The party of envy, class warfare, and Marxism
Now that the gay marriage ban amendment has been relegated to the dust-bin of past pandering, the Senate has scheduled a vote tomorrow on a far more important issue - estate taxes.
This one has been labeled as pandering by some on the left as well, but has ramifications that belie such a guileful dismissal. Indeed, the results of this debate say much about who we are and what kind of nation we wish to be.
I do really dislike having to levy generalities on an entire group of people (in this case, the left), but in this instance I find it difficult to believe that they really buy their own line on this issue. For example, the left says that repealing estate taxes will have disatrous effects on the budget. From a United for a Fair Economy press release today:
"At a time of rising deficits and big due bills like the war in Iraq, we cannot afford either the cost of repeal-a trillion dollars over the first ten years-or the aristocracy of wealth that repeal would leave us," said Chuck Collins, senior fellow at United for a Fair Economy.
From another United for a Fair Economy press release:
Estate tax repeal would mean adding another $1 trillion to the national debt over the next 20 years.
This is from an op-ed by Peter Rothberg in The Nation:
This change in the tax code would benefit less than half of one percent of American citizens but would harm many more by creating a one trillion dollar hole in future federal reserves.
The elephant in the room that each and every person on the left knows (but will not publicly ackowledge) is that revenues have soared in the wake of the Bush tax cuts. The singular reason for continuing deficits is the lack of fiscal discipline in Congress. Sadly, this is currently across the board, and the subject is only raised as a political weapon, long on hot air and short on action. Regardless, the notion of higher deficits as a result of estate tax repeal is a provably fraudulent one. If you're one of the few who really do buy into it, please drop me a line via email with your contact information as I'd like to discuss selling you a bridge (I have a picture post card if you wish to see it).
The other reasons the left gives for "preserving" (like it's a good thing - we also preserve old buildings and pickles) the estate tax center around "fairness". And everyone values fairness, right? That's why I picked United for a Fair Economy for quotes above - the word "fair" is in their name. So lets talk about fairness.
Nearly every argument made in favor of the estate tax mentions that >99% don't pay it. But fairness is treating all Amercans equally. In other words, under current tax code, we're being unfair to either 1% or 99% of the population. To remedy this inequality, we should either expand the estate tax to the 99% who have been getting away with not paying it, or repeal the estate tax all together. No other solution save those two would be fair.
I also love the this claim, also nearly universal:
Over the last decade, 18 of the wealthiest families in the country have spent more than $200 million lobbying to repeal the estate tax, according to lobby disclosure reports analyzed by two groups that favor retaining the estate tax, United for a Fair Economy and Ralph Nader's organization, Public Citizen. The wealthy families include the Mars candy family; the Gallo wine family; the Wegman supermarket family; the Dorrance family, which controls Campbell soup; and the Waltons, who control Wal-Mart.
Here's a variation from Barack Obama:
"Let's call this trillion-dollar giveaway what it is. This is the Paris Hilton tax break," said Sen. Barack Obama, D-Ill.
Lobbying is nothing new. But when farmers lobby for more subsidies, no one villifies the farmers. Here's some reality for you - the folks most likely to benefit from a particular cause are likely to be the ones who lobby for it. Just because some rich folks are lobbying for estate tax reform doesn't automatically make tax reform a bad thing. Unless, of course, you're one of those folks who think anything having to do with Wal-Mart is automatically evil. But for everyone else, doing the right thing is still right even if people you don't like support it as well.
I'd really like to know what the "punish the rich" crowd thinks the rich does with all that money.
Just in case some of you are curious what I think they do with it, I'll tell you:
1. They spend it, creating/sustaining employment and growing wealth for others (like you and me).
2. They invest it, fueling the economy that creates jobs and grows wealth for others (like you and me).
3. They hide some of it from the tax man.
This is not overly simplistic, either. Short of stuffing their mattresses, the weathy's cash is always being put to some use.
Changing the estate tax affects all three behaviours. High taxes mean less money for 1 and 2 (very bad for you and me), and more money for number 3 (also bad for you and me, because they aren't spending or investing much of what they hide). Low (or no) taxes mean more money for nos. 1 and 2 (very good for you and me), and less reason to hide money from the tax man (which means even more money for 1 and 2, which is very, very good for you and me).
So once the usual arguments against fixing the inequalities of estate taxes don't work, what's left?
