Coddling the Rich

Congress is gutting vital programs for the poor while heaping billions of dollars of relief on a few wealthy families.

[Distributed via OtherWords]

Question: How much did Congress save taxpayers last year when it cut food stamp benefits for 16 million poor children?

Answer: Less than the windfall Congress is trying to bestow on a few of the richest American families by ending the federal estate tax. The House has already approved a bill to do this, and the Senate is poised to follow suit.

To get a sense of just how breathtaking this giveaway is, consider the $30 billion estate of casino magnate — and GOP super-donor — Sheldon Adelson.

If the repeal goes through, the Adelson family’s savings, when added to what they’ve already avoided through loopholes, could total as much as $12 billion. That’s far more than the $8.6 billion Congress sought to spare taxpayers over a decade by cutting food stamps last year.

Two very ugly realities are at play here.

First, the distribution of wealth in the United States is now so lopsided that the assets of individual families can rival the cost of entire government programs that serve as lifelines for millions of needy Americans.

Second, majorities in both houses of Congress won’t shrink from inflicting additional misery on the people who rely on those programs to heap piles of wealth onto the already obscenely rich.

What’s fueling this madness?

Ask any lawmaker who wants to repeal the estate tax, and she’ll probably tell you it’s all about family farms and small businesses. That fiction’s been peddled by politicians across party lines, from Washington Republican Dave Reichert to Arizona Democrat Kyrsten Sinema.

But as they well know, virtually no owners of family farms or small businesses are subject to the estate tax, and there are ample relief provisions already in the tax law to protect the few who are.

Besides, even if there were a problem, Congress could solve it without bestowing a windfall on oil tycoons and Wall Street kingpins — you know, the folks making those million-dollar campaign contributions.

Make no mistake, the billionaire class, now numbering over 500, isn’t the accidental beneficiary of estate tax repeal. It’s the intended beneficiary.

The tribute Congress is seeking to pay to the children of any one of those billionaires, even the lowliest one, could offset the entire $400-million cut in 2013 to the Head Start program. That cut denied 57,000 poor kids a better chance in life, supposedly in the name of saving money.

In this golden age for billionaires, over half of public school students are poor enough to qualify for school lunch subsidies, according to The New York Times.

High-profile GOP funders Charles and David Koch together control about $100 billion. By repealing the estate tax instead of closing its loopholes, Congress could put an additional $40 billion in the pockets the next generation of Kochs. That’s over 13 billion school lunches.

A century ago, Congress enacted the estate tax to stem the concentration of wealth and close the gap between haves and have-nots. This time around, it’s doing the exact opposite.

9 responses to “Coddling the Rich

  1. Bumper sticker: vote republican -when you hit the lottery -we will protect you from the poor! Of course to many democrats think that would be divisive. They want to reason with the unreasonable. There bumper sticker: we like being punching bags for republicans! I think I saw this on fred duvals car.

  2. Excellent, Bob! I appreciate your very good economic analysis and its politics. This revelation should give pause to every democracy loving American and cause alarm that the American oligarchy is so well entrenched and the US Congress so blatantly in its service that it is too late to reverse this course. I am going to share this on a few sites.

  3. Great piece, Bob. Really important read. People need to wrap their minds around what happening with this massive, massive wealth gap and inequality…without the ideological spin tacked on the end. I’ve shared this and hope that it goes out into the world for all to read and assimilate. We can not continue down this path.

  4. Say it ain’t so, Kyrsten! What? It is so?

    • She’s been more than a little disappointing….

    • Jim Hannan

      With less than 5,000 estate tax returns per year under the current guidelines, that works out to about 10 estate tax payers per congressional district, if all districts were equal in wealthy individuals. In fact, much of American wealth is concentrated in a few zip codes. So, let’s say that there are 5 estate tax payers in Krysten Sinema’s district each year.
      She has just voted for a bill that favors only 5 taxpayers, at the great expense of the other 700,000 residents of her district.
      Krysten Sinema needs to hear from the labor unions and other groups that contribute to her campaigns.

      • Jim, I completely agree with you here, but remember the committee on which she serves? Financial Services. That committee deals with folks from several of those few really rich zip codes, all starting in 100. And they write really big checks. Just sayin’

  5. Excellent post. It was even picked up by Nation of Change. 🙂