Anthony Weiner on the Tax Compromise

Wednesday, December 15, 2010

Welcome to Politics Bites, where every afternoon at It's A Free Country we bring you the unmissable quotes from political conversations on WNYC. On today's Brian Lehrer Show, Anthony Weiner weighs in on the compromise between Congressional Republicans and President Obama on the extension of the Bush tax cuts.

Rep. Anthony Weiner of New York has been one of the most outspoken members of Congress against Obama's tax compromise. On Meet the Press on Sunday, Weiner said he wants the president to succeed, but the question is, "can we really afford to give millionaires a $160,000 tax cut?"

With the Senate expected to pass the tax cut compromise this week before it moves to the House, Weiner says one of the things that has people most "offended" in his chamber is the estate tax, not only because of how it's written, but that the President compromised more on this point than anyone ever expected.

Even my Republican colleagues were saying, boy, they were surprised that so much was given away. And I say given away because [the estate tax] is enormously expensive. It's a tiny number of people but it's an enormous strain on the budget.

Weiner asked the IRS how many people in his district would be affected by the estate tax, and he was given a number in the single digits of constituents who would pay the estate tax each year.

What this tax debate comes down to, he said, is a basic debate about how much of an obligation wealthy taxpayers should have toward the rest of the country.

Part of what this tax debate is also about, is about when do we start restoring a sense of fairness and balance to the economy where we try to deal with the enormous concentration of wealth among very few when the top one percent that makes the same amount as the next 25 percent. There is that imperative also that we have to address when we're looking at tax rates.

One listener called in to the show, enraged that a Democrat was "attacking our President" instead of attacking the Republicans. Her Irish mother always said, "the best defense is a strong offense." Weiner responded, he does want to support the President and wants him to be successful, but:

...when you have Mitch McConnell and the Republicans saying effectively, we're going to hold our breath and not do anything until you give us what we want, the question is then what is the proper tactical response to that, and what is the proper substantive response and I think the President to some degree underplayed our hand here.

In response to other Democrats, like Congressman Jim Himes, who thinks fighting this plan is a big risk, Weiner says it's still worth the fight to make the plan better and it's his job as an elected representative to do so.

I think sometimes fighting for what you believe in is a value in and of itself, even if you don't get every single thing you want, at least you define the issues. In this case we kind of went down with a whimper rather than a bang.

When asked if he'll vote against the tax deal in its current form, Weiner didn't exactly say no, but said he'll have a very difficult time voting yes.


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Comments [23]

JUST SAY NO! Don't sell our future to benefit Rich from No Bonuses for Millionaire Senators

JUST SAY NO! - Don't sell our future to benefit the rich.

Most Senators and many Congresspersons
are millionaires. How much will
each of these leaders and their
families gain personally from these
new policies.

After all, that's how countries decline
and become 3rd world : their leaders
borrow money and use it to line their
pockets and those of their cronies.
Then the bill comes due, vital services,
infrastructure and investment in the
Nation's future are cut, opportunities
wilt, people become poor. As a result
society becomes even more corrupt, since
working hard offers diminishing opportunities and people follow the
example of their leaders. Income
disparity increases, empathy decreases.
Leaders tax the middle class and poor
more and more and give them fewer and
fewer services and protections.
Those that remain are chronically
underfunded, and often corrupt.
To enforce this new cruelty, the
nation further degrades fundamental
freedoms, increases monitoring of
its people and makes punishment more
draconian. And there you have it -
decline, corruption, injustice,
poverty, inequality, cruelty and the
loss of our democratic society as
we know it - a ticket to becoming
3rd world.


Dec. 16 2010 08:07 PM
jawbone from Parsippany

From Bloomberg, Moody's Steven Hess on Tues, Dec. 12:

Moody’s Investors Service Inc. said an extension of the Bush-era tax cuts agreed upon by President Barack Obama won’t lead to a downgrade of the nation’s Aaa credit rating.

“The extension of the current tax rates is for a temporary period of two years and we think that if that’s all there is to it -- it does not have ratings implications,” Steven Hess, senior credit officer at Moody’s in New York, said in an interview today. “We have a stable outlook. We don’t feel it will get changed downward in the next year or two.”
“We think it will be positive for economic growth in 2011 and 2012,” Hess said.

“That helps government revenue growth. However, it will not nearly offset the reduction in revenues coming from these measures and therefore it’s a negative for government finance if nothing else is done,” he said. “It would not be favorable for any effort to reduce the deficit and reverse the debt trajectory.”
“We are not sure that there will be other reforms while this temporary extension is in place,” Hess said. “If no other measures are taken and if the tax cuts are made permanent, we would certainly see rising fiscal pressure. That wouldn’t necessarily lead to a rating action, but the pressure on the rating would be more than it would be otherwise.”

