Monday, 6 October 2008

Bailout advice

Joel Stein of the LA Times has advice for those in congress with regard to the bailout plan,
If I were in Congress, I'd hold out. Every representative who voted no on the bailout got something totally sweet in the bill that passed the Senate. Jim Ramstad (R-Minn.) changed his mind once he got the health insurance for mental illness he's been fighting for. The Senate is trying to bribe Gabrielle Giffords (D-Ariz.) with tax breaks for Arizona solar companies. Earl Blumenauer (D-Ore.), who rides a bicycle, is supposed to be tempted by a tax deduction for bike commuters, as Democrats Adam Schiff of Burbank and Brad Sherman of Sherman Oaks are by tax breaks for movie producers.
You may well ask what has any of this got to do with dealing with the financial problems the US faces right now. The answer has to be nothing, but it is good politics if you have an upcoming election. Michael Giberson at Knowledge Problem writes, with regard to the tax deduction for bike commuters, that
It is kind of hard to find the provision, since it is embedded in Title III, Section 303, which is described as "Extension of Exclusion of Income From Discharge of Qualified Principal Residence Indebtedness." Scan down to Division B, Title II, SEC. 211: "TRANSPORTATION FRINGE BENEFIT TO BICYCLE COMMUTERS." I don't quite see the connection between bicycle commuting and the discharge of qualified principal residence indebtedness, but no matter.
Giberson also points out that
This is a bigger deal than even Title III, Section 303, Division C, SEC. 503: "EXEMPTION FROM EXCISE TAX FOR CERTAIN WOODEN ARROWS DESIGNED FOR USE BY CHILDREN."
Wooden arrows, financial crisis, an obvious connection. But the best point Stein makes in his article is at the end,
Any representative who voted against the world's largest economic bailout last week but votes for this bigger, uglier, more dangerous version has been bought. Whether you think this bailout is good or not, the people who changed their minds on such a monumental matter for such flimsy, unrelated reasons do not deserve to be trusted with your vote this November
Stein is right but this kind of dishonesty work with voters. Not just in the US but in New Zealand, and all other democracies. We really do get the politicians we deserve.

1 comment:

John Maszka said...

This bailout is just one more example of the indivisible handjob stroking irresponsible CEOs and CFOs with billions so that they can run the American economy even further into the ground. So much for Keynesian economics. If the goal is to stimulate the economy, why not give the money directly to the American taxpayers? We could do twice as much good for the economy by giving half as much money directly to hardworking American taxpayers. A bird in the hand is worth two in the bush administration.