Moyers: The Story Behind the Story of Those Huge Corporate Tax Cuts
Last week, Igor Volsky reported for Think Progress that Senate Majority Leader Harry Reid (D-Nevada) had struck a deal with House Republicans to give corporate America a massive tax giveaway just weeks after the midterm elections. The agreement, wrote Volsky, “would permanently extend relief for big multinational corporations without providing breaks for middle or lower-income families.” Writing in The Washington Post, Jared Bernstein, a former economic advisor to Vice President Joe Biden, called the package ”a dog’s breakfast of permanent tax breaks mostly for businesses that would add over $400 billion to the 10-year budget deficit without doing anything for low-income, working families.”
He wasn’t alone in panning the deal. Treasury Secretary Jack Lew told Volsky that the cuts would be “fiscally irresponsible.” The 10-year, $444 billion package includes a few provisions that were popular with Democrats, but would phase out existing tax credits for clean energy development. Mostly, it’s a boon for some of the top corporate tax-avoiders in America. Some 90 percent of the cuts would benefit their bottom lines. One of the biggest beneficiaries would be GE, which, according to Citizens for Tax Justice, claimed tax refunds of $3.1 billion on $27.5 billion in profits between 2008 and 2012. That means the company had a negative tax rate of 11 percent. Other big winners would include Wall Street financial firms, pharmaceutical companies and computer and Internet businesses.
And while Republicans insist that things like disaster relief and unemployment benefits be “offset” with cuts to other programs, these breaks would not be. The resulting deficits would then be used to justify deeper cuts to programs that have already been starved by “sequestration” — health care, education and assistance for the poor. Jared Bernstein called that “a particularly nefarious twist.” And, as if to add insult to injury, The New York Times reported that Republican negotiators announced that they were stripping away an expanded earned-income credit and a child tax credit, two measures that help keep poor working families above the poverty line. The proposed cuts were in retaliation for Obama’s executive action on immigration.
Once the story broke, Harry Reid’s office denied that a deal had been struck. The White House quickly issued a veto threat. And one Democratic strategist who asked not to be identified told BillMoyers.com that shortly after Volsky’s story was published, administration staffers were sending out emails to allies excoriating the deal. He noted that it was an unusual response for an administration that values message discipline and is typically deliberative in crafting responses to these kinds of legislative proposals.
THE REST:
http://billmoyers.com/2014/12/03/tax-extenders/
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