Sales taxes

Vote To Raise the Minimum Wage without Cutting Estate Taxes of 2006

hmoroz — Mon, 27 Jul 2009 12:15:12 -0400

Legislation

The middle class

Supports

Video Summary

Injustice Facts

Number of workers who would benefit from the minimum wage increase included in the Estate Tax and Extension of Tax Relief Act: 5.6 million

Approximate number of estates the estate tax reduction would benefit: 8,200

Percentage increase in the cost-of-living since September 1997: 26

Percentage increase in the federal minimum wage since September 1997: 0

Top estate tax rate and maximum exemption in 2001, respectively: 60%, $675,000

Top estate tax rate and maximum exemption in 2015 under the Estate Tax and Extension of Tax Relief Act: 30%, $5 million

Overview/Summary

Middle Class Position Analysis

The Middle-Class Supports. At less than $11,000 a year for a full-time worker, the federal minimum wage is a poverty wage. It is a rate at which it is impossible for working Americans to independently pay their rent, feed their families or get needed medical care—much less save for the types of investments that make it possible to work one’s way into the middle class, like an education, a secure home or the chance to start a business.

Contrary to the stereotype of the minimum wage worker as a teenager with nothing to purchase but junk food and movie tickets, the typical minimum wage worker is an adult providing more than half of his or her family’s total earnings. According to the Economic Policy Institute, half of families with a minimum wage worker rely on his or her pay as the family’s only source of earnings. As many states have raised their minimum wages above the federal rate, economists have also had more opportunities to study the effects of minimum wage increases, concluding that raising the minimum wage does not lead to the loss of jobs.

In contrast, the estate tax provisions which this vote aimed to remove from the bill will only benefit the wealthiest taxpayers. The estate tax is the most progressive component of the federal tax code and applies only to Americans lucky enough to inherit substantial fortunes. By taxing inherited wealth, the tax preserves the American tradition of rewarding hard work, not inherited privilege and wealth. According to the nonpartisan Congressional Budget Office, the estate tax provisions would cost approximately $267.6 billion between 2007 and 2016. This significant reduction would adversely affect aspiring middle-class and middle-class Americans by burdening them with more of the cost of public services while allowing accumulated wealth to be passed on for generations. Those who work for their money would be forced either to pick up a bigger share of the tax bill or to suffer cuts in services essential to middle-class families and communities.

Roll Call Vote 424 would strip the provisions that are detrimental to middle-class households from the legislation, while preserving the minimum wage increases that are critical to expanding the ranks of the middle class.

Quotes from Experts

Beyond this Bill

Additional Resources

“Nine Years of Neglect: Federal Minimum Wage Remains Unchanged for Ninth Straight Year,” from the Economic Policy Institute

“States with Minimum Wages above the Federal Level Have Had Faster Small Business and Retail Job Growth,” from the Fiscal Policy Institute

“Tax Topics: Estate and Gift Taxes,” from the Tax Policy Center

American Recovery and Reinvestment Act of 2009 - Conference Report

hmoroz — Tue, 17 Feb 2009 19:06:44 -0500

Legislation

The middle class

Supports

Video Summary

Injustice Facts

Unemployment rate in early 2010, if current laws and policies governing federal spending and taxes do not change, according to the Congressional Budget Office: 9.2%

Reduction in unemployment rate in 2010 if the American Recovery and Reinvestment Act is enacted, according to the Congressional Budget Office, Mark Zandi of Moody’s Economy.com, and White House economic advisers, respectively: 1.9%, 2.1%, 1.8%

Increase in GDP from spending $1 on extended unemployment insurance benefits, in dollars: 1.63

Increase in GDP from spending $1 on accelerated depreciation, which provides businesses a tax break for new investment, in dollars: 0.25

Percentage of spending and tax cuts that will take effect by the end of 2010, according to the Congressional Budget Office: 74%

Percentage reduction in aid to states made by the conference report of the American Recovery and Reinvestment Act compared to the House version: 32%

Overview/Summary

Middle Class Position Analysis

Middle Class Supports.Economic conditions are bleak. The Congressional Budget Office estimates that if the economy continues on its current course, both the length and depth of the current downturn will be the worst since the Great Depression. For middle-class Americans, this means job and wage cuts, loss of health insurance, and, simply, a daily struggle to keep up with everyday costs like mortgage payments and college tuition.

