Side Orders On The Second Bail Out Plan

Pleiades Mailbag

Here are some interesting links from our man in the info-sourcing business.

This one talks about the pork barreling to get the Bill through; in other words, little riders to help the House members go home to their electorates with something to show.

Senators attached a provision repealing a 39-cent excise tax on wooden arrows designed for children to an historic $700 billion financial-markets rescue that passed tonight by a vote of 74-25. The provision, originally proposed by Oregon senators Ron Wyden and Gordon Smith, will save manufacturers such as Rose City Archery in Myrtle Point, Oregon, about $200,000 a year.

It's one of dozens of tax breaks benefiting Hollywood producers, stock-car racetrack owners and Virgin Islands rum- makers included in the broader legislation in an effort to win support from House Republicans, whose defection contributed to a rejection of an earlier version of the legislation two days ago on a 228-205 vote.

``This is how Washington works,'' said Keith Ashdown, chief investigator at Taxpayers for Common Sense, a Washington research group. ``A big pot of pork is their recipe for final passage.''

Representatives for Wyden, a Democrat, and Smith, a Republican, didn't immediately return calls. Jerry Dishion, president of Rose City Archery, was in meetings and unavailable to comment, a receptionist at the company said.

Most of the provisions are part of a package of provisions known as ``extenders'' because they are renewed for only a few years at a time.

That's pretty handy if you're a recipient but you sort of wonder how any of this actually helps America beyond the bill. Anyway, that's how it's done in Washington. Horse-trading for all.

This one covers an energy tax break as part of this process.

The U.S. Senate approved tax cuts valued at more than $100 billion, including a host of alternative energy credits and dozens of breaks for businesses and individuals, as part of its $700 billion bank rescue bill.

The legislation, which the House likely will act on tomorrow, passed the Senate on a 74-25 vote. It would give the Treasury Department authority to buy troubled assets, chiefly mortgage- backed securities that are burdening financial institutions.

The Senate added the tax provisions to woo Republican votes in the House, where an earlier version of the bailout plan failed by 12 votes on Monday. The tax package would spare 24 million American households from a scheduled alternative minimum tax increase this year, renew credits for business research, and extend $17 billion in energy incentives.

House adoption of the provisions would end a 10-month stalemate in Congress over how to deal with the budget impact of the tax breaks. It would also bolster the balance sheets of companies such as Microsoft Corp. and Harley-Davidson Inc. that rely on the research credit, as well as those producing energy from wind and solar sources.

It would be ``virtually impossible'' to expand solar energy without the credit, Madison Grose, a managing director at Starwood Capital Group LLC, said yesterday in an interview before the vote. ``The cost to the rate base for these types of projects is substantially higher without the investment tax credit being part of the capitalization of the projects.''

So much for that one. It's hard to see if one is meant to feel good about it at all when the whole economy might go down the gurgler but there you go.