A few facts…to spread around.
Hillary Clinton will raise taxes if she is elected president… Sharply! As her candidacy gains momentum and she closes in on the Democratic nomination, it would be well to review the record and underscore the tax increases she would be likely to enact.
As always, Hillary speaks in code. So here’s the code book. She says that she will “…let President Bush’s tax cuts for top earners expire.” Most people assume that this pledge means that she will raise the top bracket (for those earning more than $200,000 a year) on income taxes from the 35 percent to which Bush cut it, to the 39.6 percent to which her husband raised it in 1993. But, in reality, it means a whole lot more.
It also means increasing the tax on capital gains from the current 15 percent to at least 20 percent and probably to the 30 percent level backed by most liberals. Some even believe she may eliminate capital gains taxation entirely and tax it at the same rate as ordinary income.
She certainly would repeal Bush’s tax cut halving the tax rate on dividends and would raise it from its current 15 percent to 30 percent. She would also most likely end the planned elimination of the estate tax and probably reduce the size of estates subject to the tax.
Robert Novak reports that Rangel’s staff is “hard at work on an audacious plan that over the next decade would redistribute up to a trillion dollars in American income through the tax system.” Rangel, himself, calls the new legislation “the mother of all tax reforms.”
Hillary would likely use the repeal of the AMT (which nobody ever envisioned reaching these levels) as the lynchpin to claim that she is not increasing taxes but just redistributing them so as not to hurt the middle class. But the reality would be a vast increase in tax revenues and a major increase in the redistribution effect of the tax code.
Already the top 1 percent of all taxpayers earn 17 percent of the national income but pay 35 percent of all federal income taxes. And the top 10 percent make one-third of the national income but pay two-thirds of the income tax. The bottom half in income pays less than 3 percent of the income tax collections. Hillary will make this curve a lot steeper.
In her own way, Hillary’s views on tax policy are rooted in her religious convictions. As a believing Methodist, she demonstrated the link between her faith and her liberal politics when she said the following, when commenting on Republican proposals to make illegal entry into the U.S. a crime:
“It is hard to believe that a Republican leadership that is constantly talking about values and about faith would put forth such a mean-spirited piece of legislation.”
“It is certainly not in keeping with my understanding of the Scripture because this bill would literally criminalize the Good Samaritan and probably even Jesus himself … We need to sound the alarm about what is being done in the Congress.”
On a more secular level, she told a San Francisco audience in 2004: “We’re going to take things away from you on behalf of the common good.” And, speaking in New Hampshire on May 30, 2007, she said she would “raise taxes on upper-income Americans and eliminate breaks for corporations.”
She attacks the Bush administration for “going back to the era of the robber barons.” She says, “It’s time for a new beginning, for an end to government of the few by the few, and for the few. Time to reject the idea of an ‘on your own’ society and to replace it with a shared responsibility for shared prosperity. I prefer a ‘we’re all in it together society.'”
Behind her rhetoric about shared values and unity, lies the most far reaching tax increase proposals since the days of the New Deal. And, if she is elected, she will likely carry enough Democrats into the Senate (my current estimate is 58) to pass whatever she pleases.
Also, I found this editorial at the National Center For Policy Analysis:
The Congressional Budget Office (CBO) has released its preliminary estimates for Fiscal Year 2007 that ended September 30, and the federal budget deficit fell again, this time by 35 percent to $161 billion, says the Wall Street Journal.
* Since 2004, deficit spending has tumbled by $251 billion, which is one of the most rapid three-year declines in U.S. history.
* The deficit as a share of the economy is down to 1.2 percent or about half the average of the last 50 years.
* This improvement is especially remarkable given the $150 to $200 billion a year of post-9/11 expenses for homeland security and the wars in Iraq and Afghanistan.
* Americans coughed up a record $2.568 trillion in taxes to the IRS in 2007, or 6.7 percent more than in 2006.
* This means federal receipts have climbed by $785 billion since the 2003 investment tax cuts, the largest four-year revenue increase in U.S. history. *See Note from Norm
* Income, dividend and capital gains tax rates were all cut in 2003, but individual income tax receipts have soared by 46.3 percent in four years, with payments by the wealthy accounting for most of the windfall.
* Last year’s increase in individual income payments was 11.3 percent, or more than double the rate of growth in nominal GDP.
The overriding lesson here is that the best antidote for deficits is faster growth, not tax increases. The budget deficit has declined more rapidly this decade in the wake of the Bush tax cuts than it did in the 1990s in the wake of the Clinton tax increases. CBO is still forecasting a balanced budget in 2010, but if Congress gets its way on spending and taxes, all of this progress will be short-lived, says the Journal.
*Note from Norm: Simply put, are you paying attention to the facts or Hillary’s quacks