D;04,3;-D$=8-$!3H,4.MCh3V.,-$4C$[9S_YR,3D0,472$eT4M72,-$@))($;-6$'((a%$O-$L%$`/DM72/0$&96%*#$/*C'=.A-%:;+RF(=.A*:+E*>"&#='%C+C:;+<*&Q:;*&C:O?+B(:+<*&O-*(.A+;*&+,"-('(_5+C:;+M%:;-C:O=>*-;*&$&R80%$>A$Y$@(Z*%$K/6,-YK/6,-N$k8C8M%$

];.V8T4.e#$9%$&'(()*%$F.4C;0;M$+8-,5$/-6$1,/0.2$S/3,$<,M,/372$/-6$O-=,M.C,-.%$M*%-'A+,"-(.9+c*F=-*''*&@+66&'*%$$

E/.e,-M.,4-#$"%$]%$&'((c*%$_,-C/3V$/-6$MC/00$M./.,M%$O-$]%$I%$S/CUH,00#$]%$!%$1/00$J$[%$E%$",6,3M,-$&96M%*#$c%'(":%-+(;*:'('9+%:;+'A*+)%&(*'(*=+">+.%$('%-(=#?+JA*+/%:(=A+*d$*&(*:.*$&UU%$ZAAYZZ(*%$+8-.3,/0N$+7G400Yo;,,-pM$L-4=,3M4.5$"3,MM%$

I,=4.#$+%$<%$&'(@@*%$X2,$f,6,3/0$K;6D,.N$OMM;,M$B83$fl'(@@#$fl$'(@'#$/-6$K,58-6%$!E0+E*$"&'+>"&+!":O&*==@+ED137I%$$

I4H3/35$8B$S8-D3,MM$&"386;7,3*%$&'(@A*%$L%F%$90,7.48-M$F./.4M.47MN$!$<,M8;37,$G;46,%$<,.34,=,6$B38C$http://www.loc.gov/rr/program/bib/elections/statistics.html$

I8S#$I%$8%$S%$&'((>*%$K400$F;CC/35$J$F./.;M$@@(.2$S8-D3,MM$&'((Q$Y$'((>*$1%<%A))Q%$$$<,.34,=,6$@(?@A?'(@A#$B38C$http://hdl.loc.gov/loc.uscongress/legislation.110hr3997$

+;004D/-#$]%$9%$&'((>#$@(?('?'(@A*%$E,--,65bM$;-4-.,-6,6$380,$4-$24M.835%+,&")(;*:.*+H"C&:%-%$$[H/C/#$K%$1%#$J$K46,-#$]%$&'((>*%$K/3/7V$[H/C/$/-6$]8,$K46,-qM$U0/-$.8$08T,3$2,/0.2$7/3,$78M.M$/-6$

,-M;3,$/BB836/H0,#$/77,MM4H0,$2,/0.2$7/3,$78=,3/D,$B83$/00$i"3,MM$3,0,/M,j%$<,.34,=,6$B38C$2..UMN??MA%/C/e8-/TM%78C?MA%687;C,-.708;6%83D?687;C,-.M?AZc'cc?2,/0.27/3,B;00U0/-%U6B$

[9S_%$&'(()/*%$B.":"#(.+eC'-""_$&R80%$>a*%$"/34M%$[9S_%$&'(()H*%$978-8C47$[;.088V%$O-.,34C$<,U83.$+/372$'(()%$&+/372$'(()*%$$[9S_%$&'(()7*%$[9S_$978-8C47$[;.088V%+7I&'(()?@*%$$[9S_#$[%$B%$9%$S%Y[%$/%$_%$&'(@'*%$eB!/W0'%'Bd'&%.'=%$<,.34,=,6$B38CN$http://stats.oecd.org/$"3,MM#$!%$&'((>#$@(?(@?'((>*%$F,-/.,$/UU38=,M$H/408;.$U0/-$H5$/$T46,$C/3D4-%+B-+,%="+J(#*=%$<,.34,=,6$

B38C$http://www.elpasotimes.com/ci_10612486$<,472/36#$]%$&'(()#$('?@'?'(()*%$S8-B,3,-7,$!D3,,C,-.$O-70;6,M$1,/0.2$S8-7,MM48-M$.8$.2,$18;M,$

Z%=A(:O'":+M*%-'A+,"-(.9+Z**_+(:+E*)(*F%$<,.34,=,6$B38C$http://www.commonwealthfund.org/Newsletters/Washington-Health-Policy-in-Review/2009/Feb/Washington-Health-Policy-Week-in-Review-February-17-2009/Conference-Agreement-Includes-Health-Concessions-to-the-House.aspx$

<8.2#$+%#$J$F720;U#$<%$&'(@(*%$+4.$D,Hm-6,0.,3$E3/B.$=8-$F72T,4e,3$E+L$e;C$93B80D$/;B$!;M0/-6MCh3V.,-%$/(*+<"-_=F(&'=.A%>'&a*#$a(YaZ%$$

