-----Original Message----- From: Rich Cowan <rich at organizenow.net> To: rwwatch at topica.com <rwwatch at topica.com> Date: Wednesday, February 07, 2001 11:11 AM Subject: [RWWATCH] A Call to Arms on the Tax Cut Plan
>RWWATCH -- 2/7/01 (pls forward)
>
>The Bush Tax Cut Plan will be delivered to Congress tomorrow.
>We have 6 people who have volunteered to help with developing
>"13 myths about tax cuts" or, maybe more appropriately, "13
>myths about the Bush tax plans." See their comments, below!
>
>ON STRATEGIES FOR RESPONDING
>
>So far the Democratic Party has focused on two issues: the
>size of the tax cut, and the percentage of the cut that is
>going to the wealthy.
>
>This strategy is relatively effective, but it is not appearing
>to be effective enough to actually get the Republicans and the
>corporate lobbyists to back off. In fact, much of the media
>coverage in the last two days (see below) has focused on calls
>within Congress for an even larger tax cut than what Bush has
>proposed! As all students of the Right are aware, there are people
>in Congress now who want to completely eliminate all social
>programs. Huge tax cuts are seen as a way to create the budgetary
>pressure needed to accomplish this goal.
>
>Here are some ways we can improve the effectiveness of the
>existing strategies on each issue:
>
>1) on the size of the tax cut
>--- What is missing is some analysis of the economic slowdown
>and how it is affecting the projected "surplus." The number of
>corporate layoffs, according to CNBC, in December and January
>hit an all-time record. So it might be useful at this time to
>revisit the numbers; the projections policy makers are using were
>all done before the US economic slowdown hit. It is really a
>myth that Clinton left with a budget surplus. He left with
>a budget that was barely reducing the deficit, after many years
>of rapid deficit growth. The US still has a deficit of something
>like $5.6 trillion!
>
>
>2) on who gets the benefits
>--- What is missing is some analysis of how the tax cuts plan
>(which is really the Christian Coalition plan repackaged) shifts
>tax burden from married people with dependent children to
>unmarried people or retirees who no longer have dependents. If
>you look at the effects of the plan on taxpayers aged 16-24, you
>will likely find that they do not receive much benefit.
>Again, doing a little bit of the right math might yield some
>interesting results. Anyone want to join the discussion list
>at www.unmarried.org and call for people to help out?
>
>--- What is also missing is some analysis of how the plan would
>affect very-low-wage taxpayers. Take a family of three, with
>parents working a total of 60 hours/week at $5.50 per hour. The
>total income is $17,160. Now it doesn't take a rocket scientist
>to figure out how many families are like this, and how many of
>them wouldn't have to pay any taxes to begin with. A tax credit
>only helps people who have to pay tax right now. The tax plan
>wouldn't help these people unless the tax plan would affect those
>families on the verge of qualifying for the "earned income tax
>credit" which is a form of "negative tax." Somehow, I doubt the
>plan Bush is going to release will allow the per-child deduction
>to be applied to a credit, which would mean that it discriminates
>against low-income families. Of course, the devil will be in the
>details.
>
>
>WHAT WE CAN DO
>
>1) We need a volunteer to make contact with those DC based
>organizations (Center for Budget & Policy Priorities,
>Economic Policy Institute, etc.) who have people working on
>this issue to encourage them to post their analyses to RWWATCH.
>
>2) We need someone to begin writing myths. The software
>to allow collaborative editing and posting of comments is 85%
>completed. Hopefully it will be ready in a day or two; we
>will let you know. Until then please send your suggested
>myths (with facts and references if possible) to:
>
>myths at organizenow.net
>
>3) We need someone to obtain a copy of the details of the
>Bush tax plan, including budget projections and even
>spreadsheets. Then we can post the URL and encourage grassroots
>activists to point out some of the seedier details that the
>lazy mainstream media is unlikely to uncover.
>
>4) It would be great if the economics professors on this list
>could ask students to write papers analyzing the tax plan. I'm
>sure that some of the 40,000 or so economics students in this
>country will have something to offer.
>
>Finally, I'm hoping there are a few people willing to clear off
>their plates for day or two to help out, on Saturday and Sunday
>especially. I am sure that with almost 1100 people
>now on this list, it will be relatively easy to come up with
>a solid piece pointing out some of the "Myths" the bush team
>is using in its tax plan arguments.
