As the G.O.P. Promises to Address Inequality, Follow the Money - by John Cassidy

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http://www.newyorker.com/news/daily-comment/as-the-g-o-p-promises-to-address-inequality-follow-the-money

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On Wednesday, the G.O.P.-dominated House Ways and Means Committee voted to repeal the federal estate tax, which Republicans have, for years, been labelling a “death tax” that ravages the bequests of ordinary Americans. “This tax doesn’t just hit the big guy,” the committee’s chairman, Paul Ryan, said. “It hits the little guy—like the small business and the family farm.”

The facts? Since George W. Bush entered office, in 2001, the estate tax has already been reformed several times, and it now applies only to inheritances valued at more than $5.4 million. According to an analysis by the nonpartisan Tax Policy Center, in 2013, the latest year for which figures are available, about 0.2 per cent of estates—that’s two in a thousand, or fewer than four thousand estates in total—owed the estate tax. As Congressman Jim McDermott, a Democratic member of the Ways and Means Committee, pointed out, “You cannot call twenty-three-thousand acres a family farm.” A repeal of the estate tax, he said, would amount to a “massive unfunded tax break” for the very wealthiest people in the country. The Joint Committee on Taxation estimates that the move will raise the budget deficit by about two hundred and seventy billion dollars over the next ten years.

On the same day that this attempted exercise in upward income redistribution was going on in Ryan’s committee, just down the hall, in the main chamber of the House, Republican representatives were approving a new budget that, according to its primary sponsor, Tom Price, the chairman of the Budget Committee, would balance the budget within ten years, primarily by cutting expenditures by nearly $5.5 trillion, as compared with the projected costs of current policies. Who would be most hurt by those spending reductions? You guessed it.

An analysis by the liberal-leaning Center on Budget and Policy Priorities shows that more than two-thirds of the proposed spending cuts would come from programs that serve low-income and middle-income Americans. Almost three trillion dollars (yes, trillion) would be saved by repealing Obamacare, which provides income-based subsidies for the purchase of private insurance plans, and by slashing funding for Medicaid, the federal health-care system for the poor, which would be converted to a block-grant program and handed over to the states. The Price budget would also cut spending on food stamps by more than a third between 2021 and 2025. It would allow some existing tax credits for low-income and middle-income families to expire over the next few years. And it would significantly reduce funding for Pell Grants, which help students from families of modest means to afford college.

In one sense, of course, none of this congressional maneuvering matters. As long as a Democrat occupies the White House, there’s practically no chance that G.O.P. spending cuts will be enacted, marking the Price budget as more of a political wish list than an actual funding bill. But wish lists matter, too, especially for a Party that is supposedly trying to change its public image. And in 2015, it seems, the most that the Republicans can hope for is to shower more gifts on the wealthiest households in America, while depriving poor families of health care, food stamps, and college tuition.