REGISTER VIEWPOINT: Sweeteners leave sour taste in bailout bill

For most people, the big number to consider in the so-called "bailout bill" was $700 billion -- as in 700 billion of
Sandusky Register Staff
May 24, 2010

 

For most people, the big number to consider in the so-called "bailout bill" was $700 billion -- as in 700 billion of our dollars.

But maybe the more telling number is 450 -- as in the number of pages in the bill that finally passed the House, up from three in Treasury Secretary Henry Paulson's first proposal.

It took that many extra pages to contain all the pork-barrel tax breaks senators added to the bill so their fellow lawmakers in the House -- which rejected the earlier version, might be persuaded to approve it, which they did a week ago Friday.

We've all heard the stories by now: Tax breaks amounting to $128 million for people who own car racing tracks, $10 million in breaks to small TV and film producers -- and the one that's drawn the most satirical lightning, the repeal of the 39-cent excise tax on toy wooden arrows (as opposed to professional-grade arrows) that might just save the company in Myrtle Point, Ore., that makes the toys.

The irony here: Many -- all right, the great majority -- of those tax breaks were supposed to expire, if not now, then soon. In fact, the tax break "extenders" were part of a budget package the Senate approved a month ago. The House, according to MSNBC.com, would not agree to the package unless a means to pay for it was found. In the middle of last week's impasse, the Senate told the House -- whose members were getting calls from the folks back home that maybe this bailout thing was a good idea after all -- there'd be no bailout bill if the "extender" package wasn't part of it. That's how MSNBC.com tells it, anyway.

The idea was that these tax breaks, attached as riders to the bailout bill, would change the minds of enough of the House's previous "no" votes to bail out the bailout bill.

Maybe it worked. Maybe what worked was the flood of calls our U.S. representatives said they got from people in the home districts, afraid that if Wall Street went down, so would Main Street.

But if that was the case -- if this bill was recognized by Capitol Hill and Main Street as being so important -- why were these tax breaks needed?

Was the bill not that important? We were certainly told it was. Or was it simply Capitol Hill unable to break out of its business-as-usual, here's a little pork for you mentality? That would be especially ironic, given that the whole reason for the bailout bill was a decade and more of people spending what they didn't have.

It's funny, frightening and fascinating, in a slow-down-and-look-at-the-car-wreck kind of way, that an attempt to rectify our failure to learn that most basic lesson hinged on our not yet having learned that lesson.

Whatever. Herewith, from various news sites and services, are some of the highlights of the pork fat that greased the bailout bill:

-- Extending for one year a seven-year depreciation timetable for motorsport racing facilities have had for some years, the same tax break that amusement parks enjoy. A number of representatives had been pressing for the extension, and two of them -- Rep. Mike Thompson, D-Calif., and Rep. Robin Hayes, R-N.C. (and whose district includes Lowe's Motor Speedway) voted against the original bailout. They told the Charlotte Observer they had nothing to do with getting the tax break into the bailout bill. Thompson voted for the final bailout package but Hayes stayed in the "no" column. Cost: $100 million.

-- Exempting wooden practice arrows used by children from an excise tax of 39 cents per arrow. Oregon senators Gordon Smith, a Republican, and Ron Wyden, a Democrat, and two Wisconsin representatives previously introduced legislation calling for the tax break, but the senators say they didn't seek its addition to the bailout bill. Cost: $2 million.

-- New tax credit for purchasers of plug-in electric-drive vehicles. The provision would grant all-electric vehicles or plug-in models with at least a four-kilowatt battery pack a $4,168 credit. A vehicle like the extended range Chevrolet Volt with a 16-kwh battery would qualify for the maximum $7,500 credit for vehicles under 10,000 pounds, according to the Detroit News. Cost: $758 million.

-- Allowing commercial fishermen and others hurt by the 1989 Exxon Valdez oil spill in Alaska to average out damage awards over three years. Alaska Rep. Don Young, who told news services the tax break was aimed at his vote, voted "no" anyway. Cost: $49 million.

-- Allowing employers to exempt from taxation what they spend on some fringe benefits for workers who commute to work by bicycle, up to $20 a month per cyclist. Cost: $2 million.

Some more of the tax breaks:

-- Extending an expired provision that gives Puerto Rico and the Virgin Islands a rebate against excise taxes charged on imported rum. Cost: $192 million.

-- Extending tax credits for certain domestic corporations involved in American Samoa economic development. Cost: $33 million.

-- Extending a credit for the training of mine rescue team members. Cost: $4 million.

-- Enacting President Bush's proposal to erase the debt of the black lung disability trust fund at a cost of $1.3 billion.

-- Extending for five years a program that reduces import duties on some wool fabrics. Cost: $148 million.

-- Increasing the single-year deduction in production costs for film and TV productions may take if the costs are incurred in economically depressed areas. Cost: $478 million.

-- Extending two programs that fund rural schools and rural logging communities. Cost: $3.3 billion.

-- Allowing employers to exempt from taxation what they spend on some fringe benefits for workers who commute to work by bicycle, up to $20 a month per cyclist. Cost: $2 million.

For a roll call vote on the final bailout bill in the House, click HERE.