Bloomberg reports on business groups lobbying for a 35 percent death tax to prevent a return to the 55 percent tax rate at the end of the year. Business has long argued for eliminating the death tax altogether, but current political and budgetary realities make that an unrealistic goal at the moment.

A 35 percent rate “is really that sort of sweet spot of what’s acceptable to all sides,” said Dena Battle, director of tax policy for Washington-based National Association of Manufacturers. “We don’t want to see the tax go up to 55. We didn’t want to see the tax at 45.”

The longer Congress delays action, bringing a 55 percent tax closer to reality, the fewer reasons Democrats have to consider Kyl’s and Lincoln’s 35 percent alternative, said Jeff Shoaf, senior executive director for government affairs at Arlington, Virginia-based Associated General Contractors.

In a December 2009 column, Sen. Jon Kyl (R-AZ) explained the reasoning behind the language he and Sen. Blanche Lincoln (D-AR) have sponsored:

I have always believed that permanent repeal of the death tax represents the best policy, since it frees capital in the private market for more productive uses than fueling the federal government’s spending binge. However, even in the best of times, we have only been able to win 56 votes in the Senate for repeal, just shy of the needed 60. With the current makeup of Congress, permanent repeal is simply not in reach.

With that in mind, Democratic Senator Blanche Lincoln and I offered an amendment to the Senate budget resolution in 2009 that attempted to strike the best compromise. It would have permanently established a 35 percent death tax rate with a $5 million exemption amount indexed to inflation. That amendment passed by a vote of 51 to 48 with the support of 11 Democrats and every Republican senator. But, unfortunately, the congressional budget resolution is only an advisory measure.

From The Orlando Sentinel, “Dems come out against card check“:

There is a growing roster of Democrats coming out against the White House-backed card check legislation, and now Orlando has its own political A-listers following suit.

Roger Chapin and Joe Kefauver recently formed an advocacy group called Floridians for Responsible Policy (Floridiansforresponsiblepolicy.com), which will take on the bill that pits business against labor as item No. 1 on its agenda.

Chapin and Kefauver, both longtime Democrats who voted for Barack Obama for president and contributed to Democratic candidates, say the Employee Free Choice Act is bad for a lot of reasons, but first and foremost it represents an “over-reaching” by their party.

“I agree with the right to unionize,” said Chapin, an executive at Mears Transportation, which contended with an attempt to organize last year. “But this tilts the playing field too far.”

Expect scorn and retaliation, gentlemen.

From Talking Points Memo, “Will Unions Back A Green Candidate Against Blanche Lincoln?”

Michael Kinsley, “Democrats for Rich Heirs?“:

Oh, small business blah blah blah. For the umpteenth time: Big businesses (such as General Motors) are mostly owned by people of small means (workers through their pension funds, 401(k)s and so on). To be affected by the estate tax, a business must be owned by someone of large means: at least $7 million. Small businesses come and go. Yes, they create jobs disproportionately. They also eliminate jobs disproportionately. There’s nothing wrong with small businesses, but there is no reason of fairness or efficiency that they deserve special treatment.

Oh, Michael Kinsley blah blah blah.

That not being an adequate retort, we’ll instead cite Sen. Blanche Lincoln (D-AR), sponsor of the Senate amendment to reduce the death tax. From her floor statement, April 2:

Because my time is limited, I wish to take a moment to read to you a few excerpts from an editorial that appeared in the Arkansas Democrat-Gazette earlier this year. It was submitted by a member of a family who runs a timber operation in southwest Arkansas and that has been in the family since 1907. He said:

The estate tax kills jobs. It kills companies that provide jobs. In the process it kills towns and communities, particularly those in rural areas dependent upon the land and local industry.

Five times this man’s family has been subjected to the estate tax—five times. He goes on:

Between the 1950s and 1980s, vast amounts of money—tens of millions of dollars—were raised to pay the tax. Lands were clear cut, mills liquidated, communities destroyed. . . The next hit will be too great.

Think about this type of family business. They have grown their business, reinvested in it over a century’s worth of time, put almost all their profits back into it, and now this particular company employs over 1,000 Arkansans and has multiple mills that are worth a good bit of money—millions of dollars.

Blahing aside, doesn’t the man make a compelling argument economically, that the death tax destroys wealth and investment and jobs?

Today’s editorial in the Wall Street Journal, “Death Blow,” on the death tax points us to two representative expressions on the issue last week’s Senate budget debate.

