The Fog of War and Tax Policy

A movie none of us has yet seen, but I would like to (it opens December 26), is ‘The Fog of War: Eleven Lessons from the Life of Robert S. McNamara.’

I remember when then Defense Secretary McNamara – one of the ‘best and the brightest’ (the Donald Rumsfeld of his day, only less smug) – came to Harvard to defend his policies in Vietnam. It was still relatively early in the war, and I was one of those who trusted the government to be making the right choices. What information did I have on which to put my 20-year-old judgment ahead of McNamara’s? This guy was clearly brilliant, clearly decent. And – as it turns out, he says now – clearly wrong.

‘We acted according to what we thought were the principles of the nation,’ he says. ‘We made our decisions in light of those values. Yet we were wrong, terribly wrong.’

This is not to say that Iraq and Vietnam are the same. When those 19 Iraqi hijackers killed 3,000 Americans, we were completely right to declare war on terrorism. (OK, they were 19 Saudis, not Iraqis, but REDACTED, REDACTED, REDACTED, REDACTED, REDACTED, REDACTED, REDACTED, REDACTED, REDACTED, REDACTED, REDACTED, REDACTED, REDACTED, REDACTED, REDACTED, REDACTED, REDACTED, REDACTED, REDACTED, REDACTED, and a majority of the American public somehow got the false impression that Saddam Hussein had a hand in the attack.)

But I would argue that in alienating so much of the rest of the world with our arrogance before September 11 – and then after – the Bush team did not serve us well.

And now another plug for Al Franken’s book, Lies and the Lying Liars Who Tell Them: A Fair and Balanced Look at the Right.

It turns out, the Right have not been completely square with us.

A review from the right, September 5, 2003
Reviewer: A reader from Greensboro, NC

I hate to admit it, but this book really illustrates the poor research and constant mistruths that come from my party. Coulter is a disgrace to not just the right but America and all it stands for. Hannity and Colmes should be re-named to the Sean Hannity Show because Alan Colmes simply is not as vociferous as his counterpart and it hurts the left. I’m Republican but more importantly I’m a proud American. I would prefer to hear fair and balanced because it is good for public discourse but it simply is not happening and never will. He who yells loudest is usually the one heard. I was really disheartened to learn the truths about Al Gore and Love Canal, the Internet and Love Story. Franken illustrates the truth about the lies that were told by the media that negatively affected Gore’s run for the presidency. It is worth buying this book just to read about this alone. Some that read this review may question my loyalty to the GOP. At times I do myself. I simply wish that everyone would put the country first rather than their agenda. After completing the book I’m a little more than disillusioned with the lies in the media. We should stand for it no longer. This is an excellent book for everyone!

That was the first of 470 reader reviews that came up when I went to Amazon to look yesterday. But it leaves one to wonder . . . where do these mistruths come from? Do they spring from the rightwing media itself? Or are they orchestrated?

Some of the mistruths come from the very top.

Then-candidate Bush looked into the camera and – defending his proposed tax cut for the wealthy – said, ‘by far, the vast majority of the help goes to the people at the bottom end of the economic ladder.’

That was simply untrue – a multi-centi-billion-dollar lie. But he seemed so amiable, and Gore’s character had been so called into question (Love Canal, the Internet, Love Story…), that much of America believed him.

In pushing through the most recent cuts, the President characterized them as “little bitty” and told us that they were designed for maximum impact in creating jobs.  That, too, was untrue.  Yet the whole administration was saying it . . . all the while using the famous $1,083 “average” that taxpayers would save to help sell it.  They never pointed out that this $1,083 was an average.  That rich folks saving tens of thousands of dollars a year – in some cases, millions – while 50% of Americans saved less than $100.  (Remember that when Bill Gates walks into a crowd of homeless people, they all become, on average, centi-millionaires.)

Bill Spaced:  “Your readers may not believe this (nor might you), but I don’t remember what the tax break for the rich *was* … was it the estate tax, or something else (or both)?”

☞ Here’s the nub of it:

Cut top bracket from 39.6% to 35%.

Cut dividend rate from 39.6% to 15%.

Cut cap gains from 20% to 15%.

Cut estate tax from 55% to 0% by 2010 (theoretically).

So say you’re the average Joe who lives in Florida and has $75 million in stocks and mutual funds that in a typical year throw off $2 million in dividends and $5 million in long-term capital gains.  OK?

First off, Governor Jeb cut your “intangible property tax” in half (Florida has no income tax), saving you $250,000 or so.  And President George cut your federal income tax by a further $750,000.  Total savings: $1 million a year.  (And that’s just while you’re alive.)

This may sound fanciful – who has $75 million in securities?  But as mentioned a few weeks ago, in the year 2000 there were 400 Americans who reported annual income – income! – of $86 million or more.  (Many reported much, much more.)  So please don’t tell me that Florida Joe, with his piddling hypothetical $7 million in dividends and capital gains, is such a big deal.  He needs little bitty tax relief just like everybody else.