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Politics : Foreign Affairs Discussion Group -- Ignore unavailable to you. Want to Upgrade?

To: jttmab who wrote (218202)	2/13/2007 5:28:01 PM
From: Ilaine	Read Replies (2) \| Respond to of 281500

TEFRA raised taxes in large part by getting rid of abusive tax shelters for the super-rich. In case you don't know what I mean, super-rich business owners were off-setting their income against accelerated depreciation on real estate investments. Once these tax shelters were abolished, a lot of real estate projects on the books never got built, which (in addition to the Fed raising interest rates to combat double digit inflation under Carter) hurt the commercial real estate market. The crash in the commercial real estate market spread to the residential real estate market by 1991. I remember TEFRA well because I worked for law firms that were involved in litigating construction cases, and if you don't remember here's Donald Trump reminiscing. nytimes.com Reagan signed it because Congress promised to cut spending $3 for every $1 TEFRA raised, but of course, being Democrats, they reneged.