There is no money in the COVID relief bill for states and cities that are verging on bankruptcy due to the collapse of tax revenues. Those states and cities support our schools. But there was lots of money for special interests.
The Washington Post reports that Congress tacked on billions of dollars in tax breaks to their favorite lobbyists. When a bill is more than 5,000 pages long, it takes time to find out what goodies were included for favored industries.
Congress on Monday unveiled a 5,593-page spending bill and then voted on it several hours later, with lawmakers claiming urgent action was needed to rescue an ailing economy ravaged by the coronavirus pandemic.
But tucked in the bill was over $110 billion in tax breaks that strayed far from the way the bill was marketed to many Americans. These giveaways include big tax cuts for liquor producers, the motorsports entertainment sector and manufacturers of electric motorcycles.
These measures, added onto the broader spending bill, are known as “tax extenders” — tax breaks targeted at specific, sometimes niche industries. And routinely extending these “temporary” measures has become something of a year-end tradition, despite loud complaints from some lawmakers who allege the votes largely benefit special-interest groups who stand to gain financially from the outcome.
These tax extenders are designed to be temporary but are frequently renewed, often at the urging of industry lobbyists, and done so during late-night votes at the end of the year. (The Senate vote Monday took place shortly before midnight.) The Joint Committee on Taxation estimated the extenders benefiting industry and special interests included in the stimulus bill would cost over $110 billion over 10 years.
Tax experts and good governance advocates have criticized such short-term tax relief extensions, arguing they hide the true cost of the cuts and advantage industries with the most well-connected lobbyists. “They are a gravy train for members and lobbyists, who repeat the same exercise every year or two,” Howard Gleckman, a tax policy expert at the Urban Institute, said in an email. “The lobbyists get to keep billing hours. The members get campaign money from the same people. Many of these are classic special interest tax breaks that do not benefit the overall economy in any way.”
The federal government collected $3.4 trillion in taxes in the 12 months that ended Sept. 30, but it typically allows more than $1.5 trillion in annual tax breaks, according to the Committee for a Responsible Federal Budget. Some of these are locked into the tax code. Others, however, were initially designed to last only a year or two but continue winning extension after extension because of intense lobbying.
President-elect Joe Biden has been critical of the plethora of tax giveaways, but he will find that both Democrats and Republicans have been steadfast in their supportive of certain tax breaks. And to win passage each year, the tax breaks are bundled together into one package for votes to draw maximum support.
Congress is scrambling to pass a coronavirus stimulus bill before the end of 2020. Here’s what you need to know about what’s included in the legislation.
The enormous new bill packages together emergency economic relief, government funding and tax cuts. The economic relief component of the bill is worth around $900 billion. The legislation included a slew of provisions that had nothing to do with coronavirus relief or funding the government, including many of the tax extenders.
One measure, for instance, makes permanent a cut in excise taxes for producers of beer, wine and distilled spirits, which first became law in 2017 as part of the Republican-led tax cut package. The cuts were due to expire without congressional action, and the alcohol industry had pushed hard for their renewal, arguing that their businesses had been decimated by the pandemic. The industry has supporters among both Democrats and Republicans in Congress, who in turn pushed their leaders to include a bill making the cuts permanent “in the next appropriate legislative package.”
Also, as I just read, the “pro-life” Senate Majority Leader personally ensured the discontinuation of the CARES Act’s mandatory two weeks of paid sick leave for workers who test positive. Although this provision had numerous exemptions, it prevented many working people from having to choose between their livelihoods and their lives.
Mitch and his allies are pro-life only for the unborn. They lose interest in the lives of the born.
Appalling!
America has become NOT the land of the brave and the free, but instead the land FOR the RICH and the GREEDY.
There is so much corruption in our government I wonder if we will ever be able to clean up the mess. The President is having a tantrum and refuses to sign the bill that will help millions of Americans. He is pardoning all his corrupt cronies and other assorted vandals and murderers. We have socialism for the wealthy and harsh capitalism for all the little people. We need systemic change, and we need it fast.
But the news this morning is that Trump will not sign the bill or any variant that includes his last minute proposal for $2000 checks instead of $600.
I am not alone in being whiplashed by Trump’s not having any understanding of this bill or the larger bill it is attached to–The Defense Authorization Act– and why his last minute proposal for $2000, initially accepted with glee by Nancy Pelosi, has already been rejected by Republicans.
So…perhaps the government will shut down again while Trump continues to offer pardons to his supporters, among them convicted criminals, thieves, and masters of the big con.
The Defense Authorization Act supports our military. Trump would rather eliminate schedule pay raises for the military than allow the passage of the current bill’s effort to change the names of military bases named for Confederate generals.
