The sellout of a tax deal has been signed into law. Despite all our best efforts, all the efforts of thousands of groups, hundreds of thousands of individuals, and a few stand-up politicians, we appear helpless to resist the onslaught of the “starve the beast” strategy (except for war, policing & corporate giveaways).
The utter failure of the Obama Administration to stand up to the rightwing assault on lower and middle-income workers, families, and communities has left many angry and feeling powerless.
It is truly dispiriting.
I believe, however, that there is a silver lining. For the first time in a long time, there appears to be a groundswell of recognition that what has happened is in large part due to the lack of a progressive social movement to counterbalance the power of the oligarchy and its Tea Party ground troops. Union leaders, community-based organizing coalitions, progressive beltway think tanks, and many others who have traditionally put most of their strategic eggs in the basket of support for the liberal wing of the Democratic Party, are calling for strategies that will build an independent movement.
And many voices have been raising the need for a unifying, values-based narrative to counter the ultra-conservative blame the victim, blame big government, blame unions, blame Muslims, blame immigrants story amplified by Fox News and mainstream media echo chamber.
More and more progressives are recognizing the importance of organizing, not just mobilizing, and perhaps most important of all, the need for unity across issues and constituencies. As George Lakoff explained:
“Those of us outside of government have to organize that unified movement, and not be limited by specific issue areas. The movement is about progressivism, not just about environmentalism, or social justice, or labor, or education, or health, or peace. The general principles govern them all.”
There is an opportunity here to put aside our notions of turf and any “we’ve got the key facts or the correct analysis or the pipeline to people in power” mentalities. We may need to let go of our egos and keep our eyes on the prize and get some agreement about those general principles.
To my colleagues:
I am proud to be part of the extraordinary work you do day in and day out, and am amazed at how, even with our resource constraints, you still manage to ramp up the intensity when needed. We are suffering defeats but our efforts are not for naught.
Seeds may stay dormant for years before springing to life. I am grateful for the work you do in the garden.
The $900 billion tax bill that was passed by Congress this week provides massive tax breaks for the wealthy. These tax breaks will not create jobs or improve the economy. They add to the deficit and will worsen economic inequality in the United States.
The worst part of the bill is the gutting of the estate tax, which only affects multi-million dollar estates, to its weakest form in 80 years.
Progressive organizations and progressive representatives in the House fought long and hard to establish a stronger estate tax. The sole positive aspect of the estate tax provision is that the cut lasts for only two years.
It’s clear the estate tax will continue to be at the center of future battles for tax justice.
Senate Republicans held relief for unemployed Americans hostage in the middle of the worst employment crisis in decades. Tax breaks for the wealthy were the ransom they demanded.
This bill makes clear the hypocrisy of deficit hawks in both parties. Now that it has been passed, the same deficit hypocrites are already saying their next goal is to shrink public spending on programs that benefit the working and middle classes.
President Obama says that he wants these tax cuts for the wealthy to be temporary. UFE will fight to make sure they are.
The President also says that he plans to focus on overall tax reform. UFE will fight for a stronger estate tax, for taxes that ensure the wealthy pay their fair share, and for taxes that reduce economic inequality.
We face several important choices between now and 2012. Our country will have to seriously consider this question: Do we want an economy that works for everyone, or one that excessively rewards the wealthy?
In the coming years, we at UFE will redouble our efforts to build a movement for tax fairness and a more just and inclusive economy.
Twenty states gathered in Atlanta, Georgia on December 5th and 6th, 2010 for the annual TFOC Conference. Below are links to presentations and notes from the conference.
- Participatory Media (PDF)
- Working with Ethnic Media - CrossRoadsNews (Doc)
- Stories from the Front Lines - New York (PDF)
- Stories from the Front Lines - Colorado (PDF)
- Stories from the Front Lines - Washington (PDF)
- Stories from the Front Lines - Virginia (PDF)
- Demos - Talking about Taxes in Tea Party Times (PDF)
- Demos - updated compendium on page 10 (PDF)
The House leadership heard our message loud and clear! But, we still have work to do. TODAY, the House will hold a vote on an amendment to the tax package for a stronger estate tax at the 2009 level.
