Bush/Cheney are Small Businessmen

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Registered: 08-05-2004
Bush/Cheney are Small Businessmen
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Sat, 10-09-2004 - 12:56am
Here's the orginial link: http://factcheck.org/article.aspx@DocID=265.html

A Bush-Cheney ad says Kerry would raise taxes for 900,000 "small businesses" and "hurt jobs." It's a big exaggeration.

September 23, 2004

Modified: October 1, 2004

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Summary



A Bush-Cheney '04 ad claims Kerry would raise taxes on 900,000 small businesses and "hurt jobs." But it counts every high-salaried person who has even $1 of outside business income as a "small business owner" -- a definition so broad that even Bush and Cheney have qualified while in office. In fact, hundreds of thousands of those "small businesses" have no jobs to offer.

Furthermore, by the Bush definition 32 million "small businesses" would see no tax increase. The ad doesn't mention that, of course. Nor does it mention Kerry's proposals for some tax cuts specifically targeted for small businesses.

(Update, Oct. 1: After this article was posted, the Tax Policy Center issued a new estimate that the number of small employers is 471,000 -- barely half the number the Bush ad claims.)

Analysis



A Bush ad released Sept. 17 claims that under Kerry's tax plan, "900,000 small business owners would pay higher tax rates than most multinational corporations" and that would "hurt jobs."

Bush-Cheney '04 Ad

"Common Sense vs. Higher Taxes"

Bush: I'm George W. Bush, and I approve this message.

Announcer: President Bush and our leaders in Congress have a common sense plan to grow our economy...

(Graphic: President Bush & Congressional Plan: Small Business Job Growth; New Skills Through Education; A Fairer, Simpler Tax Code)

Announcer: And create jobs so small businesses can expand and hire.

The liberals in Congress and Kerry's Plan: Raises taxes on small businesses. Nine-hundred-thousand small business owners would pay higher tax rates than most multinational corporations.

(Graphic: "Liberals in Congress & Kerry’s Plan: Raises Taxes on 900,000 Small Business Owners Small Businesses Pay More Taxes Than Big Corporations")

Announcer: Tax increases would hurt jobs, hurt small business and hurt our economy.

(Graphic: "Liberals in Congress And Kerry’s Plan: Higher Taxes Hurt Our Economy")

Actually, Kerry proposes no specific tax increase on small businesses at all, and in fact is proposing some targeted tax cuts for small businesses. What the Bush ad refers to is Kerry's proposal to raise taxes on individuals making more than $200,000 per year.

Republicans argue that taxing the affluent is, in effect, taxing many small business owners who pay taxes on their business income reported on their personal returns. And that's true enough.

But what we said last December in an article de-bunking a similar tax fable bears repeating here:

FactCheck.org (Dec. 19, 2003): By twisting statistics and over-hyping, Republicans are spoiling for themselves what would otherwise be a perfectly serviceable argument: lowering taxes on the most affluent Americans does indeed lower taxes on many small businesses, and thus creates more jobs. But not nearly as many as . . . Republicans are claiming.

It is true that what Kerry proposes would return the top rates on individuals making over $200,000 to 35% and 39.6%, compared to the nominal top rate for large corporations, which is 35%. Where the Republican argument goes off the rails is in inflating the number of "small businesses" affected by raising rates on those high-income individuals. Republicans count any individual as a "small business owner" who reports even as little as $1 of income from a sole proprietorship (reported on schedule "C" of federal income-tax returns), a partnership, or a "Subchapter S" corporation (one with fewer than 75 stockholders). In fact, the majority of those being counted as "small businesses" are really individuals who aren't primarily business owners, and a huge number have no employees.

Bush & Cheney as "Small Business Owners"

To find examples of this we need look no farther than the top of the Bush-Cheney ticket:

*

President Bush himself would have qualified as a "small business owner" under the Republican definition, based on his 2001 federal income tax returns. He reported $84 of business income from his part ownership of a timber-growing enterprise. However, 99.99% of Bush's total income came from other sources that year. (Bush also qualified as a "small business owner" in 2000 based on $314 of "business income," but not in 2002 and 2003 when he reported his timber income as "royalties" on a different tax schedule.)

*

Vice President Cheney and his wife Lynne qualify as "small business owners" for 2003 because 3.5% of the total income reported on their tax returns was business income from Mrs. Cheney's consulting business. She reported $44,580 in business income on Schedule C, nearly all of it from fees paid to her as a director of the Reader's Digest . But giving the Cheneys a tax cut didn't stimulate any hiring; she reported zero employees.

