Maybe a good argument can be made that the Senate should be allowed to originate a taxing bill, but as it stands Constitutionally, they cannot. So how did the Senate pass the recent "bailout bill" before the House? Enter RI-D Rep. Patrick J. Kennedy's "Paul Wellstone Mental Health and Addiction Equity Act of 2007". From The Providence Journal:
In order to get around the Constitution, the leaders turned to the time-honored stratagem of finding a live but dormant House bill -- Kennedy’s mental-health parity bill -- to use as a shell.
"They take out the entire text" of Kennedy’s old bill, "and then, by amendment, they substitute the other bill," said Don Ritchie, an assistant Senate historian. Two bills, in this instance: the emergency rescue bill and the tax provisions and the final version of Kennedy’s mental-health parity wrapped inside.
And that is how Kennedy of Rhode Island became the original lead sponsor — in name only — of one of the most hard-fought financial bills in congressional history.
Add to that the fact the bill is being pushed through and it becomes very attractive for earmarks. From "Billions in earmarks in Senate's bailout bill" (with more details at TCS):
Wooden arrows: This tax break, backed by Oregon's two senators, would benefit an Oregon manufacturer of wooden arrows for children by $2 million over 10 years.
Racetracks: Earmark would allow auto racetrack owners to depreciate their facilities over seven years, saving the industry $100 million over two years.
Rum: Offers rum producers in Puerto Rico and the Virgin Islands a rebate on excise taxes worth $192 million over two years.
Wool: Reduces tariffs for U.S. makers of wool fabric that use imported yarn, worth $148 million over five years. The measure was pushed by Reps. Louise Slaughter, D-N.Y., and Melissa Bean, D-Ill.
Exxon Valdez: Plaintiffs in the suit over the 1989 oil spill could spread their tax payments on punitive damages over three years, cutting their tax bill by $49 million. The measure was backed by Rep. Don Young, R-Alaska.
American Samoa: Allows certain corporations to reduce their tax liability on income earned in American Samoa, at a cost of $33 million over two years.
Hollywood: Extends a tax break for film and TV companies that keep their production in the United States, worth $478 million over 10 years. The provision was originally pushed by Rep. Diane Watson, D-Los Angeles.
In case you're curious, here's the latest version of the bill as of 10/2/2008, and a section by section analysis.
I know this stuff happens all the time but it just seems wrong. What's more, I would imagine that the vast majority of people would agree that it is wrong, yet it continues.
My question: Is this just reflective of the nature of negotiation and compromise? Is there no better way? Should we just accept these tactics? Am I just being too persnickety in letting this annoy and frustrate me? :)
btw, I'm still struggling to understand the economics, but this looks like a decent summary: Making Sense of Our Financial Mess.
P.S. Both McCain and Obama voted for the bill. I think this reflects the difficulties that McCain will have in keeping his remarkable promise to veto any bills with earmarks as President when he believes the bulk of the bill is vital.