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IT questions Obama's IT stimulus

Don't Buy American

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As Republicans in the US Senate take their sharp knives to President Obama's stimulus plan, the Computing Technology Industry Association (CompTIA) has some free advice for America's lawmakers.

CompTIA is thrilled that IT is playing such a big role in the stimulus package, accounting for $37bn of the $825bn in the House version of the bill that passed last week. But the IT lobbying group wants to throw in some extra bennies for the IT industry - and caution lawmakers about implementing so-called "Buy American" provisions in the bill, which seek to keep the stimulus packaging doing its stimulating at home.

(If Bill Clinton had done this, we wouldn't be in such a mess. But that's another story).

"As the contours of the recovery package take shape, we see much that we like," explained Todd Thibodeaux, president and CEO at CompTIA in a statement. "The package's focus on 'greening' America and its technology, boosting uptake of health information technology (HIT), promoting more broadband, and repealing government withholding taxes on government contract work, among others, excite us. That noted, we feel a few important proposals could work better to enhance the package's overall effectiveness in our recovery."

Specifically, CompTIA wants to make permanent the tax deduction for small businesses that allows them to buy up to $250,000 worth of IT equipment. This deduction was a temporary provision put into the Bush Administration's $152bn stimulus package, signed in February 2008, as the American economy was beginning to weaken. The Bush tax benefit for IT spending at SMBs does not expire until the end of 2009, and not surprisingly, CompTIA - meaning its members, who are IT vendors and their resellers - want the tax breaks to be made permanent.

Such a move would make it easier for small companies - key to the recovery in the American economy - to keep investing in new gear. They'll be able to get those investments off their books quickly rather than depreciating them over many years.

Thibodeaux banged the "IT skills shortage" drum, saying that the federal and state governments have to work together to invest in IT skills. "Though the proposals place much hope on IT to help our economy, at bedrock, technology works only at the hands of skilled IT workers. Yet, we have a perennial shortage of IT-skilled technicians in America," said Thibodeaux.

"We urge that the underlying federal and state programs that deliver those skills to workers be updated, becoming more market-driven and focused toward 21st century, IT-driven skills. If we cannot improve upon this critical investment in human capital, then IT's role in our recovery will be greatly diminished."

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