Tag Archives: Republicans

And now some after thoughts

There are some Nevada politicians still clutching Trumpian coat-tails, or pants’ legs, or something as of now.  They might want to ask some questions, some fundamental, some quotidian, some tangential about that posture.  We’ve had a day in which President Obama has spoken of a need to preserve and protect our democratic institutions, and in which his successor has spoken of a felt need to use the Department of Justice to pursue his personal political critics.  It’s time to address the questions.

Do Nevada politicians really want to associate themselves with a president who cannot, or perhaps will not, differentiate between his own sense of security and the security of this nation?  There is a difference.  Our national security is not compromised by the publication of non-classified, albeit controversial, information about how the West Wing functions.  It is a stretch to assume that IF a person divulges information from a meeting then it is presumed the individual in questions would necessarily reveal classified information.  I can think of one instance in which #45 shared information with Russian visitors to the White House that compromised sources and methods; no sources and methods were compromised by the NYT op-ed piece.

President Bush took flack from critics of the Iraq War, from those critical of his administration’s response to Hurricane Katrina, and from others who decried his economic policies and his advocacy of de-regulation.  Never once did he call the press an “enemy of the people.”  President Obama received his share of criticism and complaint concerning everything from wearing a tan suit to the validity of his birth certificate. Never once did he call the press an “enemy of the people.”  Both these men understood the difference between the President and the Presidency, and the difference between being the Head of State and the State itself.

Merely because criticism makes #45 feel insecure doesn’t mean the state is insecure.  Bush understood this. Obama understood this.  Nevada politicians would do well to consider whether or not to wholeheartedly support someone who can’t make this distinction.

Do Nevada politicians truly want to run campaigns anchored in a message of fear and division?  What is gained by suggesting that Nevada citizens of Hispanic origin are less “American” than the citizens of Irish, German, Polish, Basque, or Chinese descent who preceded them?  What is gained by inferring that immigrants from the Philippines are less capable of assimilating into the broad fabric of Nevada life than the immigrant workers in the hospitality industry who came from other countries?  What is better for Nevada in the long run, promoting a path to citizenship and entrepreneurial opportunities for immigrants to this country (and this state), or building walls, both metaphorical and literal to keep them at a distance?

It isn’t necessary to run about wearing a white hood to touch the vile pitch of racism.  All that’s required is to advocate in favor of restricting the economic opportunities, circumscribe the education, and diminish the participation in civic life, for various ethnic or minority groups.  We can constrict them, devalue them, and make advocacy difficult for them.  We can take away their voices by capriciously restraining their voting rights.  We can wall ourselves off from them.  However, in doing so we only succeed in encircling and shrinking ourselves.

If there’s one thing Nevada has it’s miles and miles of beautiful miles and miles. We can see further toward the horizons beyond most other topographical regions in this nation.  Why would we choose to close down our social horizons when after a few moments driving time we can open up our physical ones?   Every time we build a wall we restrict our own field of vision.

Fear usually breeds failure.  Do Nevada politicians want to associate with failed policies? Nothing seems like a larger failure than the Zero Tolerance debacle on our southern border.  416 children to date separated from their parents, some of whom were lawfully seeking asylum in this country.  Too many of these youngsters are under the age of 5.  This is an unconscionable failure.  Unless, of course, one adopts the President’s mindset that immigrants from Mexico and Central America “infest” our country; unless, of course, one thinks of people from Sh*thole Countries as undesirable. And now the Administration wants to detain families indefinitely. Indefinitely. [Vox]

There is only one nation on this planet that pulled out of the Paris Climate Accords, and as President Obama noted today, it wasn’t Syria…it was the United States of America.  There is only one nation that gave away dominance in regional trading by backing out of the Transpacific Partnership…it was the United States of America.  China and Japan are only too happy to fill the void.  There is only one western democracy causing friction among NATO allies…the United States of America. There is only one nation threatening trade wars with debilitating tariffs … the United States of America.  There is only one nation taking positions which could seriously damage trade relations with two of its most valuable trading partners… the United States of America.  This isn’t success.

We got vague promises of future vague promises from the North Korean regime.  While we made relations with China more difficult, the Chinese now have less incentive to pressure North Korea to do more.  The North Koreans are continuing their military research apace. This isn’t success.