The Congressional Budget Office estimates that if current economic conditions persist the unemployment rate could reach as high as 9.2% by 2010. With 46 million Americans already uninsured, the Kaiser Family Foundation reckons that if unemployment averages just 7% in 2009 (the current rate is 7.2%), the number of uninsured will increase by 2.6 million with an additional 2.4 million individuals enrolled in Medicaid and SCHIP. Indeed, state governments are struggling to provide the increased services needed to keep the swelling ranks of unemployed, uninsured individuals from falling out of the middle class. But the current economic climate has left states with decreased revenue from income, sales, and property taxes: 46 states face budget shortfalls with combined budget gaps of $350 billion through 2011. To confront these gaping budget holes, more than 20 states have implemented or are considering cuts to health insurance programs; the same is true of K-12 and early education programs and of funds for public colleges and universities.

Beyond the decidedly dire short-term outlook, economic improvement is probably quite far off. Douglas Elmendorf, director of the Congressional Budget Office, has testified that “economic recovery is likely to be slow and protracted.” Thus, programs that address longer-term concerns – investment in infrastructure and green technology are two primary examples – are as important as an immediate, stimulative jolt to the economy.

The American Recovery and Reinvestment Act ties together measures designed to assist middle-class households struggling to make ends meet, provisions that will provide an immediate economic stimulus, and investment that can help set the stage for an economy built on energy efficiency and durable infrastructure. Economists generally agree that the legislation will save around 3 or 4 million jobs by 2010, while increasing economic output. Indeed, the Congressional Budget Office, Mark Zandi of Moody’s Economy.com, and White House economic advisers all project that the legislation will reduce the unemployment rate by around 2%. Extended unemployment insurance will allow 6.7 million people to collect benefits. Importantly, aid to state governments for Medicaid and education programs would shore up budget gaps and help prevent cuts to vital services.

While assisting those most at need during the economic downturn, extended unemployment insurance and state fiscal assistance also generate the most “bang for their buck” in terms of stimulus because they funnel money into the hands of the people most likely to spend it. Extended unemployment insurance generates an estimated $1.63 in economic activity for each dollar spent; aid to state governments generates $1.38. In contrast, though they act more quickly than spending measures, tax cuts generate less stimulus. The Making Work Pay, Child, and Earned Income tax credits will help keep more than 2.3 million Americans out of poverty and the American Opportunity credit will make 3.8 million more students eligible for a higher education tax break. These are important measures that will assist aspiring middle-class and middle-class Americans struggling to make ends meet. But the expansions are temporary and tax cuts, even when refundable and directed at the low-income individuals most likely to spend them, are less effective stimulus measures. Worst of all, though, are tax cuts for businesses like accelerated depreciation and carryback loss provisions that have little economic benefit.

Despite concern that the spending included in the American Recovery and Reinvestment Act will be delayed, perhaps a valid concern due to the legislation’s size and complexity, the Congressional Budget Office estimates that 74% of spending would occur between 2009 and 2010. Indeed, funds for investment in infrastructure and energy efficiency, though perhaps more complicated to spend, are a critical step in longer term economic recovery. Beyond its stimulative value – infrastructure spending’s “bang for the buck” is $1.59 – the United States desperately needs new infrastructure to compete in the global economy. The American Society of Civil Engineers estimates that $2.2 trillion in infrastructure spending is now necessary. The funding for infrastructure projects included in the legislation is a first step in addressing this deficiency and funds devoted to high-speed rail are particularly welcome. Similarly, spending on a modernized electricity grid, retrofitted low-income housing, and weatherized homes creates the framework for a future economy less reliant on fossil fuels and, indeed, based on green technology.

Limitations on executive compensation and bonuses are a first step in establishing the accountability that has been missing from the financial bailout. Still, the bill does not set forth a comprehensive plan to address the foreclosure crisis that includes a moratorium on foreclosures, a mechanism to require modification of mortgages, and a change to the bankruptcy code to permit modification of mortgages on primary residences. Funds for the Neighborhood Stabilization Program are a necessary, but insufficient, step in mitigating the widespread negative effects that foreclosures can have on entire neighborhoods and communities.