Then, Moody's Steven Hess on Monday, Dec 13th:

Moody's Investors Service said in a Monday report that the tax-cut deal hammered out between President Obama and congressional Republicans jeopardizes the Aaa credit rating enjoyed by U.S. Treasury bonds. The package could add $900 billion to the national debt, if it is made permanent, and this increases the chances the U.S. would one day default on its debt.

"From a credit perspective, the negative effects on government finance are likely to outweigh the positive effects of higher economic growth. Unless there are offsetting measures, the package will be credit negative for the US and increase the likelihood of a negative outlook on the US government’s Aaa rating during the next two years," Moody's analyst Steven Hess writes.

Hess writes that the higher economic growth from the tax cuts and unemployment benefits might be substantial, but the effect of the growth on budget deficits will be less than the effect of the foregone revenue and increased spending.
This ratio would be worsened if the tax cut package is extended in 2012, something that is highly possible in an election year, the report notes. It says that the president's debt commission developed a plan to deal with the budget crisis but adoption of the plan is "uncertain."

So, what changed between 12/7 and 12/13?

Dec. 15 2010 12:16 PM
jawbone from Parsippany

Funny thing this past week: Moody's analyst Hess, last week said the Obama/Republican tax plan would have no impact on the defict. Nothing to worry about.

5 days later? Oh, no! The sky is falling! The deficit will rise! We must make severe cuts in the budget. Next year. And Obama himself said earlier that next year is time to go after big programs like SocSec and Medicare. The House Repubs will take care of cuts to Medicaid, with all its new responsibilities which states will be unable to meet.

Gee, Medicare for All Improved would have been way cheaper and covered everyone from dollar one. Except Obama took it off the table and wouldn't even talk about it except to diss its supporters....

And neuter any stimulus effect of Obama's tax cuts for those earning above $20K for individuals and $40K for families.

What is game is being played here? It's not a game plan from the Democratic Wing of the Democratic Party. Much more like conservative Republican.

What does Obama think being a Democrat meanjs? He has self-identified as a Blue Dog Dem, which is pretty close to saying Republican....

Dec. 15 2010 11:03 AM

i would prefer:

-- all tax cuts continued for one year rather than two.

-- a different way of doing what the payroll tax cut is intened to do. expansion of the earned income credit perhaps?

-- inheritance beyond an exclusion treated the same way as earned income with special treatment for family farms and perhaps other small businesses.

-- a thorough review of the federal tax code before the bush tax cuts are due to expire again.

Dec. 15 2010 10:54 AM
Ken from Little Neck

This debate is getting stupid. We're not talking about the government taking 100% of an inheritance - we're talking about taxing a piece of a piece of very very large estates. I don't know a single person for whom the estate tax has ever been an issue, and I suspect I never will. Secondly, we're not taxing hard earned money. As congressman Weiner said, that was taxed when it was earned, but the person who earned it has to die for the estate tax to take effect. We're talking about taxing the income of the descendants of the deceased. They're the ones receiving the money, and they didn't do a thing to earn it. Never mind that even at that, they get to keep an enormous amount of money, if the estate is large enough for the tax to take effect.

Dec. 15 2010 10:54 AM
Economist from Montreal

Not a death tax, because very few people who die leave estates subject to this so-called death tax

Dec. 15 2010 10:51 AM
jawbone from Parsippany

Obama gave the Republicans actually more than they dreamed they could get from him, according to Republican comments about the Obama/Republican tax plan. But the last caller said he's doing everything he can.

I fear he's doing everything he can to protect banksters, big insurance and other big healh industry players, Big PhrMA, big money.

Why didn't Obama demand the R's agree to raise the debt limit, which will be looming as a huge issue come the new year and new Congress? Does he want to use --or allow the R's to use-- the debt ceiling to force the Dems to cut SocSec and Medicare???

Well, why else would he have set up the Cat Food Commission and stacked it with his appointments of anti-deficit hawks and Austerians who want to cut SocSec?

Also, this "stimulus" is just one year, and it is weak in that most of the money (25% goes to the top 1%) and will not have much bang for the buck. Then the fight for stimulus will begin all over again.

Also, SocSec will not receive 2% of this year's revenues to fund the program. The R's and deficit hawks among the D's are also already saying, Oh, Oh, Oh! SocSec must be cut! Oh dear me, the revenue is falling!

I fear we no longer have two parties, we have two groups competing to please Wall Street and the Powers That Be.

And the little people are not among the Powers That Be.

Dec. 15 2010 10:51 AM
RJ from prospect heights

The formation of foundations (i.e., Gates) encourages the ability of the wealthy to drive policy creation (i.e., education); if the estates were taxed higher and went into the general fund, perhaps our elected representatives would be the ones to make the public policies we elect them to, rather than the wealthy, based not on their expertise but on their individual, personal (i.e., not community driven) choices.

