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Tax cuts for the few - good for our security?
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Tax cuts for the few - good for our security?
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The most essential facts.

2004

Do big federal tax cuts

for the few

make $ense for our security?

 

·      Homeland Security assistance to local police, fire & other front-line staff is under-funded by $98 billion for the next 5 years ($98 billion is 4 times what Washington now spends). [1]

 

·       Poorly guarded nuclear bomb-making materials in the former Soviet Union will not be secured for another 13 years without more funding and leadership from Washington. [2]   

 

·       Since 9/11, Washington has come through with only $516 million (9%) of the $5.6 billion the Coast Guard needs to make U.S. seaports minimally secure. [3]

 

·       Many unguarded factories in the U.S. produce lethal chemicals in populated areas, but the current Administration has not requested funds to protect them. [4]   

 

Vote on Nov. 2.  Help get out the vote.  

 

www.nationalvoice.org, 1-866-428-7228;

www.nhcitizensalliance.org/UpcomingCanvasses.html.
 

·        The Administration opposed adding 80 new criminal financial investigators to disrupt the financing of terrorist groups (to save $12 million.) [5]

 

·        Although Washington has provided funds for our badly neglected state and local public health system to protect us from bioterrorism, it did very little to help states & municipalities through their general funding crisis of the past 4 years.  As a result, state and local funds for public health have been cut. [6] 

 

OUR ECONOMY

 

·        Despite the need to reduce our dependence on foreign oil, the White House budget plans a 27% cut ($1.2 billion) by 2009 in energy programs (which include renewable energy source development). [7]  (With its other hand, the Administration slightly increased this year’s funding for “renewable” energy, i.e. hydrogen to be produced by coal and nuclear power.) [8]

 

·        Research, science and technology programs would be cut for the next 5 years to finance exploration of the moon and Mars. [9]  (Past successes of federally-financed research include the initial development of computers and the Internet.)

 

·        Funding for “No Child Left Behind” has totaled $32 billion (25%) below the levels authorized by Congress during the 4 year state fiscal crisis, despite the fact that school children in a significant number of other countries surpass the U.S. in science and math. [10] 

               

·        Long-term economic growth will probably not increase as a result of the 2001-2003 federal tax cuts, and may be reduced, according to a number of economic studies (even if the tax cuts are made permanent). [11]

 

OUR PEOPLE

 

·        One out of every three people under 65 had no health insurance for part or all of 2002-2003. [12]    

 

·        Two million long-term unemployed have gone without extended unemployment benefits. [13] 

 

·        “39 percent of student borrowers have unmanageable debt after they graduate [college]” (due to student loan payments over 8% of income). [14]

 

·        Unless taxes are raised, severe cuts in Social Security, Medicare and Medicaid will be necessary. [15]  

 

·        Federal tax cuts, “unfunded mandates” & other federal burdens cost the average state 8.4% of its “general fund” budget. (Wonder why local taxes are going up?) [16]  

 

·        In New England, the cost to Massachusetts will be $1.1 billion in 2005, Connecticut - $782 million, Maine - $222 million, New Hampshire - $145 million and Vermont - $126 million. [17] (See the data source for your state.)

 

·        “Cleveland has laid off 15 percent of its cops – 250 officers. Pittsburgh has lost a quarter of its officers, - - Los Angeles County - 1,200 deputies - ‘This is all compounded by - - less money coming in from Washington’ ”. [18] 

 

OUR ENVIRONMENT

 

·        For National Parks, since 2001, the White House has provided only $350 million (7%) of the $4.9 billion it promised to eliminate maintenance backlogs. [19]

 

·        By 2009, the Administration’s budget plans a 20% cut ($6.8 billion) in total funding for Natural Resources and the Environment. [20]

 

·        The 2005 White House budget cuts funds for water quality by 30% (from $2.6 billion to $1.8), despite $450 billion in needs identified by the EPA. [21]

 

These service cuts are caused primarily by tax cuts, not over-spending; “the large deficits - - are more a reflection of a historically low level of revenues, - - as a share of the economy, than of an unusually high level of federal spending.  In 2004, revenues will total 15.8% of [the economy] - - the lowest level since 1950.” [22] 

 

You may have trouble believing the previous paragraph because most of us now pay a higher share of the tax burden.  Why?  Corporate tax revenues today average only 10% of total federal tax revenues, compared with 28 percent in the 1950’s - -.  [23]  “the effective federal tax rate on the best-off 1 percent of Americans has dropped by 30 percent over the past quarter-century”. [24]     

 

We do have the resources we need for a decent future. [25]  If “the wealthy paid the same share of their income in taxes today as they did in 1977, annual revenues would jump by $200 billion.  Likewise if corporate income taxes were restored to the share of the economy that they averaged from 1950 to 2000, companies would pay $180 billion a year more.” [26]  Further, “tax avoidance among corporations & upper-income individuals is far outrunning the audit capacity of the IRS. There’s a $113 billion gap between what corporations should [and actually do pay].” [27] 



[1] Includes only the “emergency responders” portion of homeland security - “Emergency    Responders: Drastically Under-funded, Dangerously Under-Prepared”, Council on Foreign Relations, 7/29/03, p. 2, www.cfr.org/pdf/Responders_TF.pdf.