F72T,4e,3$K;-6,M3/.%$&'(()*%+8"'=.A%>'+RC+*(:*#+8C:;*=O*=*'R+YU*&+U*>&(='*'*+_":fC:_'C&*--*+0'%U(-(=(*&C:O=#%==:%A#*:+(#+8*&*(.A+;*=+K&U*('=#%&_'=+C:;+;*&+L:>"&#%'(":=5+C:;+T"##C:(_%'(":='*.A:"-"O(*:+VGW+0'C>*+;*&+_":fC:_'C&*--*:+0'%U(-(=(*&C:O=#%==:%A#*:X%$$<,.34,=,6$B38C$http://www.seco.admin.ch/stabilisierungsmassnahmen/index.html?lang=de&download=NHzLpZeg7t,lnp6I0NTU042l2Z6ln1acy4Zn4Z2qZpnO2Yuq2Z6gpJCFdIJ7gGym162epYbg2c_JjKbNoKSn6A--%$

F72T,4e,3$"/30/C,-.$&"386;7,3*%$&'(()#$c.2$];05#$'(@A*%$+8.48-%$E;3e/3H,4.%$+/MM-/2C,-$e;3$L-.,3M.m.e;-D$6,3$`,4.,3H406;-D$4C$K,.34,H%$,4-D,3,472.$=8-$!;H,3.$]8M4/-,%$$

F9S[#$F%$B%$`%$&'(@'*%$8*&(.A'+;*=+0'%%'==*_&*'%&(%'=+>Y&+Z(&'=.A%>'+0B!e+YU*&+;(*+0'%U(-(=(*&C:O=#%==:%A#*:+6442g6414%$$K,3-%$

F<f#$F%$<%$;%$f%$&`34.,3*%$&'(()*%$X/D,MM72/;%$MT4MM4-B8%72$&"386;7,3*%$&'(()#$('?(Z?'(@A*%$`43.M72/B.M=,3Hh-6,N$]/$e;3$ORYn;M/.eB4-/-e4,3;-D%$

<,.34,=,6$B38C$http://www.swissinfo.ch/ger/Wirtschaftsverbaende:_Ja_zu_IV-Zusatzfinanzierung.html?cid=7557374$

L%F%$18;M,$8B$<,U3,M,-./.4=,M$&"386;7,3*%$&'((>#$A36$[7.8H,3$'((>*%$9-,3D5#$9\.,-6,3M#$!+X#$/-6$_4M/M.,3$X/\$"38=4M48-M$O-$.2,$9C,3D,-75$F./H404e/.48-$!7.$8B$'((>%$<,.34,=,6$B38C$http://perlmutter.house.gov/index.php?option=com_content&view=article&id=697:-energy-extenders-amt-and-disaster-tax-provisions-in-the-emergency-economic-stabilization-act-of-2008-&catid=28:bulletin-board&Itemid=18$

LR9E$&946D,-PMM4M72,M$_,U/3.C,-.$Bm3$LCT,0.#$R%#$9-,3D4,$;-6$E8CC;-4V/.48-##$J$9-,3D4,*#$K%$K%$B%$&'(()*%$P%.'=A**'?+P(:%:RA(->*:+>Y&+KC=5+C:;+Z*('*&U(-;C:O+C:;+N#=.AC-C:O+(#+[*UQC;*5+C:;+B:*&O(*U*&*(.A+VK&'W+3X%$$nm3472N$$<,.34,=,6$B38C$T,H%/3724=,%83D?T,H?'(@'(c'>(@A''Z?http://www.seco.admin.ch/stabilisierungsmassnahmen/03055/index.html?lang=de&download=NHzLpZeg7t,lnp6I0NTU042l2Z6ln1acy4Zn4Z2qZpnO2Yuq2Z6gpJCFdX19gGym162epYbg2c_JjKbNoKSn6A--%$

`/DM72/0#$L%$&@))c*%$0'%%'=)*&=.AC-;C:OW+N&=%.A*:+(#+(:'*&:%'(":%-*:+<*&O-*(.A%$[U0/6,-N$I,MV,$r$K;63472%$

`/DM72/0#$L%#$J$]hV,0#$X%$&'(@(*%$sBB,-.0472,$f4-/-e,-$4C$F.3,MM.,M.$Y$"80475Y<,/V.48-,-$/;B$64,$f4-/-eY$;-6$`43.M72/B.MV34M,%$;*&+#";*&:*+='%%'@+6#$')aYA@)%$$

`886#$F%$&'((@*%$K;M4-,MM#$G8=,3-C,-.#$/-6$"/..,3-M$8B$I/H83$+/3V,.$"80475$4-$K34./4-$/-6$.2,$f,6,3/0$<,U;H047$8B$G,3C/-5%$O-$"%$!%$1/00$J$_%$F8MV47,$&96M%*#$<%&(*'(*=+">+!%$('%-(=#?+JA*+L:='('C'(":%-+P"C:;%'(":=+">+!"#$%&%'()*+K;)%:'%O*$&UU%$'ZQY'QZ*%$k,T$l83VN$[\B836$L-4=,3M4.5$"3,MM%$

n820-2PB,3#$<%$&'(@@*%$K,.T,,-$/$<87V$/-6$/$1/36$"0/7,N$X2,$G,3C/-$<,MU8-M,$.8$.2,$978-8C47$S34M4M%$[*&#%:+,"-('(.=@+6411&'(*#$''QY'Z'%$$