The Bribe So Far: $151 Billion

In the unsanitary sausage kitchen that is Congress, the bailout bill that the Senate approved Wednesday night is particularly ugly and smelly.

Must vote-buying be so shameless in the midst of a serious financial crisis?

We've focused a lot on what this bailout bill does not do [1]. It will not fund critical infrastructure projects that are needed now more than ever for the jobs that will be produced in the process. It will not help state and local governments cope with dwindling tax revenues. It offers nothing to retirees who by no fault of their own will see their standard of living lowered by losses on Wall Street. And it punts on the serious reforms needed to keep this mess from happening again.

But it will, on page 290 [2] of what started out as a three-page proposal, give a motorsports racing track operator an additional two years to enjoy a tax write-down.

That's just one of the $150.6 billion in tax provisions that were added to the Senate bill in the hopes that lawmakers in the House, mostly Republicans, will hold their nose and vote for the bill.

It also has the effect of expanding the number of interest groups that have a stake in pushing for this bill's passage. Sadly, that includes some progressives, who, as Congressional Quarterly reports [3], have some of their concerns taken care of.

Our members were supportive [of the bailout bill], but it wasn’t really our focus. It is now,” said Greg Wetstone, senior director of governmental and public affairs at the American Wind Energy Association, which is trying to get the key tax credit for wind energy extended beyond Dec. 31.

The Senate’s tax bill, which passed, 93-2, on Sept. 23, would provide incentives for renewable energy production and conservation, “patch” the alternative minimum tax (AMT) for 2008, extend expiring tax incentives through 2009 and help victims of natural disasters. It is partially offset with revenue increases that would hit the oil and gas industry and hedge-fund managers.

Senate Finance Committee members assembled the tax bill carefully, to break a months-long logjam. They sprinkled it with targeted provisions: a child tax credit expansion for liberal Democrats, new coal tax breaks for Midwestern senators, extra help for Midwest flood victims and Gulf Coast hurricane victims, benefits for Alaskan fishermen, and beefed-up incentives for domestic film production.

Not to mention the elimination of a 39-cent excise tax on wooden arrows for children, a measure designed to benefit Rose City Archery, an Oregon firm, according to Bloomberg [4], which has looked at that and several other tax provisions in the bill.

The same story quotes a spokesman for House Minority Leader John Boehner as saying the inclusion of the tax breaks "will increase the appeal of the package for our members.''

Whatever the merits of these tax measures—and you can be sure that the merits of many of these provisions are highly questionable and exist only at the behest of lobbyists or lawmakers pandering for votes—they certainly make a mockery of all the protestations of not turning the economic rescue effort into a "Christmas tree" of special-interest provisions. As it turns out, the "Christmas tree" concern only applies to provisions that would, for example, fund community organizations that have a track record of helping homeowners avoid foreclosure. You know, things that would help ordinary people directly affected by the financial crisis.

Ian Welsh at FireDogLake [5] put it this way: "This isn't even closing the barn door once the horses are all out; this is buying new horses and deliberately leaving the barn door open. Bottom line: a bad bill which has been larded up with various legislators' pet bills to get the votes necessary to pass."

It's enough to make you want to take a stack of wooden arrows to Capitol Hill and shoot them off in protest [6].