Our best hope for a stronger estate tax is passing this amendment in the House. Let your representative know what you want right now!
MAKE THREE CALLS using our toll-free number to the Congressional switchboard at 800-830-5738:
If the House fixes the bill to include a stronger estate tax, there’s still time for the Senate to pass the bill.
While we at UFE do not consider the 2009 estate tax to be ideal – with a $3.5 million exemption per spouse and a 45% rate on amounts above that – it is far better than the estate tax in the Senate bill ($5 million exemption per spouse and 35% rate).
Please forward a link to this alert to friends, family and colleagues. Call and urge them to take action. And, help spread the word further by blogging about this important issue, and sharing this alert on your social networks.
Here are a few news updates on this debate that may be helpful in getting you up-to-speed:
- This is a great estate tax editorial by USA Today. We hope this helps to inspire you and others in your network to take action.
- On December 15, the Senate passed, with an 81-19 vote, the Obama-GOP tax deal with a severely weakened estate tax and extension of the Bush tax cuts for the wealthy. See how your Senators voted here.
- Unfortunately, the Sanders amendment to fix the whole bill by ending the Bush tax cuts for the wealthy, setting the estate tax at the 2009 level, and replacing the payroll tax holiday with a one-year extension of the Make Work Pay Credit, failed 43-57.
The House Democrats and the Congressional Black Caucus are wise in their righteous opposition of the shameful tax compromise put forth by the Republican Caucus and the Obama Administration. Their message is clear: there will be no deal until significant improvements are made to the package. We must encourage them to hold the line on that demand.
The most inexcusable part of the Obama-GOP package is the dramatic slashing of the federal estate tax even further beyond the already weakened 2009 law. Although the estate tax impacts less than 0.25% of all estates – the wealthiest of the wealthy – it has profound implications for all Americans and communities of color in particular. By curbing the transfer of unlimited wealth from generation to generation, the estate tax is an important tool for ensuring that the inequalities of generations past, including those drawn along the lines of race, do not forever haunt our nation.
For much of U.S. history, white Americans have had greater opportunities to build wealth, often with the help of the federal government programs such as the Homestead Act and the GI Bill. African-Americans were largely denied these opportunities as the weight of overt racism, Jim Crow, bank redlining, and more prevented African-Americans from closing the gap with their white counterparts. Though many of these unjust structures and policies are now gone, the inequalities they created continue to this day thanks to the power of inheritance.
Currently, African-Americans earn 62 cents and Latinos earn 68 cents for every dollar of white income. Troubling as these numbers are, the wealth disparities are even more unsettling. African-Americans have only 10 cents and Latinos have only 12 cents of net wealth for every dollar of white net wealth. To see these appalling disparities, is to see generations of injustice carried forward as wealth, mostly in white hands, is transferred from one generation to the next.
This intergenerational transfer of wealth takes place over many years, including help in buying a first car, paying for college, or subsidizing the down payment on a first home. The apex of this transfer though is at the time of death, when the remainder of the parent’s wealth is usually transferred to the children or grandchildren.
Because the estate tax acts as a check to the concentration of wealth at the very top, it helps to even the economic playing field for each generation to follow. That is precisely why it is of critical importance not only to communities of color, but also to working class white communities
Obama’s decision to concede so much ground to Republicans on this issue is simply baffling. Further weakening of the estate tax is unacceptable. We should instead be finding ways to significantly strengthen it. It’s also clear that buckling on the estate tax, and the tax cuts for the wealthy more broadly, would be dangerous move for Democrats. Congressional Republicans will leverage the deficits created by this tax giveaway to millionaires and billionaires for massive cuts in social services and other public structures, on which all Americans depend.
In the days ahead, we must rally behind the House Democrats and the Congressional Black Caucus. Encourage them to stand strong and not back off their demands in those crucial negotiations. In the words of Frederick Douglas, "Power concedes nothing without a demand. It never did and it never will."
