Small Business Owners and Entrepreneurs Speak Out
For A Strong Estate Tax;
Call the Tax Fair, Manageable and Rare
Featuring Three Business Owners
- Two small business owners who represent the vast majority of farms and businesses that would owe no estate tax should it return to 2009 levels (a farm service provider from Arkansas and a microbrewer from Washington state), and;
- A Silicon Valley entrepreneur and an Oregon real estate developer who represent the mere 1.8% of all estates that would expect to pay estate tax at 2009 levels that are small businesses or farms.
Jean Gordon, Little Rock, AR
Co-owner of Frostyaire of Arkansas, agricultural freezing and cold storage company.
Jerry Fiddler, San Francisco, CA
Principal of Zygote Ventures, venture capital firm, and Founder of Wind River Systems, tech company.
Dave Eiffert, Snoqualmie, WA
Co-founder and Co-owner of Snoqualmie Falls Brewery, craft brewery and tap room.
John Russell, Portland, OR
Owner of Russell Development Company, real estate development.
- Lee Farris, Senior Organizer on Estate Tax Policy at United for a Fair Economy.
- Mike Lapham, Director of Responsible Wealth, a project of UFE.
- If you are a member of the press, and would like to participate in this teleconference, please see contacts above for access information.
- If you are a blogger with a focus on tax and economic policy, and would like to participate in this teleconference, please contact Maz Ali at 617-423-2148 x101 or [email protected]
FOR IMMEDIATE RELEASE: July 21, 2010
Rubin and Other National Figures Join United for a Fair Economy in Calling on
Congress to Move Quickly to Restore a Permanent, Robust Estate Tax
Former Treasury Secretary Robert Rubin, Hedge Fund Pioneer Julian Robertson, Philanthropist Abigail Disney and AFL-CIO President Richard Trumka Argue for Progressive Tax in National Teleconference
Boston, MA – With 12 legislative days remaining before the August recess, United for a Fair Economy (UFE) is calling on Congress to prioritize reinstating the estate tax, currently the most progressive tax in the code and the only national tax on wealth. On Wednesday, July 21, four powerful and expert voices joined UFE and its Responsible Wealth network (RW) in a teleconference urging Congress to immediately restore a robust and permanent estate tax.
Among participants on the call was Robert Rubin, the former Secretary of the Treasury who is widely credited with overseeing the Clinton era economic boom. “Our country is on an unsustainable fiscal path. A progressive estate tax can provide needed revenue with no adverse supply-side economic effect, and that revenue can then fund deficit reduction, additional public investment, or added assistance to those affected by the economic crisis,” stated Rubin. Moreover, he added, “our nation has always held itself out as a meritocracy and a land of opportunity, and an estate tax helps avoid accumulation of inherited economic and political power that is antithetical to this historical vision of our society.”
In her prepared remarks, Abigail Disney, the grandniece of the legendary Walt Disney, explained that her family amassed its fortune “not in spite of, but because of the American system of taxation.” Disney continued, “After all, without reliable and safe roads there’d have been no Disneyland; without high functioning legal systems and a well regulated business environment there would have been no copyright protection for Mickey Mouse.”
Mike Lapham, director of UFE’s Responsible Wealth Project, which brings together high net worth individuals who advocate for an end to tax breaks for wealthy Americans like themselves, stated, “Members of Responsible Wealth recognize that our good fortune comes from some combination of skill, luck, and public investments, and we have a unique ability and responsibility to give something back.
Lee Farris, UFE’s Estate Tax Policy Coordinator, added, "Hardworking families who live paycheck to paycheck pay their fair share of taxes, and so should the heirs of millionaires. If Congress chooses to shrink the estate tax, the middle class will face higher taxes or cuts in vital services like unemployment benefits or education. We don’t need to weaken the estate tax – we need to strengthen it.”
Julian Robertson, a hedge fund pioneer who made his fortune on Wall Street beginning in the 1980’s, was also on the call and said: “America desperately needs to bring its budget more in line. Any move in that direction is favorable. It seems to me that the least deserving recipients of wealth are inheritors. Further, there are many indications that inheritors often have trouble adjusting to their unearned inheritance. An inheritance tax would de facto help remedy this.”
