The bailout bill

That bill we’ve been referring to as the “$700 billion Wall St. bailout” bill? It actually has a title:

To amend the Internal Revenue Code of 1986 to provide earnings assistance and tax relief to members of the uniformed services, volunteer firefighters, and Peace Corps volunteers, and for other purposes

That’s the official title. The unofficial (short) title is Emergency Economic Stabilization Act of 2008. Here’s the full text of the bill. Here’s a fascinating dissection of it on

The bill, HR 3997, was originally known as the Heroes Earnings Assistance and Relief Tax Act of 2007.

The HEART Act allows combat pay to be used as earned income for purposes of claiming the Earned Income Tax Credit. It makes permanent expiring Tax Code provisions that allow active duty reservists to make penalty-free withdrawals from their retirement plans, and let employers make contributions to retirement plans on behalf of an employee who has been disabled or killed in combat. It also includes tax benefits for other volunteers by clarifying that rebates of state and local taxes for volunteer firefighters and that reimbursements for expenses incurred in the line of duty by volunteer firefighters are not taxable.

It passed the House unanimously last November. Another version passed the Senate. It was known as the Defenders of Freedom Tax Relief Act of 2007. A final bill was agreed to and then it died from inaction with the last legislative action dated December 20, 2007.

The bill had been loaded up. It aided education for returning veterans, prohibited group health plans that provide medical, surgical care and mental health care from imposing coverage limits on mental health. It has been brought back a number of times to forgive nursing student loans. It died originally, apparently, because of a provision for an exit tax for Americans who renounce their citizenship or terminates residency in the U.S. In other words, people who were trying to avoid paying taxes.

Sometime after its late December death, the original provisions of the bill (and the Exit Tax) resurfaced in another bill last spring, HR 6081. It was passed by Congress and signed into law by President Bush in June.

That left HR 3997 still hanging around with nothing to do, so it was used for the bailout bill, with its official title still intact, and no longer making any sense.

With its defeat, it apparently is still available for future uses, too.

It actually sounded easier on Schoolhouse Rock.

  • 2 lips for a better world


    ///This is one of the BEST ideas I have EVERY HEARD! SERIOUSLY!!!

    I’m against the $85,000,000,000.00 bailout of AIG.

    Instead, I’m in favor of giving $85,000,000,000 to America in a We Deserve It Dividend.

    To make the math simple, let’s assume there are 200,000,000 [227,719,424 per 2007 US Census Estimates] bonafide U.S. Citizens 18+. Our population is about 301,000,000 +/- counting every man, woman and child. So 200,000,000 might be a fair stab at adults 18 and up. So divide 200 million adults 18+ into $85 billon that equals $425,000.00.

    My plan is to give $425,000 to every person 18+ as a Dividend, We Deserve It.

    Of course, it would NOT be tax free. So let’s assume a tax rate of 30%. Every individual 18+ has to pay $127,500.00 in taxes.

    That sends $25,500,000,000 right back to Uncle Sam. But it means that every adult 18+ has $297,500.00 in their pocket. A husband and wife has $595,000.00.

    What would you do with $297,500.00 to $595,000.00 in your family?

    – Pay off your mortgage – housing crisis solved.

    – Repay college loans – what a great boost to new grads

    – Put away money for college – it’ll be there

    – Save in a bank – create money to loan to entrepreneurs.

    – Buy a new car – create jobs

    – Invest in the market – capital drives growth

    – Pay for your parent’s medical insurance – health care improves

    – Enable Deadbeat Dads to come clean – or else

    Remember this is for every adult U S Citizen 18+ including the folks who lost their jobs at Lehman Brothers and every other company that is cutting back. And of course, for those serving in our Armed Forces.

    If we’re going to re-distribute wealth let’s really do it…instead of trickling out a puny $1000.00 ( “vote buy” ) economic incentive that is being proposed by one of our candidates for President.

    If we’re going to do an $85 billion bailout, let’s bail out every adult US Citizen 18+!

    As for AIG – liquidate it.

    – Sell off its parts.

    – Let American General go back to being American General.

    – Sell off the real estate.

    – Let the private sector bargain hunters cut it up and clean it up.

    Here’s my rationale. We deserve it and AIG doesn’t.

    Sure it’s a crazy idea that can “never work.” But can you imagine the Coast-To-Coast Block Party! How do you spell Economic Boom?

    I trust my fellow adult Americans to know how to use the $85 Billion. We Deserve It Dividend more than I do the geniuses at AIG or in Washington DC.

    And remember, The Family plan only really costs $59.5 Billion because $25.5 Billion is returned instantly in taxes to Uncle Sam.

    Ahhh…I feel so much better getting that off my chest.

    Kindest personal regards, A Creative Guy & Citizen of the Republic

    PS: Feel free to pass this along to your pals as it’s either good for a laugh or a tear or a very sobering thought on how to best use $85 Billion!! ///

  • khidr9

    umm, that would be $425.00 a person.

  • 2 lips for a better world


    the point is:

    give the money back to the people.

    no bail out for the greedy.

    no caretaking.

    you republicans will dig this: tough love for the greedy.