If you want to understand what corporate lobbyists in Washington, D.C., are trying to foist on us with the pending "stimulus" bill, look back to the first half of the 1980s.

In 1981, Ronald Reagan pushed a huge tax-cut bill through Congress. Forcorporations, it offered an array of new loopholes, centered on super-accelerated"depreciation" write-offs for equipment and buildings. The results werestaggering, as widespread corporate tax avoidance quickly became routine.

Studies by Citizens for Tax Justice found that half of America's largest andmost profitable corporations were able to avoid paying any income tax at all inat least one year between 1981 and 1984, with many enjoying multiple zero-taxyears. The list of corporate tax freeloaders was a rogues' gallery of famousnames. General Electric, Texaco, Dow Chemical, PepsiCo, Boeing, and ITT wereamong the long list of companies that paid nothing at all in taxes from 1981 to1984. In fact, these and other companies were actually able to get checksoutright from the U.S. Treasury--by "carrying back" their excess write-offs toearlier years and getting rebates of taxes paid in the past. Meanwhile, companiesthat couldn't take advantage of carrybacks sold their surplus loopholes to otherfirms.

The public, and eventually the politicians, found this situation intolerable.A House Ways and Means Committee report in late 1985 said: "The committeebelieves the tax system is nearing a crisis point. Certain tax provisions allowmany corporations to pay relatively little Federal income tax, withoutstimulating investment and production as intended." A few months later, theSenate Finance Committee agreed: "The committee finds it unjustifiable for somecorporations to report large earnings and pay significant dividends to theirshareholders, yet pay little or no taxes on that income to the government."

Even President Reagan got the message. "I just didn't realize that things hadgotten that far out of line," he told Treasury Secretary Donald Regan. SoCongress passed, and Reagan signed, the Tax Reform Act of 1986, which closed themost egregious loopholes and established a corporate "alternative minimum tax" toassure that large, profitable companies would pay some significant tax no matterhow many of the remaining tax breaks they were able to employ.

Well, here we are in 2001, and corporate America sees an opportunity to undoReagan's 1986 tax reforms. The House-passed "stimulus" bill, endorsed byPresident Bush, would reinstate super-accelerated depreciation, at least for thenext three years. It would repeal the corporate alternative minimumtax--retroactively, back to 1986. And for companies that find themselves with anexcess of tax breaks, it would extend the "carryback" period from the current twoyears to five years. This is the same witches' brew that gave us the massivecorporate tax avoidance of the early eighties--which, of course, is exactly whatthe lobbyists have in mind.

Although the right wing is happy to name a building and an airport afterReagan, most are contemptuous of the better parts of his tax legacy. The CatoInstitute, the Heritage Foundation, and other leading rightist leaders are all inthe tank for this fall's corporate-welfare package. Kenneth Kies ofPricewaterhouseCoopers--a former aide to Congressman Bill Archer, the TexasRepublican who tried mightily to derail the bipartisan 1986 tax reforms--condemnsthose who oppose new corporate tax breaks as guilty of "astonishing ignorance."And Grover Norquist, who began his career as a Reagan-administration-sponsoredadvocate for the 1986 reform bill, is now enthusiastic in repudiation.

One rare, principled conservative, Bruce Bartlett of the National Center forPolicy Analysis, bemoans that his usual soul mates are "confirming the liberalcaricature of conservative tax policy." But sadly for Bartlett, this fall'sevents show once again that no caricaturing is required.