Many Americans viewed the just adjourned 112th Congress as a "do-nothing" Congress. After looking at the fine print of the fiscal cliff legislation, they may revise that assessment to the "do-what?" Congress.
After squabbling interminably over tax rates for wealthier Americans, Congress finally approved legislation to prevent most Americans from facing significant income tax hikes at the start of the new year.
An element of the deal pounded out in the Senate was to allow expiration of a Social Security payroll holiday, which means every working American will feel a slight pinch in his or her new year paycheck.
The balky GOP-controlled House pouted by not acting on a $60 billion storm relief package for badly battered parts of New York and New Jersey, which drew the ire of Republicans inside and outside Congress.
Despite the huge economic stakes and deteriorating public patience, fiscal cliff negotiators found the time to add in a host of tax provisions that The Washington Post labeled as "curious." That may be an understatement.
For example, the fiscal cliff bill renews special expensing rules for movie and TV productions. The bill also contains a $9 billion per year provision that allows manufacturers and banks to defer taxes on financial transactions known as "active financing," which critics blast as an incentive to move jobs overseas, but corporations defend as necessary to compete abroad.
Fiscal cliff legislation contains several provisions dealing with energy, including one to treat coal from Native American lands as an "alternative energy source" and another to promote plug-in electric scooters. There also is a subsidy for commuters who take the bus or train to work.
Odder provisions include ones to help NASCAR build racetracks, an extension of a rum tax break for Puerto Rico and continuation of a tax credit to repair railroad lines, especially for short-line railroads.
Perhaps the most ironic tax provision is a continuation of tax-exempt financing for the "Liberty Zone" near the former World Trade Center in New York. The Washington Post said this provision was "supposed to help reconstruction after 9/11. Yet a recent [New York Mayor Michael] Bloomberg investigation found the bonds have mostly helped finance new luxury apartments, not to mention construction of the new Goldman Sachs headquarters."
While most of these tax breaks already existed and are being extended, eyebrows might lift at the price tag — $77 billion, more than the cost of the relief legislation for Superstorm Sandy. And you can imagine the views of workers who see a noticeable drop in take-home pay.
Battles loom in the new Congress, which was sworn in last week, over how to rein in the federal spending. Part of the answer might be found in the fiscal cliff legislation.