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We have a new caucus on Capitol Hill: the chazer caucus. For those
of you who might not be hip, chazer is the Yiddish word for pig. As in, "Gee,
that person has so much [fill in the blank], to grab for more is just being
a chazer ."
Which brings me to a lead footsoldier in the chazer caucus, Republican Sen.
Jon Kyl. Right after Labor Day, Kyl will attempt to bring to a vote a bill that
would repeal the estate tax. When some really rich person croaks, their assets
get transferred to their heirs, who, God forbid, have to pay taxes when the
estate gets to a certain level.
The chazer caucus has been brilliant in framing the estate tax as a
"death tax" hurting poor family farmers. But that turns out to be
nonsense. As the good folks from OMB Watch point out, "An incredibly
tiny number of family farms are actually impacted by the estate tax." A
new report from the nonpartisan Congressional Budget Office found that "if
the current exemption level of $1.5 million per individual ($3 million for a
couple) were in effect in 2000, then only 300 family farms would have had to
pay any estate taxes. The report further estimates the number of family farms
impacted would have dropped to a mere 65 farms nationwide with an exemption
of $3.5 million ($7 million per couple), the level the exemption will be in
2009."
This tax hits only the wealthiest 2 percent of Americans.
The Coalition for America's Priorities underscores the fact that this tax hits
a tiny portion of the population: "In 2001, over half of all estate taxes
were paid by 3,502 people with estates larger than $5 million -- representing
the top 0.14 percent of all Americans."
The estate tax stayed largely unchanged until 2001, when the current president
took office. What's truly amazing is that the estate tax is supposed to disappear
by 2010, and then be reinstated in 2011 -- as one of the gimmicks that was part
of the Bush tax cuts.
And what's the cost of giving the richest Americans more cash? In the first
10 years, the U.S. Treasury will lose between $750 billion and one trillion
dollars, forcing more cuts in education, Medicare and other key social programs
-- not to mention piling on more debt for future generations. This is an unconscionable
raid on the public treasury by people already benefiting from the Bush tax cuts.
It shows what a pickle we are in that the forces of light who are fighting
complete repeal are suggesting one possible compromise. Instead of completely
eliminating the estate tax, the compromise deal would raise the exempted estate
tax to $3.5 million and $7 million for couples. But why compromise? Why shouldn't
people sitting on several millions dollars be forced to pay the current tax
on estates? One thing that we forget in the debate over taxes is that the wealth
of the richest in our society is not a natural phenomena or due to pure skill
-- society makes multi-billion dollar public investments in areas such as infrastructure
and education that make it possible for the rich to pile up their wealth. Think
of taxing estates as simply a modest payback for public services rendered --
the reason most people pay taxes on their paychecks.
The Republicans will probably hold all 55 of their chazer caucus supporters
in line by simply demanding party loyalty, though there are some attempts being
made to lean on John McCain, George Voinovich (Ohio), Lincoln Chafee (Rhode
Island), Susan Collins (Maine), and Olympia Snowe (Maine) to buck Majority leader
Bill Frist by arguing the fiscal insanity of letting millionaires get away with
more money from the U.S. Treasury at a time of record deficits.
It's pretty certain that the Republicans also have three Democrats: Blanche
Lincoln (Arkansas) and the Nelson boys. Bill Nelson (Florida) signed on as a
co-sponsor of Sen. Jon Kyl's repeal bill; Lincoln has long been for full repeal
and her pet policy is unlimited exemptions for farms and business, which is
awful tax policy. Ben Nelson (Nebraska) gives as his excuse that he has a tough
re-election next year -- but he's been off the reservation for a long time.
So Frist already has 58 votes to end debate and crush a filibuster -- just two
votes shy.
The other Democrats who apparently are most ripe to topple are: California's
Dianne Feinstein, who is personally rich, so I guess this is her looking after
her heirs; Mark Pryor, who sees this as a way to suck up to his home-state Arkansas
Wal-Mart heirs; Evan Bayh, who has to court financial contributors for his presidential
run; and Mary Landrieu, who won a close re-election in Louisiana thanks to the
low-income black voters who will take the biggest hit from the repeal. By the
way, Landrieu, Bayh and Pryor all voted for the bankruptcy bill earlier this
year -- yet another bill that hurt average working families but helps the well-connected
and powerful (in this case, the credit card industry).
What's striking to me is the complete inability of the Democratic side (read:
Harry Reid) to demand party loyalty on this crucial issue and call for a solid
vote against the repeal and for sustaining the filibuster. And if morality isn't
enough of an argument, those considering joining the chazer caucus can seek
solace in the public polls showing a majority of people against full repeal.
If Kyl can't get his full repeal past a filibuster, he's going to try another
maneuver: a "compromise" bill, which would make permanent the exemption
at $5 or $10 million but also drop the tax rate for the estates that have to
pay to an effective rate of 6 percent -- similar to a sales tax. This is a back-door
repeal because it would cost up to 93 percent of the full repeal proposal.
U.S. Action did an amazing chart, which shows us this: If the repeal
passed, the $45 billion going back to the richest people in the country could
provide health insurance for more than 22 million children. So there's the choice:
more money for rich people or health coverage for children. To all the masses
of people of faith, including those sanctimonious chazer caucus senators like
Rick Santorum and Bill First, I ask: Wonder what Jesus would say on that?