By James K. Galbraith in The Washington Post, September 25, 2008
Now that all five big investment banks -- Bear Stearns, Merrill Lynch, Lehman Brothers, Goldman Sachs and Morgan Stanley -- have disappeared or morphed into regular banks, a question arises.
Is this bailout still necessary?
The point of the bailout is to buy assets that are illiquid but not worthless. But regular banks hold assets like that all the time. They're called "loans."
With banks, runs occur only when depositors panic, because they fear the loan book is bad. Deposit insurance takes care of that. So why not eliminate the pointless $100,000 cap on federal deposit insurance and go take inventory?...
The current financial crisis is disproportionately affecting people of color. In our search for solutions, we must remember that deregulation led us to this crisis and that those who are traditionally the hardest-hit are people of color.
Our current financial crisis reeks with the smell of hypocrisy. We have traded the rights of people for the rights of profits, and continue to watch the house of our economy crumble, due to its rotten foundation of deregulation. As foreclosures continue to reach an all-time high and more than $290 million of housing wealth is lost in the next year; housing values are likely to fall another 15% during this period.
Read the full article on Movement Vision Lab.
Evaluating Candidates on Taxes
Whether at the state or federal level, candidates for public office are crafting proposals and taking positions on tax policy.
While tax policy can be used for a wide range of purposes, in our view one of its most important functions is addressing economic inequality.
Some candidates, but not all, share this value. But often it's difficult to see through the rhetoric and evaluate a candidate's position – especially on topics as complex as taxes.
That's why we created Action Tools for evaluating candidates on taxes. They contain short descriptions and definitions of key progressive principles and sample questions that you can ask as you research candidates' proposals and positions.
Tax Fairness Action News - Back Issues
Spring 2008 Issue (PDF): Unprecendented Victory in WA | Virginia Defeats Give-a-ways | Better Choice Budget in NY | Subsidizing the Rich | TFOC Members
Spring 2007 Issue (PDF): Tabor Takes Beating | Reframing "Budget Surpluses" | Success on State Estate Tax | Conference Reports | TFOC Members
There was electric excitement in Washington, DC, during the UFE co-sponsored Estate Tax Lobby Day, where participants inspired each other and advocated for their belief in a strong estate tax. One participant said, "Speaking with other thoughtful advocates made me feel both powerful and knowledgeable. It made me feel like an effective citizen." He and others intend to continue advocating for the estate tax.
On the first day, March 18, 2008 participants gathered for a talk featuring Bill Gates, Sr. and author Barbara Ehrenreich, moderated by UFE-founder Chuck Collins, who is currently a Senior Fellow at the Institute for Policy Studies (IPS). The talk, entitled Challenging the Second Gilded Age, was part of the Take Back America conference. The talk was followed by an in-depth training for people planning to meet with Congressional staff.
Early on March 19, 35 estate tax supporters assembled in the Dirksen Senate Office Building for more training. They were grouped into teams of 4-5 people, and each team held between 4 and 7 meetings with staff in the offices of Senators and Representatives to press for preserving and strengthening the estate tax. These teams were often composed of business owners, inheritors, young people and senior citizens, and included many UFE and Responsible Wealth members. They came from as far as Washington state and California, and included at least one Republican. In all, the teams visited 23 Senate and 18 Representatives' offices during the day.
After meeting with staff and talking about the future of the estate tax, most participants were inspired to continue similar advocacy. One participant noted that, "all day long, we heard from staffers of supportive legislators that they were very very happy to see us," because they rarely meet estate tax supporters.
Thanks to all who participated, including co-sponsors Fair Economy Action Fund and IPS, and to all who support our work to keep the estate tax!
Amy Goodman and Juan Gonzalez interviewed co-author Dedrick Muhammad. Broadcast on both radio and TV.
Racism and inequality are not relics of the past. Both historical and contemporary barriers to wealth creation among communities of color have resulted in a disproportionate wealth divide among people of color that exists today.
UFE’s Racial Wealth Divide (RWD) program seeks to deepen the public’s understanding about boundaries to economic parity among communities of color. It does this by providing resources that emphasize the importance of wealth and wealth-building strategies among communities struggling to attain greater economic equality.
The RWD program has become well known for its annual State of the Dream report, released each year in honor of Martin Luther King, Jr. Day. The report examines the state of racial inequality in America as it relates to contemporary political issues, such as foreclosure, the austerity agenda, and unemployment.
In addition to the State of the Dream report, the RWD program creates and shares resources around innovative strategies, public policies, communications work and grassroots organizing that fight against the growing racial economic divide. Our goal is to help educate and empower community leaders, activists, organizations, media, and the public at large. Through workshops, publications, primary research, policy initiatives, and community empowerment strategies, our goal is to help create a network of individuals and groups that will work together to abolish the racial wealth divide.
The estate tax is a tax on the transfer of assets at death (inherited wealth). It applies only to large accumulated fortunes.
When someone dies, his or her assets (the "estate") are distributed to heirs. If the total value of the estate is larger than the tax-exempt amount, an estate tax is imposed on the portion above the exemption before the remaining assets are distributed. Any amount given to a spouse or charity is tax exempt.
Since 2002, the estate tax has been paid only by millionaires. Rates have varied, since the Bush Tax Cuts of 2001 and 2003 resulted in frequent changes to the estate tax exemption and rate.