“Our economy remains on the edge of a double-dip recession, and we urgently need to create millions of jobs and invest in our future, not give more tax breaks to the wealthy,” said Richard Trumka, President of the AFL-CIO. “Anyone who pretends to care about cutting deficits while opposing the restoration of the estate tax is clearly residing on a different planet.
UFE is calling on Congress to move quickly on the estate tax as part of a larger tax package addressing the Bush tax cuts. All the participants in today’s UFE teleconference believe that a proposal, recently reintroduced by Senators Jon Kyl and Blanche Lincoln, to further weaken the estate tax is the wrong way to go, and agree the estate tax should be re-established at its 2009 level or stronger.
While participants on the call have varying views of what form a reinstated estate tax should take, UFE supports such progressive proposals as: the bill offered by Senators Sanders, Harkin, and Whitehouse (S.3533) with a $3.5 million exemption per spouse, 45-55% rate, and a 65% rate on amounts over $1 billion; and a House bill from Rep. Jim McDermott (HR 2023) with a $2 million exemption per spouse and a 45-55% rate.
The federal estate tax, established in 1916, has been temporarily suspended for one year at the beginning of 2010 as a result of Bush era tax policies and Congress’s failure to act in 2009. If Congress fails to pass new legislation, the estate tax reverts in 2011 to a $1 million exemption per spouse and rates from 41-55%.
To date, UFE and Responsible Wealth have gathered over 5,000 signers on their Call to Preserve the Estate Tax, including over 2,000 individuals whose families have paid or who expect to pay the estate tax themselves. UFE will continue this effort in the weeks and months ahead and invites voters across the country to visit http://http://www.faireconomy.org/estatetax to sign the call for a strong estate tax and get the latest information on UFE’s efforts.
United for a Fair Economy (UFE) is a national non-profit organization based in Boston, which raises awareness about the dangers of extreme economic inequality and works to foster a more broadly shared prosperity. Responsible Wealth, a project of UFE, is a network of business leaders, investors and inheritors in the top 5 percent of wealth and/or income in the US who use their surprising voice to advocate for progressive state and federal taxes and greater corporate accountability. More at www.FairEconomy.org.
EVENT ADVISORY: MEDIA TELECONFERENCE, WEDNESDAY, JULY 21 at 11 A.M. EDT.
Robert Rubin, Richard Trumka, Abigail Disney and Hedge Fund Pioneer Julian Robertson Ask Congress to Reinstate Estate Tax Before August Recess; Cite Urgent Need to Balance Federal Budget and Restore Prosperity
United for a Fair Economy Hosts a Press Conference Call Featuring Four Powerful Voices on the Estate Tax on Wednesday, July 21, 2010 at 11:00 A.M. Eastern.
Boston, MA – Former Treasury Secretary Robert Rubin, President of the AFL-CIO Richard Trumka, heiress and philanthropist Abigail Disney and Tiger Management founder Julian Robertson are asking Congress to move quickly to reinstate and strengthen the federal estate tax. The tax was weakened and then suspended entirely in 2010 as part of the Bush tax cuts of 2001. These three high wealth individuals with economic expertise will join a national labor leader and representatives from United for a Fair Economy (UFE), which has been fighting to preserve the estate tax since 1999, in a press teleconference on Wednesday, July 21 to discuss their reasons for supporting a permanent and robust estate tax. Participants will make opening remarks and take press questions regarding estate tax policy, including legislative proposals from Senator Kyl, Senator Sanders and Representative McDermott.
In 2001, President George W. Bush put forward a proposal to completely repeal the estate tax, but members of UFE’s Responsible Wealth network, a nonpartisan group of wealthy individuals, helped block several efforts at repeal by publicly signing on to Responsible Wealth’s Call to Preserve the Estate Tax. The estate tax debate now centers on what exemption level and rate will be in place when the tax returns in 2011. To date, over 2,500 high net worth Americans have signed the Call, including Bill Gates, Sr., George Soros, Ted Turner, Vanguard founder John C. Bogle and Richard Rockefeller.
WHAT: Estate Tax Teleconference
- Robert Rubin, U.S. Treasury Secretary 1995-99 under President Clinton, formerly at Goldman Sachs and Citigroup, currently at the Council on Foreign Relations;
- Richard Trumka, President of the AFL-CIO;
- Abigail Disney, grandniece of Walt Disney, Founder and President of the Daphne Foundation in New York City, Vice Chair of Shamrock Holdings board;
- Julian Robertson, founder of Tiger Management hedge funds, now a private investor, philanthropist, founder of Robertson Foundation;
- Lee Farris, Estate Tax Policy Coordinator at United for a Fair Economy;
- Mike Lapham, United for a Fair Economy’s Responsible Wealth Program Director.
