Nightly News   |  January 06, 2013

Cutting the deficit – or raising money for projects?

With the nation’s debate at nearly $16.5 trillion, increasing at $140 million an hour, the White House and Congress agreed to increase taxes last week. But despite the rhetoric about cutting the deficit, much of that money will be spent on special projects. NBC’s Lisa Myers reports.

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>>> we are back now with a closer look at those urgently passed bills to avert the fiscal cliff and to provide much-need reed leave much-needed relief for victim is of super storm sandy. they are loaded with things totally unrelated and critic says it amounts to the fleecing of america. our correspondent lisa myers is on the money trail.

>> reporter: the nation's debt is almost $16.5 trillion and increasing at the astounding rate of $140 million an hour. so, the president and congress agreed last week to increase taxes.

>> tonight's agreement further reduce the deficit by raising $620 billion in revenue from the wealthiest households in america.

>> reporter: what they didn't advertise was that the bill to avert are the so-called fiscal cliff also was stuffed with billions of what critics call corporate tax giveaways for certain hollywood films , $430 million. nascar racetrack owners, $78 million. puerto rican rummakers, $220 million. and algae growers, $59 million.

>> to use vehicles that are must-pass, which are the lobbyist's ticket on board the gravy train is a sad and cynical commentary on the way washington does business.

>> reporter: nascar says its writeoff increases investment in construction, which result us in desperately needed jobs. supporters of other breaks also say they foster research, create jobs and help companies compete. still, experts say over two years, the special tax breaks for business largely wipe out $86 billion raised by increasing taxes on the wealthy.

>> so where did all that money from letting the tax cuts expire for the rich go? they gave it right back to big business .

>> reporter: so, despite all the rhetoric about cutting the deficit, washington still seems to be engaging in business as usual , doling out money through tax breaks and special projects. take that $60 billion emergency bill passed by the senate to help victims of superstorm sandy. much of that money is desperately needed for recovery, but not all.

>> many billions of dollars in this bill has nothing to do with helping the victims of sandy.

>> reporter: taxpayer watchdog groups complain buried in this emergency bill is money for amtrak projects, fisheries in alaska and mississippi and new cars for the justice department .

>> it's like they don't get it that we have got the warning siren going on the debt crisis yet they want to do things just wait they have always done.

>> reporter: the ultimate losers, experts says, are americans asked to pay more taxes or give pup benefits. lisa meyer, income news,