The individual estate tax exemption—the amount of money an individual can pass to heirs tax free—has been as low as $1 million in 2002 and as high as $5 million in 2011. The exemption is effectively doubled for married couples who engage in basic estate planning.
Rates on the amount above the tax-free exemption have varied from 55 percent to 35 percent. Below you can find a table listing the estate tax exemption and rate since 2002.
Who pays the estate tax?
The estate tax is reserved only for society's wealthiest elite. In 2009, just one-quarter of one percent (0.25 percent) of all estates were expected to owe any estate tax at all.
Very few family farms and small businesses are affected by the estate tax. The Congressional Budget Office estimates that with a $2 million exemption, only 123 farms per year in the U.S. would owe any estate tax, and the number of small businesses is similarly small. In 2001, the New York Times reported that American Farm Bureau Federation (who was in favor of repealing the estate tax) could not cite a single case of a family farm lost due to the estate tax.
On average, those few small business and farm estates will owe only 14 percent of the estate, so it is unlikely they will have to sell the business or farm. Plus, they can spread any payments over 14 years. They also benefit from special use valuation, and minority interests and marketability discounts.
Moreover, gutting the estate tax would actually hurt family farms. The estate tax helps make family farms more competitive against mega-scale agriculture, because it moderates ever-larger concentrations of wealth and economic clout. Repeal of the estate tax or exempting farms completely will only encourage further concentration of farm ownership, which reduces competition. An unlimited exemption for farm assets could create a giant loophole from the estate tax because wealthy individuals who expect to owe estate tax could use much or all of their wealth to buy farms before they died.
The estate tax raises billions of dollars each year. The estate tax, at 2002-2009 rates and exemptions, raised $15-26 billion per year. The variations are due to the changes in exemption and rates caused by the Bush tax cuts, as well as fluctuations in the overall economy that affect the value of assets like stocks and real estate. The table below summarizes estate tax revenue since 2002, using IRS data and an estimate by the Tax Policy Center.Why is it important to preserve a strong estate tax?
Weakening the estate tax would mean billions of dollars in tax breaks each year for the exclusive benefit of multi-millionaires. The responsibility of paying taxes for public services will shift from millionaires to low- and middle-income taxpayers. A strong estate tax is one of the best remedies for economic inequality because it reduces dynastic wealth and helps ensure more broadly shared prosperity.
A strong estate tax law will have a graduated rate structure that taxes very large fortunes at a higher rate and an exemption that results in 98 percent of Americans paying no estate tax. A strong estate tax would raise substantial revenue for our government.
UFE is one of the few national organizations that trains and supports organizers, educators, activists, and others, to lead interactive presentations on economic inequality. There are several hundred TOT Institute graduates nationwide who use UFE’s Popular Economics Education methods and/or materials in their justice work. We hold these intensive Training of Trainer Institutes several times a year.
Who Should Attend?
The Training of Trainers Institute serves activists, educators, organizers, clergy and laypersons working on issues of economic or social justice. We also accepts applications from trainers seeking to improve their teaching skills and become more comfortable presenting economic information.
The Institute's Curriculum
The Institute will include:
- Key economic trends, viewed through class, race, and gender lenses;
- How rules and policies have contributed to the growing economic divide;
- A brief history of US popular resistance to economic inequality;
- Strategies for building a movement for economic equity;
- Selected principles and practices of popular education;
- Practice leading participatory activities about economic inequality; and
- Learning from others and buiilding community among people working for economic justice.
Mini Training of Trainers: UFE offers shorter versions of the full four-day Institute. Similar material is covered in an abbreviated version. To request a Mini-TOT, email firstname.lastname@example.org
Full TOT Institute: Each four-day TOT Institute consists of work sessions in the mornings, afternoons, and evenings, with breaks during the day to allow participants to take advantage of recreational attractions available at the conference sites.
Each Institute features presentations of UFE's workshops; a review of key principles and practices of popular education; time for small teams to plan, practice, and get feedback on activities from the Growing Divide workshop or curricula that participants bring to the Institute; sessions on responding to challenging questions and difficult situations; and an exploration of education in the context of organizing, mobilizing, and movement building.
It is necessary to attend the full TOT Institute in order to get the maximum benefit of the training. Materials, including a workshop Trainer's Manual and handouts, a detailed agenda for the Institute, background and reference materials, and short readings are included in the Institute fee. Additional logistic and background information will be sent to all registrants prior to the training to help participants prepare. To request a Training of Trainers Institute, email email@example.com.
Sliding Fee Scale: $500 - $1,500 (based on what you or your organization can afford). This fee includes meals, accommodations, and training materials. Transportation is NOT included in the fee.
A minimum $25 non-refundable deposit is required at the time of application. Payment in full is due one week before the start of the Institute.
We have limited funds available for scholarships to help offset a portion of the Institute's cost. These are available for participants representing community and grassroots organizations with limited financial resources. Applicants will have the opportunity to request aid after submitting the registration application.
We welcome contributions and sponsorships from well-funded organizations and individuals to help facilitate the participation of less well-funded groups. Gifts are tax deductible. Please click here to contribute!
For More Information
Contact us at firstname.lastname@example.org.