Katherine Gallagher Robbins, Senior Policy Analyst

by Katherine Gallagher Robbins, Senior Policy Analyst, 
National Women's Law Center

While the heirs of billionaires like George Steinbrenner are lucking out in 2010, struggling Americans cannot catch a break. Up to 2.5 million workers may lose unemployment benefits by the end of this week.  Senate Minority Leader Mitch McConnell (R-KY) cited the deficit as a key reason for not extending these benefits saying, "The only reason the unemployment extension hasn't passed is because our friends on the other side have refused to pass a bill that doesn't add to the debt."

So, when Senator Jon Kyl (R-AZ) (who voted to block the extension of UI benefits and is supporting other costly tax cuts for millionaires) and Senator Blanche Lincoln (D-AR) announced that they would try to get Congress to act this month on a measure reducing the estate tax next year for the heirs of the very rich, we wondered what the effect on the deficit would be.

Because Congress allowed the estate tax to expire at the beginning of the year, the heirs of the very wealthy get an additional windfall in the form of $14.8 billion in tax savings that would otherwise have gone to the U.S. Treasury. (The estate tax returns to its pre-Bush tax cut level on January 1, 2011.) In comparing how extending unemployment benefits and prominent estate tax proposals would affect the deficit over the next decade, Ezra Klein shows that extending unemployment benefits would be a drop in the deficit bucket while various proposals regarding the estate tax would set America back by hundreds of billions of dollars.

This graph is from Ezra Klein's Blog in the Washington Post. To read the full article, click here.