TaxVox points out how tax breaks, like those in the House "extender" bill, often work at cross-purposes:
Finally, there are my favorites—the contradictory energy breaks. The bill tries to encourage the use of alternative fuels by extending a subsidy for hybrid trucks at the same time it attempts to keep the cost of fossil fuels low by continuing breaks for marginal oil wells. This, I guess, is symbolic of the entire exercise. It only makes sense if you are in Congress.
Outside the extender bill, there are lots of examples of this sort of thing; for example, the Homebuyer Credit to increase demand for unsold homes while the low-income housing credit increases the supply. One credit works to keep homes from becoming more affordable, the other tries to provide affordable housing. Go figure.
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