>
>-rich cowan
>
>p.s. Here are 6 suggestions from RWWATCH readers, as well as
>the article I referred to earlier on appeals to make the tax
>plan even larger than it is.
>
>
>From: Filia Rationis <filia at gore-in-context.com>
>Subject: Tax Myth submission: 19% think they are in top 1%
>A poll during the campaign found that 19% of the country think
>THEY are in the top 1% of income. And about 20% expect to get
>there sometime in their lives. :-)
>In fact the top 1% is people making over $325,000/yr, iirc.
>
>
>From: Pndscm13 at aol.com
>my suggestions for things to touch on in the 13 myths about tax cuts:
>
>-myth: reagan tax cuts- responsible for 90's economic boom
>-myth: clinton tax hike - the largest in history.
>both reagan and bush raised taxes on gasoline, so why are they only griping
>about clinton's smaller hike?
>please mention progressivity:, ie. the rich pay all (or more) taxes so they
>should benefit from a tax cut.
>-inheritence tax cut - won't we have to pay taxes on capital gains instead?
i
>heard that will cost some people more than the inheritence tax does now.
>true or false: a bush tax cut will do what the reagan tax cut did, and is
>that a good thing?
>hope this helps.
>
>
>
>From: "Jim Mooney" <kana at fcol.com>
>Regarding tax cut myths, one thing I remember from the "big Reagan tax
>cut" besides never seeing more money in my paycheck, was that a lot of
>middle class deductions were dropped to make up for the money given to
>the upper bracket, so many of us ended up paying More taxes. This seems
>to have been forgotten in the razzle dazzle about GOP tax cuts. They
>Never benefit the majority and may actually increase taxes for them.
>Yours,
>Jim Mooney, webmaster, Bush BoyZ Stole the Vote
>http://www.bushboyzstolethevote.com
>
>
>
>From: "Peter Kemble" <pkcpa at silcom.com>
>To: <myths at organizenow.net>
>1) A Republican representative in discussing upcoming tax reduction
>legislation said "we must first save social security". This is simply code
>for leaving SS rates, which are highly regressive intact, while lowering
>the income tax rates to a less progressive schedule.
>
>2) The whole discussion around elimination of estate taxes, especially the
>rhetoric around family businesses/farms.
>
>3) Social security taxes are borne equally by all workers. a) it's
>regressive. b)working couples disproportioanlly carry the load, since a
>non working spouse (or divorced spouse from a 10+ year marriage) is
>entitled to 1/2 of working spouse's benefit. 3) Classes of people with
>lower life expectancy receive on average far fewer years of benefits in
>relation to their contributions.
>
>4) The whole flat tax debate, especially as a tool for simplification
>
>
>
>
>From: Mary Schweitzer <schweit2 at ix.netcom.com>
>To: myths at organizenow.net
>Subject: would like to help
>I am a ph.d. economic historian, and I would like to do my part in
>helping explain what is phony about "capital gains" taxes needing to be
>cut (a number of things: what is defined as "capital," the assumption
>that there is something sacred about physical capital as opposed to
>human capital, which has been disproved by all long-term MAINSTREAM
>economic history studies) -- whatever can help.
>Mary Schweitzer
>
>
>From: MelodyIG at aol.com
>Subject: Questioning of Bush Plan on Estate Taxes (NY Times: News)
>
>1/29/01 7:38:18 PM P, waffleck-asch at uswest.net writes:
><< Some Experts Questioning Bush Plan on Estate Taxes
>Unless Congress writes conditions into President Bush's tax
>cut plan, estate tax lawyers and other experts say, the real
>savings to the wealthiest 2 percent of Americans could be
>vastly greater than predicted.
>http://www.nytimes.com/2001/01/29/politics/29TAX.html >>
><A HREF="http://www.nytimes.com/2001/01/29/politics/29TAX.html">Some
Experts
>Questioning Bush Plan on Estate Taxes</A>
>
>
>
>
>Posted at 6:46 a.m. PST Tuesday, Feb. 6, 2001
>GOP, lobbyists still plan to expand Bush's tax cut package
>BY ALAN FRAM
>Associated Press Writer
>
>
>WASHINGTON (AP) -- Congressional Republicans and lobbyists say they like
>President Bush's proposed tax cut, but they won't back down from plans to
add
>their own priorities, even though Bush is promising to defend his proposal
>``mightily.''
