Wednesday, October 1, 2008

PTC added to the Splurge

In the latest twist of the ongoing drama around the credit market bail-out (aka the Splurge), the Senate passed a version today that adds in the PTC, ITC and other renewable energy incentives that were in uncompleted legislation passed earlier by the Senate. By adding these and apparently many other initiatives into the Splurge Congressional leaders are clearly hoping that they can attract enough votes (without losing others) that the bill can pass both houses and presumably be signed with minimal sniveling by the President.

It's a really risky approach--adding in a host of unrelated legislation and spending to attract additional one-issue voters who feel passionately enough about the additions that they will vote for a bill on which they otherwise would have voted nay. At $700B, those members of Congress will have to really love these added goodies to vote yeah.

The House was where the previous PTC legislation foundered, as some representatives arbitrarily insisted that the renewable energy provisions be subject to the pay-go rules. Will they stick to that petty token of financial discipline so they can still posture as fiscal conservatives even while sacrificing the budget (and the deficit) on the altar of trickle-down salvation?

The stink of the Splurge is causing many people to hold their noses. Will it be voted anyway, especially in an election year? I worry that the renewable energy elements will garner the stench of this massive taxpayer-funded handout, which, regardless of its merits, is extremely unpopular. I like Thomas Friedman's view that funding green initiatives is the right way to address our economic problems, but coupling a tiny tincture of that to the horse pill which is the Splurge may make all of it unpalatable. Too bad we can't decouple the Splurge altogether. Imagine what $700B would do if instead it were all committed to (re)building our country's infrastructure and laying the groundwork for a sustainable 21st Century economy and the enormous and multi-faceted industries that will compose it.

I don't think that's likely to happen, but right now I don't see anyone who has much of an idea what will happen at all, regardless of whether the Splurge passes or not.

Does anyone else get the sense our planning is less disciplined than making decisions based on the Magic 8-Ball?
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