There have been lots of complaints about too many of the megabucks in the so-called stimulus bill being spent too far in the future, or perhaps just far enough in the future to try to affect the 2010 elections. Maybe it’s just me, but I didn’t realize until today that it also included going back and paying for things that already happened.
Note the following from this article about how the Senate now has this monster over $900B.
In a victory for auto manufacturers and dealers, Sen. Barbara Mikulski, D-Md., won a 71-26 vote to allow most car buyers to claim an income tax deduction for sales taxes paid on new autos and interest payments on car loans. The break would cost $11 billion over the coming decade but could mean savings of $1,500 on a $25,000 car.
“Just as we need to get the housing market going, we need to get auto sales going,” said Sen. Debbie Stabenow, D-Mich.
Mikulski’s office put the cost of the automobile tax break she sponsored at $11 billion over 10 years. It would apply to the first $49,500 in the price of a new car purchased between last Nov. 12 and Dec. 31, 2009. Individuals with incomes of up to $125,000 and couples earnings as much as $250,000 could qualify, including those who do not itemize their deductions.
If you want to stimulate the economy down the road that’s fine. But giving a tax break to people who bought cars after some arbitrary date last year is no stimulus. They bought cars because 1) they must have needed one and 2) the price was right. You’re not stimulating the economy by making this “stimulus” retroactive are you?
This is silly for another reason. Why the arbitrary $49,500 cutoff? That would cover most people who bought SUVs. Is she supporting poisoning our air supply? Why not cut it off at total car price of say $20,000 or less instead of the “first” something to limit it to more greener vehicles? Should I get a tax break if I buy a Lamborghini Murcielago that gets 8/13 mpg?