honoluluadvertiser.com

Sponsored by:

Comment, blog & share photos

Log in | Become a member
The Honolulu Advertiser
Posted on: Friday, August 4, 2006

Tax bill was cynical political move

Whatever the merits of softening the blow of the so-called "estate" or "death" tax on mom-and-pop businesses and farms in real-estate-rich Hawai'i, it is hard to understand how Hawai'i Reps. Neil Abercrombie and Ed Case found themselves able to vote for a cynical Republican bill that ties relief to the rich with an increase in the minimum wage.

Case said it was a matter of taking the good with the bad, that in Congress it is often a matter of swallowing something distasteful to get other needed changes.

Abercrombie said he was motivated in part by an unrelated provision that would restore tax deductions for spousal business travel. That should be a boon to Hawai'i, he said.

Other problems with the bill could be separated and rationalized in the Senate, Abercrombie said, but that was before before the Senate yesterday killed the bill.

Still, that's not the way to deal with matters of such importance.

Packaging the minimum-wage hike with the near-repeal of the estate tax was politics most cynical. There are arguments pro and con about the minimum wage; some argue that every hike drives people out of the workforce since some employers won't pay the higher rate.

But the federal minimum wage, today at $5.15 an hour, has not been raised in nearly a decade. Over that time Congress — just to use one example — has given itself several salary hikes.

It seems logical that some adjustment in the federal minimum wage makes sense. But whatever the merits of this idea, pro or con, it should not be tied into a plan that would offer a tiny number of American families (fewer than 9,000) an average tax break of more than $1 million, according to the Brookings-Urban Institute Tax Policy Center.

What we had here was election-year politics at its worst. A proposed hike in the minimum wage and adjustments to today's generous estate tax system should have been considered on their own merits, not tied together in this cynical way.