Polarization begets gridlock, and gridlock impedes progress.  Do Nevada politicians want to take this route?  My way or the highway is NOT a bargaining position.   Implacable positions, taken for political expediency, mean a politician can never follow the dictum: Campaign in poetry, Govern in prose.  I can startle a conservative relative by arguing that single payer health care would promote entrepreneurship and support small businesses by leveling the playing field between the big box retailers and the mom and pop stores.  My conservative relative can widen my eyes by arguing that when work requirements are attached to Medicaid benefits we should be mindful of single adults, who while not physically disabled, are intellectually or developmentally challenged, and adjustments should be made for them.   If hard and fast positions don’t advance conversations; then how can they be an impetus toward progress?

We can, and must, do better.  And, we’ll do better when we function from a foundation predicated on our shared values, not one based upon our private fears.

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Filed under Nevada politics, Politics

News From a Fire House Sprinkles on the Republican Finance Committee

April 3, 2017:  Republican Party issues the following announcement

“I am delighted to announce the addition of these longtime friends of the Party and supporters of this administration to our Finance leadership team,” said Chairwoman McDaniel. “Elliott Broidy, Michael Cohen, and Louis DeJoy will serve as National Deputy Finance Chairmen, and Brian Ballard, Bob Grand, Gordon Sondland, Geoff Verhoff, and Ron Weiser will serve as Regional Vice-Chairmen. Together this team will employ their extraordinary talent and understanding of Americans across the country to maintain and build uponF our unprecedented fundraising success.”

January, 2018:  Former casino owner Steve Wynn, steps down from the RNC finance committee as reports of sexual harassment hit the headlines. [Politico] Wynn has since resigned as casino company CEO (March 22, 2018), has settled a six year legal battle with his ex-wife (WSJ), and has asked to be removed as a “qualifier” from the list of key employees required to undergo background checks by the Massachusetts Gaming Commission. [BostonH]  However, Wynn’s donations to a Trump super-PAC aren’t going to be returned:

“Wynn gave $500,000 to America First Action Super PAC on Jan. 23, just days before the first reports of his alleged harassment of women were published, according to first-quarter financial data from the Federal Election Commission. CNBC asked the group whether it has any intention of returning the contribution following the stories of Wynn’s alleged misconduct.

“We’re not returning the donation,” a spokeswoman for America First said.” [CNBC]

Thus, the next time a member of the GOP sputters about Democrats accepting money from a potentially dubious source, the appropriate response is, “Steve Wynn.” Chicago Cubs owner, Todd Ricketts, became the new RNC Finance Chair. [CNBC]

April 13, 2018: Another shoe drops — on Elliott Broidy.

“A major donor with close ties to the White House resigned on Friday as deputy finance chairman of the Republican National Committee after the revelation that he had agreed to pay $1.6 million to a former Playboy model who became pregnant during an affair.” [NYT]

Mr. Broidy comes with a bit of a “past,”

In 2009, Broidy pleaded guilty to committing a felony by giving nearly $1 million in illegal gifts to state officials in order to secure a lucrative deal with New York’s public pension fund for his then-firm Markstone Capital Partners.

Broidy avoided jail time by blowing the whistle on the same people who accepted his bribes. He admitted to ponying up $75,000 for an all-expanses paid luxury trip to Jerusalem, which included first-class tickets, luxury hotel suites, a helicopter tour, and a personal driver for New York State’s comptroller and his family. [TWrap] [WSJ] {Markstone Capital, NYT}

His appeals worked such that Reuters reported in 2012:

Los Angeles money manager Elliott Broidy was spared jail time and a felony conviction on Monday for his role in a “pay to play” scheme at the New York state pension fund.

Justice Lewis Bart Stone reduced Broidy’s felony to a misdemeanor and sentenced him to a conditional discharge.

Mr. Broidy had a busy social calendar entertaining those who sought access to the White House, including the following:

Mr. Broidy offered tickets to V.I.P. inauguration events, including a candlelight dinner attended by Mr. Trump, to a Congolese strongman accused of funding a lavish lifestyle with public resources. He helped arrange a meeting with Republican senators and offered a trip to Mar-a-Lago, the president’s private Florida resort, for an Angolan politician. And he arranged an invitation to a party at Mr. Trump’s Washington hotel for a Romanian parliamentarian facing corruption charges, who posted a photograph with the president on Facebook. [NYT]

The “past became prologue” when he used the services of yet another RNC Finance Committee member to clean up — dare we say “fix” — his issues with the Playmate and her pregnancy. Therefore, the correct response to any Republican who wishes to discuss “family values,” is… “Elliott Broidy.”

