I’ve spoken of Senator Tom Coburn before in approving tones. He seems to be one of the few Senators or Representatives who truly ‘gets it’ about our deficit spending crisis, budgetary woes, and overall fiscal condition. (If you haven’t already watched his video presentation at the link above, you really should make time to do so. It’s that important.)
He’s make another excellent point today, identifying what he terms ‘welfare for millionaires’. The Hill reports:
Sen. Tom Coburn (R-Okla.) released a report detailing special tax breaks for wealthy income earners that could give members of the supercommittee common ground for raising tax revenues.
The report found millionaires enjoy about $30 billion worth of “tax giveaways” and federal grants every year — almost twice NASA’s budget, the report notes.
“From tax write-offs for gambling losses, vacation homes and luxury yachts to subsidies for their ranches and estates, the government is subsidizing the lifestyles of the rich and famous. Multimillionaires are even receiving government checks for not working,” Coburn said in a statement Monday.
The report is significant because Coburn is one of the Senate’s outspoken conservatives and has spent more than a year working intensely on a bipartisan grand bargain to reduce the deficit.
. . .
His staff found that millionaires received $74 million worth of unemployment checks from 2005 to 2009; $316 million in farm subsidies from 2003 to 2009; $89 million for the preservation of lands on ranches and estates in 2009 and 2010; and $7.5 million to compensate for property damages caused by disaster.
And it found that nearly 1,500 millionaires did not pay federal income tax in 2009.
In 2009, 18 people earning more than $10 million a year received an average of $12,000 in unemployment benefits. That same year, 74 people earning between $5 million and $10 million received $18,000 in benefits, on average, according to the report. In 2008, 2,840 millionaires received unemployment benefits — an average of $6,500 per beneficiary.
. . .
The average annual amount of tax breaks claimed by millionaires is $28.5 billion, Corburn’s report found.
There’s more at the link, and also in this report at the Daily Caller.
I totally agree that many of these benefits need to be means-tested; in other words, paid only to those who actually need them, as opposed to everyone who might otherwise qualify for them. It’s a waste of taxpayer dollars to play the Socialist fairy godmother like this. What’s more, if we stopped handing out tax breaks, concessions and rebates as if they were Halloween candy, we wouldn’t need to increase tax rates. Existing tax rates would bring in enough revenues if they applied equally to everyone, with no exceptions or loopholes.
Frankly, I’m sorry Senator Coburn (and, for that matter, Senator Rand Paul of Kentucky) aren’t running as candidates for the Republican Party’s Presidential nomination. On economic grounds alone, I’d support either of them in a heartbeat. Fiscally speaking, they’ve got their heads screwed on the right way.
Peter
It was Senator Coburn who made a believer out of me with his C-Span presentation earlier this year. I bookmarked it and still watch it. No more trust! I suddenly withdrew all my good intentions to donate to any and all campaigns for two reasons: #1-the cute smile and heaven-sent message is just rhetoric to separate me from my money and #2-once they get on the Hill, me and my money are just a fading memory. I'll spend it on myself, thank you. I am a conservative, and will probably change my party affiliation to Independent.
You are correct. Too bad neither of these two men are running. Maybe that is to our advantage down the line.
There was a candidate I haven't heard much about since the start of campaign season(he was excluded from 3 TV debates, by CNN and Fox News), Gary Johnson(R-NM). When he was governor, he veto'd more bills than the other 49 governors combined, to reduce deficits and cut growths in government. He sounded a lot like what america needs.
I have to point out that any time a politician brings in the class warfare guns, I always have to wonder at what the real agenda is. I recognize most of the programs that Sen. Coburn is talking about. Perhaps unemployment compensation should be means tested along with write offs for gambling debts etc.
However, when you look at the items used to illustrate his point, the numbers are trivial compared to the bottom line number of 28.5 billion. So, you go from the specifics that seem like means testing may be appropriate (and all are relatively small numbers) to a great big generalization of billions that are attributed to "tax breaks".
I think pretty highly of Senator Coburn overall, but I try to remind myself that he has been in Washington, DC for a long time. This particular report his office has generated sounds more like an operation that has lost sight of the real problem in our current government finances. That is overspending. It certainly is NOT under-taxing.
Phil has a point. There was another set of numbers out there (can't remember where I came across them) that showed that we could tax income over $200k (or was it $250k) at 100% and cover our deficit for a couple of months at most. We CANNOT tax our way out of this. We MUST cut spending.
This is not to say that I have no problem with a multi-millionaire drawing unemployment. I have a problem with the whole unemployment benefits concept, much less paying someone that wealthy to not work.
As for millionaires not paying income taxes: what if they're retired? No income = no income tax. I have NO problem with that.
No argument that the tax code needs major surgery – or even complete elimination (Fair Tax, anyone?).
But I would argue that imposing means testing is a form of socialism, in that it is government redistribution of wealth according to some arbitrary formula.
Reasonable people can discuss whether and how to implement means testing, but Phil and Joe speak to the real problem: over-spending. Let's get that under control first, then tinker with the revenue side of the equation.
BTW, Coburn's estimated $28.5B is somewhere around .02% of the estimated $1.3T deficit. Much ado about nothing, other than the headlines…