McCain Panders To "Death Tax" Crowd
Lashing out at the "estate tax" is nothing new for most Republicans -- though it would seem to be for Sen. John McCain. One way you can tell is by simply contrasting his Tuesday remarks to small business owners -- in which he described the tax "one of the most unfair" in the entire code -- with his historical opposition to a total repeal of taxation on all inherited wealth that many of his Senate GOP colleagues have long lusted after.
Another way to identify McCain as a recent, and perhaps not wholly sincere, convert to the cause is to note his diction. Most opponents of the "estate tax" refuse to call it that, instead preferring the "death tax" moniker -- implying a "double taxation." (In fact this is not entirely accurate, as some inherited estate wealth comes from capital gains that were never taxed a first time.) While it's impossible to know whether McCain's avoidance of that cliched demagoguery masks a conflicted heart, the Congressional Record does offer a few tidbits that reveal a more nuanced view of the issue than he expressed today.
In fact, a quick review of the dozens upon dozens of Senate debates about a tax that affects fewer than an estimated three percent of estates shows no evidence that the Arizona Republican ever viewed the tax as fundamentally unfair before today. As he himself stated in a June 8, 2006 speech from the Senate floor, McCain has "consistently voted against repealing this tax because of the impact it would have on the deficit, as well as the possible chilling affect it could have on charitable giving in this country."
In the same speech, McCain harked back to his presidential idol, Teddy Roosevelt, to draw support for his view of the essential morality of the estate tax:
"In his 1906 State of the Union Address, President Theodore Roosevelt proposed the creation of a federal inheritance tax . Roosevelt explained: 'The man of great wealth owes a peculiar obligation to the State because he derives special advantages from the mere existence of government.' Additionally, in a 1907 speech he said: 'Most great civilized countries have an income tax and an inheritance tax. In my judgment both should be part of our system of federal taxation.' He noted, however, that such taxation should 'be aimed merely at the inheritance or transmission in their entirety of those fortunes swollen beyond all healthy limits.'
"I agree with President Roosevelt, and I remain opposed to full repeal of the estate tax."
During that debate, McCain argued that the cap for triggering the estate tax should be raised to $5 million, so that family farms and businesses would not be affected upon transfer from one generation to the next. So far, things are trending McCain's way. In 2009, the cap will be raised to $3.5 million.
But even before that increase, McCain was already suspicious of the idea, floated by some estate tax opponents, that the tax was bedeviling small business owners -- precisely the crowd targeted in his remarks today.
In a June 12, 2002 Senate floor speech, McCain said:
"Farm and family-owned business assets accounted for less than three percent of the total value of these estates in 1999. In most estates that are taxable and include a business or farm, the business or farm does not even constitute the majority of the estate. In fact, the American Farm Bureau Federation has acknowledged that it could not cite a single example of a farm having to be sold to pay estate taxes. These facts belie the argument that we must repeal the estate tax to save family businesses and farms to assure that they do not have to be liquidated to pay estate taxes."
McCain often suggests that voters should look to his record in order to reach a judgment about his fitness to lead. A close look at his record on the estate tax -- a record of statements that affirms its underlying morality and debunks any danger it poses to modest family businesses -- brings to mind pandering more than it does the maverick persona McCain would prefer to promote.
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First Posted: 06-10-08 11:21 AM | Updated: 06-18-08 05:12 AM