The Tax Cut Debate: Let The Spin Begin

By Bruce Sullivan | July 7, 2008 | 8:24 PM EDT

(CNS) - Depending on whom you're listening to, the $792 billion tax cut bill passed by Congress last week is either too small, too big, too risky, not bold enough, not what the people want, or exactly want the public wants. With taxes, it seems, not only is the devil in the details, but in the polls as well.

Some polls say that tax cuts are not a priority for the American people, while others show that a large majority of the public favors the Republican tax cut plan, as in a just released Wirthlin Worldwide poll of 800 registered voters, which said that 67 percent favored a tax cut and 31 percent were opposed.

Last month, a Fox News poll asked 900 registered voters if they preferred the projected federal budget surplus "to go mostly to tax cuts or mostly to social programs," and only 40 percent chose tax cuts, while 47 percent said most of the surplus should be spent on social programs.

In a non-scientific survey of readers on the subject of tax cuts, 89 percent said the GOP should hold out for the $792 billion package. Only 11 percent said they preferred a compromise with the White House on its offer of less tax relief.

President Clinton has promised to veto the GOP tax cut when Congress puts it on his desk next month, saying that it is too large and gives too much tax relief to the wealthy and not enough to lower income Americans. "If I can stop it I will," Clinton told the nation's governors gathered at a conference this weekend. The White House has countered with a tax cut offer of about $250 billion.

GOP leaders disagree with Clinton on both counts, arguing that their tax cut bill is neither too large, nor too aristocratic. Some, such as House Republican Conference Chairman J.C. Watts of Oklahoma, say that the President's position is divisive, while ignoring the fact that the Taxpayer Refund and Relief Act, as the bill is called, gives taxpayers earning under $35,000 the highest percentage of tax relief.

"[Clinton] has pulled every trick out of the bag, and not one is working," Watts' spokesman Bill Shapard told

"One of the most effective methods the Left has figured out to use is this class warfare nonsense," said National Taxpayers Union President John Berthoud.

An analysis of the $792 billion tax cut plan by the nationally known accounting firm Deloitte & Touche confirms that a family of four with an annual income of $35,000 would receive a 24 percent reduction in their tax bill. The same family with an income of $50,000; $75,000; $100,000; $200,000; or $1,000,000 would only receive respective cuts of 9 percent; 16 percent; 15 percent; 7 percent; and 3 percent.

"Plus," Berthoud told, "you could make the argument that the tax cut is only about $79 billion per year over ten years. That's not a huge amount of money."

However, since the tax cuts are based on projected budget surpluses the math is not as simple as just dividing the total package by ten. Most of the tax cuts in the Republican plan occur nearer to the end of the ten-year period rather than being spread equally out over the decade. Tax cuts for next year are scheduled to total just $5.2 billion and only about $156 billion for the first five years. Only if the economy stays strong will the more than $600 billion in remaining cuts occur, a bit of a gamble that in Las Vegas they call "betting on the come."

"There are a lot of politics on both sides" National Taxpayers Union Foundation Communications Director Pete Sepp told

With such a large gap between the White House's $250 billion proposal and Congress' nearly $800 billion package some expect the two sides to end up somewhere near the middle. Last week, Senate Budget Committee Chairman Pete Domenici suggested a compromise of about $500 billion. And in his speech to the governors, Sunday, President Clinton softened his stance on a compromise tax cut. "I am determined to try do it," he said.

"The bidding has begun," a spokesman for the Senate Majority told