Add-ons turn tax cut bill into ‘Christmas tree’

WASHINGTON (AP) — In the spirit of the holiday season, President Barack Obama’s tax-cut deal with Republicans is becoming a Christmas tree tinseled with gifts for lobbyists and lawmakers. But that hardly stopped the squabbling on Friday, with Bill Clinton even back at the White House pleading the president’s case.

While Republicans sat back quietly, mostly pleased, Democrats and other liberals were going at each other ever so publicly. As Clinton lectured on Obama’s behalf, Vermont independent Bernie Sanders castigated the agreement for the TV cameras in the mostly empty Senate chamber.

The tax deal, reached behind the scenes and still informal, now includes ethanol subsidies for rural folks, commuter tax breaks for their cousins in the cities and suburbs and wind and solar grants for the environmentalists — all aimed at winning votes, particularly from reluctant Democrats.

The holiday additions are being hung on the big bill that was Congress’ main reason for spending December in Washington, long after the elections that will give Republicans new power in January. The measure will extend Bush-era tax cuts, averting big tax increases for nearly all Americans, and keep jobless benefits flowing.

Republicans generally liked that agreement, worked out by Obama and GOP leaders. Democrats generally didn’t, hence the add-ons.

It’s all expected to come to a decisive vote next week, total cost by the latest congressional estimate: $857.8 billion.

On Friday, there were contrasting events for public consumption.

On Capitol Hill, Sanders spoke vigorously for 8 1/2 hours in a virtually empty chamber, urging defeat of a measure he said would give “tax breaks to millionaires and billionaires who don’t need it.” He finally ended his speech, conceding “It has been a long day.”

At the White House, Obama turned over the briefing room microphone to former President Clinton who declared, “I don’t believe there is a better deal out there.” All sides, he said, “are going to have to eat some things they don’t like.”

The add-ons were being attached behind the scenes.

Almost $5 billion in subsidies for corn-based ethanol and a continuing tariff to protect against ethanol imports were wrapped up and placed on the tree Thursday night for farm-state lawmakers and agribusiness lobbyists. Environmentalists won more grants for developers of renewable energy, like wind and solar.

For urban lawmakers, there’s a continuation of about-to-expire tax breaks that could save commuters who use mass transit about $1,000 a year. Other popular tax provisions aimed at increasing production of hybrid automobiles, biodiesel fuel, coal and energy-efficient household appliances would be extended through the end of 2011 under the new add-ons.

The package also includes an extension of two Gulf Coast tax incentive programs enacted after Hurricane Katrina to spur economic development in Mississippi, Louisiana and Alabama.

The ethanol money was added despite a growing congressional opposition to subsidizing the fuel after decades of government support. Last month, 17 Republican and Democratic senators wrote to leaders calling the tax breaks “fiscally indefensible,” since there’s already a law in place that requires ethanol be blended into gasoline.

“Historically the government has helped a product compete in one of three ways: Subsidize it, protect it from competition or require its use. We understand that ethanol may be the only product receiving all three forms of support from the U.S. government at this time,” the senators wrote.

But ethanol still has powerful supporters on Capitol Hill, including Iowa Sen. Charles Grassley, the top Republican on the Senate Finance Committee and a key negotiator on the Senate tax bill. Adding the ethanol tax breaks was designed to help shore up the votes of many rural Democratic as well as Republican senators.

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  • nexialist

    The American dream has always contained the notion that anyone willing to work hard will be allowed to keep the fruits of his labor and make a better life for his children. By insisting that inheritance be double taxed at confiscatory rates, progressive Democrats are once again governing against the will of the people, and in this case, opposing the American dream.

  • libertyatstake

    GOP members should vote NO on any package that includes any provision that does not reflect directly on an individual W2, or which does not “pay for” every dollar of cost for provisions that pass the previous test. Note: differences in rates between the status quo and the pre-Bush status quo ante are not counted as costs to the government.

    “Because the Only Good Progressive is a Failed Progressive”

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  • truebearing

    Nuke the damn thing and let Obama spin in the wind. He has the left attacking him, and everyone else already hates him. Let him marinate in his failure.

    We don’t need to waste more money on ethanol, especially since there is a food shortage looming. What are these morons thinking?

    Once again, the Democrats have festooned a major bill with enough pig fat to float a cruise ship. The irony of it all is that with the increased spending brought about by the “add ons”, there will be a need for raising taxes after all.

    The Republicans have to learn how to strategize, and how to wield power. The fact they are pleased is all the evidence we need that they are suffering from Chronic Powerlessness Disorder. We want, and demand, representatives who won’t bend over and take it for a movie and dinner.

    • mapletree

      Great words and colorful language to describe this disaster. This is the first test to see if they got the message in DC we sent on Nov 2nd. If Republicans in January start playing games and loading on the pork and acting like democrats I can guarantee there is going to be a third party created in time to throw them out of office in 2012.