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August 05, 2006

Yeesh

Shakes here...

At a certain point, I don’t particularly care if these blowhards are deliberately misrepresenting policies to obfuscate their appalling realities or if they’re just being alarmingly obtuse. The intentions cease to have any relevance when you say something this fucking dumb:

"[W]e are turning our back on the middle-class and poor people in this country who depend on the minimum wage and death-tax relief." — Senator Kay Bailey Hutchison, R-Texas

The proposed "death tax" (or, as it is known by anyone who favors integrity over hyperbole, "estate tax") relief to which Hutchison is referring would exempt $5 million of an individual estate from taxation.

Now I grant you that I’m not the most well-connected girl in the world, but, in all my many years, I’ve yet to meet a middle-class or poor person who has $5 million lying around. In fact—and again, I admit I’m no genius—I’m pretty sure not having anything close to $5 million, on which deriving benefit from the estate tax proposal the GOP attached to the minimum wage bill is predicated, is sort of what makes someone middle-class or poor.

But maybe I’m just being too literal. Maybe what old Hutchy meant is that middle-class and poor people are dependent on the estate tax relief given to the wealthy, because that just means there will be more to trickle down on them. Though, still, I wonder if minimum wage workers would have time to collect all those pennies from heaven, what with the wanton spending sprees and luxury vacations they’d be taking with that extra two bucks an hour burning a hole in their pockets.

(Hat tip Jill.)

August 5, 2006 | Permalink

Comments

"Now I grant you that I’m not the most well-connected girl in the world, but, in all my many years, I’ve yet to meet a middle-class or poor person who has $5 million lying around."

Have the folks you've met checked the couch cushions? Oftentimes, a surprising amount of loose change is concealed in the couch cushions.

"I’m pretty sure not having anything close to $5 million, on which deriving benefit from the estate tax proposal the GOP attached to the minimum wage bill is predicated, is sort of what makes someone middle-class or poor."

Actually, recent studies show the average family on food stamps has over $17 million stuck in the couch cushions.

If we don't repeal the death/estate/Frank Luntz tax, what will happen to the children when the parents of that family on food stamps die? Will they just leave their couch on the curb for trash pickup? Won't anyone think of the children?

Posted by: Petey | Aug 5, 2006 5:35:46 AM

I have a friend who died, 2 days ago, who has 7 children. Frank didn't have $5 million. But if he did I'm sure he would rather give more to his children than the IRS.

My fish monger has 2 retail buildings right on the Gulf Coast in Tarpon Springs and his 5 children all work in the business along with another 10 employees. Forget the shrimp boat, I'm sure the land is worth $5 million. If the owner dies why should 55% of the value go to the IRS?

I told my Fish Monger to die in 2010 so the IRS can't get his money and his children could keep the business. He has all those Grandchildren so he's thinking about it.

Posted by: Ron Greiner | Aug 5, 2006 7:44:35 AM

"I'm sure the land is worth $5 million. If the owner dies why should 55% of the value go to the IRS?"

Well, if the land is worth $5m and the owner is single, then 27% of the value would go to the government, not 55%. If the owner is married, then only 9% of the value would go to the government, not 55%.

In other words, your fish monger's children will be paying a lower rate of tax on their multi-million dollar inheritance than a janitor pays on his five dollar an hour minimum wage job.

But aside from quibbling over a measly two million dollars or so in your math, you've asked an excellent question. The answer is that we have a government that we finance through taxes. Politically, we've decided that having the richest one percent of families pay some tax on intergenerational transfers of vast wealth is part of the way we should be financing the government.

Of course, absent the estate tax, there would be a shortfall in revenue. That shortfall would have to be made up through higher taxes on poorer families than your fish monger's, or through deficit spending that acts as a tax on all Americans' children and grandchildren.

Thanks for your excellent question, though.

"I told my Fish Monger to die in 2010 so the IRS can't get his money"

Y'know, if your HSA-peddling diseased soul were to die tomorrow, the IRS wouldn't be able to get it's hands on part of your future income. Think about it! You'd be doing yourself a big favor, not to mention the rest of humanity. Plus, I'm sure Frank is lonely, and would appreciate the company.