Quotes from Experts

Beyond this Bill

Additional Resources

Recovery.gov, the official website of the American Recovery and Reinvestment Act

“Recession and Recovery,” from the Center on Budget and Policy Priorities

“Impact of Economic Turmoil on Health Coverage and State Medicaid Programs,” from the Kaiser Commission on Medicaid and the Uninsured

American Recovery and Reinvestment Act of 2009 - Senate Version

hmoroz — Tue, 10 Feb 2009 16:24:04 -0500

Legislation

The middle class

Supports

Video Summary

Injustice Facts

Unemployment rate in early 2010, if current laws and policies governing federal spending and taxes do not change, according to the Congressional Budget Office: 9.2%

Increase in GDP from spending $1 on extended unemployment insurance benefits, in dollars: 1.63

Increase in GDP from spending $1 on accelerated depreciation, which provides businesses a tax break for new investment, in dollars: 0.25

Percentage reduction in aid to states made by the Senate version of the American Recovery and Reinvestment Act: 50.1%

Percentage reduction in Head Start and Early Head Start funds made by the Senate version of the American Recovery and Reinvestment Act: 50%

Overview/Summary

Middle Class Position Analysis

Middle Class Supports. Economic conditions are bleak. The Congressional Budget Office estimates that if the economy continues on its current course, both the length and depth of the current downturn will be the worst since the Great Depression. For middle-class Americans, this means job and wage cuts, loss of health insurance, and, simply, a daily struggle to keep up with everyday costs like mortgage payments and college tuition.

The Congressional Budget Office estimates that if current economic conditions persist the unemployment rate could reach as high as 9.2% by 2010. With 46 million Americans already uninsured, the Kaiser Family Foundation reckons that if unemployment averages just 7% in 2009 (the current rate is 7.2%), the number of uninsured will increase by 2.6 million with an additional 2.4 million individuals enrolled in Medicaid and SCHIP. Indeed, state governments are struggling to provide the increased services needed to keep the swelling ranks of unemployed, uninsured individuals from falling out of the middle class. But the current economic climate has left states with decreased revenue from income, sales, and property taxes: 45 states face budget shortfalls with combined budget gaps of $350 billion through 2011. To confront these gaping budget holes, more than 20 states have implemented or are considering cuts to health insurance programs; the same is true of K-12 and early education programs and of funds for public colleges and universities.

The American Recovery and Reinvestment Act ties together measures designed to assist middle-class households struggling to make ends meet, provisions that will provide an immediate economic stimulus, and investment that can help set the stage for an economy built on energy efficiency and durable infrastructure. Economists generally agree that the legislation will save around 3 or 4 million jobs by 2010, while increasing economic output. Indeed, the Congressional Budget Office , Mark Zandi of Moody’s Economy.com, and White House economic advisers all project that the legislation will reduce the unemployment rate by around 2%. Extended unemployment insurance will allow 6.7 million people to collect benefits. Importantly, aid to state governments for Medicaid and education programs would shore up budget gaps and help prevent cuts to vital services.

While assisting those most at need during the economic downturn, extended unemployment insurance and state fiscal assistance also generate the most “bang for their buck” in terms of stimulus because they funnel money into the hands of the people most likely to spend it. Extended unemployment insurance generates an estimated $1.63 in economic activity for each dollar spent; aid to state governments generates $1.38. In contrast, though they act more quickly than spending measures, tax cuts generate less stimulus. The Making Work Pay, Child, and Earned Income tax credits will help keep more than 2.1 million Americans out of poverty and the American Opportunity credit will make 3.8 million more students eligible for a higher education tax break. These are important measures that will assist aspiring middle-class and middle-class Americans struggling to make ends meet. But the expansions are temporary and tax cuts, even when refundable and directed at the low-income individuals most likely to spend them, are less effective stimulus measures. Worst of all, though, are tax cuts for businesses like accelerated depreciation and carryback loss provisions that have little economic benefit.

