The Senate will take up a “sweetened” version of the financial rescue package this evening. The “sweeteners” are intended to encourage House Republicans (who chose not to support the House version) to ultimately support the Senate version. Trouble is, as this CNN story points out (and as Richard Rubin’s CQ article elaborates on), the Senate seems to be saying “to hell with” the House Democrats, especially the group of House Ds I am most fond of (the Blue Dogs)–emphasis added:
The revised bill contains provisions that the Senate hopes will appeal to House Republicans, who voted two-to-one against the original legislation. The sweeteners include renewable energy tax incentives - for individuals and businesses alike - that have been on the table for several months and had a chance of passing at some point anyway.
The bill also includes relief from the Alternative Minimum Tax, without which millions of Americans would have to pay the so-called “wealth tax.”
AMT relief is an annual political ritual, not because it lacks receive bipartisan support, but because deficit hawks on both sides of the aisle contend the cost of providing that relief should be paid for. Others argue it shouldn’t be paid for because the AMT was never intended to hit the people the relief provisions would protect. Nevertheless, lawmakers pass the measure every year or two.
There’s that reasoning I can’t stand: that it’s “not right” to replace the revenue from an unfair tax with revenue from completely different (fairer) taxes. That’s called “revenue neutral tax reform.” Someone needs to ask those senators (both Rs and Ds) who espouse such justification for deficit-financed tax cuts: why is it more fair to replace that revenue (from that unfair tax) with a debt burden that will ultimately be paid by our children and grandchildren?