Posted by: Petey | Aug 5, 2006 8:55:04 AM

Ron

I would add one more item to Petey's response- we are in the middle of a war. I know the classic response is "let's cut services." Okay, where? We are spending billions and billions on the Iraqi war alone, not including the budgets for Afghanistan or Homeland Defense- where do you think this money comes from? The war fairy? The choice isn't between cutting taxes and cutting spending, it's between borrow and spend (for those children to pay later) because we are in the middle of a War and have programs that are popular with the American people or tax and spend so that future generations aren't left with the burden. Leaving idealogy out of it- it's really as simple as this: either you want the present generation to pay as it goes now or you want the future generations to pay for you. So, please don't use 'the children' as an excuse when its 'the children' that you would be bilking.

Posted by: akaison | Aug 5, 2006 10:52:47 AM

Petey, don't pretend you know something about HSAs or healthcare. You listen to people who don't exactly know what they are talking about. Senator John Edwards said, "These Health Savings Accounts, they're nothing but write-offs for millionaires. We all know that."

That of course is a lie. HSAs are a tax write off for everyone. There is no payroll tax on employer HSA deposits. Every single parent mother working at Burger King is paying payroll tax on every dollar earned, matched by their employer. It's smart when single parent mothers and their employers band together and cut the greedy IRS out.

Maybe John Edwards thinks that all single parent mothers are millionaires. You have to admit Petey that John Edwards is just a bit confused. You better not let John Edwards prepare your taxes. He is not all that smart on taxation, sorry.

I must point out, there is no income tax on HSA deposits either, geesh. People are paying income tax before they are millionaires. Who would listen to you or John Edwards? Get real.

Posted by: Ron Greiner | Aug 5, 2006 11:01:09 AM

akaison, I say get the money from Senators Kennedy and Clinton. They are rich and they don't pay taxes on their health insurance unlike all Americans who don't have employer-based health insurance.

Why should uninsured Americans pay for Senator Clinton's health insurance? Why doesn't Hillary pay taxes on her health insurance? Hillary is a millionaire and most young hardworking American families, with small children, are not.

All Americans should get the same tax dodge as Hillary Clinton does with her free health insurance. The President says its a matter of fairness.

Posted by: Ron Greiner | Aug 5, 2006 11:09:00 AM

"People are paying income tax before they are millionaires."

If the estate tax repealers like you had their way, the children of your fish monger would become multi-millionaires without paying a single penny in taxes. And in exchange, non-millionaire Americans would pay higher taxes.

"Who would listen to you or John Edwards?"

You'd certainly better hope no one would. Because when the Democrats return to power and reform the healthcare system, HSA-peddlers like you will need to find a new line of work.

As a smart career move, you might want to consider dying before the 2008 elections.

One of the many reasons I like John Edwards is because I'm confident he'll defend us against folks like you.

Posted by: Petey | Aug 5, 2006 11:38:04 AM

...only 9% of the value would go to the government...

The amount is not the point. The point is why the government should get *any*? Class warfare and wealth trasnfer aint' pretty.

"Don't tax you, don't tax me, tax that man behind that tree!"

Posted by: Fred Jones | Aug 5, 2006 11:40:29 AM

Ron

I am not the Republican base. I say this for a reason. You are using symbolism, which even if what you askedfor were to changed exactly as you ask, would not substantively make a damn bit of difference with the spiraling cost of healthcare in this country. I, for one, am tired of this fake shit. You try to coopt the language of the working people in order to sound like you care, but your policies show that you don't. It's the absolute cost of health insurance, the economiies of scale, etc that matter. Your stuff sounds good- good roughed individualism type shit, but it ain't real. A few years from now, even if we did exactly as want, just like with Bush's medicare plan, the American people would be exactly as they are now left being even more cyclical and left in a lurch with their healthcare. Why don't we ask the tooth fairy to frollick in the fields- it has just as much impact.

Posted by: akaison | Aug 5, 2006 11:42:24 AM

there is already class warfare. this tax merely keeps it honest.

Posted by: akaison | Aug 5, 2006 11:48:00 AM

akaison, President Bush promised Rx in Medicare and he delivered. Before President Bush it was illegal for someone over the age of 65 to purchase Rx coverage in the United States, much like Cuba. So if an old person had MS and their medication was $20,000 a year, Medicare didn't cover the expense and neither would Medigap plans A - J, the only government regulated choices.

