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Sunday, June 18, 2006

Anti-Estate Tax Democrats

Jonathan Chait brings up anti-estate tax Democrats and criticizes them because unlike Republicans, they "don't even have the charade of fake spending cuts to hide behind":

The lie of the anti-estate tax Democrat, by Jonathan Chait, Commentary, LA Times: A week and a half ago, Democratic Sen. Blanche Lincoln of Arkansas took to the Senate floor to decry the estate tax as unfair... It was all very moving. Especially if you stand to inherit an enormous fortune.

That same day, Lincoln again appeared on the Senate floor, this time to decry the lack of funding for federal anti-hunger programs. This too was unfair. Lincoln was particularly nonplused by the counter-argument that there was insufficient money for such programs. "I understand our current budget constraints. I know we all do," she said, "Yet I didn't create this mess."

Oh, you didn't? Let's look at the main causes of the budget mess. There's the 2001 tax cuts. Lincoln voted for those. There's the war in Iraq. Lincoln voted for that too. There's the Medicare prescription drug benefit, which she likewise supported. Other than that, how did you like the budget, Mrs. Lincoln?

Lord knows I'm no fan of Republican fiscal policy. But at least Republicans pretend they have some vague future intention of slashing the hundreds of billions of dollars from the budget it would take to balance out their tax cuts, even if everybody knows it will never happen. Anti-estate tax Democrats such as Lincoln, on the other hand, don't even have the charade of fake spending cuts to hide behind.

They want to spend money on the poor because they're compassionate. They want to spend money on the military because they're hawkish. They want to cut taxes for the middle and working class because they're populist... And they also want to cut taxes for the super-rich because they're … um, help me out here. Oh, right — they want to help the poor family farms and small businesses that are ruined by the estate tax.

In reality, any sentient person could tell you that the populist arguments against the estate tax are hokum.... Even among the tiny percentage of estates that pay inheritance tax, the effective rate is under 20%. Lincoln and other estate tax opponents, who are trying to abolish the levy even on the super-rich, like to repeat sob stories about families that have to sell their small business or farm to pay Uncle Sam. In fact, those families can spread out the pain in installments over 14 years, which is plenty of time to come up with the money.

But critics never talk about the handful of massively wealthy families who have bankrolled the anti-estate tax campaign. Those families stand to save billions... One such family is the Waltons, who own Wal-Mart. They live in Lincoln's home state of Arkansas. I'm sure any connection between that fact and Lincoln's support for repeal is purely coincidental.

So Lincoln doesn't want rich heirs to pay any inheritance tax on their windfall. She wants middle- and lower-income workers to pay lower taxes as well. And she doesn't want to slash the federal budget. So, who does she want to pay more in taxes? This is the question estate tax foes who aren't rabid conservatives never answer... They don't answer because their vision of government is incoherent...

Is this supposed to characterize some large group of Democrats who are for the 2001 tax cuts, against the estate tax, pro war, and so on? Unfortunately, the "they" in the following statement are not identified.:

Anti-estate tax Democrats such as Lincoln, ... They want to spend money on the poor... They want to spend money on the military because they're hawkish. They want to cut taxes...

Here's an indication of the size of the Democratic coalition on this set of issue, who "they" are. If we separate Democrats on a single dimension, voting to end debate on the estate tax, the group is very small already:

Earlier this week, Mr. Kyl circulated a [compromise] proposal... But that proposal failed to win over more than two or three Democrats.

Besides Mr. Baucus, three other Democrats voted to end debate and clear the way for a vote on repeal. They were Senator Ben E. Nelson .., Senator Bill Nelson... and Senator Blanche L. Lincoln of Arkansas. Two Republicans, Senator George V. Voinovich ... and Senator Lincoln Chafee ..., voted to block the bill.

What is the point of this column and why is creating "the charade of fake spending cuts" a virtue? Is this some attempt at balance by finding a way to criticize Democrats? If so, it doesn't work. As a characterization of a single individual or a group of three or four people, it is coherent, but this is not a set of mainstream Democratic views. Thus, drawing or implying any conclusions about Democrats more generally from the characterization of these few individuals, as the use of "they" attempts to do, is not valid.

    Posted by on Sunday, June 18, 2006 at 03:33 AM in Economics, Policy, Politics, Taxes | Permalink  TrackBack (0)  Comments (18)


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