April 13, 2018:  Who helped arrange the $1.6 million payout to the Broidy’s ex-mistress? Another RNC Finance Committee member Michael Cohen. [CNN]  Mr. Cohen has drawn the attention of the prosecutors in the SDNY, complete with a highly publicized raid.

“The longtime attorney for President Donald Trump’s real-estate empire, Michael Cohen, went to federal court on Monday in a bid to block federal prosecutors from reading documents and other materials that were seized from Cohen’s home in a sweeping raid. The porn star Stormy Daniels, whom Cohen allegedly paid off to protect Trump, was there to watch. And the hearing was presided over by Judge Kimba Wood, who ordered Cohen to reveal the name of a client he’d tried to keep secret: the Fox News host Sean Hannity.” [Atlantic]

The paragraph above sums up the Trumpian swamp which is looking more like a sink-hole with every passing day.  Thus, the appropriate reply to Republican assertions of “transparency and accountability” is “Michael Cohen.”

Meanwhile, will the last member of the Republican National Finance Committee please turn out the lights and lock the door?

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Filed under campaign finance reform, campaign funds, corruption, Nevada politics, Politics, RNC, Steve Wynn

Not One More Word About the GOP Is Good For Business

No, I don’t want to hear one more word about how Republicans are “good for business.”  Not after this week.  First, we got that Tax Scam, the benefits of which went to corporations and the top 1% of income earners.  That is only superficially good for business — it did precious little for consumers, the ones who actually make the US economy run.  Corporations (we learned in high school General Business classes) make a profit when people buy their products or use their services.  The Tax Scam benefited the Investors, not necessarily the “business” in totality.   A system in which we continually cut corporate taxes in order to protect corporate revenue/profits and put the burden on consumers is a recipe for disaster.

Then the occupant of the Oval Office throws a tantrum and announced he is about to put 25% tariffs on imported steel and 10% on aluminum.  If this is about a trade war with China, he’s got it exactly backwards — we get more aluminum from China than we do steel.  And, now he’s finding out his steely blast will hurt Canada, “The top supplier to the U.S. in 2017 was Canada, followed by Brazil, South Korea, Mexico and Russia. Other notables include Turkey, Japan and Taiwan.” [MrktWtch]   The reaction to the announcement is/was predictable:

“Trump has declared that the U.S. will impose steep tariffs on steel and aluminum imports, escalating tensions with China and other trading partners and raising the prospect of higher prices for American consumers and companies. With tensions rising over international trade, stocks closed sharply lower on Wall Street. China on Friday expressed “grave concern.” [WAPT]

While the tariffs may have an effect on aluminum importation, the damage will be downstream:

“But industries that use aluminum say there’s an ugly trade-off: Manufacturing jobs in the auto and aerospace industries might go away if the cost of aluminum rises too much. The aluminum smelting jobs that Trump wants to save account for 3 percent of the total aluminum industry jobs in the United States, according to the Aluminum Association. The other 97 percent of jobs (about 156,000) are in downstream industries that take the raw metal and make something new with it.” [WaPo]

When former President George W. Bush slapped tariffs on foreign steel (2002) we lost approximately 200,000 jobs.

“A study funded by steel producers that supported the tariffs found that the tariffs brought back 16,000 steel jobs. A study funded by steel-consuming companies that opposed the tariff found that rising prices caused 200,000 job losses, concentrated in the metal manufacturing, machinery and transportation equipment sectors, though it noted that it was not clear how much of the price increases were caused by he tariffs.” [Star.com]

The job loss numbers are disputed, ranging from about 43,000 to 200,000, but no one appears to be arguing there won’t be some downstream (and midstream) damage from the imposition of tariffs.  Nor are major economic voices saying the Bush tariffs did all that much good.  The Bush tariffs were removed after 21 months.  And then there’s that “it’ll be easy” part.

Trade wars aren’t good for anyone.  One pithy summary asserts prices will go up, American businesses will lose sales, and American trading partners are also among our biggest lenders [CNN] and thus may be less willing to purchase our bonds — remember that budget busting tax scam passed by the GOP controlled Congress and signed by an enthusiastic executive?  Lovely, now that we’re racking up a mountain of indebtedness as a result of the Tax Scam, we’re ticking off our biggest lenders?  In what world does this make any sense?

So, we have a Tax Scam that benefits a small investor class and backhands 99% of American income earners, a tariff plan that could easily cost more jobs than it saves.  It’ll be jeans, bourbon, and motorcycles … more a signal to Congressional and Republican leadership I’d think… but I’ll cling to my opinion that the real damage will be to American agriculture.