Despite concern that the spending included in the American Recovery and Reinvestment Act will be delayed, perhaps a valid concern due to the legislation’s size and complexity, the Congressional Budget Office estimates that 78% of spending would occur between 2009 and 2010. Indeed, funds for investment in infrastructure and energy efficiency, though perhaps more complicated to spend, are a critical step in longer term economic recovery. Beyond its stimulative value – infrastructure spending’s “bang for the buck” is $1.59 – the United States desperately needs new infrastructure to compete in the global economy. The American Society of Civil Engineers estimates that $2.2 trillion in infrastructure spending is now necessary. The funding for infrastructure projects included in the legislation is a first step in addressing this deficiency. Similarly, spending on a modernized electricity grid, retrofitted low-income housing, and weatherized homes creates the framework for a future economy less reliant on fossil fuels and, indeed, based on green technology.

Requirements for application of TARP funds to foreclosure prevention and for limitations on executive compensation and bonuses are first steps in establishing the accountability that has been missing from the financial bailout. Still, the bill does not set forth a comprehensive plan to address the foreclosure crisis that includes a moratorium on foreclosures, a mechanism to require modification of mortgages, and a change to the bankruptcy code to permit modification of mortgages on primary residences.

Quotes from Experts

Beyond this Bill

Additional Resources

“Recession and Recovery,” from the Center on Budget and Policy Priorities

“The State of the Economy and Issues in Developing an Effective Policy Response,” Statement of Douglas W. Elmendorf before the House Committee on the Budget

“Impact of Economic Turmoil on Health Coverage and State Medicaid Programs,” from the Kaiser Commission on Medicaid and the Uninsured

Renewable Energy and Job Creation Act of 2008

hmoroz — Mon, 29 Sep 2008 11:22:48 -0400

Legislation

The middle class

Supports

Video Summary

Injustice Facts

Percentage of the benefits of the child tax credit that went to families in the top 40% of the income distribution in 2005: 60

Maximum percentage of the benefits of the child tax credit that went to families in the lowest 20% of the income distribution in 2005: 1

Estimated number of children that the child tax credit provision in the legislation would benefit: 13 million

Estimated number of jobs that could be lost if federal tax credits for solar and wind energy are not extended: 116,000

Percentage by which the cost-sharing for addiction benefits exceeded that for medical or surgical benefits, according to a 2007 Health Affairs study of employer-provided benefits: 46

Number of taxpayers subject to the alternative minimum tax in 1970: 20,000

Number of taxpayers projected to be subject to the alternative minimum tax in 2010, absent changes in current law: 33 million

Number of taxpayers subject to the alternative minimum tax in 2007, after Congress passed a temporary alternative minimum tax patch: 4.1 million

Overview/Summary

Middle Class Position Analysis

The Middle Class Supports. The Renewable Energy and Job Creation Act includes a wide range of tax cuts and legislative initiatives, but the overall thrust of the bill is highly positive for the middle-class. Indeed, middle-class Americans are increasingly feeling the effects of an energy policy that favors large oil companies over the economic and environmental benefits of sustainability. The energy tax credit expansions and extensions in the Renewable Energy and Job Creation Act are part of a long-term strategy to alleviate high gas and heating costs, make the country more energy efficient, and ensure that the economy retains jobs in renewable energy and technology. With the middle class already feeling the effects of weak employment, Congress must strengthen a renewable energy and energy efficiency industry that benefits both the environment and the economy.

Additionally, the Renewable Energy and Job Creation Act’s changes to the child tax credit would make 2.9 million additional children eligible for the benefit and would increase the benefit for 10.1 million more. Expanding the income floor for the tax credit means that very low-income aspiring middle-class families, who currently benefit less from the credit than higher-income families, will receive the support they need to make ends meet.

The mental health and “substance use disorder” parity provisions of the Act not only do much to remedy the discriminatory practices of insurers, but will increase access to mental health care services for middle-class Americans already struggling with high health care costs. Temporarily raising the Alternative Minimum Tax exemption ensures that middle-class Americans are not overwhelmed by a tax that they were never intended to pay. An increase in tax payments for more than 25 million American homes – exposing fully 46% of households with incomes between $75,000 and $100,000 to the AMT by 2010– would be disastrous for families already reeling from home foreclosures, high gas prices, and nearly stagnant wages.

