April 25, 2006
Wealthy Families’ Campaign to Repeal Estate Tax is Big Con Job
Statement of Joan Claybrook, President of Public Citizen
We are here today to expose one of the biggest con jobs in recent history: the campaign by a handful of the country’s wealthiest individuals to persuade Congress to repeal the estate tax. The long-running, secretive campaign of 18 extraordinarily wealthy families worth $185.5 billion has relied on deception to bamboozle the public and Congress not only about who must pay the estate tax, but about how repealing it will affect the country. In fact, more families could be involved in the effort – it’s hard to tell because it’s so easy for the backers of this campaign to hide their identities, which is allowable under current lobbying rules.
As outlined in the report released today by Public Citizen and United for a Fair Economy, these families, which alone stand to save $71.6 billion if they succeed, have masterminded a fraud on the American public. They claim that the estate tax will harm small businesses and small farms, when in fact it will not. They claim that the estate tax is a second tax on income, when in fact, it often is the first – 70 percent of wealthy families’ assets are in the form of unrealized capital gains that have never been taxed. And remember, these are people who already received a big tax break because of President Bush’s recent tax cuts.
We’re talking about enormously powerful and wealthy people – billionaires and mega-millionaires. They include the makers of Gallo wine and Campbell’s soup; the founders of world’s largest retailer, Wal-Mart, and the family behind the giant candymaker, Mars.
Contrary to the claims of these individuals and the lobbyists they hire, only about one-fourth of one percent of all estates will pay the estate tax this year.
The families have hidden behind trade associations and lobbyists to make their pitch. They have paid for misleading, fear-inducing ads. They have poured tens of millions of dollars into their efforts, essentially buying what they want in Washington since 1998. They have pumped nearly $28 million into political campaigns to ensure doors open for them and their lobbyists, and collectively, they and their businesses have spent $27 million lobbying Washington officials on a variety of issues, including estate tax repeal.
They have found a friendly and receptive audience on Capitol Hill and in the White House. Too many lawmakers in Congress favor the interests of the rich and powerful over those of ordinary Americans and will bend over backwards to do their bidding, particularly for those who donate to their campaign treasuries.
In addition to revealing the insidious details of the repeal campaign, this report underscores the acute need for lobbying reform. We need disclosure of the movers behind large grassroots lobbying efforts and disclosure of who supports the types of for-profit associations that are outlined in this report. And the database of lobbying records maintained by the clerks of the House and Senate should enable searches by lobbyist, which they currently do not.
Repealing the estate tax will cost America a trillion dollars in just 10 years – enough to provide health insurance to every uninsured person in the United States. We cannot afford for this campaign of manipulation and deception to be successful and put the country further in hock. A vote on estate tax repeal is scheduled to be taken in the Senate in the next several weeks. It has already passed the House of Representatives. The Senate should vote in the interests of the majority of people in the country, not 18 super-wealthy families.