Pay raise for federal judges and tax shelters snuck in Auto Rescue/Bailout bill

Filed under: Government/Legal

Let's say you're a Congressman and your constituents are begging for a bronze statue of Johnny Cash in the center of town. Fortunately, there's an important bill being voted on this week, so you just slide a federal funds provision for "urban improvement" in there and vote Yes for the larger matter along with your buddies. It's called pork and the Auto Rescue/Bailout Bill approved by the House last night contains a couple bites of it.

In addition to approving $14 billion in government loans for the Detroit 3, the bill also provides a cost of living adjustment (COTA) for federal district judges, otherwise known as a good old raise. They currently make $169,300/year, which some fear is too little for the important function they serve. Normally these judges earn exactly what those in Congress make, but while politicians in the House and Senate automatically get a COTA each year, they must vote to give the same to judges. The Senate has already approved this year's COTA for judges, but the House hasn't. To remedy this, Senate Majority Leader Harry Reid (D-NV) slipped the provision into the Auto Rescue/Bailout Bill. This also has the added benefit of hiding the raise behind the larger issue of aid for U.S. automakers, as the general populace might not look kindly on any government employee getting more money in the midst of a recession.

The other piece of pork in the bill involves a big tax shelter for corporations that allows them to avoid paying taxes. We had a hard time following exactly how this one works, but Zac over at BloggingStocks is really miffed about it, so it must be bad.

[Source: Wall Street Journal, BloggingStocks]

Pay raise for federal judges and tax shelters snuck in Auto Rescue/Bailout bill originally appeared on Autoblog on Thu, 11 Dec 2008 14:29:00 EST. Please see our terms for use of feeds.

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