WHEN: Wednesday, July 21, 2010, 11: 00 AM EDT.
WHERE: Dial in number: 800-895-1549; Conference ID: 7TAX
An MP3 audio file of the teleconference will be available at http://http://www.faireconomy.org following the call.
United for a Fair Economy is a national, independent, nonpartisan, 501(c) (3) non-profit organization located in Boston, MA, which advocates for progressive economic and tax policies. Responsible Wealth, a project of United for a Fair Economy, is a network of business leaders, investors and inheritors in the top 5% of wealth and/or income in the US, who use their surprising voice to advocate for more broadly shared prosperity, including progressive state and federal taxes and greater corporate accountability. More at http://http://www.faireconomy.org.
For Immediate Release: June 24, 2010
Contact: Lee Farris, 617-423-2148 x133
UFE Cheers New Responsible Estate Tax Act as Chance to Ensure Broadly-Shared Prosperity in Economic Recovery
Boston, MA – United for a Fair Economy (UFE), which has worked since 2000 to preserve a strong estate tax, announced their support today for the new Sanders-Harkin-Whitehouse Responsible Estate Tax Act. “This is the kind of common sense solution that balances the desire to protect small businesses and farms, while ensuring that the super-wealthy give back to support the country that made their prosperity possible,” states Lee Farris, UFE’s estate tax policy coordinator.
Additionally, the Responsible Wealth network, a project of UFE that brings together high-wealth individuals as a voice for progressive taxes, is also supporting the bill. To date, UFE and Responsible Wealth have gathered over 2,000 signatures on their Call to Preserve the Estate Tax from the very individuals who would be subject to the estate tax, or whose families have paid the estate tax.
In late 2009, UFE held a press conference with three of those Call signers, Bill Gates, Sr., Vanguard co-founder John Bogle, and Richard Rockefeller, urging Congress to enact a robust estate tax before it expired temporarily in 2010. While Congress failed to enact the one-year patch, there is still time to fix the estate tax for the remainder of 2010.
After years of wrangling, a permanent solution to the estate tax debate may finally be taking shape. This morning, US Senators Bernie Sanders (I-VT), Tom Harkin (D-IA) and Sheldon Whitehouse (D-RI) put forward a new proposal – the Responsible Estate Tax Act – that will permanently fix the estate tax by combining the generous 2009 exemption levels with progressive rates for larger estates, including a new billionaires surtax.
“If we are going to get out of this recession, we need to reject the failed trickle-down policies of the Bush years. It’s time to restore the progressive tax system that made our country strong, beginning with a robust estate tax,” Farris adds. “The Sanders-Harkin-Whitehouse Responsible Estate Tax Act is an important step on the road to an economic recovery that benefits all Americans.”
“In the weeks ahead, United for a Fair Economy and Responsible Wealth will mobilize our thousands of members to support this legislation and seek co-sponsors for this bill,” adds Farris. Supporters of a strong estate tax can sign UFE’s Call to Preserve the Estate Tax at http://www.faireconomy.org/call_to_preserve_the_estate_tax.
New Report: States Without Income Taxes Hike Residents' Federal Tax Bills by Billions a Year
Contact: Mazher Ali, 617-423-2148 x101, [email protected]
Boston, MA, April 12, 2010 – States that rely heavily on sales taxes instead of levying a personal income tax are imposing billions of dollars in extra federal income taxes annually on their residents, according to a new report from the Institute on Taxation and Economic Policy (ITEP) and United for a Fair Economy's Tax Fairness Organizing Collaborative (TFOC).
The new report, Leaving Money on the Table, calls attention to the important, but often overlooked, linkage between state and federal tax systems. In particular, the report examines the federal deduction taxpayers may take for state and local taxes they paid, and analyzes the impact of this deduction on the combined federal taxes paid by all state residents.
The report shows that in the seven states that do not levy an income tax but do rely substantially on state sales taxes (Florida, Nevada, South Dakota, Tennessee, Texas, Washington and Wyoming), state residents pay considerably more federal income taxes as a result:
If these seven states enacted even a minimal, flat-rate income tax and used the revenues to reduce sales taxes dollar for dollar, the federal taxes paid by residents of these seven states would drop by a combined $1.7 billion a year.
