Tax Policy -- W&M Approves Extenders; Rejects AMT Patch: By a mostly party-line vote of 25-12, the House Ways and Means Committee approved at $57 billion tax package of an assortment of tax breaks yesterday. The committee also voted down a Republican-offered unpaid-for one-year AMT patch. The bill is expected to be on the House floor next week.

War Supplemental -- House Rejects War Funding Portion of War Sup: Anti-war Democrats voted "no" and 132 protesting Republicans voted "present" to defeat an amendment that would fund war operations in Iraq and Afghanistan to a war funding bill. A domestic spending package was approved along with provisions aimed at changing war policy. The Senate is expected to add war funds when it votes on the bill, probably after the Memorial Day break.

Farm Bill -- House and Senate Pass By Wide Margins: The Senate passed the farm bill reauthorization yesterday by a wide margin: 81-15, well above the 67 needed to override a promised presidential veto of the bill. The House has also passed the bill by much more than needed to override a veto in that chamber. The bill has almost $300 billion in spending over the next five years, with 73 percent of that spending going to people in poverty.

The gas tax holiday proposed by Sens. John McCain (R-AZ) and Hillary Clinton (D-NY) has been universally panned by experts, economists and elitists of all political stripes.

Now comes a novel objection from perhaps the most famous of all pundits, certainly one with a bigger media footprint than all the others who have opined to date.

"The gas tax holiday? It doesn't go far enough!" grouses Stephen Colbert. His argument is neatly laid out in a presentation made to "nation," in Stephen Colbert's Gas Tax Holiday.

Congressional opposition to the Frank housing bill is coalescing around apparently dubious propositions ($).

[Antonia Ferrier, spokeswoman for House Minority Whip Roy Blunt (R-MO)] also took aim at the [Rep. Barney] Frank proposal. "This bill perversely rewards those who borrowed more than they could afford — their monthly mortgage payments get reduced with the government footing the bill. How is that fair to the millions of Americans who worked hard and paid their mortgages on time? And who ends up holding the bag if all goes south? No surprise, the American taxpayer."

Meanwhile, economist and Fed Chief Ben Bernanke provides an "expert" opinion:

"High rates of delinquency and foreclosure can have substantial spillover effects on the housing market, the financial markets and the broader economy," [Federal Reserve Chairman Ben] Bernanke said Monday..."Therefore, doing what we can to avoid preventable foreclosures is not just in the interest of lenders and borrowers. It's in everybody's interest," he said.

...

The current housing crises has clobbered some borrowers home prices dropped. That left them with mortgages that are bigger than the value of their home. When that's the primary problem, Bernanke said the best solution may be reducing the amount that the borrower owes on the loan or some other permanent modification to the loan.

Fine. Helping distressed homeowners can help everyone. But surely we cannot stand in the way of the the almighty market! That would be disaster.

Republican talking points obtained by Roll Call also suggested housing prices must fall further rather than be propped up by a new government program, an argument also made by [Sen. Richard Shelby (R-AL)] Shelby.

"The correction in the housing market is a necessary reaction to a prolonged period of reckless lending and borrowing practices that helped take housing prices to levels that were simply unsustainable. For the market to stabilize, prices will need to return to levels that ordinary Americans can afford," the talking points read.

Or not.

Rising foreclosures add to the glut of unsold homes and that put more downward pressure on prices, aggravating the housing slump, he said. More rapid declines in house prices could have an "adverse impact" on the broader economy and the stability of the financial system, [Bernanke] said.

Photo by Flickr user msabcmom used under a Creative Commons license

If you find an email that looks like this in your inbox, delete it! It is a scam.

We are top officials of the United States Senate Government who are interested in importation of oil into our country with funds that are presently trapped in the FEDERAL TRANSPORTATION TRUST FUND dedicated to improving transportation. We wish to send this money to overseas accounts in the MIDDLE EAST but cannot due to restrictions in Congress Transportation Equity Act requiring that this money must be spent to build roads, bridges and high speed trains.

If you accept we will deliver to your a sum of 30 DOLLARS in the summer 2008 in form of a "GAS TAX HOLIDAY". You will then deliver this money to accounts of our friends in Middle East by taking it to your nearby gasoline station where they have information to forward the money. Please supply your bank account, social security number, address and your vote in DEMOCRATIC PRIMARIES AND NOVEMBER GENERAL ELECTION.

As a follow-up to the comments of Messrs. Mankiw and Berman regarding the notion of suspending the federal gas tax during the summer months, we submit for your consideration the substantiation offered by Sam Stein, Political Reporter at the Huffington Post, for the proposition that Expert Support For Gas Tax Holiday Appears Nonexistent, to wit:

• Tom Friedman of the Times: "so ridiculous...it takes your breath away"
• Jonathan Alter of Newsweek: "Hillary Clinton has now joined John McCain in proposing the most irresponsible policy idea of the year -- an idea that actually could aid the terrorists"
• Jerry Taylor, a fellow for the Cato Institute, called the proposal a "holiday from reality"
• Robert Shapiro, former undersecretary of commerce in the Clinton administration: ""Stated as clearly as I can, it's utterly misguided both environmentally and economically"
• Max Schulz, a senior fellow at the conservative Manhattan Institute: "I think it is close to political pandering. It is bad policy and political gimmickry

This could go on all day. So we close on this note, from Ken Green, an energy expert for the American Enterprise Institute: "I'm afraid that your record is going to be unbroken in terms of finding someone who will like this idea."