“The tariffs announced by the administration will put the interests of other domestic industries over farmers,” American Soybean Association President John Heisdorffer, an Iowa soy grower, said in a news release.  “Prior to today’s (March 1) announcement, China has indicated that it may retaliate against U.S. soybean imports, which would be devastating to U.S. soy growers. Our competitors in Brazil and Argentina are all too happy to pick up supplying the Chinese market.” [Fence Post]

But wait, we’re not finished.  There’s S. 2155 coming up in the US Senate — a bill to roll back some of the reforms included in the Dodd Frank Act, enacted in the wake of the Housing Bubble Debacle.  That’s right — the current mis-administration wants to reopen the Wall Street Casino and let the “investors” play the banking games which caused the last economic collapse.

Considering these three examples of incompetency and ineptitude, please — oh please — spare me any more renditions of “Republicans are Good for Business.”

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Filed under Economy, Politics

The Incredible Tax Bill

For once the President* found the precise word.  The recently enacted tax bill is incredible, and so is the President*.

There are some elements of the tax plan which, indeed, are genuinely incredible.  Here are a few —

 The tax plan is predicated on what amounts to economic mythology/ideology, and it is NOT grounded in empirical evidence.  Trickle Down economics is and has always been a theory in search of some evidence, and not a result of the collection and analysis of actual economic data.  The following summation is as good a point at any to discuss the reality of this manufactured ideology:

“The harsh reality is that while this story has been told for – sometimes very eloquently for 30 years, now – we can look back to President Reagan’s tax cuts in 1981. There’s never been a documented case in which it actually worked. The problem is that every time we’ve enacted tax cuts in the last 30 years that have been based on this premise, we’ve had to backpedal as a nation. We’ve had to undo them. Sometimes, as in the case of the Bush tax cuts of 2001, it’s taken a decade of pitched battle for Congress to realize in a bipartisan way that they really had just dug the hole too deep.”

The tax plan benefits approximately 83% of the nation’s income earners, and does little to help the remainder.

“By 2027, more than half of all Americans — 53 percent — would pay more in taxes under the tax bill agreed to by House and Senate Republicans, a new analysis by the Tax Policy Center finds. That year, 82.8 percent of the bill’s benefit would go to the top 1 percent, up from 62.1 under the Senate bill.”

And even in the first years of the bill’s implementation, when it’s an across-the-board tax cut, the benefits of the law would be heavily concentrated among the upper-middle and upper-class Americans, with nearly two-thirds of the benefit going to the richest fifth of Americans in 2018.”

Let’s get realistic about this point.  Nevada has a total population of 2,998,039; with a median home owner value of $191,600.  The median household income is $53,094.  The per capita income is $27,253.   We’ve covered Nevada tax filers previously, with the following result:

1,350,730 Nevadans filed income tax returns in 2015.   27.21% of the Nevada filers reported adjusted gross income between $25,000 and $50,000.  13.5% of filers reported AGI between $50,000 and $75,000. 8.15% reported AGI between $75,000 and $100,000.  Another 10.22% reported an AGI between $100,000 and $200,000.  From this point on the percentage of filers by category drops, those reporting AGI between $200,000 and $500,000 were 2.48% of the filers; those reporting AGI between $500,000 and $1 million were 0.43%, and those reporting over $1 million AGI made up 0.26%.

It doesn’t take any form of complicated arithmetic to discover that giving tax breaks to the top tier income tax filers doesn’t apply to all that many people in the state of  Nevada (or anywhere else for that matter.)  While the definition of  “middle class” seems to vary, the most commonly accepted definition by income asserts  it is  those households  earning between $46,960 and $140,900 annually.  Nevada’s median income ($53,094) fits within that range.   The majority of the benefits included in the current tax scheme do NOT accrue to the majority of Nevada’s income tax filers.

And then there’s the CBO analysis:

“According to the CBO’s calculations, individuals in every tax bracket below $75,000 will experience a year in which they record a net loss — meaning they’ll pay more in taxes, experience diminished services, or both — by 2027.  The lowest income groups will face significant overall losses, and those making between $10,000 and $20,000 a year will face the biggest losses. The CBO estimates that in 2027, taxpayers from this bracket will see an overall loss equivalent to $788.10.”