If these states enacted a progressive personal income tax similar to what many other states now levy, federal taxes paid by residents of these states would drop by up to a combined $5.5 billion a year.
"How states choose to raise money has a big impact on the amount of federal tax dollars that can be returned to their residents each year," said Karen Kraut, Director of the TFOC. "Substituting an income tax for a sales tax would keep the total revenue raised by the states the same, but would substantially reduce the federal tax bills of the residents of these states. That's because the sales tax deduction offers a small benefit and the low- and middle-income people for whom sales taxes are most burdensome generally do not itemize their federal tax returns, while the income tax deduction offers a much larger tax benefit and the beneficiaries – mostly upper-income taxpayers – are very likely to itemize."
"The federal tax system provides a clear incentive for states to adequately fund public services," noted ITEP Executive Director Matthew Gardner. "It also provides a clear incentive for states to rely on progressive personal income taxes to fund those services. And the few states that have not yet taken advantage of this incentive are basically leaving federal money on the table."
The report also shows that such a tax swap would substantially reduce state taxes on low- and middle-income families, resulting in significant improvements in the tax fairness climate of each state.
The added benefits to the economy of such a progressive tax swap are highlighted in a recent TFOC report, Solutions that Work for Main Street: Progressive Guidelines for Closing Recessionary State Budget Gaps. As the report explains, switching to a more progressive tax structure puts money in the hands of low- and middle-income people who tend to immediately spend it in the local economy. Such increased economic activity leads to job retention and creation, and enhances economic recovery during a recession.
Leaving Money on the Table is available for download at http://www.faireconomy.org/news/Leaving_Money.
The Institute on Taxation and Economic Policy is a non-profit, non-partisan research and education organization that works on government taxation and spending policy issues.
UFE's Tax Fairness Organizing Collaborative is a network of statewide grassroots organizations that are educating and organizing for fair and adequate taxation at the state and federal levels.
For Immediate Release: April 6, 2010
Millionaires to Congress: Tax Us!
Wealthy Americans Use Personal Tax Breaks to End Bush Tax Cuts for the Rich in 2010
Boston, MA -- With Congress poised to act this year on the Bush tax cuts, a group of American millionaires is calling for an end to the tax breaks that have benefited them – but left the rest of the country with a crippling debt and dwindling budgets for education, health and other vital services at the state and Federal levels.
These millionaires are among the 700 bsusiness leaders and individuals in the top 5% of wealth and income who make up the Responsible Wealth network, which has been instrumental in, among other things, preventing the permanent repeal of the estate tax which President Bush had vowed to eliminate. They are asking other wealthy Americans to join them in their efforts to end the Bush tax cuts for the wealthy once and for all by taking the Tax Fairness Pledge and directing their tax breaks to fight for tax policies that benefit all Americans.
The growing list of Pledge signers includes:
Judy Pigott, an author and co-founder of Personal Safety Nets who lives in Seattle, Washington and is the daughter of the late Formula One race car driver Pat Pigott. Her family wealth comes from manufacturing Peterbilt and Kenworth trucks.
Jeffrey Hollender, the co-founder of Seventh Generation natural products, he lives in Vermont. He is a self-made millionaire, author and entrepreneur who is a leader in the socially responsible business movement.
Eric Schoenberg, a behavioral economist at Columbia University’s School of Business who lives in New Jersey. He was a successful investment banker, after a stint with the State Department, and built his wealth on the fortune his father amassed in the computer and telecoms industries.
Marnie Thompson, an education consultant and co-founder of the Fund for Democratic Communities in Greensboro, NC where she lives. She accepted her inheritance from her father, an Ohio businessman, on the condition that she could give it away to charity.
Mike Lapham, director of United for a FairEconomy’s Responsible Wealth project and an inheritor of family wealth from a paper mill business in upstate New York. He lives in Boston.
In taking the Pledge, each of these individuals agrees to donate some or all of their tax savings under the Bush tax cuts to support tax fairness organizing and/or other economic justice efforts. An online Tax Break Calculator allows anyone to plug in their 2009 income and other assets and quickly estimate their individual share of the Bush tax cuts.
