Text 5337, 102 rader
Skriven 2004-11-25 15:04:10 av Alan Hess
Ärende: Reverse Robin Hood
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Monument to greed
Gene Lyons

Posted on Wednesday, November 24, 2004

After eking out a three-point election win, President Bush claimed a
mandate and announced plans to "reform" the tax code and Social
Security. Almost needless to say, those reforms conform to the
reverse-Robin Hood ideal of giving to Bush's wealthy benefactors while
taking from wage-earners everywhere. I say "almost" because,
hypnotized
by the president's folksy drawl, many don't realize that they're about
to be conned out of even the minuscule tax cuts Bush delivered during
his first term. As described in quasi-official leaks to The Washington
Post, Bush's tax plan reads like a scheme crafted by Scrooge McDuck.

No wonder. Self-pitying tycoons have long funded tax-sheltered GOP
think-tanks like the Heritage Foundation and the American Enterprise
Institute dedicated to the return of Gilded Age values. Their reward
the White House euphemistically dubs the "ownership society." The
Bush/McDuck plan is a monument to untrammeled greed, a veritable
swimming pool filled with bullion for trust-fund inheritors like Paris
Hilton and the president himself to bask and wallow in.

Without exception, each of the White House's planned "reforms" would
have the effect of shifting the federal tax burden away from the rich
and toward the salaried middle class. It favors wealth over work at
every turn.

If Bush gets what he wants from the GOP Congress, a secondary benefit
would be to raise income taxes in the wealthier "blue" states (most of
which already send more to Washington than they get back in federal
spending) even more than in the "red" states that supported him.
Nifty, huh?

Oh, and yes, millions of salaried workers would stand to lose
employer-sponsored health insurance in the bargain.

Think I exaggerate? According to the Post's Jonathan Weisman and
Jeffrey H. Birnbaum, the White House has quit flirting with utopian
daydreams like a one-size-fits-all "flat tax" or national sales tax
(probably because at an estimated 25 to 28 percent, the latter might have
sparked rebellion in Wal-Mart checkout lines). Instead, the plan is to
accomplish similar goals indirectly.

Here's the straight dope as the Post reported it. According to
Treasury Department officials: "The president will pursue a tax system where
all income-whether from wages, dividends, capital gains or interest-is
taxed only once. That would mean eliminating taxes on dividends and capital
gains paid out of fully taxed corporate profits. Most investment gains
are currently taxed at 15 percent.

" The administration will also push hard for large savings accounts
that could shelter thousands of dollars of deposits each year from
taxation on investment gains, according to White House economic advisers who
have been involved with the planning. And any tax reform, according to
Treasury Department officials, would likely eliminate the alternative
minimum tax, a parallel income tax designed to ensure that the rich
pay income taxes but one that increasingly ensnares the middle class. "To
pay for those large tax cuts, the administration is looking at
eliminating both the deduction for state and local taxes, and the
business tax deduction for employer-sponsored health insurance. That
would raise nearly $926 billion over five years, according to White
House and congressional documents."

Anybody who's ever filled out an itemized IRS Form 1040 can read the
cards. With the estate tax (excuse me, "death tax") on
multimillion-dollar inheritances already gone, an heiress like the
aforementioned Paris Hilton, for example-who, until discovering" The
Simple Life" on FOX, lived off dividends and interest from the family
trust-might literally end up paying less income tax than her
hairdressers and bodyguards. So might everybody in the Bush clan.

Likewise, investors and real estate and stock speculators who live off
capital gains could avoid income taxes almost altogether.
High-salaried executives, physicians, professional athletes and
others who earn considerably more than they spend would be able to
shelter much of their income in tax-free accounts.

Ordinary working people would be left holding the bag. So you'd no
longer have to pay income tax on savings account interest. Big deal.
Eliminating the state and local tax deduction would cost most
taxpayers many times more.

As an added political benefit, residents of "blue" states like New
York, Pennsylvania and California, who pay far higher state and municipal
taxes than citizens of, say, Florida and Texas (which have no state
income tax), would pay considerably more than their "red" state
counterparts. Readers who doubt me should dig out their own 2003 tax
returns and do the arithmetic. For most, it ain't pretty. Given the
national crisis in health care funding, it's almost beyond belief that
even Bush would eliminate deductions for employer-sponsored group
health insurance, a potential boon to insurance companies selling far more
expensive-and profitable-individual policies, but a big blow to
everybody else. It should be axiomatic: Any time a politician mentions
"family values," get a firm grasp on your wallet.

Free-lance columnist Gene Lyons is a Little Rock author and
recipient of the National Magazine Award.

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