If ever there was an example of Reverse Robin Hood, this tax scheme would serve nicely.  This is a middle class tax cut only if the middle class is defined in extremely illogical ways — as if $250,000 AGI was anywhere in the “middle.”

The tax plan make corporate tax cuts permanent and individual/family tax cuts temporary.  This is a recipe for disaster in 2027 when someone is asked to pony up the difference between realistic spending and unrealistic assumptions about economic growth.

The tax plan is underpinned by the assumption corporate tax cuts will yield increased wages and increased employment.   A common Republican argument of the moment is that our recovery from the last recession was sluggish, and tax cuts would have made it better.  Another argument could as easily be made:  The recovery was not as robust as it could have been because Republicans refused to enact the kinds of stimulus spending that would have both improved our national infrastructure and boosted consumer expenditures.  Republicans screamed “deficit spending” and “national debt” to the heavens, a tune they now seem to have forgotten as they vote in favor of a $1.4 trillion deficit.

The tax scheme also ignore the obvious.  How many times in this modest little blog have we said: There is ONE and ONLY  ONE reason for any firm to hire anyone at any time — a business only hires personnel when the staffing levels are insufficient to meet the demand for goods or services with an acceptable level of customer/client satisfaction. Regular readers should be able to recite this from memory by now.

We’ve also mused about other ways corporations spend their windfalls — mergers and acquisitions, increased dividends, stock buy-backs, increased investment in financial revenue streams, etc.  It’s not like wage increases and plant expansion are the only options.  In fact, for corporations, especially those for whom  ‘shareholder value” is the driving focus, increasing wages and capital expenditures is the last likely option.  Shareholders are focused on getting a maximum return on their investments and this is not enhanced by increasing labor costs.

The tax plan is riddled with benefits for the wealthy that defy common sense.  For example: Carried interest, increasing the estate tax exemption (Fun Fact: Of the 5,460 estates slated to pay the estate tax this year only 80 of them are small businesses or farms.)  More examples?  There’s the alternative minimum tax which was enacted  to address a concern which may be resurrected by this tax bill:

“Congress enacted the AMT in 1969 amid widespread outrage that many wealthy people paid little or nothing to Washington thanks to clever use of loopholes. But because income thresholds for being subject to the tax weren’t indexed to inflation (until 2012, which didn’t make up for the decades of lost ground), many middle-class people got sucked into paying it. ”

The tax plan is only part of an overall plan to Kill The Beast.  Or, make government so small it could be drowned in a bathtub?  Those who aren’t convinced by now that the next move by this Norquistian Congress is to go after Social Security, Medicare, and Medicaid haven’t been listening to GOP leadership.   Expect the drumbeat of commentary on “entitlements” to increase by leaps and bounds — We have a Huge Deficit! (Which they created) and now We have to cut government spending.  Remember: They are called entitlements because you are entitled to the benefits you’ve been paying for with your payroll taxes all along.

Pro Tip:  This assessment of voters was made in 2006, and not all that much has changed since –

“Regular voters also are older than those who are not registered. More than four-in-ten of those ages 50 and older (42%) are regular voters, about double the proportion of 18-29 year-olds (22%). Among those between the ages of 30 and 49, more than a third (35%) reliably go to the polls ­ a fact that is consistent with previous research that found voting is a habit acquired with age.”

Now, who is most likely to be quite concerned with saving Social Security and Medicare? There’s a reason  Social Security and Medicare form the third rail of American politics.

A final point.  The Republicans have given away their cards.  When Democrats called for increased spending on health programs, Republicans pointed to the deficit. When Democrats called for increased infrastructure spending, Republicans pointed to the deficit.  Now, the deficit (all $1.4 trillion of it) is the responsibility of the Republicans.  They’ve given away the revenue.  Now the Democrats have the Tax the Corporations card in hand.  And who among the GOP wants to run on a platform of saving those cash-hoarding multi-national corporations?  Good luck with that.

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Filed under Economy, Nevada economy, Politics, Taxation

Tax Cuts, Wages, and Promises, Promises, Promises

GD income wages salaries tax cuts 1980 2017

That Blue Line on the chart is FRED’s report of gross domestic income, in terms of compensation for employees (wages and salaries) from 1980 to the present.  One of the things to notice is that it keeps rising.  We can explain part of this by taking inflation into account, and some of the bumps and blips by noting that the shaded gray sections represent recessions.  But, it just keeps going up except for the Great Recession brought to us in the wake of the Housing Bubble/Wall Street Casino Crash, compliments of the Wall Street Casino.

