Estate tax myth exploded

A new report shows that 18 families, including prominent Southern families, are financing the campaign to repeal the estate tax.

Across the South, the repeal proponents try to convince farmers that the estate tax threatens the survival of their family farms. Turns out that's just not true.

18 families worth a total of $185.5 billion have financed and coordinated a 10-year effort to repeal the estate tax, a move that would collectively net them a windfall of $71.6 billion.

The report profiles the families and their businesses, which include the families behind Wal-Mart, Gallo wine, Campbell’s soup, and Mars Inc., maker of M&Ms. Collectively, the list includes the first- and third-largest privately held companies in the United States, the richest family in Alabama and the world’s largest retailer.

These families have sought to keep their activities anonymous by using associations to represent them and by forming a massive coalition of business and trade associations dedicated to pushing for estate tax repeal. The report details the groups they have hidden behind – the trade associations they have used, the lobbyists they have hired, and the anti-estate tax political action committees, 527s and organizations to which they have donated heavily. ...

Just more than one-fourth of one percent of all estates will owe any estate taxes in 2006. And the American Farm Bureau, a member of the anti-estate tax coalition, was unable when asked by The New York Times to cite a single example of a family being forced to sell its farm because of estate tax liability. ...

These super-rich families have spent millions in personal wealth and used their companies’ resources and lobbying power in repeated attempts to influence members of Congress to repeal the tax. ...

The stakes of the campaign are great, not only for the super-wealthy families, but for the public. If the families’ repeal bid succeeds, it will cost the U.S. Treasury a trillion dollars in the first decade – roughly what it would cost to provide health insurance for every uninsured person in the United States.

Growth of Black Businesses is a Sign of Progress for All

This week, both the Richmond Times-Dispatch and Washington Post trumpeted the rapid rise in the growth of African-American owned businesses over the past few years. Citing data from the Census Bureau, the media outlets noted that there are, “1.2 million black-owned businesses in the U.S., a figure that rose 45 percent from 1997 to 2002, according to a report released yesterday by the Census Bureau. There are roughly 23 million U.S. companies.” Thus, black-owned firms account for around 5% of total firms nationwide.

The picture in Virginia and in Metro Washington is even brighter, where “about 8 percent of Virginia's roughly 530,000 businesses are run by a black entrepreneur.” In Metro Washington, “the increases included huge jumps in the previously small number of black-owned firms in Prince William County, which increased 103 percent, to 2,010, and Howard County, where black businesses grew by 87 percent, to 3,293.”

This amazing growth is both a sign of social progress, as well as, an indicator that the economic fortunes of black Americans are continuing to look upward. Entrepreneurship is the bedrock of the American economy, and only through full participation in what Alexander Hamilton deemed, “the commercial republic” can some of the more pressing issues that the African-American community faces be adequately addressed.

This rise in black entrepreneurship also has political ramifications. As blacks gain greater access to the upper-echelons of the economy, it can be expected that they will take on similar voting behaviors as their socioeconomic cohort. Inevitably, their individual economic circumstances will influence their outlook on government, for reasons as simple as keeping more of their hard-earned paychecks or as complex as advocating business-friendly regulatory schemes. As the Post article noted, “black-owned businesses appear to be going the way of the…black population, which for the past decade has been increasingly lured into the suburbs.” This increased suburbanization, coupled with higher income-earning opportunities brought on by increased “boot-strapping” entrepreneurship, stands to redefine the relationship of both the Democratic and Republican Party to the African Americans.

In the end, this latest economic good news is not about honing in on race as much as it is about acknowledging the steady march of progress that has been powered by the American marketplace. In the words of one Richmond area businessman, "What I'm seeing now is more and more people are realizing there are more quality businesses out there that are minority-owned." Black business owners are managing to overcome negative perceptions and prove their ability to compete. As such, their continued growth will pay dividends for all Americans.

Mudcat and Southern Democrats

Much has been written about the plight of Democrats in the South. Last week, political writer Rob Chirstensen weighed in with a piece about Southern Democratic strategist Dave "Mudcat" Saunders. Saunders is out to improve the party’s standing in the South.

"Where I live," he says, "it has become politically and culturally unacceptable for a white man to admit that he is a Democrat."

Saunders blames the party leadership for being out of touch with Southern voters and interests.

