New ad compares Bush, Kerry records on middle-class tax cuts

Posted on Mon, Mar. 29, 2004
New ad compares Bush, Kerry records on middle-class tax cuts
By Matt Stearns
Knight Ridder Newspapers

WASHINGTON - The Media Fund, an independent organization that's working to defeat President Bush in his re-election campaign, began airing a new television ad Monday comparing Bush's record on middle-class tax cuts with that of his Democratic opponent, Massachusetts Sen. John Kerry. The ad attempts to counter the president's portrayal of Kerry as a tax-loving liberal, and to portray Bush as a tool of the rich.

THE AD: The ad says Kerry voted to eliminate the tax code's so-called "marriage penalty," voted for an increased child tax credit and proposes to roll back tax reductions for "America's wealthiest 1 percent, helping pay for a middle-class tax cut." It says Bush "raided Social Security to pay for a tax cut for millionaires. And he supported tax breaks for companies that export jobs."

THE FACTS: The "middle class tax cut" the ad mentions includes Kerry's proposals for a college-tuition tax credit, a $50 billion fund to offset recent state and local tax and tuition hikes, and a tax credit for health-insurance premiums for small businesses and their employees.

The ad doesn't address the fundamental problem of Kerry's fiscal plans, which Bush's ads point out: That Kerry's tax increase for people who make more than $200,000 a year wouldn't come close to raising enough money to pay for all of his proposed new spending. His proposed tax hike would raise about $250 billion, and he's proposed more than $900 billion in new spending. Any middle-class tax reductions would expand the gap between spending and revenue.

As for Bush, to call his tax cuts a "raid" of Social Security is misleading. They do reward the well-to-do more than the middle class, but the well-to-do pay more in taxes.

The president's tax reductions have helped drive up federal budget deficits, and when that happens, the Treasury sells bonds from the Social Security Trust Fund to pay for general government operations. If there were no deficit, the government still would sell bonds from the Social Security Trust Fund, only it would use the proceeds to pay down government debt. In neither case is Social Security weakened, except to the extent that the entire federal government is weakened by having federal debt expand.

Bush did support killing a tax break that helps companies export goods, and the loss of that break could encourage companies to move jobs overseas, but Congress hasn't yet approved the president's proposal.

The Media Fund's site is:

http://www.makeamericaworkforus.org/