Harrisburg, Pa., April 10, 1996--The Pennsylvania campaign organization of Democratic Presidential candidate Lyndon LaRouche, released an emergency plan to balance the Commonwealth budget, with no cuts in medical assitance or other necessary social programs. The plan proposes either a modest excise tax on capital gains, or a "securities sales tax,' modeled on a Feb. 28 proposal made by U.S. Sen. Jeff Bingaman. (D-N.M.) to U.S. Senate Democratic Leader Tom Daschle (S-S.D.). Either emergency measure will easily raise the $250 million demanded by Governor Ridge, to prevent wrongful deaths of Pennsylvanians caused by massive budget cuts.
LaRouche campaign representative Philip Valenti had called Ridge's proposed medical assistance cuts, "a violation of the Nuremberg Code, under which Nazi leaders who 'knew, or should have known' that their policies would result in wrongful deaths of innocent people, were tried and convicted of 'crimes against humanity.'
Valenti said the emergency plan is designed both to tax those who can afford it, and to encourage long-term productive investments at the expense of destructive financial speculation.
About 80% of capital gains are made by people with income of over $100,000, Valenti said, citing U.S. Treasury Department figures. "According to 1993 IRS statistics, capital gains nationwide amounted to about $152 billion, which makes Pennsylvania's share, with a 4.8% of the population, about $7.3 billion, so a modest 3.4% Pennsylvania excise tax will raise about $250 million. Capital gains today are certainly much, much higher than 1993, so our tax percentage could be lowered proportionately."
Valenti also cited the set of proposals by Senator Bingaman, "Scramblng to Pay the Bills: Building Allies for America's Working Families."
"We believe that we must take steps to help "Wall Street become allies with Main Street," writes Bingaman. "We propose creating a disincentive to the churning of securities on the form of a less than-one-half-of one-percent, and declining tax on the sales of securities that occur within two years of purchase.... The tax would extend to transactions by individuals, corporations, and tax-exempt pension funds and other entities and would apply to stocks, bonds, options, futures, and swaps of currency, interest rates, and other assets."
Bingaman's report estimates revenues of $27 billion per year, assuming a large drop in short-term trading volume; $43 billion per year with a medium drop; and 462 billion per year with a small drop.
"Estimating that 4.8% of securities sales are made by Pennsylvanians." Valenti said, "a similar securities sales tax enacted in Pennsylvania, should yield revenue of about $1.3 billion to $3 billion each year!"