Now Liberals say that old sick people don't like the Medicare Rx insurance paying 95% of their costs over $3,600 a year. Nobody believes you akaison. Sick old people love the Medicare Rx insurance company paying their bills so they can buy food with their own money.

President Bush promised Rx coverage in Medicare and he delivered. Democrats tried for years and they couldn't do it.

Vote Republican because they can trick Democrats and get things done.

Posted by: Ron Greiner | Aug 5, 2006 12:17:53 PM

"The amount is not the point. The point is why the government should get *any*?"

Because we have a government that we finance through taxes.

Perhaps you're an extreme libertarian who's in favor of abolishing all government, but short of that kind of looniness, someone is going to get taxed.

Once you start operating in reality and think about how to design a sensible tax code, the argument for the estate tax becomes pretty compelling.

Posted by: Petey | Aug 5, 2006 12:18:18 PM

ron

you lost me when you said "liberals say." that's just conservativespeak for "i can't handle reality, so I am going to turn the facts into liberal ideaalogy." Sorry, but, this homey don't play that. I tell you what though- you keep spinning that shit- I am sure somewhere out there you will find someone still buying what you are selling. Hell, even Bush still gets 35 percent of the population, and there are stilll as many people who thinks Saddam had WMDs. So, for you, all hope is not lost. But, for me, your arguments are up there will believing in unicorns.

Posted by: akaison | Aug 5, 2006 12:25:36 PM

Petey, remember when John Kerrey wanted to throw in the towel and quit because President Bush had won the 2004 election and Senator Edwards wanted to keep fighting along with Kerrey's foul mouth daughters?

Remember how Senator Edwards used to tell the jury how the dead babies where talking through him? Come on Petey, you have to admit that sounds pretty goofy.

Trust me, there is no eligibility requirement that you must be a millionaire to make an HSA deposit and write it off like John Edwards said. Its Federal law and Edwards was just lying, sorry.

Posted by: Ron Greiner | Aug 5, 2006 12:25:56 PM

I'm just wondering if Ron Greiner's fish monger advertises his fish by spamming political blogs that are discussing unrelated issues.

Posted by: Neil the Ethical Werewolf | Aug 5, 2006 12:25:57 PM

OK akaison, before President Bush name an insurance plan, that was not from a previous employer, that would pay for old sick people's prescription drugs over $4,000 a year? Don't bother you can't.

Am I the only one that questions your Democratic talking points? 90% of 42 million seniors enrolled into President Bush's Rx plan so I guess that proves that you are wrong. You may not be a Democrat but you still use their goofy arguements.

You didn't answer the question: Why should millionaire Hillary Clinton not pay taxes on her health insurance and Americans without employer based health insurance pay taxes on their health insurance? If you have an answer akaison, email Hillary and the dlc.org right away. Those people are a little short on ideas. Tell Petey and John Edwards too. Edwards can work it into his 2 Americas stuff. Something like, One America, like millionaire Hillary Clinton doesn't pay taxes on her health insurance and the other America, the people without employer-based health insurance, do pay taxes on theirs. All Americans deserve the same tax dodge that I and Hillary use on health insurance. Like President Bush says, "It's a matter of fairness."

That sounds pretty good. What do you think Petey?

Posted by: Ron Greiner | Aug 5, 2006 12:43:35 PM

Sure Neil, Petey said HSA before me.

And akaison said Medicare Rx plan before me too.

Is that the only way you can fight Republican health care reform is call it spam? If you try Neil I'm sure you could come up with something just a little better.

So Petey, 27% of $5 million is over a million dollars in taxation. How can the 5 children of the fish monger pay the taxes without selling the business and firing all the employees? Do you really want all 15 families unemployed?

Have you thought this through Petey?


Posted by: Ron Greiner | Aug 5, 2006 12:55:46 PM

Is that the only way you can fight Republican health care reform is call it spam?

So let me see if I have this straight. You support a massive increase in government supported health care, but oppose raising taxes to pay for those programs? That should work out well.

Posted by: Col Bat Guano | Aug 5, 2006 1:09:09 PM

You don't have it straight Col Bat Guano. I don't support a massive increase in government supported healthcare. When the government buys health insurance they always get the insurance from politically connected employer-based insurance companies like Blue Cross. They are a giant monopoly who wish all Democratic politicians to pander to them, and they do. Blue Cross gives more money to Democratic Senator Debbi Stabenow than any other Senator.

