Rangel on the Fringe
This article is from the archive of The New York Sun before the launch of its new website in 2022. The Sun has neither altered nor updated such articles but will seek to correct any errors, mis-categorizations or other problems introduced during transfer.

For the entire year House Ways and Means Committee Chairman Charles Rangel has promised a bill to repeal the Alternative Minimum Tax by raising $850 billion in other taxes. Now it appears we will finally see his handiwork this week. Mr. Rangel has enjoyed keeping the public guessing about the details, but what he intends is no surprise. He wants to raise taxes instead of simply repealing a tax that Congress never intended to levy on 23 million middle class taxpayers. Mr. Rangel would like to raise the tax on capital gains and dividends, perhaps by taxing all income at the high “ordinary income” rate instead of moving to a modern consumption-based system with flatter, lower rates. Our understanding is Mr. Rangel will call for a 4% surcharge on individual adjusted gross income over $150,000 a year, tax private equity fees at ordinary income rates, and assume expiration of the Bush tax cuts, among other things. For the Democrats in Congress, it seems, it is not enough to have one tax increase coming with the expiration of the Bush tax cuts expire after 2010.
Chairman Rangel insists it is not about the money. He wants a system with fewer tax rates, which is fine with him as long as most of them are higher. His latest conciliatory gesture is to offer a corporate tax rate that is nominally lower, but he would remove various corporate tax breaks to ensure that American companies still pay some of the highest tax rates in the world. Call it Rangelism. His actions show that his bottom line is still increasing the government’s tax take instead of making the tax system better and the government smaller. If Mr. Rangel truly worried about the economic vitality of New York City and the country, he might take steps to shore up Wall Street’s status as the world financial center. Instead, the one thing he has promised to do is raise taxes on private equity to drive that business elsewhere.
Could this be too much even for Mr. Rangel’s fellow Democrats? Speaker Pelosi is pressuring Mr. Rangel to introduce a bill that does exactly what he says he would not do, which is to continue the annual charade in which Congress offers AMT relief one year at time. Mr. Rangel will still introduce his “Mother of All Tax Reforms” as a separate bill, but his will be the only name on it. Not a single of his Democratic colleagues will join him. Mr. Rangel still wishes to position himself for the Superbowl of tax increases in 2009 if the Democrats increase their hold on government in the next election, but for now, Ms. Pelosi has bigger fish to fry. Her own hard-left base has forced her to spend so much time on pointless efforts to withdraw American forces from Iraq that Congress has yet to enact a single major spending bill. Much other unfinished business looms.
The Congress may yet spend weeks locked in a veto battle with the president, at least if Mr. Bush follows through on his threat to redline spending that breaks budget caps. Ms. Pelosi and Senator Reid find themselves leading a Democratic Congress that has achieved approval ratings that, at 11%, are even lower than that of the Bush administration or the Republican Congress that it replaced. There is a kind of tragedy at the heart of all this. New Yorkers know Mr. Rangel to be a sager, more inclusive, more responsible public figure than he is often reputed to be, who has written a wonderful book about how he hasn’t had a bad day since he crawled out of the frozen battleground of the Korean War. It is a shame to see him emerge as a fringe figure in the Congress he has waited to lead.