The Senate has enough votes to pass the weak Lincoln/Kyl estate tax as part of the overall Obama-GOP tax package. Our best hope for a stronger estate tax is in the House of Representatives. House leaders are developing their strategy now.
Let your representative and the House leadership know what you want.
MAKE THREE CALLS using our toll-free number to the Congressional switchboard at 800-830-5738:
- Call House Speaker Nancy Pelosi and urge her to organize a vote on amending the tax package to include a stronger estate tax at the 2009 level or better.
- Call House Majority Leader Steny Hoyer and demand the same of him.
- Call your own Representative and urge him/her to ask Speaker Pelosi and Rep. Hoyer to hold a vote on amending the tax package to include a stronger estate tax at the 2009 level or better.
Let’s flood their phones with calls! If the House fixes the bill to include a stronger estate tax, there’s still time for the Senate to pass the bill. (And if the switchboard is busy, here’s the direct line for Rep. Nancy Pelosi: 202-225-0100; for Rep. Steny Hoyer: 202-225-3130.)
Learn more about the federal estate tax. Also see UFE’s recent press releases and E-News stories on the estate tax.
Forward a link to this alert to friends, family and colleagues. Call and urge them to take action. And, help spread the word further by blogging about this important issue, and sharing this alert on your social networks.
Thanks for doing your part in the fight for tax justice!
Here are some encouraging quotes we've seen in the news over the past few days:
"[The estate tax cut] is rightly seen by the overwhelming majority of the Democratic caucus as egregious and unnecessary...Are Republicans really willing to hold up tax relief for millions of middle class Americans and others in order to provide a $25 billion hit to the deficit that benefits 6,600 estates at an average benefit of $1.8 million?”
- Rep. Chris Van Hollen (D-MD)
“Ninety-nine point seven percent of American families will not pay one nickel in an estate tax...This is not a tax on the rich. This is a tax on the very, very, very rich.”
- Rep. Bernie Sanders (I-VT)
"The people at the very, very top have made enormous gains...Now we're saying, you've ridden this huge wave of economic inequality and now we're going to let you pass even more of your wealth to your heirs without paying any taxes."
- Leonard E. Burman, tax policy expert at Syracuse University,
on the decades of wage stagnation for lower- and middle-income Americans.
Somewhere into the seventh hour of his actual, old-fashioned, stand-up-and-talk-and-don't-yield-the-floor filibuster of the lousy Obama - GOP tax deal, Bernie Sanders made a passionate plea to supporters to let their Senators and Representative know that this is a bad deal. He is urging everybody to call Congress to tell them that we don't need more tax cuts for the wealthy. So are we! Do what Bernie says. Call now. Call often.
Earlier this week, President Obama struck a deal with elitist Congressional Republicans, a deal that he claims is "doing what's right for the American people, for jobs and for economic growth."
The reality is that the deal does more for Paris Hilton than it does the 100,000 people who work at Hilton hotels.
The Obama-GOP plan sucks because it doesn’t do anything to close the wealth divide that has been growing steadily for decades. Closing this gap by allowing the Bush tax cuts to expire and restoring the estate tax was a top priority for progressives during the 2008 election. We expected bold, decisive action. Needless to say, we're a little pissed off.
Compromise usually means that both sides give up a little something to reach an agreement that we can all live with. The problem is, all the Republicans wanted out of a deal with Obama was to preserve tax cuts for the wealthy. And they got it.
Of course, not everything in the deal sucks. Extension of the Bush tax cuts for the middle class is good, as well as the tax credits. And there’s little question that reprieve was essential for the millions of out-of-work Americans. But to settle for a deal that provides a huge tax break for millionaires and billionaires is wildly irresponsible and undeniably unfair. Not to mention sucky.
The deal sucks. And – in plain English – here’s why:
1. It holds unemployed Americans hostage.
It sounds like a nightmare: either watch unemployment benefits for out of work Americans expire or let Wall Street fat cats walk away -- scot-free -- from paying their fair share of taxes. This plan sucks because it wrongly turns this compromise into a black/white, either/or decision. It draws a line in the sand, attempting to divide the left at a time when we should be pulling together.
