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Archive for Sunday, October 28, 2001

House GOP prepares tax-cut feast

October 28, 2001

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To call House Ways and Means Committee Chairman Rep. Bill Thomas, R-Calif., prickly is an understatement roughly comparable to describing rock-star Madonna as flirtatious. If abrasiveness were an Olympic event, Bill Thomas would, in the judgment of many of his House colleagues in both parties, win the gold, the silver and the bronze. What makes Thomas such an influential legislator is not simply his position atop Congress' most powerful tax-writing committee, but the fact that Bill Thomas is as bright as he is difficult and nobody in this city works any harder than he does.

By writing a tax-cut bill so loaded with controversial pro-business breaks that it was able to pass the Republican House by only a razor-thin margin of 216-214, Chairman Thomas may have unwittingly exposed President George W. Bush's most serious political vulnerability. Simultaneously, he may have left his own GOP House colleagues exposed to election year charges that, in the middle of a recession, they chose to reject any income tax cut for the bottom 75 percent of American earners and preferred instead to comfort their already comfortable corporate patrons.

How, you might logically ask, could any president who currently receives a favorable job rating from 9 out of 10 of his constituents have any "serious political vulnerability"? Consistently in the first eight months of his administration, Mr. Bush was viewed by the voting public as being too chummy with and too responsive to the "very well-off." In the Wall Street Journal/NBC news poll, the Republican president's biggest negative, named by more than three times as many respondents as any other shortcoming: "His policies mainly benefit the wealthy and special interests." When the ABC News/Washington Post survey asked, "Do you think George W. Bush cares more about protecting the interests of ordinary working people or cares more about protecting the interests of large business corporations?" by 61 percent to 28 percent the answer was Bush "cares more" about large business corporations.

Now comes Bill Thomas' House-passed tax-cut, which repeals the corporate alternative-minimum tax (that was signed into law 15 years ago by President Ronald Reagan) and was written to ensure that businesses with large deductions and other write-offs would pay at least some federal tax. Not content simply to repeal the minimum tax on corporations, the House Republican bill would return from the now-shrinking U.S. Treasury to the companies all the taxes they had been required to pay under that law since 1986.

Consider Enron, the Texas energy company that contributed $1.8 million to Republican campaigns and committees during the last campaign. Enron, according to the respected Congressional Reference Service of the Library of Congress, would get U.S. Treasury checks totaling $254 million. Talk about return on investment!

Enron is not alone. General Electric, hardly a charity case, gave $1.8 million to the GOP and would, under the Thomas bill, reap a payoff from U.S. taxpayers of $671 million. For a "modest" donation to Republicans of $786,000 during the last campaign, Chevron would "win" a grand total (Including some other tax credits) of $314 million. In all, the cost to taxpayers which would have to come out of Social Security taxes paid by all working Americans who make less than $83,000 a year would be $25 billion.

Democrats cannot believe the political advantage given to them. Rep. Gerald Kleczka, D-Wis., compared the Republican raid on the public purse to pay off corporate contributors to the loathsome "looters in the basement shops of the fallen World Trade Center." Massachusetts Rep. Ed Markey spoke in debate about the Civil War, when the wealthy could purchase substitutes to do their fighting for them and how "the war became known as the rich man's war but the poor man's fight. That is what the Republican bill today in a time of war is a big goodie grab bag of tax breaks for the wealthiest."

The question now becomes, what will President Bush do? With a favorable public rating of 90 percent, that means the president's standing among Republicans must be somewhere over 110 percent. Surely he would have the confidence to stand up to the most militant wing of his own party now and say: This is not the sort of "sacrifice" I am asking of all Americans. Otherwise, the bipartisan honeymoon is history. It is an unhappy choice thrust upon the GOP executive by his GOP "friends" in the GOP House.




Mark Shields is a columnist for Creators Syndicate.

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