Dec. 15 2010 10:49 AM
Joe from Park Slope

Republicans always say the estate tax will destroy family farms passing between generations. Is this true or not?

Dec. 15 2010 10:46 AM
clairenyc from staten island

Thank you Congressman Weiner. We need to stand up and be counted. The Democrats need to stand for something, we allow the GOP to control the conversation.

Dec. 15 2010 10:45 AM
mike from brooklyn

With all due respect to MR Weiner (and I commend him for his vociferousness) I take execption with inheritance being labeled a "gift"... that is hard-earned FAMILY SAVINGS and/or investmenot free money.
I for one wanted to open a store that would have employed 5-6 people with moneys I stood to inherit but I didn;t get it. So now (while I'm on unemployment for 2 years +) I will have to find a job and be a drain on someone else'e payroll.
Great job

Dec. 15 2010 10:43 AM
Xtina from E. Village

Congressman Weiner please explain how you and your colleagues will allow taxes on the super rich to go down, at great cost to the treasury, but those for people making under $40,000 will go UP. YES UP. No one is talking about this, because people making so 'little' money have no voices in Congress.

Dec. 15 2010 10:43 AM
Concerned citizen

Mr. Weiner's idea of fairness is to confiscate hard earned and already taxed money from those who worked hard to provide for their children. The estate tax is immoral and socialist.

Dec. 15 2010 10:43 AM
Stuart Waldman from West Village

Money isn't taxed. People are. That's the misconception in calling the Estate Tax, the Death Tax.
Only a Pharoh, or a Republican I suppose, believes you can take it with you. The person the estate tax hits hasn't earned one dime of that money, while enjoying the fruits of it his entire life—the best schools in particular. Taxing at only 55% is a gift to these people.
My suggestion Estates should be taxed at 70% with every cent of the money going toward education, to it least begin to level the playing field.

Dec. 15 2010 10:40 AM

"Taxes are too high." ... So Anthony Weiner buys the Republican line that "taxes are always too high".

So why don't we just eliminate all taxes -- reduce all tax rates to zero?

If American politicians haven't got the guts or decency or honesty or intelligence to explain why taxes (not just any tax) are necessary, then how can they possibly get anything done?

Dec. 15 2010 10:39 AM
jake from NYC

RE: Estate tax

This is all about ideology and funding the government. The estate tax is to stop affluent people from NOT working. It is just as hypocritical as bailing out wall street.

Also, 3 million is not wealthy enough to remove 45% of it for government financial mismanagement. Make it 10 million or 20 million, and tax those same individuals MORE on a yearly basis.

I am a liberal.

Dec. 15 2010 10:39 AM
Martin Chuzzlewit from Manhattan

Did Weiner really just say that he thought "taxes are too high" ??!!!

Dec. 15 2010 10:37 AM
amalgam from Manhattan by day, NJ by night

If you don't agree with the Estate Tax, then you agree with the continuance and further development of concentrated wealth, a form of economic aristocracy, economic inequality and stratification.

Bill Gates and his father wrote a good book setting up the argument for the estate Tax.

Dec. 15 2010 10:36 AM
Economist from Montreal

All property with capital gains is NOT taxed at death. At death, the owner disposes of the property. In theory it is like a sale. Therefore all gains should be taxed at death. Likewise pension savings in 401(k) plans and the contribution has never been taxed.

Without a tax at death, we cannot justify deferring taxation until disposition of capital gain property

Dec. 15 2010 10:36 AM
Steve Bloch from Richmond Hill

I don't know about "the constitutional option", but there's a budget reconciliation process that limits debate. Would that apply to a tax-cut bill that's amended to be more progressive?

Dec. 15 2010 10:34 AM
M Peter from NYC

I support and wish all the best to Congressman Weiner and share his views from "Meet the Press". What is out there for low and middle income people who are stuck in long term unemployment?

Dec. 15 2010 10:34 AM
bernie from bklyn

can mr.weiner explain why the democrats don't seem to have the ability to sel the things they want to do in a clear way to the american people. the president is terrible at this but so are the members of congress.
for example- why do they never bring up the two ridiculous, unnecessary wars that are draining our tax dollars by the minute. tell the american people how much this is costing and what the goal is or isn't. what is the goal? tell the [eople to protest these wars as a way to gain public support to fight the republicans.
and can someone in gov't please explain the diference between welfare and unemployment. don't we pay for unemployment insurance in our paychecks every week? it's more like social security than welfare but no one in gov't seems to have the ability to explain this distinction.

Dec. 15 2010 10:31 AM
Sophia from Yonkers, NY

Can't the House Democrats stay strong on the middle class tax cuts, let the millionaire tax cuts expire and then can't the Senate take the constitutional option and pass it with 51 votes?

Dec. 15 2010 10:07 AM

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