Other examples of those counted as "small businesses" would include doctors, lawyers, accountants and management consultants who organize their practices as partnerships, and journalists who accept occasional fees for speeches or articles.

Who Would Be Affected?

When the nonpartisan Urban-Brookings Tax Policy Center ran the Kerry plan through its computer model, it projected that in 2005 a total of 995,000 persons with "business income" (or business loss) would see a personal tax increase under Kerry's plan. That's in line with various Republican calculations that put the total at up to 1 million or more.

But here's what the Tax Policy Center also found about those "small business owners" who would see their taxes go up:

*

Only 49% of them actually got most of their income from business (485,000 of them).

*

The large majority have no employees aside from themselves. Of the 487,000 who reported any business income on Schedule C, only 71,000 claimed deductions for wages -- fewer than 15% .

To be sure, Kerry's plan would in effect raise taxes on considerably more than 71,000 small-business owners with employees. The Tax Policy Center could not determine how many owners whose businesses are partnerships or Subchapter S corporations both had employees and reported income high enough to be affected. Those types of businesses tend to be larger and more likely to have employees than the owners of sole proprietorships who typically report on Schedule C. Census Bureau figures from 1997 show that 28% of all partnerships had employees, and 77% of all Sub-S corporations. It is also true that at least some businesses that have no direct employees other than the owner still create jobs by hiring contractors for services.

Still, it is clear that the Bush ad's 900,000 figure greatly exceeds the number of job-creating businesses that would be affected by Kerry's proposed tax increase. And the vast majority of small businesses would not be affected at all.

(Update, Oct 1: The Tax Policy Center refined its estimates after we posted this article and came up with a figure of 471,000 small employers who would see a tax increase under Kerry's proposal, including an estimate of sub-S and partnership filers who have employees. Buy this estimate, the figure used in the Bush ad is nearly double the real number.)

Who Would Not Be Affected

Bush's own Treasury Department estimates that a total of 33 million "small businesses" benefited from the Bush tax cuts on individuals, but most of them are in lower tax brackets. So -- even accepting the 900,000 figure used in the Bush ad -- that leaves more than 32 million "small businesses" not affected by an increase in the top rates on individuals.

It should also be noted that Kerry is proposing several tax cuts specifically targeted to small businesses, including a refundable tax credit aimed at reducing the cost of health-care benefits, eliminating capital-gains taxes for "long-term investments" held for five or more years in small businesses, and a "new jobs tax credit" for small businesses that add new jobs in 2005 and 2006. What Kerry is proposing for small business can be found on his website .

Sources



Neil Bradley, " Tax and Spend Democrats ," House Republican Study Committee, 25 March 2004.

2000 Federal Income Tax Returns of George & Laura Bush , Tax History Project

2001 Federal Income Tax Returns of George & Laura Bush , Tax History Project.

2002 Federal Income Tax Returns of George & Laura Bush , Tax History Project.

2003 Federal Income Tax Returns of George & Laura Bush , Tax History Project.

2003 Federal Income Tax Returns of Richard & Lynne Cheney , Tax History Project.

2003 Public Financial Disclosure of Richard Cheney , Opensecrets.org.

2003 Public Financial Disclosure of George W. Bush , Opensecrets.org.

David Wessel, "Undoing Tax Cuts Will Have Little Impact On Small Businesses," Wall Street Journal, 1 April 2004: A2.

Urban-Brookings Tax Policy Center, "Kerry Plan vs. Current-Law, Size of Individual Income Tax Change, 2005 - - Distribution Tables by Size of Tax Cut - 2005" Table T04-0144 , 16 Sep 2004.

US Census Bureau, "Statistics about Business Size (including Small Business)from the U.S. Census Bureau," website, accessed 23 Sept 2004.

"A New Era of Opportunity for Small Business," fact sheet, Kerry-Edwards 2004, undated.

Tax Policy Center Newsletter , "Kerry Tax Plan and Small Businesses," 30 Sep 2004.

Related Articles

Puncturing a Republican Tax Fable

GOP fact-twisters claim 80% of the tax relief given to the rich goes to job-creating small businesses. Don't believe it.

iVillage Member
Registered: 08-05-2004
Mon, 10-11-2004 - 12:20am


According to the CNN.com report I read (and posted a thread here with it)if they waited just a few more months they would have found out what we already know. So, why did Bush not wait just a few more months like they requisted? Instead he went straight in. Did he have a plan? Even just an idea of a plan for aftermath? I get news from other newsgroup sites that post about all what's going on and this board. What people post here helps me as well stay in the know about what's going on. Along with the newsgroup board and sites like CNN and MSNBC for example.I also like to watch programs like "Tough Crowd" and "Daily Show" on Comedy Channel and every once in a while watch Joe Scarborough and Hardball. Oh and also I actually did watch (and taped) the V.P. debate so I don't go by sound bites since I can go back and watch the video. I love watching the debates.