"They stereotype us," he says. "They think we sit around the dinner table and rather than talk about the job we just lost, how we are going to get health insurance and how our kids are leaving because they can't find work, instead they think we talk about what new gun we are going to get today, or who we are going to lynch tonight.

"These same people who talk about tolerance have none for my culture," Mudcat says. "The only real tolerance that these people exhibit is for their own intellectual arrogance."

Whether Saunders is right about the root of the leadership’s disconnect from the region, there needs to be a change if they hope to regain the Presidency.

Wal-Mart: Healthy?

The debate over Wal-Mart's impact on the public health care system continued yesterday, when Arkansas Gov. Mike Huckabee defended the company at a media forum organized at its Bentonville, Ark. headquarters.

This article from the Arkansas News Bureau encapsulates the terms of the debate:

Huckabee said 81 percent of Wal-Mart employees qualify for a health benefit, compared to 61 percent of retail-sector workers as a whole.

"When you compare the number of Wal-Mart employees who have insurance to the number of employees of Microsoft, for example, who have insurance, it's not a fair comparison," the governor said.

Among large employers, defined as having 200 employers or more, the average is 66 percent, said Nu Wexler of Wal-Mart Watch, a non-profit group that says Wal-Mart is in need of reform.

"The governor can slice and dice it any way he wants, but Wal-Mart is a huge burden on state Medicaid in his state and others," Wexler said.

The company may offer benefits to 81 percent, but only about 50 percent find the offer worthwhile and take it, Wexler said.

Huckabee also said that the spiraling cost of health care "is not a Wal-Mart issue. This is a national issue," he said, noting that the United States spends 16 percent of the gross domestic product on health care when no other country spends more than 10 percent.Medical spending threatens the economy, Huckabee said.

"It's an economic challenge equivalent to erasing the national debt," he added.

Wexler agreed that health care has national implications, but argued that the world's largest corporation has a role to play in fixing it, and is not helping. ...

[Huckabee] said Wal-Mart has empowered consumers by driving down prices of basic consumer goods, leaving families with more disposable income. Asked if the consequences of low wages and few benefits were worth it, Huckabee asked: "If Wal-Mart jobs are so terrible, why did 11,000 people show up in Oakland, Calif., to apply for 400 Wal-Mart jobs?"

Wexler replied: "We're all for low prices, but there is a social cost. Is saving a dollar a bag on disposable diapers worth giving up health care for your employees?"

Southern Politics Revisited

The growth of the Republican Party in the South frequently is described as the product of an intentional, top-down strategy that used racial tensions to push white Southerners out of the Democratic Party into the GOP. This conventional account is called into question by a new book by Matthew Lassiter, a political scientist at the University of Michigan.

In The Silent Majority: Suburban Politics in the Sunbelt South (Princeton, 2006), Lassiter argues that the South's political realignment resulted from the grassroots mobilization of white suburban Southerners in places like Atlanta, Charlotte and Richmond. White southerners in these cities developed a "color-blind" ideology that "defended residential segregation and neighborhood schools as the natural outcome of market forces and individual meritocracy rather than the unconstitutional products of discriminatory public policies." In Lassiter's telling, this trend emerged not from overt race-baiting, but from the confluence of population shifts, metropolitan growth and waning political support for policies that promoted racial integration.

Click here to hear Lassiter discuss his book on The State of Things, a public affairs show on WUNC Radio, the NPR affiliate in Chapel Hill.

School dropouts: a silent epidemic

There's been more and more in the news lately about the alarming high-school dropout rate in the United States. Just 30 years ago, it would have been unthinkable for 30 percent of students who started 9th grade to not finish. Not today.

Here are some resources that you might find to be interesting:

• TIME magazine story. A cover story this week by TIME highlights how the number of dropouts is much higher than you think. (The story is available through the TIME site only for subscribers, but you might be able to get a better flavor of it by clicking here.)
  
  
• Silent Epidemic study. A study by Civic Enterprises, which was funded by the Bill and Melinda Gates Foundation, was used in large part by the TIME study. Called The Silent Epidemic, it outlines how it's time for businesses, educators and leaders to confront the dropout rate now to ensure the future economic viability of the country. Download The Silent Epidemic.
  
