Senators on record supporting president\’s proposal are now balking because of politics

WASHINGTON – As the US Senate gets set to finalize President Bush\’s Economic Growth and Jobs tax cut package, American Shareholders Association (ASA) would like to remind everyone of two senators that have put themselves on record calling for abolishing the double taxation of dividends and are now obstructing the president\’s proposal. The two senators are presidential candidate John Kerry (D-Mass.), who acknowledged the job creation effects and Democratic Senatorial Campaign Committee Chairman Jon Corzine (D-N.J.), who spoke about the harmful effects double taxation places on the economy and corporate accountability.

Just five months ago, and one month prior to the president\’s call for ending this unjust double taxation, Kerry delivered a speech calling for eliminating the double taxation of dividends, yet, he has now gone silent on the issue to curry favor with the liberal spending interests he needs to win the Democratic nomination for president. In fact, Kerry called for eliminating the double taxation of dividends as well as a capital gains reduction, which is similar to the House of Representatives\’ plan that will be voted on tomorrow. In his own words:

"And to encourage investments in the jobs of the future – I think we should eliminate the tax on capital gains for investments in critical technology companies – zero capital gains on $100 million issuance of stock if it\’s held for five years and has created real jobs — and we should attempt to end the double taxation of dividends." City Club of Cleveland Speech Dec. 3, 2002

Next is Corzine who comes to the Senate with an extensive investment banking and finance background. As such, he has become a key spokesperson for the Democratic Party to attack President Bush\’s proposal to abolish the double taxation of dividends. Yet, just five days after Kerry called for ending this unjust double taxation, Corzine laid out why double-taxing dividends is harmful to the economy. As such, his flip-flop obstructionist view against the proposal, in his words, is harming the economy.

"Well, I think there\’s actually reason to consider some move with regard to dividends… I\’d put it at the corporate level as opposed to the individual level, because it will work to unbias our system away from debt, which I think is limiting the growth of the economy. The kind of thing you saw at United Airlines is in part, a very large part, driven by excess debt on the balance sheet. And the way our system works right now, companies are encouraged to issue debt as opposed to do equity financing." Fox News Dec. 8, 2002

"Good policy is good politics," said ASA Executive Director Daniel Clifton. "Both senators have acknowledged eliminating the double taxation of dividends creates jobs and grows the economy. Unfortunately, however, these two senators have a personal stake in keeping the economy down to have a campaign issue in the 2004 elections. Yet, this political obstruction comes at the expense of working American families and their strategy will backfire in the next election cycle. It\’s time these senators stop playing politics and help pass a meaningful tax package that abolishes the double taxation of dividends."