“We want citizens and lawmakers alike to see the link between the continuing Bush tax cuts and the growing deficit,” said Brian Miller, executive director of United for a Fair Economy. “Wealthy citizens rejecting the cuts and demanding their taxes be raised is a great way to get people’s attention.” With recent polls showing public concern about the national deficit at a 20-year high and a majority opposing cuts to government services at this time of historic unemployment, Responsible Wealth will also be making its case to Congress that restoring the pre-2001 tax rates for the wealthiest Americans is one obvious solution to America’s fiscal crisis.
“These tax cuts were irresponsible when they were passed in 2001 and 2003. In the midst of a deep recession, they are downright inexcusable,” said Mike Lapham, director of the Responsible Wealth project and one of the millionaire signers of the Pledge. “To be clear,” he added, “low- and middle-income households only received a small portion of the Bush tax cuts. The overwhelming share of the income, capital gains and dividend cuts went to wealthy taxpayers.” A report by Citizens for Tax Justice shows that nearly half of the Bush tax cuts went to the top 5% of income-earners, while the bottom 60% of income-earners received less than 15% of the Bush tax cuts. Responsible Wealth seeks to reverse the Bush era-cuts, the total cost of which will reach $2.5 trillion by the end of 2010.
“Members of Responsible Wealth recognize that their own prosperity and success would not be possible without the foundation of a strong public education system, an effective transportation network, a strong legal system and more,” notes Lapham. “Those are the kinds of foundational building blocks that we get through our tax system. Responsible Wealth members are more than happy to pay their share to support those public investments that they have benefited so greatly from.”
Responsible Wealth, a project of United for a Fair Economy, has been working for equitable tax policies that create widespread prosperity since 1997. In addition to preserving the estate tax, to which fewer than one percent of families are subject and which has generated $1 trillion in revenues over the last ten years, the business leaders and high net worth members of Responsible Wealth have also been actively engaged in shareholder action. They have filed more than 80 shareholder resolutions on CEO pay and other corporate accountability issues and have often transferred their proxies to lower-income stakeholders, providing them access to corporate boardrooms.
- Mazher Ali - 617.423.2148 x101, [email protected]
- Karen Kraut - 617-423-2148 x122, [email protected]
New Guidelines for State Budget Deficits Offer Pragmatic, Anti-Recessionary Approach
Boston, MA, March 30, 2010 – A new set of guidelines released today highlights the essential connection between progressive fiscal policy and the twin goals of state budget repair and economic recovery.
Virtually every state is groping for solutions to budget gaps of historic proportions. Most states have responded with counterproductive budget cuts or with cuts and minimal new revenue, often tied to unfair and unsound regressive tax vehicles. "As the newly-released Guidelines make clear,” said Karen Kraut, Director of the Tax Fairness Organizing Collaborative (TFOC), "neither approach even remotely resembles a 'best practice' during a recession."
While states, unlike the federal government, are limited in their ability to engage in deficit spending, Kraut said that this does not confine them to policies that deepen the recession or stifle recovery.
Released by United for a Fair Economy's Tax Fairness Organizing Collaborative (TFOC), and authored by economist David Shreve, a TFOC member affiliated with the Virginia Organizing Project, these guidelines delineate optimal fiscal policy during a budget crisis caused by recession, for any state seeking recovery, ongoing stability, and more widely shared prosperity.
Key points of the Guidelines:
To Close Recessionary Budget Gaps
- Make money available through progressive tax reform, strategic borrowing, the timely use of rainy day funds, and building trust funds wisely.
- Make tax increases and tax reform one and the same, including by repealing unworthy tax expenditures.
- Encourage federal-state revenue sharing.
To Defend a More Progressive and Economically Sound Approach
- Don't equate frugality or efficiency with budget austerity.
- Challenge anti-tax activists who promote unfair and unsound taxes in the name of lower taxes.
"While the Guidelines make clear the need for federal government leadership and assistance, they also underscore the extent to which states have the ability to undertake much of the needed policy on their own," Shreve noted. "States have ample room for progressive tax reform that raises revenue, underwrites critical public investment, stimulates additional private investment, and maximizes job retention or creation."
While some state budgets are already set for 2011, nearly two-thirds of these have yet to be finalized.
"Because so many people's lives are being upended by this recession," remarks Kraut, "it is critical that states not settle for ineffective approaches likely to prolong the economic downturn or delay the recovery. These guidelines show us the way to avoid such wrong turns."
