Tax Breaks and Texan Billionaires

On a campaign stop for Republican candidates in Florida, Bush trotted out the latest scare tactic from the GOP.

"If they [Democrats] get control of the House of Representatives, they'll raise your taxes," Bush told several hundred supporters at a fundraiser in Tampa. "It will hurt our economy, and that's why we're not going to let them get control."

The President's remarks were a reference to Charlie Rangel, (D-NY) who would take over the powerful House Ways and Means Committee if the Democrats gain control of Congress in November's election.

....Rangel said a top priority will be offering families relief from the alternative minimum tax. He also said he will review "tax breaks for the wealthy that no one has asked for and have driven our nation deeper into debt."

If you want any more proof of the success of the Paris Hilton tax cuts and other Bush administration policies rewarding the "have mores," consider this from Forbes magazine's new rankings of the richest Americans:

Making a billion just isn't what it used to be. In our inaugural ranking of the world’s richest people 20 years ago, we uncovered some 140 billionaires. Just three years ago we found 476. This year the list is a record 793. They’re worth a combined $2.6 trillion, up 18% since last March. Their average net worth: $3.3 billion.

It's a good time to be filthy rich. In fact, the list should be renamed "Ranking America's Billionaires. " For the first time in Forbes' history, no one who was not a billionaire made the list.

Among the Texans on the Forbes list, Texas' highest ranking billionaire was computer mogul Michael Dell of Austin at number 12. Alice Walton (see Republican Priorities - More Gifts for the Rich) was close behind at 20. Three members of the Bass family of Fort Worth made the list.

Oh, and those tax breaks the President refers to?

Virtually all of President Bush's tax cuts and credits — the lower rates, the child tax credit, the special breaks for married couples and the lower tax rates on investment income — are set to expire by 2011.

Of course, they never intended to let them expire, but making them permanent would have required a little honesty about the true costs of these measures - crushing deficits as far as the eye can see. And when our government finally acknowledges it's bankrupt, who do you think will be giving up government services? Care to put your political clout up against the Waltons?

Politically, that means that fewer and fewer tax breaks will be considered too sacred to sacrifice. It also means that tax breaks benefiting those with less political power could be at greater risk.

Scores of other expiring tax breaks for middle-class and lower-income people could face challenges as well. Among them are a tax deduction for parents who pay college tuition, a tax deduction for schoolteachers who buy classroom supplies, and tax credits for hiring workers in areas of high unemployment.

As the competition to save endangered tax breaks grows more intense, survival is likely to go to the fittest.

Are you ready for the next assault on social security?