The Senate voted 51-48 (roll call) for an amendment sponsored by Sen. Blanche Lincoln (D-AR) and Sen. Jon Kyl (R-AZ) to cut the death tax rate permanently to 35 percent and exempt all estates of less than $10 million per couple ($5 million for a single taxpayer) from any tax. President Obama is seeking a 45 percent rate with just a $7 million exemption.

Senate Majority Leader Harry Reid (D-NV) inveighed against the amendment (his remarks are here). Excerpt:

President Obama inherited a crisis that no President should have to inherit or fix. Instead of focusing full time on the future, he and we in Congress must first clean up the devastating mistakes of the past. We can only turn the page from the recession to recovery if we watch every single taxpayer dollar the way families watch every dollar in their budget. Every dollar counts.

That is why it is so stunning, so outrageous, that some would choose this hour of national crisis to push an amendment to slash the estate tax for the superwealthy. This isn’t for the wealthy; this is for the superwealthy. Yet that is what we see here today.

Superwealthy? Others see jobs creators. Sen. Lincoln had moments earlier recounted a letter in a newspaper from a member of a family who runs a timber operation in southwest Arkansas, a family business since 1907 — and his family had been hit five times by the estate tax. From Sen. Lincoln’s remarks:

Think about this type of family business. They have grown their business, reinvested in it over a century’s worth of time, put almost all their profits back into it, and now this particular company employs over 1,000 Arkansans and has multiple mills that are worth a good bit of money—millions of dollars.

This amendment provides real relief to our family-owned businesses. In a time when our Government has handed out billions upon billions to failed Wall Street banks, it is time we provide a little relief to our businesses on Main Street that are in need of help right now. These are people who employ more than half the workers in Arkansas. These are the people who, if we reform the estate tax, will invest in their businesses and create more jobs.

Our emphasis. And the economic reality speaks far louder than invidious labels.

Covering the announcement by Sen. Blanche Lincoln (D-AR) that she will oppose the Employee Free Choice Act, The Hill cites her statement:

“I consider both the labor and the business communities to be my friends.  However, now that we need all hands on deck, including business and labor, to get our economy moving again, this issue is dividing us,” Lincoln said in a statement. “While I may not have been clear about my position in the past, I am stating today that I cannot support Employee Free Choice Act in its current form and I can’t support efforts to bring it to Senate consideration in its current form.”

And…

“I will consider alternatives that have the support of both business and labor but my pledge today is to focus my full attention on the priorities I have mentioned that affect every working family in Arkansas,” Lincoln said.

When Senator Specter (R-PA) announced his opposition, organized labor generally made nice, trying to keep the lines of communication open with him. But with Lincoln…

“Senator Lincoln’s decision to stand with Big Business over working families at a time when CEOs make 344 times that of their average employee, and as jobs disappear by the minute, is disappointing at best. Yet we share Majority Leader Reid’s belief that our efforts to improve the working conditions and lives of millions of Americans through the Employee Free Choice Act will not be derailed,” said Jon Youngdahl, political director for the Service Employees International Union.

Unions say Lincoln abandons working families. That’s tough. (UPDATE: A vague statement, that. What we meant was, that’s certainly harsh rhetoric from the unions.)

Meanwhile, from the Arkansas Lincoln to the Nebraska Lincoln, where Stewart Acuff whistles past labor’s political graveyard. From the Journal-Star, “Unions near victory, labor official says”:

Organized labor is “very close” to winning a breakthrough legislative victory that could help restore a healthy middle class, a top national union official said in Lincoln.

“We want to reverse a 30-year assault on the freedom to form unions and bargain collectively,” said Stewart Acuff, special assistant to AFL-CIO President John Sweeney.

Applause for Senator Blanche Lincoln (D-AR) for siding with her constituents and against the Employee Free Choice Act.

From The Hill, Briefing Room, “Sen. Lincoln Will Not Support ‘Card Check’”

Sen. Blanche Lincoln (D-Ark.) said Monday she will vote against the Employee Free Choice Act (EFCA), marking a major Democratic defection to the effort to pass the highly-prized union bill.

“I cannot support that bill,” Lincoln said during a speech before the Little Rock Political Animals Club, according to the Arkansas Business News. “Cannot support that bill in its current form. Cannot support and will not support moving it forward in its current form.”

The Associated Press is also reporting that Lincoln announced her opposition to the bill, which is strongly desired by organized labor.

The “current form” phrasing allows wiggle room, true, but the serial nature of Senator Lincoln’s sentence emphasizes her opposition.

The original ArkansasBusiness.com report is here.

