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Monday, February 9, 2009
NYT’s Krugman: Isakson proposal would be a bonus to rich house-flippers
The Atlanta Journal-Constitution
U.S. Sen. Johnny Isakson’s proposal to give tax credits to homebuyers is taking some heat today from Paul Krugman, the New York times columnist and Nobel Prize winner:
What do you call someone who eliminates hundreds of thousands of American jobs, deprives millions of adequate health care and nutrition, undermines schools, but offers a $15,000 bonus to affluent people who flip their houses?
A proud centrist. For that is what the senators who ended up calling the tune on the stimulus bill just accomplished.
There’s been some talk about the $15,000 limit being trimmed as the stimulus bill goes to a House-Senate conference committee. Isakson, despite successfully adding his amendment, has declined to support the measure.
But the junior senator all but named his ace-in-the-hole last week: Susan Collins of Maine was the primary Republican negotiator in the deal cut Friday night.
Very likely, Democrats can’t tinker with the Isakson amendment too much without the deal falling apart.
Updated: Isakson spokeswoman Joan Kirchner had this to say about the “flipping” charge:
Johnny believes our economic crisis starts and ends with the housing market, and that if we don’t fix housing first, we won’t fix anything else. The last time our nation’s housing market was this bad was in the 1970s, and Congress at that time passed a $2,000 homebuyer tax credit that turned around the housing market and turned around the economy. It worked then and it will work today.
As to Krugman’s point about giving a tax credit for “flipping houses,” Johnny’s amendment specifically prohibits flipping houses because it requires the homebuyer to live in the home as their primary residence for at least two years to get the credit. The amendment further safeguards against flipping by banning purchases of homes from family members.
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Georgia Power bill delayed to allow Senate Republicans to become ‘more comfortable’
The Atlanta Journal-Constitution
Senate Majority Leader Chip Rogers (R-Woodstock) says the bill to permit Georgia Power to charge ratepayers in advance for the financing costs associated with two new nuclear units will be delayed at least until mid-week, to permit Republicans to become “more comfortable” with the measure.
Rogers said a GOP caucus meeting will be held Tuesday, when the Legislature reconvenes after a three-day break, to discuss S.B. 31.
“I don’t think it’s going to come up tomorrow, but we may see it in the near future. This is a very difficult bill to understand. I think when you just simply hear the theory — of let’s pay the interest up front instead of waiting for it to compound seven years down the road — most people can grasp that,” Rogers said.
“In reality this is a very difficult measure to deal with, because there’s a lot of complexities that go on in determining what is the interest on that loan and how does that fit into the whole rate-making scheme that the Public Service Commission determines,” Rogers said.
“I can’t say whether we have the votes or don’t have the votes. I imagine it’s rather close. But I do think whether you’re for it or against it, all of us would like to feel more comfortable about it,” he said.
“I don’t think there’s a conceptual problem if we can prove that it saves money.”
The bill would set terms that would allow Georgia Power to recoup from ratepayers the interest charges on billion-dollar construction loans — a negotiating task normally assigned to the Public Service Commission.
Rogers said the utility feared that the PSC might change aspects of the deal once it’s been agreed to. But the Senate majority leader conceded that a future General Assembly, too, could “undo” the terms contained in the current legislation.
