"The overlap is 90-plus percent"

That was Larry Summers' argument for why we shouldn't worry too much about the differences between the House and Senate stimulus bills. But it's worth noting that the psychological threshold of 90 percent doesn't apply in lots of other situations. Observing that "92.4 percent of the of the labor force was employed in January" will reassure no one. And the fact that there is 90 percent overlap between the House and Senate bills shouldn't be reassuring either.

The ten percent difference between the House and Senate reflects a difference in how tens of billions of dollars will be allocated. Some of those allocations will do about as much to stimulate the economy as a pair of jumper cables. It is a difference worth bickering over -- not ad infinitum, but at least for a bit.



The single largest one-item difference between the two bills is that the Senate version contains a $70 billion year-long extension of the AMT patch. The AMT patch also happens to be the single silliest provision in either bill. It is worth removing.

Sure, the AMT is a a silly tax (for background see here), and if we can't just outright dismantle it and widen the tax base then it might be worth tossing on another patch for another year. But that doesn't mean it needs to be included in the stimulus bill: more than half of the benefits go to the top decile of earners, who are more likely to save than spend the savings. And since the tax is patched every year they probably won't notice they have these savings to being with.

No one is making a serious argument for why the AMT should be included in the stimulus bill. Senator Robert Menendez says the patch "can ensure that millions of middle class Americans can keep more than $3,000 in their pockets at a time when family budgets are extremely tight." Chuck Grassley says it's needed to "prevent an unfair tax increase at a terrible time, when the economy is in recession." These are just free associations of earnest-sounding Senatespeak.

Why does this matter? It has been repeatedly reported, over the weekend and this morning, that the Senate and House bills are the same size (about $820 billion) -- just composed differently. But if the Senate bill contains $70 billion that no one is describing as stimulus and that would be passed anyway, then we should not think of the bills as the same size. Instead, we should think about making changes.