UPDATE (4:05 p.m.): Sam Stein at Huffington Post writes, “In what is, perhaps, the most devastating blow yet to the fate of the Employee Free Choice Act, Sen. Blanche Lincoln said on Monday that she will oppose the union-backed legislation.” Meanwhile, Eddie Vale of the AFL-CIO says, “It’s not dead yet. It’s getting better.” Or words to that effect.

Gee, after we say something passingly nice about the left-wing advocacy group OMB Watch, they attack two Senators for daring to challenge the death tax:

Long Overdue Outrage Over the Anti-Estate Tax Crowd

Both the New York Times and the Washington Post ran lead editorials this morning denouncing the attempt of Sens. Blanche Lincoln (D-AR) and Jon Kyl (R-AZ) to give yet another tax cut to the children of the very richest Americans. Both editorials are spot on and raise excellent points about why Sens. Lincoln and Kyl seem to be both out of touch and out of their minds. In fact, both editorials express far more outrage and disdain for this proposed tax cut than I’ve ever seen before in any newspaper. (Read the Times and Post editorials.)

(Adam Hughes 04/02/09)

“Out of their minds.” OK, here’s the testmony of Eugene Sukup, chairman of the board of Sukump Manufacturing Company in Sheffield, Iowa, speaking at a November 2007 hearing of the Senate Finance Committee.

I’m not bragging when I tell you that businesses like Sukup Manufacturing are the backbone of our economy. By the same token, when a business like ours is sold off or shuttered, the loss to the economy is great. If Sukup closed today, 350 people would lose their jobs. But, that’s just the beginning. Without jobs, there’s no reason for a child care center. As people move on to other places, the restaurants and stores close down, the dentist moves to a bigger city with more customers. The loss would be felt in Iowa, in Arkansas, in South Dakota.

Now, to be clear, we’re a growing company. So, why would we close down or sell off? I’m here today to tell you that one of the greatest threats to our family-owned business is the estate tax. If my wife Mary and I died today, we estimate that our estate tax liability would be somewhere between $15 and $20 million dollars. The only way for my sons to pay that tax would be to sell off the business.

Folks will tell you that you can “avoid” the tax. Well, maybe that’s true in some cases, but it also involves extremely high financial planning costs including expensive life insurance policies that businesses pay year in and year out. Money that we put into life insurance policies and other financial planning tools to avoid the tax is money that we could have been putting into the business - hiring more employees and expanding into other states.  

Any insults about mental health you want to throw his way? Mr. Sukup is, after all, a member of the “anti-estate tax crowd.”

We bet most of his employees are, too.

Hah. Despite union reports that the Employee Free Choice Act would be introduced next Monday …

From the People’s Weekly World, “Update: Employee Free Choice Act to be introduced in Congress“:

(Editor’s note: PWW reporters at the AFL-CIO executive council meeting indicate that the report that the Employee Free Choice Act will be introduced on March 9 is incorrect. According to union sources, the bill will be introduced later in the month).

As suggested below, PWW reporters pay attention to details and are conscientious (in service of an evil cause, Communism, but still, credit where credit due). We tend to believe them more than the union blusterers.

In what’s probably related news/commentary, from Arkansas: “Is Lincoln shifting on EFCA?”

UPDATE (9:40 a.m.): More evidence of union confusion on the issue. Yesterday, the Los Angeles AFL-CIO’s website said introduction would be next Monday:

Street Dialing for Good Jobs
Join us as we phone bank Senator Feinstein from the streets of L.A. in support of the Employee Free Choice Act

On Monday, March 9th Congressman George Miller and Senator Ted Kennedy are expected to introduce the Employee Free Choice Act into the House of Representatives.

Today it says:

On the week of March 9th Congressman George Miller and Senator Ted Kennedy are expected to introduce the Employee Free Choice Act into the House of Representatives.

Don’t want to get caught up in too much of the insider ball game here. The Employee Free Choice Act is an attack on secret ballot elections, good jobs and managerial prerogative no matter whether the bill is introduced March 9th or March Xth. The question of dates is interesting just as a reflection of labor’s disarray and confused leadership.

UPDATE: (10 a.m.): “President Tells Unions Organizing Act Will Pass“:

MIAMI — President Barack Obama told AFL-CIO union leaders Tuesday in a videotaped address that the controversial Employee Free Choice Act will pass, signaling his full backing for legislation that makes union organizing easier.

“We will pass the Employee Free Choice Act,” President Obama told more than 100 top labor officials in a closed-door meeting at the labor federation’s winter gathering in Miami, according to people at the meeting.

The remarks were taped February 20th, so they’d have to be generic statements of support.

UPDATEThe Hill:

Democratic aides said lawmakers have not yet picked a day for when to introduce the bill.

