The House of Representatives rushed back to Washington yesterday in the middle of their six-week vacation to pass yet another bailout. This latest one, $26 billion in total, temporarily saves state governments that have overspent for years from fixing their chronic budget problems.

The newest bailout spends $10 billion for education funding in the states. This money is on top of the $100 billion in education funding the states got from the stimulus. The remaining $16 billion will bailout states’ bankrupt Medicaid programs.

Claims that this newest round of bailouts is completely “paid for” are true only in a fantasy world. Tax hikes on international businesses offset part of the spending. Congress raised taxes on these important job creators by $10 billion over 10 years to partially offset the price of their profligacy. Despite assertions to the contrary, raising taxes on these businesses will drive more jobs overseas and make it harder for United States businesses to compete in the competitive global marketplace.

Most of the remaining offsets come from cuts to children’s nutrition programs that will never actually happen. Specifically, the law calls for cuts to the food stamp program that don’t start until 2014. Anyone who truly believes that future Congresses four years down the road will go through with cuts to food stamps for children must also believe in unicorns, leprechauns, and the Loch Ness monster.

Even though the reduced spending on food stamps is only reversing increases in the program passed as part of the stimulus, there is no way Congress will ever roll back those increases.

In reality, those spending cuts will never materialize. Along with other fantasy spending cuts that future Congress will never allow to occur, this emergency bailout will add $13 billion to the deficit.

To add insult to injury, the looming tax hikes will slow economic recovery and prevent people looking for jobs from finding work. The bailout will reward states for spending beyond their means and provide an incentive for them to keep doing so. That will make it all the more likely that Congress will have to bail them out again and again, adding more to the deficit each time it saves states from their own wastefulness.

Next time, it’s best if Congress just stays on vacation.