Sunday, December 20, 2015

Merry Christmas from Congress: The Combined Omnibus Spending and Tax Bills Contain 2242 Pages of Ornaments

Congress just passed an Omnibus Spending Bill and a Tax Bill. The spending bill is 2009 pages with an additional 233 pages of tax benefits. Merry Christmas! Senator Rand Paul voted against it he said because neither he nor any other member of Congress had an opportunity to read the bill before voting on it. That hasn’t stopped Congress in the past! Conservatives are decrying the Omnibus Spending Bill for profligate spending and busting open the sequester spending caps. Liberals decry the lifting the 4 decade ban on oil exports. Spending will increase $1.14 trillion through 2016 and $680 billion in tax cuts (expenditures). The deficit will rise by $680 billion over the next decade, not including interest on the debt. It’s a perfect bipartisan Congressional Bill- increase spending, lower taxes, riders, earmarks and pork barrel – something for everyone who wanted something. Most members of Congress wanted the ornaments. There have been few opportunities in recent years to feed at the public through. Merry Christmas to All! Senator Schumer and House Minority Leader Pelosi are gloating because they stopped many of the Republican riders and gained some of their goals. Speaker Ryan is disappointed with the process, but happy with what was passed Rush Limbaugh, Sean Hannity and Ted Cruz and others are haranguing it as a failure. They are wrong this time. A look at the ornaments shows many victories for the Republicans with tradeoffs with Democrats. The problem the Republican Congress faced was that the Obama Administration agencies have spewed out so many rules and regulations the GOP objects to that they could not restrain all of them. They had to pick and choose the riders to attach. Thus, the President’s War on Coal survived, as does the spending for Planned Parenthood, and the admission of Syrian refugees. One environmental rider which survived requires the national Park Service to justify park by park the bottled water ban in the parks as well as calculating the purported savings in recycling and landfill costs through a bottle ban. The current bans on abortion-related spending continues as well as on closing GITMO or transferring the GITMO prisoners to the mainland. The government is barred from listing the Sage Grouse on the Endangered Species List and also from implementing the United Nations Arms Trade Treaty. The tradeoff for lifting the oil export ban was extending the solar credits for five years to 2019 and a shorter extension for the wind credits. The Republicans gave the Democrats permanent extensions of the $1,000 Enhanced Child Tax Credit, the Earned Income Tax Credit and the American Opportunity Tax Credit for college. They increased Pell Grant spending and added $2 billion to the budget of the National Institutes of Health. Yet they made permanent 20 tax cuts and extensions that have in the past been subject to annual renewals. They postponed for two years the reviled Cadillac Tax and 2.3% Medical Devices taxes part of ObamaCare. They also eliminated a significant bailout to insurance companies losing money on the exchanges. No taxpayer money can subsidize the insurers. In addition, the 2½% excise tax on health insurers was delayed. Tax cuts and extensions are for such beneficiaries as Broadway, apple cider producers, throroughbred horse owners, teachers who provide supplies to the classes, stores that donate extra food to charities, rum makers in Puerto Rico, plug-in motorcycles, real estate investment trusts, timberland owners, workers on Indian reaservations, and NASCAR racetrack developers. In addition, multi-national banks are excused from paying United States income taxes on foreign taxes. Small businesses can deduct up to $500,000 in expenses for machinery, office equipment, and computer technology. The research and development tax credit for companies became permanent. The military budget was substantially increased, but the allocation for the infamous runaway blimp was slashed by 75%, contra to the Administration’s request to increase funding. $3.8 billion was transferred from the BNP bank settlement to restore funding to the compensation fund for 9/11 victims and responders and for those of other terrorist attacks. The USDA and FDA were blocked from issuing new food guidelines until the agencies can show they are “based on significant scientific agreement; and … limited in scope to dietary and nutritional information.” Further limits are placed on reducing sodium levels for children “until the latest scientific research establishes the reduction is beneficial to children.” Restrictions were placed on the IRS’ ability to investigate politically active non-profit organizations. The SEC was barred from forcing public companies to disclose campaign contributions. Visitors from the 39 countries who otherwise do not need visas to visit the United States will be subject to additional requirements if they visited Iran, Iraq, Sudan, or Syria in the past 5 years. No funds were allocated to advocate or promote gun control. Companies are allowed to share information with each other and federal agencies on cybersecurity. Some of the provisions do not reach the stage of being eye-raising. They include a ban on the redesign of the $1 bill while permitting the Capitol Police to allow sledding on the capitol grounds. Merry Christmas to the K Street lobbyists.

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