Bailout Passes Senate with Monster Tax Breaks Attached
By Alan Stewart Carl | Related entries in Congress, Economy, TaxesAs expected, the bailout bill (with extra sweetener) has passed the Senate. The vote was 74-25 with both John McCain and Barack Obama voting in favor of the plan.
The bill the Senate passed is virtually identical to the one the House rejected on Monday. The only real difference is the add-ons. The most directly related of these so-called sweeteners is the provision to raise the cap on federal deposit insurance from $100,000 to $250,000. But there’s also $110 billion in tax cuts stapled onto the bill. And, as you would expect from this spendthrift Congress, there are no provisions as to how to pay for the tax cuts.
Why am I not surprised that this Congress’ solution to a bill that didn’t pass is not to change the bill but to bribe one another into voting for it anyway? Even though one of the tax cuts includes rescuing 20 million middle-income Americans from the onerous alternative minimum tax, I’m not at all pleased that a bill designed to save us from reckless financial decisions is now saddled with reckless budgetary management. Are we really in a position to add $110 billion to our national debt? This is like declaring bankruptcy and then going out and buying a yacht on credit.
Predictions are that the sweeteners will be enough to convert a handful of House Republicans over to the aye side, thus passing the bill. Then again, some Blue Dog Democrats are apparently upset about the tax breaks. So while the bailout has hope to pass the House in the next few days, I don’t think anyone is going to declare victory until the votes are actually cast.
We’ll see what happens.
This entry was posted on Wednesday, October 1st, 2008 and is filed under Congress, Economy, Taxes. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
October 1st, 2008 at 9:39 pm
If the sweeteners do buy off enough Republican votes, I’m going to be one pissed off Republican. This is a crappy bill, loaded with unnecessary give aways, containing items entirely unrelated to the crisis. They’re playing politics as usual with something they claim is essential to forestalling a depression. I don’t buy it, and this is a bad bill which SHOULD fail.
As I explained here at Stubborn Facts and in the other posts linked in that post, we had PLENTY of warning about this coming crisis, we could have taken action sooner, but the same people (both Republicans AND Democrats) now saying “trust us, trust us” refused to listen, refused to take action on the warnings. They had bad judgment then, and I see no reason to trust their judgment now.
October 2nd, 2008 at 6:52 am
Alan, are the tax breaks you mentioned new additions to the bill, or remnants of the House bill they had to amend to get around the fact that all spending bills have to originate in the House?
October 2nd, 2008 at 7:34 am
Brian,
My understanding is that they are all new to the Senate version.
Here’s an interesting article on spending bills and the disagreement that exists between the Senate and the House on exactly what the Constitution allows.
From my understanding, the Senate occasionally tacks on tax breaks to bills (it happened with the minimun wage bill, I believe), much to the irritation of the House. It seems, in this case, the Senate decided to take the lead in juicing the bailout bill. I imagine, if House leaders whated to get uppity, they could make the argument that the Senate overstepped its bounds. But it seems they didn’t do anything that they haven’t done before.
October 2nd, 2008 at 7:57 am
This bailout is a B.O.M.B. (Bush-Obama-McCain-Bailout) from hell.
Only Bob Barr is talking sense about the bailout.
How come the media isn’t pushing for Barr to be in the debates? America deserves to be able to vote for someone opposed to a bailout plan, but McCain, Obama and the media don’t want us to have a choice.
Vote Barr to oppose the bailout.
Contact the media to demand that Barr be included in the debates.
Call your congressman to demand that he votes no on this new version of the bailout bill when it goes to the House.