Care about inequality?
Do you think a tax change that would provide $269 billion to estates of millionaires and billionaires over the next decade would worsen or lessen inequality?
Next week, the House of Representatives will vote on a bill (H.R. 1105) to repeal the estate tax, to give $269 billion to the 2 out of 1,000 estates (worth no less than $5 million) subject to the tax. House leaders are doing it during the week of April 15, because they are confident that most Americans do not know that the estate tax is targeted to multi-millionaires on up. Many people think the estate tax is paid by at least 20 percent of all estates. The House leadership will almost certainly continue to blow smoke about this, claiming that small businesses and family farms pay the tax.
But here’s the Head Smacker about this: if you believe it, you’re being had!
Fact: only 20 small business and small family farm estates owed any estate tax in 2013. (Not 20 percent – only 20 businesses and farms.)
Fact: The revenue lost by estate tax repeal could fund the President’s proposal to provide pre-k for all low- and moderate-income four year olds ($75 billion over ten years), expand child care assistance ($82 billion), increase the Earned Income Tax Credit for workers without children ($60 billion), and continue the home visiting program for infants ($10 billion), with $42 billion left over. These are all examples of policies with demonstrated effectiveness in reducing poverty and increasing opportunity.
The House leadership is choosing to enrich super-rich heirs, and has opposed many of these proposals. Even when welcome interest has been expressed in a proposal like expanding the EITC for workers without children, House leaders like House Ways and Means Chair Paul Ryan (R-WI) have suggested paying for it by cutting other low-income programs.
The Coalition on Human Needs is joining with other national organizations to speak the truth about this inequality-increasing choice. We’ve signed a letter to the House, and if you represent a national organization, you can too, by COB April 13. The text of the letter is here. To sign it, click here.
Among other things, the letter says: “The estate tax exists to provide a meaningful check on the growing concentration of wealth, while generating revenue from those most able to pay and encouraging charitable giving. America is rapidly becoming divided between the extremely rich and everyone else. The top 1% owns about 42% of the nation’s total wealth, nearly double the 23% owned by the bottom 90%. The estate tax is a small step to level the playing field and create an economy that works for all.”
Advocates like you and me, public officials, and the press should do everything they can to tell the truth and challenge the smoke-blowers.
Do facts matter? Actually, yes.
A recent public opinion survey by the Washington Center for Equitable Growth asked people whether they supported increasing the estate tax. Without being given any background about our growing income gap or about who pays the estate tax, only 17% wanted to increase the estate tax. After getting this background, 53% supported raising the estate tax. Earlier surveys in 2007 and 2008 found that facts about who pays the estate tax plus arguments for and against the tax substantially increased support for it.
Nearly 8 in 10 people in a recent Pew survey said were “bothered by the feeling that some wealthy people (are) failing to pay their fair share” in taxes; 61 percent were “bothered a lot.” Well – want to make it worse? Repeal the estate tax.