I also support taking away any tax deduction for dangerous over-priced employer-based health insurance because it is not portable. President Bush said, "All Americans deserve portable health insurance that they can keep if they get fired, quit or retire." So I'm like President Bush who thinks the best option is the security of individual health insurance.

Democrats only support employer-based health insurance. Its just that simple.

Posted by: Ron Greiner | Aug 5, 2006 1:49:25 PM

The dirty little secret of the rich is that they can afford to pay a tax law firm a hefty retainer to find all the loopholes and set up all the structures so that a minimum amount of their wealth is actually subject to estate tax.

Unless you're talking about estate tax changes that remove ALL the loopholes, this is all window dressing.

Posted by: fiat lux | Aug 5, 2006 1:52:22 PM

"You support a massive increase in government supported health care, but oppose raising taxes to pay for those programs?"

I believe the call is to slash taxes, not just not raise them.

-----

It's odd. In the circles of the blogosphere I travel, I'm unaccustomed to encountering actual trolls. Guys like Al, Fred Jones, are Specialist are wrong on the merits IMHO, but I never picture them slobbering all over their keyboards as they type.

Posted by: Petey | Aug 5, 2006 1:55:06 PM

"The dirty little secret of the rich is that they can afford to pay a tax law firm a hefty retainer to find all the loopholes and set up all the structures so that a minimum amount of their wealth is actually subject to estate tax."

Untrue!

The estate tax is actually one of the most difficult taxes to evade. You can choose to "evade" it by giving your money away to charity, but if you want to transfer a vast fortune to your heirs (which is what the estate tax is actually trying to tax), enforcement is virtually unavoidable.

The super-rich can hire financial professionals to tinker with things on the margins. You can play some angles that push the tax day down the road a bit, for example. But the best financial professionals can't get you out of paying something very, very close to the tax rate established by law. And, of course, it's worth remembering that the super-rich hire financial professionals for most routine matters surrounding their fortune.

In short, effectiveness concerns about the estate tax are just not true.

(And FWIW, this line has been widely spread over the past 15 years by the propaganda/political efforts of 80 or so super-super-rich families headed by the estate of the Mars candy fortune to massively spend their way into getting Washington to kill the estate tax. Of course, the irony is that if the tax weren't so effective, the families wouldn't need to spend so much money trying to kill it.)

Posted by: Petey | Aug 5, 2006 2:10:23 PM

HSAs are a tax write off for everyone. There is no payroll tax on employer HSA deposits

HSA's -- and I have one -- allow me to buy $1.00 worth of future health care expenses for 83 cents.

I'm grateful -- but I'm not that grateful. And I'm fully ensured.

Posted by: Davis X. Machina | Aug 5, 2006 3:04:46 PM

Is estate tax repeal really about helping small businesses and family farmers?

Moreover, as with family farms, careful estate planning for most small businesses means that they can avoid most if not all estate taxes. There are special rules for small businesses that insure that the value of capital is assessed at use value instead of at market value, helping to reduce the assessment of equipment and other property. In fact, according to the IRS, of the 2.3 million people who died in 1998, only 780 left an estate with significant business assets. A Treasury Department analysis found that estates that included family businesses paid less than 1% of all estate taxes.

Posted by: Matt Weiner | Aug 5, 2006 3:24:52 PM

the reason why the estate tax is the most difficult to evade is that the structure of the loopholes in the system are designed (as I remember since its been years since I had to sit through my tax courses) to allow the individual tax payer to avoid tax liability before death. estate tax are a response to the ability of those with money to avoid tax liabilities by deferring the taxable income until after they die- estate taxes like a few others are designe, again as I remember, to avoid these manipulations. For the record, although I cant remember the details, the fact is our tax code is heavily waited toward passive income earners rather than middle to lower income earnings. In someways, such as cap gains, it makes perfect sense that this should be the caase- but the claim with any sincerity that the rich are being over taxed- well like I said before- you may as well ask me to believe in unicorns because it's only been a few years not several decades since I had to study this stuff, and system is clearly weighted toward the higher brackets in terms of the loopholes/

Posted by: akaison | Aug 5, 2006 3:32:49 PM

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