What "Hurricane Heat?"

We've been meaning to look at this guy's stuff for a while and now we're getting the chance. Mike Sunnucks is a reporter for The Business Journal of Phoenix. Not sure how long he's been there, but the extent to which he looks at issues and facts concerns me. My problem with his writing is not that he can't spell or punctuate, it's that he's quick to use of anecdotal information as fact.

For example, Mr. Sunnucks wrote an article on 7 September 2005 titled "Kyl gets hurricane heat from Democrats over estate tax repeal." The title is kinda nifty 'cause it was the midst of hurricane season, but reading the article, I'm not sure how anyone could interpret the comments Democrats were making were anywhere near "Hurricane Heat." There wasn't even hot air in the Democratic citations to argue they were blowing hot air. But hey, if you have an agenda...

So let's look at some of the facts of Mr. Sunnuck's article and you tell me where the "hurricane heat" belongs. If you want to read along, here's a link to the story. WARNING: You'll need to register with them to read the story.

First sentence: implies Democrats are wrong for knocking poor Jon Kyl because removing the estate tax "will only help the super rich and could take needed revenue away from hurricane relief efforts and charities." The part about helping the "super rich" happens to be true. Kyl's bill will tax exempt fortunes of $3.5 million (yup, that $3,500,000) per person or $7 million per couple. I don't know about you, but there are not a lot of family farmers who simply aren't worth $7 million dollars.

Where's the proof of that? Easy to find out. A simple Google search pops up an article in The Agriculture Decision Maker Newsletter titled Federal estate taxation of farm and ranch estates. Written by an ag economist, the article clearly debunks Mr. Sunnuck's second sentence which says Kyl's for repealing the estate tax because "they hurt small businesses and farmers." Here's what the data shows:

One of the most frequently cited reasons for repeal of the federal estate tax is the "hardships that the tax inflicts on closely held family businesses and farms."” The data, however, do not support that frequently-made assertion.

Impact on farms. Data from federal estate tax returns (Form 706) filed in 2001 provide fairly clear evidence of the impact of the tax on farms and ranches. The data show that the largest amount of farm property subject to federal estate tax is held by decedents with taxable estates of $20,000,000 or more.

The number of estates subject to the federal estate tax has been quite modest in recent years. Of the roughly 2.3 million deaths in 2001, 51,841 incurred estate tax liability (approximately 2.2 percent of all deaths). In that year, $23,532,542 was paid in federal estate tax which averaged about $453,936 per estate.

Estates reporting farm property. Of the total number of taxable estates (51,841), 2,601 decedents with taxable estates reported some farm property in 2001. That is 0.11 percent of all deaths.

He concludes:

Possible repeal of the federal estate tax and generation-skipping transfer tax is being played out against a backdrop of striking increases in concentration of wealth in recent years. Much of that increase in wealth has bypassed the farming sector.

The revenue loss from federal estate tax repeal would result in a shift of burden to other taxes, most notably the federal income tax. The income tax is a concern to a far greater segment of agriculture than the federal estate tax.

So the estate tax that "hurts farmers" actually only hurts 0.11 percent of all estates. If that doesn't sound like helping the super rich, I'm a reporter for the Business Journal of Phoenix.

In his third sentence Mr. Sunnuck writes that those nasty "Democrats and liberal advocates counter that the proposed repeal will only help the super rich and cutting the tax will mean lost revenue that could be used to help in Hurricane Katrina reconstruction efforts or assist the working poor and lower income families in Arizona." Hmmm, he Center on Budget and Policy Priorities says repeal would "cost $162 billion through 2013." "Americans for a Fair Estate Tax say Kyl's plan will "cost nearly $1 trillion, and bad reforms would cost almost as much" in the first 10 years. The Congressional Budget Office says the revenues lost by eliminating the estate tax " the reformed estate tax would cover one-half of the Social Security shortfall." If that isn't enough money that could be used to help Hurrican Katrina victims, I'm a...well you know.

It seems to me that if Mr. Sunnucks was serious about reporting on critical issues you'd think he'd do a little more homework to make sure the line he was towing made sense. Granted he mentions some opposing data in the last couple of sentences, but I'm sure he knows most people don't read the last paragraph of many stories. If there are opposing views, do the read a favor and discuss all of them as least with some proximity to one another.