Taking Away The GOP's Other Weapon

By Mimikatz

There has been much discussion here and elsewhere that the Republicans will run on terror in the midterms because that is all they have left.  But the GOP has another perennial issue that they intend to run on as well--lower taxes.  Just last night a smiling Tom Reynolds (R-NY26) told Chris Matthews this was so.  But just as the Dems are starting to attack Bush on national security, so too are they finally in a position to turn their attack boats head on into this other GOP issue and potentially neutralize it.

One way is to link tax cuts with the debt.  Imagine this ad.  A darkened House chamber, slightly ominous music, the usual deep-voiced man intoning, as the numbers flash on the screen: 

When George W. Bush took office the national debt stood at 5.7 trillion dollars.  Today, after almost six years of George W. Bush and the Republican Congress, the national debt stands at 8.5 trillion dollars,  That is an increase of almost 50%, over $28,000 for each of us.  Four times during the presidency of George W. Bush Congress has had to raise the debt limit, and Congress(wo)man X has voted for it every time.  At the same time (s)he voted over and over to eliminate the estate tax and reduce other taxes that the very wealthy pay.*   Who do you think is going to have to pay back the ever-increasing national debt?  Why don't you ask Congress(wo)man X?  After all, (s)he voted for it.

The chief cause of the burgeoning national debt is the Bush tax cuts.  Of course the Iraq War, now over $1 trillion, is also a cost, and support for the war could be included where appropriate.   But without the tax cuts we would not be running an annual deficit that adds to the cumulative debt (which is the real problem).  Moreover, the effect of the tax cuts is very uneven, and they overwhelmingly benefit the wealthy.  Coupling the increase in the debt with the Bush tax cuts helps blunt the tax issue for Dems.  In fact, the Bush tax cuts are really only a tax deferral, and the difference will have to be made up one way or another.   

Maybe it wouldn't work, since there is evidence voters support tax cuts even when theydon't think they will benefit.  But the GOP is going to raise the tax issue against Dem challengers, and they had better be ready for it.

The debt limit was raised to $8.965 trillion in March of this year, and was also raised in 2002, in May, 2003 and November, 2004.

*The estate tax affects only one half of one percent (5 per 1,000) of people who die as of this year, and will drop even further in 2009.  Dividends and capital gains go overwhelmingly (73%) to the top 3% of households, who have taxable incomes over $200,000, and 54% go to those with incomes over $1 million.  Moreover, because of higher marginal tax rates, the 15% rate on investment income is worth much more to these taxpayers.  And of course the reduction in the top brackets affects only those with taxable incomes over $185,000 per couple.   

Comments

[Mimikatz]

I have seen several "Challenger X will raise your taxes!" ads in the last week, so clearly it is coming. Some Dems have run against the Iraq War in part by linking the cost to what we have foregone. Tax cuts can be linked in the same way as a way to oppose further tax cuts, but voters don't generally like the idea of raising taxes, even for specific purposes, so I'd never suggest any candidate advocate raising taxes. In fact, Dem candidates should probably advocate extending and expanding the Earned Income Tax Credit and Child Tax Credit. At this point, the semantic discussion is whether not extending a tax cut is the same as raising taxes.

[Redshift]

If I could teach candidates and spokesmen one thing, it would be to stop saying "the top X%" and start saying "people making more than X" or even more simply, "people who make millions" or "people who are worth tens of millions."

I'm a political junkie, and even I don't have a gut feeling for how much the "top 5%" make. I'm not complaining about your writing; you're trying to be informative, not write speeches, but I certainly notice a big difference in impact between:

"54% go to those with incomes over $1 million"

and:

"The estate tax affects only one half of one percent"

Another tack:

"How much was your tax cut? They keep telling you how they're cutting someone's taxes year after year, but do you see your taxes getting lower? Congressman X's millionaire buddies know exactly how much of a tax cut they got."

[Warren]

I like the debt ad idea, and all of Redshift's comments are damned good ones. However, I don't think I'd mention support of the Iraq stupidity as a reason to oust a given moron, since that could easily backfire.

[Sara]

I think I would hammer home the trade-off's -- for instance Bush has underfunded his Education Program by so many billions -- and is prepared to hand every school child in America a bill for let's say $28 thousand -- enough to pay for three years at most State Universities. (picture of cute little 3rd or 4th grader looking at their bill, courtesy of Bush & Republican Congress.)

[Mimikatz]

I generally agree, Redshift, and tried to give both where I had them.

The estate tax affects only estates valued at over $2 million, and there are only a few each year, so there .5% seemed ok, to show how small it is. As best I've found, in 2004 about 2,500,000 Americans died, and only 30,276 people filed estate tax returns. Of these, just under 3,500 had estates of over $5 million, and about 12,500 would have had estates of over $2 million. The overwhelming majority, 98.8%, do not have enough money to need to file an estate tax return, and even those who file don't all pay estate taxes. So 99.95% decedents don't.

Whatever works.

[verplanck colvin]

Make sure to flash a pic of a sad-looking child when you ask who's going to pay for the tax cuts...

[Mimikatz]

Good idea. The amount of debt, both personal and governmental, that kids are coming of age with today is shocking. It is probably worse than it has ever been for this cohort, as opposed to, for wexample, specific adult groups like farmers, who suffered in past depressions.

Things were certainly tough for the GI generation during and immediately after WWII, but the late '40s and '50s saw a tremendous amount of economic growth, and for a variety of reasons, it was pretty widely shared.

When I graduated from college in the mid '60s jobs we were in an inflationary economy, and jobs were plentiful. And in those days people didn't have the debt, because public universities (like U of California) were practically free, except for living expenses, and there were no credit cards. Today's graduates have the double whammy of high debt and a dearth of good jobs. This is not fate, but the consequence of policies deliberately pursued over the past 25 years.