>
>Beginning a week of selling his tax plan, Bush was visiting a
Washington-area
>small business Tuesday to spotlight his argument that his proposal would
>spark greater economic growth.
>
>Bush planned to send Congress an outline of his package on Thursday, and it
>was expected to mirror the $1.6 trillion, 10-year tax reduction program he
>offered during his campaign for the White House. On Monday, Bush defended
it
>against Democrats who would shrink the measure and Republicans who would
like
>to expand or otherwise alter it.
>
>``I want the members of Congress and the American people to hear loud and
>clear: This is the right-sized plan, it is the right approach, and I'm
going
>to defend it mightily,'' he said at a White House appearance.
>
>Democrats called Bush's plan too expensive, too tilted toward the rich and
>too risky. They said it would deplete projected federal budget surpluses
>without leaving adequate funds for a proposed Medicare prescription drug
>benefit, defense increases and other proposals.
>
>``Let us not repeat the mistakes of the past,'' Senate Minority Leader Tom
>Daschle, D-S.D., said, citing Reagan-era tax cuts that helped produce
record
>federal deficits. ``If we do, shame on all of us.''
>
>Bush's plan would collapse the five current income-tax rates into four, and
>lower them. They currently range between 15 percent and 39.6 percent; the
new
>rates would be between 10 percent and 33 percent.
>
>The president also would expand child credits, ease the so-called marriage
>penalty and gradually repeal estate taxes. And Monday, he said that to
``help
>get money into the people's pockets quicker,'' he would like his package to
>be retroactive to Jan. 1.
>
>``It's tax relief for everybody who pays taxes. That's what the times and
>basic fairness demand,'' Bush said.
>
>But with Congress only beginning its year, even GOP lawmakers said they
were
>not ready to simply rubber-stamp his plan.
>
>Senate Majority Whip Don Nickles, R-Okla., said there seemed to be a
>consensus among GOP senators attending a retreat last weekend in
>Williamsburg, Va., to live within Bush's $1.6 trillion figure and to pass
its
>major components, such as the cut in income-tax rates.
>
>But from there, Nickles said, congressional proposals will compete with
>Bush's ideas.
>
>``Obviously, there's going to be some compromises,'' he said.
>
>Nickles said he would like to see the capital gains tax rate individuals
pay
>for many investments cut from its current 20 percent to 15 percent, and
other
>reductions for health care costs and other items.
>
>House Majority Leader Dick Armey, R-Texas, said he believes that with the
>Congressional Budget Office upping its estimate of the federal surplus last
>week to $5.6 trillion over 10 years, the tax cut should get bigger. He also
>favors easing the alternative minimum tax and enhancing tax breaks for
>contributions to pensions and 401(k) savings plans.
>
>``You sit down as you're moving the bill through the process and you review
>the situation in light of the new numbers,'' Armey said in an interview.
>``And it would be our job to persuade the president.''
>
>Further underlining that the tax fight is just beginning, a group of House
>conservatives led by Rep. Patrick Toomey, R-Pa., planned to unveil a tax
>package on Wednesday with a 10-year price tag exceeding $2 trillion.
>
>Their plan will include all of Bush's proposals but expand on them, such as
>accelerating the president's plans for trimming income-tax rates and
phasing
>out the estate tax and the marriage penalty, the higher taxes many couples
>must pay when they marry.
>
>``This is what the whole process is all about,'' Toomey said. ``The
president
>proposes and Congress disposes. We'll see where we go.''
>
>Business and conservative lobbyists also have their own ideas of what the
tax
>cut should look like.
>
>``The fact is this tax cut is not the right size. It's too small given the
>latest budget surplus and the size of the economy,'' said Stephen Moore,
>president of the Club for Growth, a group of conservatives that advocate
deep
>tax reductions.
>
>Moore said Bush's current plan ``could actually fail in resuscitating the
>economy if it is not sped up and made larger.''
>
>The National Manufacturers Association supports Bush's proposals, but also
>wants repeal of the corporate alternative minimum tax and a permanent
>extension of the research and development tax credit, said Dorothy Coleman,
>the association's vice president for tax policy.
>
>``We do think additional tax relief is needed for the business community
this
>year,'' she said.
>
>http://www0.mercurycenter.com/breaking/docs/063670.htm
> <A HREF="http://www0.mercurycenter.com/breaking/docs/063670.htm">GOP,
>lobbyists still plan to expand Bush's tax cut package (2/06/2001)</A>
>
>
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