  
• Debunking a myth. According to the Southern Growth Policies Board, another study "debunks the myth that high school dropouts are uninterested in education and examines policies that help these students earn postsecondary credentials. According to researchers, socioeconomic status, not race, is the biggest determinant of whether a student finishes school. These students are amazingly persistent; sixty percent of dropouts earn a high school credential by age 25 and 44 percent go on to pursue a postsecondary degree. Despite high postsecondary enrollment rates, only nine percent of these students graduate with a two or four year degree and less than a quarter of students complete a certificate program." Read the Making Good on a Promise report. (Registration required.)
  
  
• Local effort. A group of leaders in Charleston, S.C., next week will launch a local effort to make people more aware of the area dropout rate, which is more than two in five students. Your community could easily sponsor a similar blog-related effort. Visit the DropInCharleston Web site of dropout resources.

"Diversity Day" celebrated Kentucky style

It was "Diversity Day" in Kentucky yesterday and the Governor had a to-do. There was a diversity forum held for hundreds of school children in Frankfort and Gov. Fletcher signed an executive order encouraging the hiring of more minorities. It all sounds good, except for one little problem -- the order eliminates sexual orientation from the anti-discrimination list. Gov. Fletcher's order reverses a 2003 order signed by Gov. Patton that broke new ground by explicitly protecting workers based on their sexual orientation.

State Sen. Ernesto Scorsone, called the Gov.'s action "callous, unfair and indefensible" in his op-ed in The Courier-Journal.

Read about all about in:
The Herald Leader
The Courier-Journal

Raising the Minimum Wage

James Andrews wrote an opinion column today in the Raleigh News and Observer about raising the minimum wage. He cites some revealing statistics regarding the lifestyle of the lowest paid workers.

Since 1997 the cost of a loaf of bread has gone from $.86 to $1.04; a dozen eggs have gone from $1.15 to $1.45; and a gallon of gas from $1.26 to $2.32, according to the Bureau of Labor Statistics. The federal minimum hourly wage has gone from $5.15 to $5.15.

The debate over raising the minimum wage is not new, but it is good to see continued concern voiced amidst the saturation of conservative economic rhetoric in most contemporary public media.

And if minimum wage workers earned enough to provide for their families, taxpayers would not need to pick up the tab for employers who do not pay their workers a living wage. Unfortunately, the lowest-paid working Americans cannot pinch any more pennies or tighten their belts further. They are holding down multiple jobs just to make ends meet. At the current minimum wage level, a full-time, year-round minimum wage worker will earn $5,888 less than the $16,660 needed to lift a family of three out of poverty. That puts many minimum wage workers among the 37 million Americans, including 1.2 million North Carolinians, living in poverty.

(Note: In the print edition of the News and Observer there is a great opinion piece by Duke cultural anthropology professor Orin Starn about Tiger Woods, race, and golf. At the time of this posting the article was not available online. It is a great read for all progressive-minded sports fans before watching one of the South’s greatest sporting events at Augusta National this weekend.)

It's hard out here for a woman

Yesterday's Washington Post carried news of a recent study that claims women have little to no chance of winning election in almost one-third of congressional districts nationwide.

Are you surprised to know that many of the most challenging districts for female politicians are located in the South?

"There are over 150 districts in this country right now that are never going to elect a woman," said Barbara Palmer, a political scientist at American University who joined Dennis Simon of Southern Methodist University in studying the challenges faced by female congressional candidates.

Districts that are the toughest for women tend to be conservative, socially traditional and geographically larger, with a lot of rural area, said Simon. "A lot of those districts cut right through the Bible Belt," he said.

For the last seven years, Simon and Palmer have examined House elections, including their competitive nature, demographics and the gender of candidates. Their five toughest districts for women are Alabama's 4th (around Gadsden); Kentucky's 1st (around Paducah); North Carolina's 11th (around Asheville); Oklahoma's 4th (around Norman); and Arkansas' 3rd (around Fayetteville).

Race Matters in the Virginia Democratic Senate Primary

The Washington Post’s Richmond Report dropped a minor bombshell in the race between Harris Miller and James Webb for Virginia’s Democratic Senate nomination reporting that “Northern Virginia tech exec Harris Miller received the backing of leading African-American politicians Sen. Henry L. Marsh III (D-Richmond), Sen. Benjamin J. Lambert III (D-Richmond), and Del. Lionell Sr. Spruill (D-Chesapeake)” as well as a number of other black members of Virginia’s General Assembly. These endorsements apparently stem from controversial writings that Mr. Webb composed over the years.

