Clarification From Carney Interview

In his interview with Congressman Chris Carney, Gort managed to work in a question regarding the patch for the Alternative Minimum Tax (AMT) and pay-as-you-go (paygo) budgeting rules:

Our friend Local Values has a question on the pay go rules. The AMT patch actually violated the pay go rule and even Steny Hoyer voted against it but you voted for it. Any comment.

The pay go rule? Which one, what time? It was also part of the sweetener package in the last bailout. It did comply with pay go because they did identify the pay for in the next budget. The pay for was identified in the first one but was not identified in the bailout bill which is one of the reasons I voted against it. Values guy is wrong.

He’ll be glad to hear it.

First and foremost, I'm very thankful that Gort was able to plug one my questions into the conversation. I will likely never have the opportunity to interview these candidates so I appreciate Gort considering such a question. Second, I am grateful that the Congressman legitimately attempted to answer the question. He provided a substantive response which is very admirable in his tough reelection campaign.

However, it is important to clarify that "Values guy" is not wrong.

I will give the Congressman the benefit of the doubt that he misunderstood the statement, yet I stand by the content in my original question because everything was factually accurate.

The question that is in question:

2) As a Blue Dog Democrat, you have stated your commitment to pay-as-you-go (paygo) budgeting rules and their importance in reaching a balanced budget. However, your votes have not always reflected this as a priority. For instance, last December you voted for an un-offset Alternative Minimum Tax (H.R. 3996). This decision was a violation of paygo rules and was estimated by the CBO to cost $50 billion in 2008. Others, like Majority Leader Steny Hoyer of the Blue Dogs, refused to accept an unpaid for offset and voted against the bill. We all know that an AMT patch is an important priority for middle class taxpayers, but with deficits expected to reach record levels, what assurances can you make regarding your commitment to fiscal responsibility and the weight it will receive in your decision making?

Again, in fairness to Chris Carney, I believe he was referring to the AMT patch for the upcoming year that was just passed as an add-on to the bailout bill and not to his vote from last December as the question indicates. His vote from last December was in fact a vote in favor of waiving pay-as-you-go budget rules.

For those unfamiliar, paygo rules are budget neutral and were implemented to prevent the nation's fiscal condition from getting worse. In fact, they were instrumental in the early '90s as Congress traveled the difficult path to reach budget surpluses. The rules require that any change in taxes be offset with either spending cuts or increased taxes elsewhere. Since Congress continues to enact AMT patches on an annual basis to prevent the middle-class from getting hit, the patches are subject to paygo rules and are expected to be offset.

Last year, the House successfully passed two versions of the AMT with offsets. However, in the Senate it was amended and stripped of the offsets. This was a violation (or waiving) of paygo rules.

Before the Senate amended the legislation, Congressman Carney stated in a press release:

"I came to Congress with a goal of providing middle class tax relief. I was proud to vote for this fiscally responsible legislation to provide middle income families relief from the Alternative Minimum Tax. This legislation adheres to the pay-as-you-go (PAYGO) standard of fiscal discipline, I am a firm believer that Congress must not continue to pass more debt onto our grandchildren"

However, the bill was without revenue-raising offsets after the actions in the Senate. Majority Leader Steny Hoyer highlighted this on December 18, 2007 after the events played out in the Senate:

House Majority Leader Steny Hoyer released the following statement tonight after Senate Republicans blocked for a second time a fiscally responsible patch of the Alternative Minimum Tax. Senate Democrats again supported the House-passed fiscally responsible AMT bill: ...

"House and Senate Democrats have tried twice this year to enact responsible legislation that would protect 23 million Americans from the AMT while not adding to the deficit by closing unfair tax loopholes for the wealthiest Americans. Republicans in the Senate blocked each bill, while the President bolstered their fiscal irresponsibility by threatening vetoes."

When the bill came back to the House after it was amended in the Senate, Hoyer voted against the un-offset bill to prove a point. Carney, on the other hand, did not. Both are members of the Blue Dog Coalition, yet Hoyer believed it was more important to do the fiscally responsible thing while Carney placed a greater emphasis on passing an AMT patch before Congress adjourned.

From a CNN story recapping the vote:

The House on Wednesday voted in favor (352-64) of a one-year AMT "patch" that the Senate had already approved earlier this month...it's the first time House Democrats gave the nod to a "clean" bill, meaning it has no provisions to pay for the patch's estimated $53 billion price tag.

In no way was the original question meant to be a "gotcha" moment. Rather, something I believe that voters should seriously consider when casting their ballot in November. In a situation like last December, we should know how much emphasis the Congressman will put on fiscal responsibility. It is easy to support doing the right thing in the abstract, but difficult situations will arise when two conflicting priorities collide. That is the nature of Congress. In this case, it was an extension of the AMT patch (which everyone acknowledges to be a necessity) and a $50 billion unfunded liability. As I tried to point out in the original question, how much emphasis will fiscal responsibility receive when you cast your vote.

I felt it was important to make this clarification for the readers of this blog in order to defend its integrity.