Maybe Democrats on Capitol Hill are less concerned about being big spenders after the special election in PA-12, or more likely, they just know that they need to spend it now rather than later in the campaign season. Either way, leadership in both chambers have decided to press forward with a wide-ranging bill that will cost almost $200 billion, and that won’t pass the Pay-Go test, either:
Faced with a Memorial Day deadline, Democrats opted Thursday morning to move ahead with a complex tax and spending package that includes new infrastructure and state aid dollars as well as extended benefits to help sustain the long-term unemployed through November’s elections.
The joint decision by House Ways and Means Committee Chairman Sander Levin (D-Mich.) and Senate Finance Committee Chairman Max Baucus (D-Mont.) is a gamble, given the continued political uncertainty in the Senate. But with time running out, the leadership had little choice if it hopes to enact the measure before June cutoff dates for a series of stopgap provisions affecting the jobless and elderly.
Preliminary estimates are that the full multiyear cost is near $190 billion, and to reduce the deficit impact, tax writers have agreed to a series of revenue offsets worth close to $50 billion including a major increase in fees charges the oil industry to cover the cost of spills like the BP disaster in the Gulf.
Does this sound familiar? Emphasis mine:
In their desire to show movement, Democrats appear to have jumped ahead of a final budget scoring on some crucial provisions. And the oil industry risks being the last target standing, if tax writers come up short of the revenues needed to meet their target.
How do Democrats plan to pay for this new $190 billion set of boondoggles? They’re going to get $14 billion from “closing loopholes” in the Foreign Tax Credit, which will make American corporations less competitive abroad, plus the $50 billion from the oil industry that will hike energy costs to the consumer.
That amounts to less than $65 billion, or about a third of the proposed spending. That should invoke the Pay-Go restriction on the legislation, a rule passed by the same Democrats who will instead act to bypass it. Perhaps it should be renamed Spend-Go, or Charge-It, since the money will have to come from even more expansion of American debt. That’s the real reason why Democrats have “jumped ahead” of CBO scoring — they don’t want to face it.