Tweedledee. Tweedledum. This is what we get when the two parties work together, a massive spending spree.
A $1.1 trillion federal spending bill and a $650 billion tax package unveiled today show that neither party gives a damn about holding down spending. It’s not that all the items to be funded are wasteful or unneeded, but the package will push spending above previously agreed limits by $66 billion in 2016 and permanently extend a vast array of tax benefits that will add at least a half-trillion dollars to the federal deficit, once a matter of great concern.
- Bowing to pressure on Republicans and Democrats from medical device manufacturers across the county, including in Oregon, anti-Obamacare zealots, and ticked-off unions with expensive healthcare plans, the legislation will postpone for two years (which probably means forever) a 2.3 percent excise tax on medical devices manufacturers, that was expected to raise $29 billion of net revenues over 10 years and a so-called “Cadillac Tax” tax on expensive employer-sponsored healthcare plans, that was projected to raise about $30 billion over 10 years to cover new spending under Obamacare. Then, to add insult to injury, the legislation makes the Cadillac tax refundable when it restarts. The lost taxes will blow a hole in planned funding to cover the cost of Obamacare.
- The Defense Department will get $1111 billion for new military equipment, including F-35 Joint-Strike Fighters, Black Hawk helicopters, attack submarines and guided missile destroyers.
- A 40-year-old oil export ban will be rescinded and, in trade, Democrats will get expensive extensions of wind and solar power tax incentives.
- A research and development tax credit will be expanded and extended permanently.
- The $1,000 Child Tax Credit will be extended permanently.
- The Earned Income Tax Credit will be permanently extended.
- A federal health program for first responders and construction workers who worked at the World Trade Center site after 9/11 and a separate victims compensation fund will be extended at a cost of $8 billion.
- A National Oceans and Coastal Security Fund will be created to “support work that helps Americans understand and adapt to forces like sea level rise, severe storms, and ocean acidification” associated with climate change.
- The American Opportunity Tax Credit, an annual credit for tuition and other qualified expenses, will be permanently extended.
- A $250 annual deduction on qualified expenses of teachers will be indexed for inflation and permanently extended.
- Five tax credits tied to charitable donations by individuals and businesses will be permanently extended.
- Funding for the IRS will be frozen, punishing the IRS for targeting conservative groups, but also further limiting its ability to go after tax scofflaws and, this, reducing tax receipts.
- A $255 per month pre-tax benefit for parking and public transportation expenses will be permanently extended.
But aside from all the spending, Congress did accomplish a few good things.
There will be a pay freeze for Vice President Biden, for example.
Also, earlier this year the dour, stick-in-the-mud Capitol Police said sledding by gleeful children and adults on the snow of Capitol Hill would no longer be allowed. The package asks that the Capitol Police rescind that prohibition so the jollity can resume.