The Guidelines are available for download here.
UFE's Tax Fairness Organizing Collaborative is a network of statewide grassroots organizations that are educating and organizing for fair and adequate taxation at the state and federal levels.
FOR IMMEDIATE RELEASE
- Mazher Ali: 617-423-2148 x101, [email protected]
- Jeannette Huezo (habla español): 617-423-2148 x132, [email protected]
Report on Racial Economic Inequality Now Available in Spanish
Updated Unemployment Data Shows Racial Inequality Worse in Many States
Boston, MA, March 10, 2010 – United for a Fair Economy today announced that its annual report on racial economic inequality is now available in Spanish. The report, State of the Dream 2010: Drained – Jobless and Foreclosed in Communities of Color examines racial economic disparities in a range of areas including foreclosures, poverty, income and wealth.
Newly updated data in the report shows that people of color are experiencing a disproportionate share of the layoffs and foreclosures amidst the current recession, deepening inequalities that existed prior to the recession. The updated report found that Wisconsin and Minnesota had an unemployment rate for Blacks was at least three times that of whites. In another 13 states, the unemployment rate for Blacks was at least twice as high as that of whites. Among Latinos, the widest disparity was in Minnesota, with Wisconsin and Pennsylvania joining as having a disparity at least twice as high as whites.
"Unemployment statistics continue to indicate that broad-based economic recovery policies just aren't reaching those who need it most, including people of color," said Brian Miller, Executive Director of UFE and a co-author of the report. "Our report contains ample evidence to conclude that without targeted policies we will never reduce the wide gaps of income and wealth between races."
The Congressional Hispanic Caucus (CHC) earlier this year expressed their desire to rebuild broken Latino communities. "As our nation recovers from the worst downturn since the Great Depression, Latino families are being forced to make tough choices," acknowledged CHC chairwoman Nydia Velasquez. "[W]e are committed to working with President Obama and our colleagues in Congress to ease the burden on the working class, and lay a new foundation for growth and prosperity."
"Latinos and Blacks are earning on average 68¢ and 62¢ for every dollar earned by white workers," notes co-author of the report, Jeannette Huezo. "When the bills are paid, Latinos only have 12¢ and Blacks only have a 10¢ for every dollar of white wealth. It's like being on an economic treadmill – without a targeted recovery strategy, they'll never catch up, and more will continue to fall off completely."
The full report is available in English at FairEconomy.org/Dream and in Spanish at EconomiaJusta.org.
United for a Fair Economy is a national, non-profit, non-partisan organization working to build a multi-race, multi-ethnic, and multi-class movement to reduce economic inequality.
FOR IMMEDIATE RELEASE
- Lee Farris, UFE Estate Tax Policy Coordinator, 617-423-2148 x133 or [email protected]
- Brian Miller, UFE Executive Director, 617-423-2148 x111 (office) or 781-392-4564 (cell); [email protected]
SENATORS HOLD UNEMPLOYED AMERICANS HOSTAGE AS THEY BARGAIN FOR ANOTHER TRILLION-DOLLAR TAX GIVEAWAY TO THE RICH
Boston, February 25, 2010 – In a series of comments over the past few days, Senators Kyl and Grassley have made clear their willingness to hold up unemployment benefits for struggling Americans as a bargaining chip to permanently weaken the federal estate tax, and further enrich America’s wealthiest families.
“Why are Senators Kyl and Grassley more worried about enriching the heirs of multimillionaires than about helping Americans hit hardest by the recession?” asks Lee Farris, Estate Tax Policy Coordinator at United for a Fair Economy (UFE). “It is an outrage that they are willing to hold struggling Americans hostage in their efforts to secure another huge tax cut for the wealthy Wall Street crowd that crashed our economy in the first place!”
The $15 billion jobs bill that passed on Wednesday did not extend unemployment benefits or the COBRA health insurance subsidy. As a result, more than a million people will run out of benefits next month if the deadline is not extended, prompting Congress to begin debate over extending those benefits. But Senators Kyl and Grassley are ready to block it to get their way.
