Reasonably Ascertainable Reality

Thoughts and musings on current events and other random occurrences.

Location: South Jersey, United States

Thursday, February 22, 2007

Interesting Budget Analysis

How's that for a post title? Reasonably Ascertainable Reality -- sponsoring naps everywhere!

Check out this article by Matt Taibbi of Rolling Stone regarding some interesting 2008 Bush Administration budget analysis done by the office of Congressmen Bernie Sanders.

A teaser:

Sanders's office came up with some interesting numbers here. If the Estate Tax were to be repealed completely, the estimated savings to just one family -- the Walton family, the heirs to the Wal-Mart fortune -- would be about $32.7 billion dollars over the next ten years.

The proposed reductions to Medicaid over the same time frame? $28 billion.

Some other notable estimate estate tax breaks, versus corresponding cuts:

  • Cox family (Cox cable TV) receives $9.7 billion tax break while education would get $1.5 billion in cuts
  • Nordstrom family (Nordstrom dept. stores) receives $826.5 million tax break while Community Service Block Grants would be eliminated, a $630 million cut
  • Ernest Gallo family (shitty wines) receives a $468.4 million cut while LIHEAP (heating oil to poor) would get a $420 million cut

And so on and so on. Sanders additionally pointed out that the family of former Exxon/Mobil CEO Lee Raymond, who received a $400 million retirement package, would receive about $164 million in tax breaks. Compare that to the Commodity Supplemental Food Program, which Bush proposes be completely eliminated, at a savings of $108 million over ten years. The program sent one bag of groceries per month to 480,000 seniors, mothers and newborn children.

Listen, I can understand arguments regarding capitalistic tendancies and "making and keeping" your own money. But budget development is a series of choices. Choices regarding the good of the country and society. ALL OF SOCIETY. Is repealing the estate tax, which affects approximately the top 2/10ths of the top 1% of the people in this country, really as important as cutting funding for Medicaid, which provided health care services to approximately 40 million people in 2002 -- 18.4 million of them children?

h/t: Pandagon


Blogger Dave Justus said...

Of course the estate tax effects a whole lot more then the top 2/10th of 1%. That is a flat out lie.

I also suspect, but I can't prove as the article doesn't site the numbers, that these numbers are based upon the assumption that these wealthy families would not have any other loopholes or tax breaks in which to hide their money. In other words, it is based upon something that simply isn't true.

There are of course a lot of good questions as to how we should raise money and then how we should spend it. Generally speaking, this discussion is not well served by a simple rich vs. poor dichotomy.

2:37 PM  
Blogger Katinula said...

Well, according to things I've read, more the 99% of estates pay no estate tax. I'm thinking due to the fact that estates less than $2 million, are exempted ($4million for couples). This exemption is due to rise to $3.5 million in 2009. If you have data that differs from this, I'd like to see it.
And other than developing some type of tax loophole strategy that these families havent thought up to avoid the estate tax, I'm thinking that your 2nd paragraph really is pointless. Don't you think that if something was costing them X dollars, and there was a loophole to save some money, they would have found it?
I don't think its a rich v. poor dichotomy at all. Its a good of the society as a whole v. good of wealthy Americans. Whats not helpful is saying that arguments which involve pointing out that wealthy Americans benefit from something at the expense of valuable social and educational programs is a "class warfare" argument. You can argue the value of those programs, but its not class warfare to say you believe in those programs and are against cuts in their funding when NOT cutting the taxes of wealthy Americans saves the same, if not more, money.

1:23 PM  

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