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Clinton Allies Fight Repeal of Estate Tax

A new group that boasts three veterans of the Clinton administration is running television, radio and newspaper ads arguing for reform, rather than repeal, of the estate tax.

The organization, known as the Coalition for America’s Priorities, was formed by longtime Clinton confidant Steve Richetti. Gene Sperling, a former national economic adviser for Clinton, and Mark Penn — pollster for both former President Bill Clinton and New York Sen. Hillary Rodham Clinton (D) — are also allied with the group.

“It was our determination that we needed a political and substantive effort to tell the truth about what is really at stake here,” explained Richetti, who argued that repeal of the estate tax would amount to a $1 trillion tax cut for the wealthiest Americans.

The group is currently on the air with television and radio ads in North Dakota and Maine aimed at those states’ four Senators’ positions on the issue. The TV ads are running on cable stations statewide.

Richetti promised more ads would be rolled out in the coming days and said the group has already raised more than $1 million to fund its activities. It also has a poll currently in the field, being conducted by Penn, to test messages for the effort.

The Club for Growth recently launched television ads in four states urging Senators to support permanent repeal of the estate tax.

The ads target only one Senator who faces re-election in 2006: Sen. Lincoln Chafee (R-R.I.). The others are all Democrats: Sens. Mark Pryor (Ark.), Blanche Lincoln (Ark.) and Mary Landrieu (La.).

CAP’s ties to the Clintons almost ensure that it will be well-funded; it has filed as a 501(c)(4), meaning that it does not need to disclose any of its donors or its expenditures.

“We can raise serious money,” Richetti boasted.

One senior Democratic aide, who spoke on the condition of anonymity, gave mixed reviews to the group’s formation.

“On one hand they are really important because we have been getting our ass kicked on this issue for the past 10 years,” the source said. “On the other hand, it is too little too late.”

Those familiar with the organization’s plans insist that these ads are simply the leading edge of a larger effort aimed at bringing a progressive perspective to the national debate.

“We have contemplated applying [this model] to other kinds of tax priorities,” Richetti said.

To date, the estate tax fight has been largely overshadowed by the vacancy on the Supreme Court and the ongoing investigation concerning White House Deputy Chief of Staff Karl Rove’s involvement in the leak of a CIA operative’s name to the media.

But Senate Republicans appear set to bring the matter to a vote before Congress adjourns for its August recess and are in negotiations with Finance ranking member Max Baucus (Mont.) in the hopes of crafting a compromise.

Senate Finance Chairman Chuck Grassley (R-Iowa) said Monday that “Republicans and Democrats are trying to find consensus on federal death tax relief.”

Knowledgeable sources say that the timing of a vote is entirely dependent on whether a deal can be reached on the matter.

The fight to repeal the “death tax,” which applies to inherited wealth, has long been a priority issue for Republicans and a point of concern for Democrats.

“The politics of this issue are such that Democrats want to get it off the table,” said one senior Democratic Senate aide.

Republicans believe the tax makes it difficult for family-owned businesses such as farms to be handed down to the next generation. Democrats generally argue that because the tax only kicks in for estates worth more than $1.5 million in 2005, those being hit with the levy are more than capable of paying it.

Bush made the fight against the estate tax a centerpiece of the package he pushed through Congress in 2001, which has gradually raised the ceiling of wealth exempt from the tax, and he has since urged Congress to repeal it entirely.

It became a major issue in a series of Senate campaigns during the 2002 election cycle including races in South Dakota, Missouri and Minnesota, where several groups ran ads hitting Democrats for their alleged opposition to repealing the tax.

The ads currently being run in Maine by the coalition feature a narrator saying that “when government cuts one tax they always raise another.”

Should the estate tax be repealed, according to the narrator, one of three things will occur: 20 taxpayers will have to make up the cost; Social Security and Medicare will be cut; or $1 trillion will be added to the nation’s debt.

“Call Senators [Olympia] Snowe [R] and [Susan] Collins [R] and tell them to do what’s right,” the narrator intones as the ad comes to a close. “Support real reform for all of us.”

The North Dakota ad is exactly the same but in the end urges viewers to call Sens. Byron Dorgan (D) and Kent Conrad (D) to thank them for their support of estate tax reform rather than repeal.

The print ad, which ran in Roll Call last week, features a women dressed in formal attire with text that reads: “The last thing a rich heiress needs is a $1 trillion raise in her allowance.”

Richetti would not comment on where and when the campaign would expand, saying only: “We will go to locations where we think we can make a difference.”

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