In particular, a 2000 Wall Street Journal article that Webb wrote raised the ire of these seasoned black political veterans. In that piece, Webb said Affirmative Action had "within one generation, brought about a state-sponsored racism that is as odious as the Jim Crow laws it sought to countermand." The reaction among the progressive blogging community – many of whom are Webb supporters – was swift and angry, decrying Miller’s tactics as negative campaigning and coming to Webb’s defense.

Mr. Webb’s campaign responded by saying, “Jim Webb has a long history of assisting African Americans, including fighting to get African Americans represented in the Vietnam War memorial on the National Mall. Jim believes in affirmative action for African Americans. Unfortunately poverty does not discriminate on skin color. There are 37 million Americans of all races living in poverty. Jim will focus on policies which will give all Americans of every race access to opportunity. This is an issue of fairness that de serves a great deal of attention in Virginia and across this country.”

This move by the Miller campaign was not unexpected. Mr. Webb is a prolific author whose personal website serves as a repository for his thoughts, some of which were published by the Wall Street Journal and American Enterprise Institute. In that work, he directly challenges liberal and Democratic orthodoxy on the issues of affirmative action and racial politicking. Now that he is running as a Democrat, his words and actions should be of interest to public leaders and political types throughout the Southeastern US as he will now directly tackle the prickly pear of racial politics and public policy.

In light of these not-so-secret revelations, it will be interesting to see how the Webb campaign manages to reach out to hard-pressed rural and working class whites, while at the same time allaying the fears of the party’s base voters, African Americans, without alienating either group. Early supporters of the Webb campaign drew inspiration from his proposition that “the greatest realignment in modern politics would take place rather quickly if the right national leader found a way to bring the Scots-Irish and African Americans to the same table, and so to redefine a formula that has consciously set them apart for the past two centuries." With nearly half of the Commonwealth’s Legislative Black Caucus on board with his opponent, Mr. Webb may just get the chance to test out his theory...on himself.

Voting Rights Act apparently safe

The Voting Rights Act, the law that encouraged hundreds of thousands of African American Southerners to register and vote, likely will be extended before its August 2007 expiration, according to a story in The New York Times.

"The Republicans know that if they question the wisdom of reauthorization the Democrats will relentlessly demagogue them on the issue," said Roger Clegg, president of the Center for Equal Opportunity, which opposes reauthorization. "They'll be called racist and accused of wanting to turn back the clock on civil rights. The Republicans would really like to have this off the table."

While some conservatives say the time for the Act has passed, others point to its successes. According to the story:

Before the act, civil rights organizations estimate, there were fewer than 300 black elected officials in the United States, with virtually none in the South, said Daniel Levitas, who works with the Voting Rights Project of the American Civil Liberties Union in Georgia. The Joint Center for Political and Economic Studies in Washington found 1,469 black elected officials by 1970 and more than 9,500 today.

The Center for a Better South supports ways to encourage more people to register, vote and participate. More...

Campaigning vs. Leading

The recent debate over immigration reform has placed many U.S. senators and representatives, especially Republicans desirous of national office, in a difficult spot. Should an ambitious politician appeal to the conservative base by categorically opposing any reform that would include a way for undocumented immigrants to eventually gain citizenship, or pursue a more practical and realistic approach that would result in a solution to a pressing public problem?

A recent column by John Dickerson, chief political columnist for Slate.com, argues that Tennessee's Bill Frist, the GOP majority leader in the U.S. Senate and a potential 2008 presidential candidate faced this dilemma and has chosen to "pander" to the conservative base. Writes Dickerson:

"On Tuesday, when the Senate Judiciary Committee produced an immigration bill that included tough security and border-enforcement measures but also a program that would allow existing illegal aliens to get legal, Frist was the first to step up and call it 'amnesty.' This is not the act of a thoughtful, nuanced majority leader. This is the act of a candidate."

While Dickerson is pointed in his assessment of Frist's actions, the column raises interesting questions about the tension between political ambition and governance that is in the best interest of society as a whole.