Lori Montgomery:

The focus on the AMT is hardly surprising, given that victims of the tax have been concentrated in high-cost urban areas such as Washington, New York and San Francisco — places that tend to vote Democratic. Rangel, Hoyer and Nancy Pelosi (D-Calif.), the presumptive House speaker, all represent states hit hard by the AMT, which is sometimes called the “blue-state tax.” To map states with the highest concentrations of AMT taxpayers is to draw bull’s-eyes over California and the Northeastern seaboard.

Michael Kinsley:

Democrats call for ending the “Disabled Veterans Tax” and the “Military Families Tax.” The what? There cannot be any such thing as a Disabled Veterans Tax. It is a label dreamed up by people wanting special treatment, like the Republicans’ brilliant “Death Tax” for the estate tax. Maybe they deserve it, maybe they don’t. But why can’t we leave this bullying by terminology to Newt Gingrich?

The problem with tax credits in general is that they never appear in the budget, so they never get the same scrutiny as direct spending, although their impact on the deficit is exactly the same. By definition, they cost more than whatever benefit they are intended to achieve, since no one is going to be induced to spend an extra dollar on, say, dance lessons (because some member of Congress has decided that it would be good for the country if more people knew how to dance) unless the subsidy is worth more than a dollar.

The Economist:

Tax credits are the worst possible tax policy from the standpoint of economic growth. They are distortionary: they cause consumers to divert spending from higher-valued to lower-valued uses. They are a clumsy way to solve externality problems: if you want less of something, tax it. They are not transparent, so people have a very hard time finding out how much the government is spending on, say, dance lessons. And they may actually discourage work.

For almost everyone except rock stars, leisure and work are basically perfect substitutes: a decision to work less is a decision to consume more leisure. The basic intuition of supply-side economics was that if you cut the taxes on people’s labour, they would work more, since to them, the tax cut would essentially be the same as a wage increase. This intuition is simple, easy to grasp, and widely accepted. Unfortunately, it is also wrong.

I received an email recently from Tammy Baldwin regarding my post on the excesses of congressional earmarks – using our checkbooks:

Dear Mr. Zellmer,

Thank you for contacting me regarding earmark reform. It is good
to hear from you, and I apologize for the delay in my response.

Like you, I am concerned about unnecessary government spending.
In recent years, government spending has increased dramatically,
creating unprecedented national debt. Continued, large-scale
deficit spending is unquestionably poor public policy. Many have
suggested that one of the ways to cut spending is to reform the
practice of “earmarks”, which are appropriation amendments that
fund specific projects. In the current climate of excessive
spending, reforming this amendment process will not go far
enough. The government is spending billions of dollars a day on
the Iraq War while simultaneously lowering tax revenue by cutting
taxes for corporations and wealthy individuals. This shifts the
burden onto the middle and lower-income earners who are unable
to support such extensive spending.

At the current rate, the United States is adding one trillion dollars
to our national debt every eighteen months. According to the
Congressional Budget Office (CBO), if the President’s current tax
and spending polices are continued over the next ten years, the
yearly deficit will increase to $439 billion as soon as 2014. The
national debt will skyrocket to $14.5 trillion, almost double today’s
level. Clearly, this course of fiscal irresponsibility cannot be
sustained. I believe Congress must return to fiscal discipline, such
as in the late 1990s when we turned annual federal deficits into
surpluses. Rest assured that I will keep your views in mind
regarding earmark reform as the debate over fiscal responsibility
and the federal budget continues.

Again, thank you for sharing your views. Your opinion matters to
me. If I can be of service to you in any other way, please do not
hesitate to let me know. As a result of the anthrax incidents, all
mail sent to Congress is first irradiated. This process causes
significant delays. To ensure the fastest response, I encourage all
constituents who have access to the internet to contact me through
my website at http://tammybaldwin.house.gov.

Sincerely,

Tammy Baldwin
Member of Congress

I appreciate the email. Baldwin gets points (or her office) for emailing responses whereas our Senators continue to send dead tree responses to electronic inquiries. Tammy’s House & Campaign websites. Her opponent in this falls race is Dave Magnum.

John Wilke:

Charles Taylor, wealthy businessman and banker, owns at least 14,000 acres of prime land in western North Carolina. He’s also the local congressman. So when he steers federal dollars to his district, sometimes he helps himself, too.

Last year, Mr. Taylor added $11.4 million to a big federal transportation bill to widen U.S. Highway 19, the main road through Maggie Valley, a rural resort town in the Great Smoky Mountains. His companies own thousands of acres near the highway there and had already developed a subdivision called Maggie Valley Leisure Estates.

Mr. Taylor also got $3.8 million in federal funds for a park now being built in downtown Asheville with fountains, tree-shaded terraces and an open-air stage. It’s directly in front of the Blue Ridge Savings Bank, flagship of his financial empire. He is among the richest congressmen with assets of at least $72 million, records show.

The Republican lawmaker is one of at least a half-dozen House members whose public actions in directing special-interest spending known as earmarks have also benefited their private interests or those of business partners, according to congressional, corporate and real-estate records. Among them is a senior Democrat, Rep. Alan Mollohan of West Virginia.

More on earmarks.

$28.8B over the past 6 years.

Fedspending.org. Recipient Details:

• FY2000
• FY2001
• FY2002
• FY2003
• FY2004
• FY2005

I never heard from Tammy’s office regarding her Dane County earmarks.

Kudos to the “Sunlight Foundation” for making this information available to taxpayers.
I’m wondering if some of these are SBA or other government loans/grants?

Interesting spin on this vote:

We are blowing away the fog of anonymity,” said Rep. David Dreier (R-Calif.), chairman of the House Rules Committee. “The goal is to pull back the curtain on earmarks to the public.”

The rule change shelves a wider ethics bill, however, at least until next year. That bill became bogged down amid disagreements between the House and the Senate, and the reluctance of lawmakers from both parties to limit their interactions with lobbyists. The earmarks measure was brought up as a passable way to address voter unrest over the scandals, aides said.

“This bill represents the death of lobby reform,” said Rep. David R. Obey (D-Wis.), a former chairman of the House Appropriations Committee.

Madison’s representative Tammy Baldwin voted No. Obey’s comments are ironic, given his prolific use of earmarks. Lots more on earmarks here.

I don’t think there’s much to be proud of from either party’s perspective. Applying some “sunshine” to the earmark process is a good thing.