Like a toddler Trump will delight in the chaos. He has no empathy for struggling Americans. We are no more than pawns in his quest for revenge.
Apparently Trump is confused about what is in either bill. He wants to be relevant and draw attention to himself. He is undercutting Mitch as vengeance for Mitch acknowledging that Biden won.
Bring on those $2,000 payments!
Was this a surprise?…..NOT!. History/Government repeating itself……and “we the people” lose every single time. Pork, ear marks, tax extenders, tax breaks. Call it what you want, but “we” get screwed every single time and it’s “our” tax dollars that flow away from “us” and into the coffers of private industry controlled by a billionaire/ruling class.
The list corporations and billionaires getting those tax breaks are members of the alleged deep state just like Donald Trump.
2 days ago:
“Jared Kushner helped create a Trump campaign shell company that secretly paid the president’s family members and spent $617 million in reelection cash, a source tells Insider.”
https://www.businessinsider.com/jared-kushner-trump-campaign-shell-company-family-ammc-lara-2020-12?utm_source=reddit.com
How Donald Trump Moved Millions From His Campaign Donors To His Private Business
“Millions from his campaign, millions from the RNC, millions from committees. While other billionaires spend big on the election, the Donald is raking it in.”
https://www.forbes.com/sites/michelatindera/2020/07/21/how-donald-trump-moved-millions-from-his-campaign-donors-to-his-private-business/?sh=65e5972a735c
Now we know how Trump ran out of money for his 2020 re-election campaign.
Not sure this is about oligarchs & billionaires. I remember complaints about pork barrel spending since I was a kid. Isn’t this how bills have always gotten passed in this country?
What’s startling is to hear about it in the context of emergency pandemic relief. But a deal like this could & should have been hammered out & been out of the gate six months ago.
Expanding on your last sentence, yes, what you write is how our legislative system is supposed to work. Back in the day congressional committees and subcommittees actually did the work of legislating to inform the full House and Senate chamber. That all came to abrupt halt after the 1994 midterm elections and the ascendancy of Newt Gingrich to Speaker of the House. After that, congressional procedure was usurped by the House leadership, which also changed the calculus of Senate leadership (which sadly was further undermined the Bob Dole decided to run for president and therefore became subservient to House activity).
The most obvious victim was the appropriations process, which became more politicized that it has ever been in our history and is now complete broken. These 13 bills are literally the only “must pass” pieces of legislation that exist; they fund every federal agency. These 13 bills should theoretically be on the president desk no later than September 30, the end of the federal fiscal year. In normal times, the 13 House subcommittees would send the bill to the Senate by early summer, the Senate would pass them by early September, and then the conference committees would report them out my mid-to-late September for full House and Senate votes. After the 1994 elections, these subcommittee bills were held hostage by narrow legislative interests and decided by House and Senate leaders, not subcommittees.
In the past two decades-plus, we’ve seen the consequences of government shutdowns, omnibus bills of which no one understands the details (of corporate tax breaks, pork bill projects) until weeks later, usually to the detriment of taxpayers and grossly enrich the wealthy an special interest. That pattern continues today, as you comment implies.
Very interesting detail Greg, thanks for the lesson. See if I have it right:… It’s not that we didn’t “always” [or at least, decades before Gingrich] pass bills via pork barrel horse-trading. Since Gingrich, the transparency is gone. A consequence of strong-arm rule-changes, pursuant to gloves-off, polarized politics, leading to the utter gridlock evident since 2010, slowing bill-passage to treacle, resulting in passage of mostly only the bare minimum reqd to keep govt/ bills funded. Hence last minute gigunda bills no one has time to read, & recriminations on both sides re: ludicrous [& scurrilous] add-ins no one had time to learn about much less discuss/ trade.
The transparency [lack of] angle seems key to me in public’s sense that their democracy no longer works for them. We’ve always had deep-pockets lobbyists, but lack of transparency allows ALL the pork-barrel to be about what works for them [today’s oligarchs & billionaires, in addition to the garden-variety non-GDP-enhancing niche industries noted in the article]. No more bridges to nowhere that at least gave thousands jobs for a few years. No more public goods stuff like transportation-, education-, libraries-, museum-, etc-projects. Public learns about the add-ins later, always thro lens of polarized pols complaining about Dems’ this & Reps’ that fave voter/donor-slanted perks, guaranteed to distract 99% from the fact that none of it benefits them at all.
Any time a bill is longer than 1,000 pages, you can be sure that lobbyists tucked in lots of favors for their clients. Maybe even less than 1,000 pages. No one reads the whole thing and knows what in it.