Besides, I thought we weren’t supposed to negotiate with hostage-takers?
2. It increases economic inequality.
It’s a frightening reality: the top one percent of Americans own as much wealth as those in the bottom 90 percent (to be clear, by “top” and “bottom” we’re only talking net worth). If you think it’s completely unacceptable that billionaire Warren Buffet’s secretary pays more in taxes a higher tax rate than the man himself (as he famously pointed out), know that this plan will do nothing to change that. And that sucks.
The wealthy in this country are doing fine. Why aren’t they being asked to make sacrifices like the rest of us?
3. It values whack economic principles.
The number one economic justification for tax breaks for the rich is that they will somehow trickle down these savings into jobs to provide economic stimulus. Yet, history tells us that this simply isn’t true. If tax breaks for the rich resulted in job creation, we wouldn’t be in the mess we’re in a decade after the Bush tax cuts. History tells us that tax breaks for the rich sit idle in their bank accounts.
Consider a very sophisticated and economically nuanced piece of economic insight: people need money to buy stuff. If we want to stimulate the economy, we need to be looking at how we can put regular people back to work. That seems to be the most surefire plan for economic stimulus out there.
4. It’s more of the same.
Extending Bush tax cuts for the wealthy and weakening the estate tax is bad policy, bad economics, and bad for our country. During challenging times, we should be investing in our people, our education, and our national infrastructure. Instead, we are prioritizing the bank accounts of millionaires and billionaires.
This tax deal does nothing to move us forward and simply provides more of the same, setting us up for a painful bout of economic déjà vu in a year or so.
5. It disrespects the will of the people.
Obama may chide us for being progressive “purists”, but I prefer to think of those who are skeptical of this plan as progressive patriots. It is our job to hold our elected officials accountable. Polling shows that the majority of Americans believe that tax breaks for the super-wealthy should be allowed to expire. After all, low- and middle-income Americans have tightened their belts, why aren’t we asking the same of millionaires and billionaires?
This deal sucks. It sucks real bad. It’s time we rise up, make lots of noise, and hold our elected officials accountable. We must call on our elected officials and tell them that the deal sucks, and we expect more. Whose back do they have, anyway?
President Obama is still pushing his tax cut deal with the GOP. The Senate has already taken up debate. They even added some "sweeteners" to coax votes out of some reluctant Democrats. What they don't realize is that things like "the continuation of a federal tax break for mass transit users, an ethanol tax credit and a grant program for renewable energy developers" are not what is needed to make this a sweet deal. The problem with this deal is demonstrated clearly in this chart (via Ezra Klein.
The deal that Administration officials negotiated gives an bigger tax break to millionaires and the richest taxpayers than even the original Republican proposal. That is why we are opposed to the deal and why Democrats in the House are right to not bring it to a vote as is. It isn't because it lacks dubious sweeteners like more ethanol subsidies. It will be a bad deal until the giveaway to the rich – who least need a tax break – is scaled back.
House Speaker Nancy Pelosi explained in a press release:
“In the Caucus today, House Democrats supported a resolution to reject the Senate Republican tax provisions as currently written. We will continue discussions with the President and our Democratic and Republican colleagues in the days ahead to improve the proposal before it comes to the House floor for a vote."
The worst part of the so-called compromise is the estate tax provision. The estate tax is levied on less than one percent of America's wealthiest estates. It reduces extreme dynastic transfers of wealth and the accompanying concentration of power, which undermines our democracy.
Under the deal in question, the estate tax would be reduced to its weakest form since 1931. Any deal with such a gutted version of the estate tax is unacceptable. UFE has spent over a decade fighting to preserve and strengthen the estate tax as a means to reduce the persistent and growing disease of inequality that ails our nation. We applaud Speaker Pelosi and the House Democrats for standing up against this giveaway to the wealthy.