The “stimulus” plan devised by House leaders and the White House at a price tag of nearly $150 billion is now being rejected as too small by Senate Finance Committee head Max Baucus. His plan would give out much more welfare benefits, and provide tax “rebates” to millions more people who don’t even pay taxes, than the House plan proposed. (I described yesterday how other Senators are busy proposing all sorts of welfare for inclusion in the stimulus plan, and how millions of dollars from the plan may end up financing left-wing special-interest groups).
Baucus’s stimulus plan would also give out rebates even to individuals making over $75,000 per year and married couples making $150,000 per year, who would be barred from receiving rebates under the House plan, which gives rebates only to people making less than that.
To try and pay for his new welfare proposals (and additional rebates), Baucus’s plan eliminates some of the business tax cuts contained in the House plan, eliminating a few billion dollars worth of tax “incentives for business investment” that might create jobs.
Baucus also engages in funny bookkeeping to make it seem like his much more costly plan costs only $156 billion, just a little more than the House plan. “House leaders and tax writers were skeptical yesterday that the Baucus plan could offer all those measures for the $156 billion price tag he put on his bill,” since the business tax cuts he removed from the House bill can’t begin to pay for all the welfare he added to it.
Future generations will have to pay off the federal debt incurred to pay for either the House or Senate versions of the “stimulus” plan. As The Washington Post notes, “The cost of either plan would be tacked onto this year’s federal budget deficit.”
Earlier, how I discussed how the stimulus plan will increase the financial power of Fannie Mae, an agency that engaged in Enron-style accounting fraud and helped create the housing bubble; how the rebates in the stimulus plan won’t revive the economy; and how the income limits on rebates in an earlier version of the stimulus plan would deny rebates to middle class people in high-living-cost areas, even as they would allow rebates to go to some rich people who receive unearned income and avoid taxes through tax loopholes.