Jay Moore and his wife, Carolyn, have read all about the new tax cuts in the local papers. But when they break out the calculator and figure out what it means to them, it hardly seems worth the fuss.
Sure, the young couple will be able to take advantage of new tax credits for their children and for Carolyn's tuition at a local community college. They even qualify for a capital-gains tax cut. But while they should receive about $1,400 in tax breaks next year, they worry what it will mean in the long term.
"I'm like a mouse sitting in a hole in the wall, and the government has just handed me a piece of cheese," says Mr. Moore, relaxing in the large living room of his double-wide trailer home on the outskirts of Leroy, Texas. "They're basically buying people off instead of dealing with the big problems of government spending."
Such a harrumph from the heartland may come as a surprise to the Republicans and Democrats in Congress, who passed a much-publicized tax cut and balanced budget plan last week. After all, politicians have learned to listen to the concerns of sales clerks, school teachers, and construction workers who make between $25,000 and $40,000. Theirs is the nation's largest demographic group.
In many ways, Jay and Carolyn are the prototype of an American working family.
He works 11-hour days, five or six days a week as operations manager of a Sherwin Williams store in nearby Waco. She attends a local community college full time, learning how to care for mentally ill and retarded children. They live with their two young sons, Skottie and Brett, in a comfortable mobile home in the scrubby ranchland north of Waco.
But unlike the solidly Democratic working class of years past, Jay and Carolyn have trouble identifying with either of the major parties. Jay wants Congress to abolish the income tax outright and rely on sales taxes, saying "the government shouldn't penalize people for making money." At the same time, he says government should provide health care for all its citizens.
One paycheck for now
Until Carolyn finishes school, Jay's paycheck is the family's sole income. In a good year, when the college professors and Dr. Pepper factory workers of Waco have money to redecorate their homes, Jay earns as much as $40,000 in salary and commissions. But even in these good times, his paycheck withers quickly under the steady sun of monthly costs: rent, food, fuel, truck loans, and day care.
This leaves precious little for fun. Weekends often mean doing yard work or having a cookout with friends. Vacations are road trips to Dallas and Houston or to visit Jay's family in San Angelo.
"We don't go anywhere we can't camp out or stay with friends," says Jay. "We don't have $400 to $500 to blow on a trip."
But come next spring, a flurry of tax credits could make a big difference in their lives.
Perhaps the most generous break for working families is the child tax credit. Families with children under age 17 can subtract $400 per child from their federal income tax bill next year. (In 1999, they can subtract $500 per child.) For the Moores, this means $800 more in their pockets.
"We could buy more clothes for that," says Carolyn, leading a pajama-clad Brett back to his bedroom. It would also help pay for day-care fees, which run about $100 a week for the two boys.
Jay nods, but he is less impressed: "It's a nice gift, but it's not something that knocks me down. They're giving back $500 of your money that you should have had in the first place."
Education credit for mom
More impressive is the new tuition tax credit, which pays for 50 percent of the first two years of postsecondary education, up to $1,500. Carolyn, two semesters away from earning an associate's degree, would get about $600 back. But for their own children, ages 2 and 4, the tuition tax credit seems too far off to be trusted. "What's $1,500 in 14 years?" Jay asks. "It's a carrot."
Jay also has a keen interest in the capital-gains tax. Every payday, he puts money into his company's stock and pension plans. Recently, he sold his stock to pay off old credit-card bills, and he was taxed 15 percent by the federal government for his profits. Now, under the lower capital-gains tax, he will be taxed only 10 percent.
"That capital-gains tax is the dumbest thing since the 39-cent gasoline tax," says Jay. "Why penalize people for making money?"
Glad it's over
Similarly, they support raising the tax-exemption level for estates from $600,000 to $1 million over 10 years.
Of course, the thought of actually having an estate worth that much makes their eyes bulge. But in principle, they don't think the federal government should be taking money out of any estate, large or small, before it can be disbursed to relatives.
With the boys finally in bed, the couple steps outside under a black sky full of stars.
For his part, Jay expresses relief that all this budget bickering is over.
"I don't think it's a strong plan ... but they promised it, so now we can put this behind us and worry about how much money to send to Bosnia."