[Jodi]

I think you over simplify the idea about "weapons" that the GOP has.

[Mimikatz]

Ok. Terror, taxes and attack ads. Three weapons. What else do they have?

[wRog]

There are also taxes that can be cut that will help the middle class without benefitting the rich.

For example, eliminating the Alternative Minimum Tax -- which, given its lack of inflation indexing, is going to start seriously hitting the middle class in the next few years if it isn't already... combine it with a top bracket hike to make it (at least) fiscally neutral and you'll bring in a shitload of votes.

GWB had an opportunity to deal with the AMT back in 2000 and chose to leave it in place because it doesn't touch his constituents (once you make more than about $400K/year, AMT gets quickly swamped out by the ordinary income tax).

[Mimikatz]

AMT should be modified, and they should expand the Earned Income and Child Tax Credits too, but the revenue will have to be made up by dumping the cuts on investment tax rates and the cuts to the top two brackets, and freezing the estate tax where it is now. But even that won't come close to balancing the budget.

[Brian Boru]

Tie the tax cuts to Chertoff's admission that they can't afford to protect us and Bush's admission that they can't protect us at all ("they'll follow us here" and we can't keep them out).

[Paul Lyon]

``Of course the Iraq War, now over $1 trillion, is also a cost, and support for the war could be included where appropriate.''

Not yet. That is a projected cost taking into account such things as long term care for injured Iraq war veterans. The actual outlay to date is IIRC somewhere around $300 billion or perhaps somewhat less---that is still a lot of dough that could have been put to a whole bunch of better uses. Of course it's all funny money at this point, until the bills come due.

[Randy Cauthen]

Also, try substituting "tax breaks for the rich" every time they say "tax cuts."

[Mary]

Great post, Mimikatz. One other way to attack this problem is to start talking about the birth tax. I think this is a pretty sobering number these days. They can worry about the bloke who dies and we can worry about the babies that have to make up for the Bush debt.

[Jodi]

Mimikatz,

Oh my God! Is that all you can think of. What about the old standards?

The Supreme Court, Affirmative Action. Gay Marriage. Abortion. School Busing (yes it is still around). School Vouchers. Teddy Kennedy and Hilary Clinton are anathema to some. Those two names can be invoked as a curse some places. The ACLU. Crime (as in weak sentencing by Dem judges) Christmas displays in public places. "In God we Trust" and other mentions of God being attacked. School Prayer. Prayer at Public meetings. And the list goes on and on.

[wRog]

The problem with AMT is it was, as far as I can tell, explicitly designed to be complicated and gratuitously different, the underlying philosophy behind the tax being that it was deemed bad for anyone to be able to enter zero on the last line of the 1040, no matter how legitimate the reason might be, and so they threw a bunch of random provisions together back in 1968 in the hopes that they could make the tax code complicated enough to be impossible to "game". They didn't have to give it too much thought because what they did affected so few people.

But as things stand now, we're having a huge chunk of the middle class hit by something that seems almost purposefully designed to make people hate the tax code. And once sufficiently many people get into that mode, we're screwed, because at that point there will be widespread evasion and automatic opposition to any kind of tax increase no matter how necessary it might be and no matter who the effect might be limited to. And the fiscal foundations of a Federal government that can actually function will essentially be gone.

I wouldn't be at all surprised if this was Norquist's plan from the beginning.

So, yes, balanced budgets are important, but keeping the AMT in place for the sake of balancing the budget, simply because it's making up an ever larger part of the revenue stream, is throwing out the baby with the bathwater. It pretty much guarantees we'll never get there, because people will be too pissed off.

Never mind that a bold move like eliminating it would completely destroy the Republican frame that the Democrats never met a tax that they didn't like. And from that you get the breathing room to restore the 39.6% bracket and jack up the rates to 45-50% for people making $1M+ which is where we need to be getting the revenue from.

[janinsanfran]

I'd be curious how this discussion fits with what's going on at Democratic Strategist about how to talk about economic wellbeing/misery.

In extremely simple minded form (but that is how one deals with voters en masse), one set seems to be saying: "most voters think their individual economic prospects are improving, so don't hit them with the statistical showing of rising inequality." The other is saying "but most people are getting screwed in the Republican plutocracy." Only all expressed more moderately. :-)

My head agrees with the latter position -- but my experiences actually talking with the poltically uninvolved confirm there is something to the former. Most folks are so brainwashed into believing that their individual circumstances are their own fault that they bitterly resent someone telling them there are systemic problems. They interpret the assertion to mean they are somehow suckers. That hurts; it is like being called stupid in school; and is a guaranteed turn off.

But it also puts Dems in the position of not being able to advocate for -- and implement when in office -- sensible, moderate economic strategies to increase equality.

[Mimikatz]

Jodi: My point is that those issues only work with Bush's base, who is about 30% of the population, if that, and already votes GOP. They don't win over the middle.

Jan: Good point. I think it is very important on a lot of fronts to figure out how to appeal to (non)voters without making them feel stupid.

[Jodi]

Mimikatz, do you really believe in Polls?

What effect do they have?

Do they give the people on the favored side so much confidence that they are going to win easily that they don't feel that they have to bother to go vote?
Do they give the people not favored the feeling of doom so they don't feel that they have to bother to go vote?

The best thing I could see coming from polls is perhaps information on what changes in a position might help a candidate.

I also don't believe in the question methodology or the statistical analysis which is on a flawed model. And don't get me started on sampling.

And if you do know something about it, then are past performance errors factored into new polls?