A new column for the Financial Times:
Checks and balances are all very well, but sometimes you have to wonder. The first session of the 110th Congress came to a close last week in a disorderly crush of half-baked legislation. It was the end of a year that gave the new Democratic leadership little to boast about. Seizing control of House and Senate in the 2006 elections, the Democrats had big ideas about holding the Bush administration to account, forcing a prompt withdrawal from Iraq and radically realigning the government’s domestic priorities. Measured against those early promises, their record has been dismal.
The budget process was an unintelligible mess – not for the first time, admittedly. An omnibus $555bn spending bill, lumping together who knows how many appropriations bills, finally passed. The president gave it his blessing, because it gave him enough of what he wanted – including $70bn additional funding for the wars in Iraq and Afghanistan. Admittedly, that is less than half the extra war funding the administration had asked for, but enough for the army to keep going without another supplemental until June.
The rush of unfinished business also included the long-anticipated fix of the alternative minimum tax. This is a parallel income tax, allowing only limited deductions, initially devised to curb tax avoidance by the very rich. Due to years of neglect and rising incomes, it threatened to drag millions of middle-class taxpayers into its net. Patching it up so that this would not happen cost $53bn in forgone revenue.
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