December 21, 2019 Reading Time: 3 minutes

This week, the House of Representatives went all out. It oversaw and approved a massive spending package, resurrected sleazy corporate tax breaks, reauthorized an odious corporate welfare program, and implemented paternalistic policies, and simultaneously found the time and energy to impeach the president. While the Senate won’t convict Pres. Trump, Senators gave up all pretenses of fiscal rigor and rushed to pass the bills by a large margin.

Congress approved two major spending packages. Together they spend $1.4 trillion spread over 2,300 pages, which no one has had time to read. (For the geeks out there, you can find 4 of the 12 Appropriations bills here, and the other 8 here). 

Adding to the lack of seriousness of the whole exercise, the spending was split between two bills because President Trump said he would never sign again an “omnibus bill.” But he will apparently sign two bloated bills that together spend more than a single omnibus bill would spend alone. Senator Mike Lee (R-Utah) had this to say about the move:

 “Leaders and appropriators have cleverly put the negotiated spending agreement into two bills so that we can all pretend that it’s better than just one,” he said. “Even though they were negotiated at the same time, released to the public at the same time and will be voted on within only minutes of each other.”

The bills also include dozens of priorities, such as raising the national tobacco-purchase age to 21 without any debate in either chamber on the issue, $25 million for gun-violence ‘research,’ election-security grant money, and one more comfortable $22 billion increase to the Department of Defense. Probably as a big wet kiss to the Union, they also include a bailout for coal miners.

This monster of a spending package would also reauthorize the U.S. Export-Import Bank, without any reforms worth mentioning. If you want to know how offensive this reauthorization is, think about it this way: the Ex-Im Bank has long been called The Boeing Bank, for good reason. When it is fully functioning, 40 percent of its activities benefit Boeing. 

That’s the same company that is in deep trouble right now because it appears that it spent tons of effort and money lobbying Uncle Sam for defense contracts and to solidify its cozy relationship with the Federal Aviation Administration (FAA) while neglecting to spend enough in R & D to avoid the mechanical failure that was the Max 737.

And yet, Congress is now insisting that taxpayers want to guarantee large loans to foreign airlines so that Boeing can sell more planes! Even ignoring the disgusting cronyism of the whole sorry episode, I predict that the reauthorization of Ex-Im won’t help Boeing much since people would rather fly in planes that are safe rather than cheap.

But then as if that $1.4 trillion in spending wasn’t enough, there is also an additional $500 billion in additional federal debt over the next decade in tax cuts and entitlement changes. I like tax cuts as much as the next libertarian, but I hate special-interest handouts. And I profoundly dislike kicking the debt can down the road to impose on future generations the tab for our excessive spending today. 

This is why I am so annoyed by the resurrection of tax extenders that had been dead for 2 years in spite of widespread opposition from organizations across the political spectrum. Notice also how, apparently, Democrats – who loudly opposed the Trump tax cuts back in 2017 – suddenly don’t mind corporate tax cuts as long as long as these serve the special interests that they like.

Republicans, of course, love that crony junk and are more than happy to bring these zombie tax breaks back to life. Adding insult to injury is the fact that the legislation would actually make the tax cuts retroactive, meaning that taxpayers can claim subsidies for activities they completed up to two years ago.

Legislators thought it would also be appropriate to repeal a variety of health-care-related levies, including the “Cadillac” tax on high-cost plans, thus finally busting the illusion that Obamacare was paid for, and, hence, fiscally responsible.

No one has any doubts that the president will be happy to approve the new debt, especially since it is packaged in something that isn’t called an Omnibus bill. And that’s why future taxpayers will be getting lumps of coal for many Christmases to come. 

Veronique de Rugy

Veronique de Rugy

Veronique de Rugy is a former writer with AIER. She is a Senior Research Fellow at the Mercatus Center at George Mason University and a nationally syndicated columnist.

Her primary research interests include the US economy, the federal budget, homeland security, taxation, tax competition, and financial privacy.

She received her MA in economics from the Paris Dauphine University and her PhD in economics from the Pantheon-Sorbonne University.

Follow her on Twitter @veroderugy

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