I have searched this topic, wasted more paper on printing it all out than I'd like to admit.>

Check this out for Bush and the 2000 election: http://www.thestolenelection.com/

http://www.chromehorse.net/rants/rants00/supremes.htm

http://www.newpara.com/God%27s%20Theft.htm

http://www.butterflydreams.com/pub/coup.html

http://www.arktimes.com/mccord/122200mccord.html

http://www.masnet.org/articleinterest.asp?id=343

That's all I could find on it right now. I flipped through a lot of the google search and that's what I found right now. Also on Moore's movie he interviewed this guy who was a black man who was in the army and was on the list as a criminal. Even the local reverend was on the list. These were actually testimonies and one woman testifying in court she didn't get to vote.



It's not a serious lie, but to me if he lies about something so innocent and just silly to lie about, why would he lie about it? Why did he not say the truth about meeting Edwards before? He didn't have to lie about that but he did! He's met Edwards at least three times (prayer breakfast in 01, meet the press I believe also in 01 and also the swearing in of Elizabeth Dole who is from North Carolina and he's standing right next to Edwards). And on those meeting days Cheney only did I believe two of those dates and once even had Edwards there. I'll try to find that list again. And on those meeting things Cheney talked about he only meets with republicans and Edwards is a democrat, so of course he wouldn't meet with him. I saw it on another message board I'm on. Here's one picture of Edwards and Cheney together at a prayer breakfast in 2001: http://blog.johnkerry.com/blog/archives/Cheney-Edwards.jpg Cheney is Bush's V.P. Shouldn't they be on the same page?



If you do trust Bush so much try reading and watching some of the movies out there. There's a lot. "Bush's Brain" I believe is a book and a movie (I know for sure a movie) and also "The Hunting of the President" which is what republicans did to Clinton because they just didn't like him. Also Joe Scarborough's book "Rome Wasn't Burn in A Day" and Pat Buchanan's book "How the Right Went Wrong." (I believe it's from him)

Do you ever at least see what the other side is saying too? Just wondering. Before I made up my mind to support Kerry I looked into everything I could to see who was the best guy in my eyes. I read what Bush is for and I read what Kerry's for both from their official site's and also from what Bush has done in the last four years. I just think we need a change in the House. Does Bush work with ANY democrats? Doesn't he believe in balance in views? Or are all his people republicans?



I didn't think it was a smart move by Rather to put out those documents and not to 1000% make sure they were real. Anybody could get scammed and that sucked for him. I don't know the whole story on that. If he was set up or just was excited about the story and didn't think or what. *shrug* I don't know much about CBS news since I don't watch them really. If you can point out to me stuff that you know and have links to that show that stuff I've said isn't fact based then I'll check them out. Since you seem to know.



Nobody wants to be wrong. Not even myself, but if you are wrong don't you say "I'm sorry"? Dan Rather even did. If Bush was wrong about Iraq and the no WMD's why hasn't he said about it? :\ I admire someone more if they can admit to their mistakes because it shows they are learning in life. And why is New York (the place of 9/11) all blue and for Kerry? Also according to electoral-vote.com New York is Kerry 53% and Bush 41%.


This whole 'no plan to win the war' is nothing but rhetoric. What's Bush going to do, let the world know all that he will do so the enemy know's their part? I would think that the more likely response will be to use the knowledge of a plan in everyway possible for them to succeed and us to fail.>

Didn't other people tell Bush and advise him about Iraq? That it wasn't a smart idea? Why did Bush jr go in and not Bush sr?


Gee, all this and all I wanted to know was if you only got your sources from those with a liberal point of view. I do appreciate the discussion though, it's been very interesting and enlightening, and hopefully I will have learned something from it. Certainly I'll watch how I use the term "liberal", it's not a dirty word.>

I've just been hearing people say if you're a liberal it's such a bad thing. It's like a sin or something. *shrug* I was just wondering why that word is so bad and dirty sounding when people talk about being a liberal. I have no idea what all being a liberal means. *shrug* And I did say I got my news from this board from other newsgroups that people post about just everything with politics. I also like MSNBC and CNN. Also did you read the record Kerry has? It's on the debate reflections post and starting on 81. If Kerry is so bad why are so many newspapers endorsing him and not Bush? If Kerry really was that bad I don't think his home state would be a strong Kerry state. They are 64% and Bush is 27% there according to electoral-vote.com

iVillage Member
Registered: 08-07-2004
Mon, 10-11-2004 - 12:23am
Oh no problem. I could list his mistakes. I don't have time, the list is so long. And you will just say something like it's all liberal Bush bashing anyway.

