Salon editorial fellow Aaron Kinney takes another look at the estate tax.
Scott McClellan and a reporter from the White House press corps had an exchange yesterday on whether the Republican leadership is justified in continuing to seek the repeal of the estate tax in the wake of Hurricane Katrina, which is already estimated to cost taxpayers more than $60 billion. Unfortunately, the reporter referred to making the estate tax repeal "permanent," apparently confusing the estate tax with the tax cuts the president enacted earlier in his presidency, which allowed McClellan even more room for obfuscation on the issue. Still, the question the reporter raised is important.
Reporter: "I'm going to yield the floor, but I just have one more question. Why does the president believe it is morally justified, why is it the right thing to give some of the richest people on the planet a huge tax cut right now?"
McClellan: "It's not a fair -- "
Reporter: "Well, that's what the estate tax cut repeal, making it permanent, is, isn't it? There are some people who want to hand on billions -- hundreds of millions of dollars to their -- "
McClellan: "No, no. The tax cut you're talking about -- I don't know of any that are expiring this year. They expire in later years."
Reporter: "Right. But why at this point in our history is it justified, morally right, to do that?"
McClellan: "First of all, I'd have to dispute your characterization because all Americans receive tax cuts. We went through a very difficult time, economically, and our national economy is really a lifeline for that region that has been hit by this hurricane. We must continue to keep our national economy growing and creating jobs. The latest unemployment numbers are down to 4.9 percent last week, more than 4 million jobs created since May of 2003. We've made tremendous progress to keep our economy growing and get people -- and create jobs."
Reporter: "And there's no way to ask the richest people in America to sacrifice?"
McClellan: "And the economy -- keeping our economy growing stronger -- is important to helping with the rebuilding and recovery efforts on the ground. The last thing we want to do is take more money from lower-income Americans that have been affected by this and that have received significant help from those -- from those tax cuts."
Reporter: "That's not what I'm talking about. I'm talking about taking money from higher-income Americans."
McClellan: "And we're going to remain focused right now on our highest priority. Well, again, these tax cuts you're talking about, many of them expire in later years. I don't know of any that are expiring this year. But it's important to keep our economy growing and keep jobs being created."
Of course, what this reporter was talking about had nothing to do with tax cuts for "lower-income Americans." McClellan's gobbledygook on promoting economic growth is worthy of attention because it's precisely the kind of rhetoric we're going to hear in coming weeks and months as the GOP attempts to reassert control over the domestic agenda.
In its lead editorial on Sept. 6, the Wall Street Journal urged President Bush to "take steps to keep the U.S. economy growing."
According to the Journal: "Economic leadership also means instructing Americans on the link between tax cutting and the economic vitality needed to fund both Katrina relief and the war on terror. Predictably, the Bush tax cuts are under attack for denying revenue to the government and because they don't require 'sacrifice' in wartime. But the truth is that federal revenues are rising by an estimated $262 billion -- or roughly 14 percent -- this year thanks to the growth that followed the 2003 tax cuts. Republicans have been far too defensive on tax cuts, and Katrina is an opening to explain their necessity and to push for making them permanent."
But what the Journal won't say is that the increased revenue this year came not from tax-cut-driven growth but rather from an array of factors including the expiration of one of Bush's tax cuts, according to the Center on Budget and Policy Priorities. As for the rosy economic outlook posited by the Journal -- not so much.
The tenacious adherence by the president and other prominent members of the Republican leadership to the ideology of tax cuts in the face of a national emergency is causing consternation outside the White House briefing room as well.
New York Times columnist Thomas Friedman, a neoliberal and prominent supporter of the war in Iraq, was aroused from his slumber by Hurricane Katrina, and in his column earlier this week he went medieval on influential and "toweringly selfish" tax-cut zealot Grover Norquist, who has been quoted as saying he'd like to shrink the federal government until he can drown it in a bathtub:
"Mr. Norquist is the only person about whom I would say this: I hope he owns property around the New Orleans levee that was never properly finished because of a lack of tax dollars. I hope his basement got flooded. And I hope that he was busy drowning government in his bathtub when the levee broke and that he had to wait for a U.S. Army helicopter to get out of town."