Minority Whip Senator Kyl, who has been a leader in efforts to weaken the federal estate tax, stated on Feb. 24 that Republicans will block consideration of the new unemployment benefits bill unless they get “a path forward fairly soon” to voting on a permanent, and weakened estate tax.[i] And earlier this month, Senator Grassley said that “timely consideration of permanent bipartisan estate and gift tax reform” is “essential to completing action on” a previous jobs bill.[ii]
UFE’s executive director, Brian Miller, points out that the estate tax has nothing to do with extending unemployment insurance or any jobs bill. Miller adds, “We should not allow the anti-estate tax Senators to hold struggling Americans hostage in their political jockeying. If they want to shower more tax breaks on the rich while Americans lose their homes and fill unemployment lines, let them sell their message to the public on its own merits… or lack of, but don’t use hard-hit Americans as a bargaining chip.”
The estate tax was temporarily eliminated for one year, 2010, by the Bush tax cuts, and will revert to pre-2001 levels in 2011. The Senate failed to extend the estate tax in December 2009. Efforts are under way to enact a patch to cover the one-year gap, and find a workable long-term agreement.
“We need a strong estate tax that demonstrates the responsibility of millionaires to support the great country that made their wealth possible,” adds Farris. Over 2,000 high-wealth individuals who would likely pay the estate tax agree, and have signed a UFE petition in favor of preserving a strong estate tax. Other high-wealth individuals, including Bill Gates, Sr., have been outspoken supporters of a strong estate tax as a matter of fairness and responsibility.
A Congressional Budget Office study in January 2010 found that tax cuts for the wealthy are the least effective response to the recession, and increasing aid to the unemployed would be the most effective, because unemployed people spend their checks immediately and stimulate the economy.[iii] “We need to get our economy working again,” adds Miller. “All the data shows that the best way out is by focusing our attention on those hit hardest by the recession through jobs programs, unemployment benefits, and similar measures. It’s time we get our priorities straight.”
United for a Fair Economy (UFE) is a national organization that works to promote more broadly shared prosperity and an end to extreme inequalities of wealth and income.
FOR IMMEDIATE RELEASE
• Mazher Ali, UFE Communications Coordinator, 617-423-2148 x101 or [email protected]
New MLK Day Report Shows That Economic Policies Must Be Targeted to Address Racial Income and Wealth Gaps
Boston, MA, January 13, 2010 – A new report released today finds that African Americans and Latinos are experiencing the brunt of the economic recession, from joblessness to foreclosures, and that targeted economic policies are required to address the racial economic divide in the US. The report, entitled State of the Dream 2010: Drained – Jobless and Foreclosed in Communities of Color, is the seventh annual Martin Luther King, Jr. Day report from United for a Fair Economy (UFE). It is available for download at www.FairEconomy.org/dream.
In December 2009, The Congressional Black Caucus (CBC) boycotted a financial reform vote, demanding that more be done to support suffering Black communities being hit hardest by the recession. The CBC's action was an important step, garnering $6 billion for targeted investments in the House, but State of the Dream 2010 suggests that much more work remains to be done.
"As recent unemployment statistics confirm, the broad-based economic recovery policies are not reaching those who need it most, including people of color," said Brian Miller, Executive Director of UFE and a co-author of the new report. "Our report contains ample evidence to conclude that without targeted policies, such as those proposed by the CBC, we will never reduce the wide gaps of income and wealth between races."
In December, unemployment for African Americans and Latinos jumped to levels higher than any annual rate in 27 years.
Ajamu Dillahunt, co-author of the report and UFE Board member, explains, "Families survive unemployment better or worse depending on how much of a cushion they have, and African American and Latino families entered the recession with a dangerously low median net worth. In 2007, Blacks had only a dime and Latinos had only 12 cents of assets for every white dollar."
The State of the Dream 2010 report contains a broad range of accessible data and analysis about the current racial divide in terms of unemployment, income, poverty, wealth, and foreclosures. It includes policy suggestions that would target economic benefits to communities most deeply devastated by the current recession.
"A good model is how we prepare for a potential flu epidemic," says Mike Prokosch another report co-author and UFE Board member. "We give vaccines to the most vulnerable populations first. Economic policies should follow the same approach."
According to ranking CBC member Rep. Maxine Waters, "We can no longer be in denial that certain sectors of our population, including the African American community, are feeling the recession to a greater extent."
United for a Fair Economy is a national, non-profit, non-partisan organization that helps people of all races, ethnicities and classes work to reduce economic inequality.