Quotes from Experts

Beyond this Bill

Additional Resources

“Greener Pathways: Jobs and Workforce Development in the Clean Energy Economy,” from the Apollo Alliance

“Taxation and the Family: What is the child tax credit?” from the Tax Policy Center

Tax Topics: Individual Alternative Minimum Tax (AMT), from the Tax Policy Center

Renewable Energy and Job Creation Act of 2008

hmoroz — Thu, 22 May 2008 17:49:06 -0400

Legislation

The middle class

Supports

Video Summary

Injustice Facts

Percentage of the benefits of the child tax credit that went to families in the top 40% of the income distribution in 2005: 60

Maximum percentage of the benefits of the child tax credit that went to families in the lowest 20% of the income distribution in 2005: 1

Estimated number of children that the child tax credit provision in the legislation would benefit: 13 million

Estimated number of children who would become newly eligible for the child tax credit under the legislation: 2.4 million

Estimated industry revenues from renewable energy and efficiency in 2006, in dollars: 970 billion

Estimated lost investment if federal tax credits for solar and wind energy are not extended, in dollars: 19 billion

Estimated jobs in the renewable energy and efficiency industry in 2006: 8.5 million

Estimated number of jobs that could be lost if federal tax credits for solar and wind energy are not extended: 116,000

Overview/Summary

Middle Class Position Analysis

The Middle Class Supports. While politicians are proposing short-term band-aids to deal with rising fuel costs, middle-class Americans are increasingly feeling the effects of an energy policy that harms the environment and favors large oil companies. The energy tax credit expansions and extensions in the Renewable Energy and Job Creation Act are part of a long-term strategy to alleviate high fuel costs, make the country more energy efficient, and ensure that the economy retains jobs in renewable energy and technology. Indeed, a recent study demonstrated that failure to extend energy tax credits for solar and wind power could result in the loss of 116,000 jobs. With the middle class already feeling the effects of weak employment, Congress must strengthen a renewable energy and energy efficiency industry that benefits both the environment and the economy.

Aspiring middle-class families with children are in a particularly difficult situation in an economy of high food, fuel, and health care costs. The Renewable Energy and Job Creation Act’s changes to the child tax credit would make 2.4 million additional children eligible for the benefit and would increase the benefit for 10.5 million more. Expanding the income floor for the credit means that very low-income aspiring middle-class families, who currently benefit less from the credit than higher-income families, will receive the support they need to make ends meet.

The revenue raising provisions of the Renewable Energy and Job Creation Act not only make the legislation fiscally responsible, but make the tax code fairer by eliminating loopholes exploited by wealthy executives and multinational corporations.

Quotes from Experts

Beyond this Bill

Additional Resources

“Greener Pathways: Jobs and Workforce Development in the Clean Energy Economy,” from the Apollo Alliance

“Taxation and the Family: What is the child tax credit?” from the Tax Policy Center

“Families Helped by the Child Tax Credit Expansion Work Hard in Low-Paying Jobs,” from the Center for Budget and Policy Priorities

Children's Health Insurance Program Reauthorization Act of 2007 [Revised bill]

atraub — Wed, 30 Jan 2008 18:08:54 -0500

Legislation

The middle class

Supports

Video Summary

Injustice Facts

Number of children who would have health care coverage by 2012 if this legislation passes who would otherwise be uninsured: 3.9 million

Increase in the number of uninsured children between 2005 and 2006: 611,000

Percentage of uninsured children who saw a doctor for a medical check up, emergency care, or any other reason during the previous year: 51

Percentage of insured children who saw a doctor in that time: 76

Overview/Summary

Middle Class Position Analysis

The Middle Class Supports. SCHIP has been highly successful at reducing the number of uninsured children, but a lack of funding has limited its reach, leaving 9 million American children uninsured in 2006. The shortfall has consequences, not only for children’s individual health and well-being, but for society as a whole, which bears the cost of preventable emergency room visits from children who never got preventive care. By renewing SCHIP and expanding it to more low- and middle-income children, this bill offers children a healthy start in life.

