(July 13) – “Al Gore was crisscrossing the state of Washington last month with Democratic Sen. Patty Murray when he heard that the House of Representatives had voted to repeal the federal estate tax,” write Jacob M. Schlesinger and Nicholas Kulish in today’s Wall Street Journal.

“The vice president expressed surprise at the vote — especially the fact that 65 Democrats had defied party leaders and joined with the Republican majority. ‘Well, I’m a co-sponsor of a Senate bill to repeal it,’ Ms. Murray replied. ‘He asked me why,’ she says. ‘I told him, “Support for the estate tax has been a bedrock Democratic issue for a long time. But times have changed.” ‘ “

“Have they ever.”

“A decade ago, when business groups first started campaigning against what they call the death tax, ‘we were laughed out of rooms,’ says Dan Blankenburg, a lobbyist for the National Federation of Independent Business. The tax applied only to the wealthiest Americans, and everyone in Washington, Republicans included, told him ‘you’ll never get that repealed.’

“But now, a solid majority in Congress backs eliminating the tax, a capstone of the nation’s progressive tax system since President Woodrow Wilson signed it into law in 1916. The Senate has been debating repeal this week, and could vote as soon as Thursday. Nearly two-thirds of its members are on record as endorsing the idea, including at least eight Democrats in addition to Washington’s Ms. Murray.”

“Of course, Senate passage won’t guarantee repeal, since President Clinton has vowed to veto the measure. ‘For us to repeal the estate tax before we raise the minimum wage or give tax relief to low-income working families … is a huge mistake,’ he said earlier this week. ‘It reflects a wrong set of priorities.'”

“Still, the gathering political momentum behind rolling back the tax signals a seismic shift in the nation’s politics. Mr. Clinton, Mr. Gore and Democratic leaders in Congress are scrambling to respond by proposing substantial reductions in the tax as an alternative to outright repeal.”

“Hoping to stave off defections this week, Senate Democratic leaders are proposing to raise the value of estates exempt from paying estate taxes to $2 million per person — $4 million per couple — by 2009 from the current level of $675,000 per person or $1.35 million per couple. That would slash by two-thirds the already small number of families facing such a tax. And House Democrats are offering to cut the top rate for those still subject to the tax to 44% from the current 55%. (Under current law, the exempt amounts are slated to rise to $1 million, or $2 million per couple, by 2006.)”

@page_break@”In part, the changing fortunes of the estate tax reflect a clever lobbying and public-relations campaign. Over the past year, one alliance of small businesses, ranging from supermarket owners to beer wholesalers, has spent $1 million on radio ads and other grass-roots appeals under the banner of Americans Against Unfair Family Taxation, hoping to turn public opinion against the tax.”

“At times, repeal advocates have exaggerated the law’s effects. At a recent speech before the National Council of La Raza, a major Latino advocacy group, Republican presidential candidate George W. Bush told of a Mexican-American taco-shop owner who wanted to ‘get rid of the death tax so I can pass my business from one generation to the next.’ When pressed later for details about the restaurateur, the Texas governor’s campaign acknowledged the taco business was valued at $300,000, less than half the sum at which the tax would kick in under current law.”

“Yet there’s more than just slick marketing going on here. At a time when the gap between rich and poor is wider than it has been in decades, public concern about that disparity appears to be on the wane. Attitudes about wealth are clearly changing as more Americans either experience it, or hope to do so in the future.”

“The soaring values of stocks and real estate over the past decade have turned many middle-class families into paper millionaires, without necessarily making them feel ‘rich.’ On the West Coast, in particular, housing prices have risen enough to transform a modest home into a taxable estate. That’s one reason nearly half California’s House Democrats, traditionally a bastion of liberal politics, came out last month for repealing the estate tax.”