Views on the News & Other Ramblings

Friday, June 02, 2006

Death Tax Elimination Act (H.R. 8) Vote Next Week

Since the Bush administration came to being, one of their key goals has been to further enrich the pockets of those whose pockets are already overflowing, the top one-half percent wealthiest in this nation. With this mindset, a key tax to be eliminated was the tax on estate and gifts paid by the beneficiaries of those wealthiest one-half percent.

The Republicans had been pushing for the passage of the bill to eliminate the estate tax since Clinton was in office. In 2000, the bill cunningly named The Death Tax Elimination Act (H.R. 8) passed through both the House and the Senate. The bill was to completely eliminate taxes on estates in 2010 through a gradual phase-out. Thankfully, Bill Clinton vetoed the bill and Congress was unable to gather the votes to override the veto.

In 2001, a few months after Bush took office, H.R. 8 was put back before Congress. This time with the full knowledge that there was no chance of a veto. As part of a broad set of tax cuts legislated during Spring 2001, referred to as the Econonic Growth and Tax Relief Reconciliation Act of 2001, the estate tax was to gradual phase-out by 2010, only to be back in full force in 2011. This sleight-of-hand was performed by Congress so the true cost of the estate tax elimination would remain hidden, as the cost of the tax was estimated by the Congressional Budget Office (CBO) report of 2001 to be close to $50 billion in 2011. What was passed was an estimated $186 billion in revenue reduction. Not, what is estimated to be upward of a $1 trillion revenue reductive measure to the government's coffers over the ten year period from 2012 to 2021 if complete elimination of the tax had occurred.

Through the trickery of those who benefit from the elimination of the estate tax, the wealthiest one-half percent of the nation, the vast majority of the rest of us have been brainwashed to believe that the tax should be eliminated. Frank Luntz, the infamous Republican pollster, is credited with the evil sounding name change from estate tax to death tax. It is referred to as a bill to help small businesses, family farmers, mom and pop operations from going under after death of a loved one. Polling data used to support the elimination of the tax refers to it as a tax that "protects small business and family farms".

A CBO commissioned report in 2005 saw little evidence that such tax related business demises are occurring for small businesses and family farms. Whereas, the report shows that this issue is complicated and the way the law is currently in place could be improved, it does not support the arguments of those who want complete elimination of the tax. The numbers of those adversely effected in any way by the estate tax before passage of the 2001 bill are so small (maybe as many as 302 estates per the CBO report), it is a sick joke that our elected representatives have spent so much time, effort, and energy on this measure. It was also realized in the report, putting the tax threshhold number at the 2005 figure of $1.5 million, would have resulted in "far fewer" then 302 estates being negatively impacted by the tax. The 2001 bill called for the threshhold to move up to $3.5 million per person before taxation on estates in 2009 prior to its complete phase-out in 2010. At the $3.5 million level, the report calculates that a total of 54 estates would be adversely effected. The caveat to all this is though a $3.5 million estate may be adversely effected in some way, this still would leave millions of dollars in inheiritance money to be passed out to the beneficiaries.

If the estate tax cuts are to become permanent it will serve to us as a reminder of what Congress really thinks of the 99.5% of the American people living on the poorer side of the fence. They figure, and likely correctly so, that it is those wealthy .5% that supply them with the money that gets them re-elected over and over. Money seems to have a way of making fools of even the best of us, and those who have it know how to use it to work it in their best interests and against ours.

Thursday, June 01, 2006

How Many More Mistakes Can They Make?

The latest Bush administration misstep is the loss of funding for the most likely cities to have repeat terrorist attacks, New York and Washington, D.C. The administration seems to be misfiring on all cylinders. Bush's fellow Republicans such as Peter King (R-NY) and New York Mayor Michael Bloomberg are especially upset with the funding loss. It is difficult to make sense out of cutting funding to landmark, people filled and already hit New York while increasing funding to Omaha, Nebraska. There there is at least one person who sees it differently. The Secretary of the Department of Homeland Security Michael Chertoff called the funding loss "fair to New York."

Chertoff also came up with this gem to explain the disgruntlement, "When actual decisions get made it tends to rub people who came out on the short end the wrong way. We are always willing to listen to criticism." Chertoff's statement serve as a refresher course to two feral lessons the Bush administration has already given us. The first is the administration's policies and decisions do tend to rub most people the wrong way, as most of us do end up on the short end. The second lesson is the Bush administration is willing to listen, but doesn't do much other than that when criticized. Only on very rare occasions are they willing to make changes, such as with failed Supreme Court nominee Harriet Miers. And this was painfully done by the administration when it was clear that the nomination would fail the Senate's confirmation process.

Now, with this latest misstep, at least one prominent member of the Republican leaning press is calling for the removal of Chertoff from Homeland Security with more likely to follow. When you're traveling uphill and misfiring on all cylinders there is only one place you can go. It will nevertheless be interesting to see how this plays out in the next week.

- Steve