House approves minimum wage increaseRepublicans....always praying a problem will go away.
By ANDREW TAYLOR, Associated Press Writer Sat Jul 29, 2:02 AM ET
WASHINGTON - Republicans muscled the first minimum wage increase in a decade through the House early Saturday after pairing it with a cut in inheritance taxes on multimillion-dollar estates.
Combining the two issues provoked protests from Democrats and was sure to cause problems in the Senate, where the minimum wage initiative was likely to die at the hands of Democrats opposed to the costly estate tax cuts. The Senate is expected to take up the legislation next week.
The House Democrats are all up for re-election this year, as are all Republicans. In a near-purely partisan vote, 230-180, the House elected to combine these two issues into a muddled package for passage. This way, they can go home to their constituents...you know, the ones struggling to pay for gas as they work their two jobs or even three, at $5.15 an hour?...and say "We've...no, I've gotten you a raise! And a big one!"
The minimum wage will rise to $7.25 an hour, from $5.15 an hour, in three increments of 70 cents an hour annually. In addition to this, tax credits for research and development as well as college tuition credits and tax deductions for state sales tax were also authorized.
But rather than give the greeter at Wal-Mart some unconditional lovin', the Bastards of the Elephant took away, probably more than they gave, by giving the family that OWNS Wal-Mart a bigger tax break than all their employees will receive, combined: a permanent cut in the estate tax.
Right now, there is no estate tax. In 2011, the estate tax will be re-introduced on estates over $1 million (55%).
Granted, some of the money on those estates will have already be subject to taxes, but a lot, most of it in fact, will not.
That radical Communist, Abe Lincoln, during an early effort to impose an income tax on Americans, once said, "Labor is the superior of capital, and deserves much the higher consideration." Meaning, of course, that he would rather tax business owners who have socked away some money, than the laborers who are struggling to earn some.
Makes a lot of sense to me. And estate taxes are about the only place this actually occurs. An estate is accumulated wealth, some of it on the sweat of the person involved, particularly farmers, but much of it is the increaase in value over the normal course of time in assets owned: capital gains.
And until an asset is sold and that increased value is recognized and realized, there is no tax on it. However, through a rather curious loophole, if I own an asset that has appreciated in value and sell it the day before I die, I have to pay tax on the difference between what it cost, generally, and what I received for it.
Take that same asset and leave it to my daughter, and she sells it the day after I die, she pays no tax.
So Paris Hilton's dad can't sell a dime of his holdings without Uncle Sam's cut, but the day they put him in the ground, she's free to sell it to go buy that fur lined Rolls she's been eyeing.
Does that make sense to ANYONE?
The problem with the estate tax is, it's one of those taxes we all want to have to worry about, so none of us want it around. Who among us wouldn't want to have at least a million dollars in assets (like me)? To bear this out, 19% of Americans believe they are in the top 1% of the wealthy in this country.
By contrast, the lower-earning part of that group probably only earns about $50,000, total, and owns a home that might be worth a few hundred thousand dollars, at the tail end of this housing bubble.
YIKES! There are an awful lot of deluded people out there!
So, you see where I'm going with this? The tax burden that's been lost on the estate taxes, to the tune of $1 trillion dollars each decade.
That's "trillion", with a "t," according to ResponsibleWealth.org, Warren Buffett's think tank.
We're currently running a budget deficit of $400 billion dollars, which would be slashed by 25% if the estate tax hadn't been "temporarily" repealed.
That's $100 billion dollars that you and I (since I'm a wage earner also), and moreover, our children, grandchildren, and their children, will be paying so that Paris Hilton can snap up a few Nubian servants for her new tropical island.
We need to reform the tax system so that it's fair, equitable, and easy for the average Joe to understand. Mostly, we need to wake people up.
Senate Minority Leader Harry Reid has vowed to defeat this bill, full stop, after the summer recess. Since Senators only stand for election every six years, only a third of the Senate is running this year. This bill stands a chance of being defeated, but what about the minimum wage increase?