Steeply rising costs over the past several years have made health coverage unaffordable, not only for the poor, but also for a growing number of middle-class families. Since 2000, the premium that the average American employee pays for health coverage has risen more than 83 percent, increasing more than four times faster than wages. At the same time, more employers are dropping insurance plans entirely, and coverage is even more expensive for Americans who must purchase it themselves on the open market. Being able to take a child to the doctor for regular check-ups and immunizations is fundamental to a middle-class standard of living.

Quotes from Experts

Beyond this Bill

Additional Resources

The Center on Budget and Policy Priorities Health Policy page, with an SCHIP subsection

“Foundation Resources on the State Children's Health Insurance Program and the Debate on Its Reauthorization,” from the Kaiser Family Foundation

“SCHIP 101:What Is the State Children’s Health Insurance Program, and How Does It Work?” from Families USA

Children's Health Insurance Program Reauthorization Act of 2007

atraub — Wed, 24 Oct 2007 11:16:52 -0400

Legislation

The middle class

Supports

Video Summary

Injustice Facts

Number of children who would have health care coverage by 2012 if this legislation passes who would otherwise be uninsured: 3.8 million

Increase in the number of uninsured children between 2005 and 2006: 611,000

Percentage of uninsured children who saw a doctor for a medical check up, emergency care, or any other reason during the previous year: 51

Percentage of insured children who saw a doctor in that time: 76

Overview/Summary

Middle Class Position Analysis

The Middle Class Supports: SCHIP has been highly successful at reducing the number of uninsured children, but a lack of funding has limited its reach, leaving 9 million American children uninsured in 2006. The shortfall has consequences, not only for children’s individual health and well-being, but for society as a whole, which bears the cost of preventable emergency room visits from children who never got preventive care. By renewing SCHIP and expanding it to more low- and middle-income children, this bill offers children a healthy start in life.

Quotes from Experts

Beyond this Bill

Additional Resources

The Center on Budget and Policy Priorities Health Policy page, with an SCHIP subsection

“Foundation Resources on the State Children's Health Insurance Program and the Debate on Its Reauthorization,” from the Kaiser Family Foundation

“SCHIP 101:What Is the State Children’s Health Insurance Program, and How Does It Work?” from Families USA

Sales taxes

Vote To Raise the Minimum Wage without Cutting Estate Taxes of 2006

Legislation

The middle class

Video Summary

Injustice Facts

Overview/Summary

Middle Class Position Analysis

Related Blog: Header

Quotes from Experts

Related Blog: Text

Beyond this Bill

Related Blog: Link

Additional Resources

American Recovery and Reinvestment Act of 2009 - Conference Report

Legislation

The middle class

Video Summary

Injustice Facts

Overview/Summary

Middle Class Position Analysis

Related Blog: Header

Quotes from Experts

Related Blog: Text

Beyond this Bill

Related Blog: Link

Additional Resources

American Recovery and Reinvestment Act of 2009 - Senate Version

Legislation

The middle class

Video Summary

Injustice Facts

Overview/Summary

Middle Class Position Analysis

Related Blog: Header

Quotes from Experts

Related Blog: Text

Beyond this Bill

Related Blog: Link

Additional Resources

Renewable Energy and Job Creation Act of 2008

Legislation

The middle class

Video Summary

Injustice Facts

Overview/Summary

Middle Class Position Analysis

Related Blog: Header

Quotes from Experts

Related Blog: Text

Beyond this Bill

Related Blog: Link

Additional Resources

Renewable Energy and Job Creation Act of 2008

Legislation

The middle class

Video Summary

Injustice Facts

Overview/Summary

Middle Class Position Analysis

Related Blog: Header

Quotes from Experts

Related Blog: Text

Beyond this Bill

Related Blog: Link

Additional Resources

Children's Health Insurance Program Reauthorization Act of 2007 [Revised bill]

Legislation

The middle class

Video Summary

Injustice Facts

Overview/Summary

Middle Class Position Analysis

Related Blog: Header

Quotes from Experts

Related Blog: Text

Beyond this Bill

Related Blog: Link

Additional Resources

Children's Health Insurance Program Reauthorization Act of 2007