“We have not made a decision on timing for introduction of the bill,” said Aaron Albright, spokesman for the House Education and Labor Committee. Miller (D-Calif.) is chairman of the committee.

From AP Arkansas, “Lincoln: ‘Card-check’ proposal not necessary“:

LITTLE ROCK, Ark. (AP) - Sen. Blanche Lincoln said Tuesday she doesn’t believe federal legislation that would allow labor organizations to unionize workplaces without secret-ballot elections is necessary, but gave herself room to support the measure if it’s brought up later.

Business and labor groups are pressuring the Democratic senator from Arkansas for support either way, and Tim Griffin, a potential challenger to the senator’s 2010 re-election bid, has said her stand could be an issue in the race.

We don’t find the full AP immediately online, but here are key quotes and excerpts from Senator Lincoln:

“I think the question is, is there a need for this legislation right now? And for multiple reasons, I don’t think there is,” Lincoln said in an interview with The Associated Press….

Lincoln said that the majority of efforts to unionize workers are successful anyway and that the nation has bigger problems to deal with.

“I don’t see this bill as being the solution to those problems, and I don’t see us focusing on that bill as helping us to solve those problems,” Lincoln said. “If what we want to do is strengthen our economy, create jobs, create a better working environment for working families and workers in this country and create a better environment for business to be successful, then it’s not focusing on the Employee Free Choice Act.”

Lincoln said she thinks the act has “room for improvement,” and indicated she’d be more open to talking about the measure once other issues are addressed first.

“Just to bring this up and say this is going to solve problems, we try really hard to not do things that way,” Lincoln said. “The point is, we try to go through the hearing process, which is what we’ve tried to do on health care and tax reform and other things we’ve had all these hearings on.”

That’s an excellent assessment of the state of play, from which we infer that organized labor’s priorities aren’t the nation’s priorities. It’s especially gratifying to see Senator Lincoln acknowledge that unions win a majority of representation elections, more than 60 percent in 2007.

Meanwhile, The Hill reports that Senator George Voinovich (R-OH) is sticking to his guns, declaring, “To just have a situation where somebody can go out there and get X number of cards and then say, ‘By the way, we’ve got 50-plus-one, now you’re unionized’ — it’s undemocratic.”

UPDATE (11:30 a.m.): Brian Faughnan at The Weekly Standard does some Senate vote-counting and finds the 60 votes for cloture more difficult to reach. Beware the faux compromise, though.

(Note: NAM’s Executive Vice President Jay Timmons is blogging from the National Democratic Convention in Denver this week.)

The capstone event the NAM team attended on Wednesday was a reception hosted by the Third Way Democrats. Third Way is a group of thoughtful policy professionals who believe partisan politics get in the way of creative solutions.

NAM is a proud supporter of Third Way. Although we won’t always totally see eye-to-eye on all issues, the organization is one of the few in Washington willing to look past campaign rhetoric in order to bring together non-traditional allies to devise policy proposals to help real people in the real world, and make America more competitive.

Senator Tom Carper (DE) was in attendance. NAM’s CEO, John Engler, worked closely with Senator Carper when the two were Governors. That productive relationship has extended into their new leadership roles as they have collaborated on common sense proposals to reform our litigious legal system in order to reduce the cost of doing business in the United States.

Senator Blanche Lincoln (AR), another attendee, is expected to be a major player in the next Congress when tax reform proposals are offered. Senator Lincoln has a history of reaching out to stakeholders, and the NAM expects to work closely with the Senator and her staff next year on tax policies that will enable U.S. manufacturers to better compete and succeed against our major trading partners.

Free trade, in particular, is an area where the Third Way can make an extraordinarily positive impact next year. The NAM has been actively working with the group to craft meaningful proposals to advance pending trade agreements, pursue new agreements that would open additional markets to U.S. products, reduce non-tariff barriers, and enforce our existing agreements.

Third Way is clearly in touch with members of their party: Fully 62 percent of Democrats say they benefit from free trade, according to a nationwide poll conducted by the Consumer Electronics Association this month. Data released today by the Commerce Department explains why this perception is a reality. Second quarter Gross Domestic Product figures show a stronger than expected 3.3 percent annual rate of increase in real GDP. Exports contributed 1.65 percentage points of that 3.3 percent growth. And “net exports” (trade balance – exports minus imports) contributed 3.1 percentage points of that 3.3 percent growth, because real imports (price-adjusted) fell.

Third Way Democrats understand free trade works. Hopefully their philosophy and the realities of the positive impact of free trade will prevail after the campaign rhetoric subsides.