 

[2]  “Securing the Bomb”, Nuclear Threat Initiative, Matthew Bunn and Anthony Weir, May 2004, p. 4,  http://www.nti.org/e_research/analysis_cnwmupdate_052404.pdf. 

 

[3]  The Ongoing Neglect of Maritime Transportation Security”, Testimony, Subcommittee on Coast Guard and Maritime Transportation, U.S. House of Representatives, 8/25/04, Stephen E. Flynn, author of America the VulnerableCouncil on Foreign Relations, 2004  

www.cfr.org/pub7269/stephen_e_flynn/the_ongoing_neglect_of_maritime_transportation_security.php# 

 

[4]  The Reality Behind the Rhetoric on Homeland Security”, Democratic Policy Committee, 9/14/04,U.S. Senate,
http://democrats.senate.gov/dpc/dpc-doc.cfm?doc_name=fs-108-2-240.

[5]   New York Times, March 31, 2004.  (Search for “I.R.S., March 31” at www.nytimes.com.) 

 

[6] “Ready or Not?  Protecting the Public’s Health in the Age of Bioterrorism”, Trust for America’s Health, 12/03, pp. 4 & 11, 
http://healthyamericans.org/state/bioterror/Bioterror.pdf. and “Passing Down 
the Deficit: Federal Policies Contribute to - - the State Fiscal Crisis”, Center on Budget and Policy Priorities, Iris J. Lav and Andrew Brecher, 5/12/04, http://www.cbpp.org/5-12-04sfp.pdf.

 

[7] “President’s Budget Contains Large Cuts in Domestic Discretionary Programs”, Center on Budget & Policy Priorities, Richard Kogan & David Kamin, 2/27/04, p. 7, http://www.cbpp.org/2-27-04bud2.pdf.

 

[8] “The Bush Administration’s FY2005 Budget for the Environment”, Natural Resources Defense Council, 2/4/04, p. 7, www.nrdc.org/media/docs/040204.pdf. 

 

[9]  President’s Budget Contains Large Cuts in Domestic Discretionary Programs”, ibid. p. 8.

 

[10] “Passing Down the Deficit: Federal Policies Contribute to - - the State Fiscal Crisis”, ibid., p.9.

 

[11] “Effects of Recent Fiscal Policies on Today’s Children and Future Generations”, Urban-Brookings Tax Policy Center, William G. Gale and Laurence Kotlikoff, July 2004, p. 11,

http://www.taxpolicycenter.org/publications/template.cfm?PubID=8922

 

[12] Two-thirds of the uninsured were without insurance for 6 months or more - One in Three: Non-Elderly Americans Without Health Insurance, 2002-2003Families USA, June 2004, p. 3,

http://www.familiesusa.org/site/DocServer/82million_uninsured_report.pdf?docID=3641 

 

[13]  “Despite Job Growth, A Record 2 Million Unemployed Have Gone Without Benefits”, Center on Budget and Policy Priorities, Isaac Shapiro, 6/28/04, p. 1, www.cbpp.org/6-28-4ui.pdf.

 

[14] “Proposals for the Reauthorization of the Higher Education Act”, The State PIRG’s Higher Education Project, 1/03, p.11,

http://pirg.org/highered/HEAreport1_03.pdf.

 

[15] “Dooh Nibor Economics”, New York Times, Paul Krugman, 6/1/04, p. A19.  Also see “Effects of Recent Fiscal Policies on Today’s Children and Future Generations”, iid., p. 16.

 

[16] “Passing Down the Deficit - - “, ibid., pp. 1, 24.

 

[17] Specific data for each state is available in “Passing Down the Deficit - - “, ibid, pp. 1,24.  Also see data for individual states from National Priorities Project at www.nationalpriorities.org.

 

[18] “A War Against the Cities”, New York Times, Bob Herbert, 7/30/04, p. A15.

 

[19] “The Bush Administration’s FY2005 Budget for the Environment” ibid. p.5.

 

[20]  “President’s Budget Contains Large Cuts in Domestic Discretionary Programs”, ibid., p. 7.

 

[21]  “The Bush Administration’s FY2005 Budget for the Environment, ibid., p. 3.

 

[22] “Deficit Picture Grimmer Than CBO’s March Projections Suggest”, Center on Budget and Policy Priorities, David Kamin and Richard Kogan, 6/4/04, p. 2, http://www.cbpp.org/6-4-04bud.pdf.

 

[23] “The Decline of Corporate Income Tax Revenues”, Center on Budget and Policy Priorities, Joel Friedman, Revised 10/24/03,

p. 3, http://www.cbpp.org/10-16- 03tax.pdf. 

 

[24] “The Taxonomist: Loophole-Consolidation Program”, The American Prospect, Robert S. McIntyre, 12/01/03, http://www.prospect.org/web/page.ww?section=root&name=ViewPrint&articleId=6941.

 

[25] “Effects of Recent Fiscal Policies on Today’s Children and Future Generations”, ibid, p. 18. 

 

[26] “The Taxonomist: Loophole Consolidation Program”, ibid. 

 

[27] Perfectly Legal, David Kay; cited in “Economic Viewpoint”, Business Week, Robert Kuttner, 1/24/03, p. 26. 

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