Alternative Energy and the Stimulus Debate

Senators take a don't-pay-as-you-go approach to energy tax breaks.

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Tax breaks for wind, solar, and alternative energy, as well as for consumers who would make energy improvements to their homes, will be part of the showdown in the Senate today over the economic stimulus bill.

Those tax breaks were stripped out of the big energy bill that Congress passed and the president signed in December—losing in the Senate by one vote.

But yesterday the Senate Finance Committee added $5.5 billion in energy tax to its own version of the economic stimulus bill. It's very similar to what was voted down in December, except for a crucial difference—this time there's no way to pay for them included in the bill. This don't-pay-as-you-go approach apparently is more appealing, because it does not involve taking tax breaks away from the oil industry.

Already, two influential Republicans who voted against the energy tax breaks in December now support the idea of putting them into the stimulus package: Charles Grassley of Iowa and Pete Domenici of New Mexico. So if it failed by one vote in December and it has two new supporters, it should pass easily, right? Wrong. That's not how legislative math works!

This time, the energy tax breaks are all tied up with other issues, such as whether the tax rebates should be extended to more people and how fast the package needs to move, in order to be a meaningful economic boost. People who support alternative energy might still vote down the bill. And at least two presumptive "yes" votes, Hillary Clinton and Barack Obama, are out on the campaign trail. Stay tuned, as the Senate decides tonight whether to go with the original stimulus deal the president and the House support or to pass its own, more generous package.