Sanders Op-Ed: We Can Do Better

By Sen. Bernie Sanders

December 16, 2010

Vermonters are aware that there is a major debate taking place in Congress over an agreement that President Barack Obama and Republican leaders reached on taxes.  I’ve been in strong opposition to that agreement and believe that we can and must put together a better deal for the middle class.  Here’s why. 
At a time when we have a record-breaking $13.8 trillion national debt and a growing gap between the wealthiest people in this country and everyone else, it is unconscionable to drive up that debt by giving huge tax breaks to millionaires and billionaires who don't need it and force our kids and grandchildren to pay it off.  We have been told that an extension of these tax breaks for the wealthy will only last for two years.  Maybe, but given the political reality that I’ve seen here in Washington, my guess is that two years from now these tax breaks for the rich will be extended again.  They may even be made permanent.   If they end up being extended 10 years into the future, as the Republicans have demanded, it will increase the national debt by $700 billion. 
Furthermore, extending income tax breaks to the top 2 percent is not the only unfair tax proposal in this agreement.  The agreement continues the Bush-era 15 percent tax rate on capital gains and dividends, meaning that those people who make their living off of their investments will continue to pay a substantially lower tax rate than firefighters, teachers, nurses and most American workers. 
On top of all of that, this agreement contains a horrendous proposal regarding the estate tax – a Teddy Roosevelt initiative enacted in 1916.  Under the agreement between the president and the Republicans the estate tax rate, which was 55 percent under President Clinton, will decline to 35 percent with an exemption on the first $5 million for individuals.  Let’s remember, this tax applies only to the top 3/10ths of one percent of the families in this country, with 99.7 percent of families not gaining one nickel in benefits.  In other words, we’re not just providing here another $68 billion in tax breaks for the rich.  This provision is for the very, very rich – the people who need it least.
Meanwhile, while all Republicans (and some Democrats) have been busy voting for huge tax breaks for the wealthiest people in this country, an amendment that I offered last week to provide a $250 Social Security Cost of Living Adjustment (COLA) for seniors and disabled vets who will not be receiving a COLA next year for the second year in a row did not win the support of one Republican.  My amendment won on the floor by a vote of 53-45, but lacked the 60 votes needed to overcome a Republican filibuster.
Further, this agreement contains a provision which could be very threatening for the future financial solvency of Social Security.  Today, the Social Security trust fund, which has a $2.6 trillion surplus, receives all of its funding through a 6.2 percent payroll tax on both workers and employers.  The deal being debated now calls for a “payroll tax holiday” of one year for workers, which would divert $114 billion away from the trust fund.  Further, there is every reason to believe that once this precedent is established, it will be continued in years to come – meaning less and less money going into Social Security.  The National Committee to Preserve Social Security and Medicare, one of the largest senior groups in the country, fears that “this could be the beginning of the end for Social Security.”
Does the agreement struck between the Republicans and the president contain positive elements?  Absolutely – and they must be retained in any final agreement that is reached. It goes without saying that at a time when millions of Americans in the middle class are struggling economically, we must extend the Bush tax cuts for 98 percent of the Americans – people earning less than $250,000 a year.  Further, with unemployment at 9.8 percent, and long-term unemployment at a record–breaking level, it is absolutely imperative that we extend unemployment insurance for another 13 months.  I also strongly support an extension of the child tax credit, earned income tax credit and college tax credit expansions included in this agreement.  
These are very tough economic times for our country.  The middle class is shrinking, poverty is increasing and workers throughout the country are finding it hard to locate decent paying jobs.  Difficult choices are going to have to be made.  They should not include huge tax breaks for the wealthiest people in this country and driving up the deficit.