I would like to hear him admit to a mistake himself.

iVillage Member
Registered: 08-05-2004
Mon, 10-11-2004 - 12:37am
Wasn't there an AOL comparrsion not long ago? I'll try to find it again.
iVillage Member
Registered: 08-11-2004
Mon, 10-11-2004 - 4:16am
You must be living on another planet if you have not invetigated what is out there about Kerry? Do you really listen to what he says? He says something different everytime he opens his mouth. He said church should be separate ftom state but then today he goes to a black church and poses with Al Sharpton and Jesse Jackson and the minister says vote for Kerry in his own church. Kerry could care less about black people. What a hypocrite!
iVillage Member
Registered: 03-26-2003
Mon, 10-11-2004 - 4:43am

<<"I would like to hear him admit to a mistake himself.">>......He did.


From the transcript: >>"Now, you asked what mistakes. I made some mistakes in appointing people, but I'm not going to name them. I don't want to hurt their feelings on national TV."<<

Djie

iVillage Member
Registered: 07-12-2001
Mon, 10-11-2004 - 10:28am
Thank you Alicia!! That was the point I was trying to make when I commented on crownotangelgrl's list of "Films to Watch Before You Vote" in the Fahrenheit 9/11 thread. Granted, I have my biases and opinions like everyone else, but if I were going to recommend a list of "Films to Watch Before You Vote," I'd try to find some that at least tried to present both points of view, and weren't blatant propaganda pieces. I trust that most people can make up their own minds about such things (provided they're at least somewhat intelligent and analytical) and can see through such tactics as someone trying to feed them one-sided information and spin.

Bev

girl in chair
iVillage Member
Registered: 08-31-2003
Mon, 10-11-2004 - 5:43pm
I have no doubt that you are genuine in your desire to find information about your candidate and your desire to support. I find that very commendable in a young adult these days, I know that at your age, I just assumed that my vote didn't really matter and whether it was a Republican or Democrat in office, it didn't really matter either. I leaned left back then too. It seems that we are just going round and round within this thread, and I don't want to spend time repeating myself. My original question was simple, and despite that I never recieved a direct answer, I do have the answer. Hopefully, some day, you will be able to look at non-biased information to come to your opinions, most likely, if your present day convictions are strong enough, your opinion will not be at risk, and will only be strengthened.
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iVillage Member
Registered: 08-31-2003
Mon, 10-11-2004 - 5:53pm
"Oh no problem. I could list his mistakes. I don't have time, the list is so long. And you will just say something like it's all liberal Bush bashing anyway."

No, if you have a sincere list of mistakes, not just the typical rhetoric, I would really like to see it. Now, if they are mistakes simply because it's an opinion based on different ideology, then I'll see them as a difference of opinion. If they are mistakes based on information not available when a decision was made, then I'll call them disingenuous. If they are clear cut mistakes, where a better course should have been chosen, no if's and's or but's, I'll probably agree. And I'll preface all this by saying that any candidate for President that would get up and 'admit mistakes' that would be used as a sound bite by his opposition against him, is a very poor candidate, and could even be called a fool.

"I would like to hear him admit to a mistake himself."

It seems that Bush did admit to a mistake, regarding some of his appointments. And, by gosh, Kerry wasted no time in using that against him.

That question was a double edged sword that Bush had no choice but to stick in himself. Where he was going to stick it was the question. Seems he tried to do it with the least amount of damage.

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iVillage Member
Registered: 08-31-2003
Mon, 10-11-2004 - 6:46pm
Your welcome Bev.

For me, it's about making an informed decision. Of course there will still be people that disagree with me, but I would rather make my desicions based on factual information and not on hype or rhetoric. It's too easy to be swayed through emotions with that,like you I find it easier to make a decision with information from all points of view, that is not inflammatory. It actually has cut down on my frustration, and anger when talking with people with opposing view points.
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iVillage Member
Registered: 08-05-2004
Mon, 10-11-2004 - 7:30pm
I did say where I got news information to make up my mind. I watch "Daily Show" and "Tough Crowd" on Comedy Central, get stuff from CNN.com and MSNBC. I every once in a while watch Joe Scarborough and Hardball with Chris Matthews and Deborah Norville as well. What I post here may not be directly from those sources but that's what news networks I watch. Are all of them liberal? Isn't Scarborough a republican? If this isn't your question, what was it? I do know my vote is important and have always been told by my parents: "if you don't vote, you can't complain."