Indeed, notice that increase in employees wages and salaries between 1990 and 2000, when the top marginal tax rate increased from 31% to 39.6%, the blue line keeps going upward.   If nothing else, the graphic above illustrates that anyone trying to convince us that increases or decreases in the top marginal rate for income tax payers correlate to increases or decreases in wage and salary compensation trends hasn’t been paying attention.

The Corporate Tax Wrinkle 

Okay, if one can’t make the case that tax cuts for the wealthy won’t “increase” the money in the pockets of middle income Americans, then there’s the Corporate Tax Wrinkle.  Thus, the White House is trying this line:

“The Council of Economic Advisers report argues that high corporate taxes hurt workers in the form of smaller paychecks and that worker incomes rise sharply when corporate rates fall. It points to “the deteriorating relationship between wages of American workers and U.S. corporate profits” and says, essentially, that high corporate taxes have encouraged companies to shift capital abroad rather than flow profits to workers through pay increases.”

Here’s the first problem — this statement assumes that high corporate taxes cause companies to “shift capital abroad.”  This conveniently ignores some other reasons corporations seek to invest overseas.  Let’s make a quick list: (1) There’s good old fashioned market seeking.  In this case the company is looking for new customers for its goods or services, and it may be that the domestic market is fairly well saturated so looking abroad makes perfect sense.  This is especially true for technology firms which often find that the smallest market needed to drive development is larger than some of the largest national markets.  (2)  Resource seeking.  Labor costs may be cheaper in another foreign market, or there may be quicker access to natural resources in a foreign location.  (3) Strategy.  Imagine that a corporation is looking to improve its distribution network, or to take advantage of new technologies; a company might decide to partner with a foreign corporation which specializes in some specific phase of production.  And then there are (4) Efficiency elements.  We can insert some common elements into this category like trade agreements which give an advantage to plant or service locations because of tariff agreements, or there could be currency exchange rate considerations involved.

Therefore, we can quickly see that the corporate tax environment is a part of the decision making process about shifting capital overseas, but it certainly isn’t the only factor, and it may not even be the most important one.  What the White House Wrinkle demands is that we believe if Congress reduces corporate taxes this will offset all the other other reasons a corporation may want to shift some of its operations overseas.  Frankly, this really isn’t rational.

And, then there’s the second problem —  hoarding.

“The cash held overseas by US firms has continued to grow at a rapid pace, rising to almost $2.5tn in 2015. The substantial tax bill most firms would face if they attempted to bring this cash home, however, means that it is still very unlikely to ever be repatriated under the current system.”

Gee, if we could “repatriate” all this money imagine the increase in wages!  Not. So. Fast. The firms stashing the most cash overseas are Apple, Microsoft, Cisco, Alphabet (Google), and Oracle. [MW]  Right off the bat we notice that these are all tech firms, and as mentioned above tech firms are constantly market and resource seeking — while a repatriation scheme may bring some of the cash home, there’s still a reason the firms may want to keep capital available for foreign operations; it wouldn’t matter what domestic tax system was in place.

Another point that should be made more often is that this money isn’t “trapped” overseas.   Where are these “deferred profits?

“A 2010 survey of 27 large U.S. multinationals found nearly half of their “overseas” tax-deferred profits were invested in U.S. assets, including U.S. dollars deposited in U.S. banks or invested in U.S. Treasury bonds or other U.S. government securities, securities and bonds issued by U.S. corporations, and U.S. mutual funds and stocks.”

What’s “trapped” are the tax payments due on the funds — not the funds themselves, 50% of which are already happily running along in the corporate revenue streams or “reinvested” in U.S. assets.   And if we could “bring home”  (or get out of the bank) the other half would this mean higher wages?  Remember, we tried this once before:

“In 2004, lawmakers allowed multinationals to repatriate more than $300 billion in profits at a greatly reduced tax rate. But independent studies largely conclude that firms used those profits to pay cash to shareholders, not to invest or create U.S. jobs. In fact, many firms laid off large numbers of U.S. workers even while reaping multi-billion-dollar tax cuts. Today, offshore profits are concentrated in a few large multinationals that have recently made record cash payouts to shareholders by buying back stock, showing that they already have enough cash on hand to make whatever investments they project would be profitable. Repatriated profits would likely similarly be paid out to shareholders, not invested.”

Who are those “buyback monsters” who’ve been demonstrating they already have enough cash on hand to make any investments they think might create even more profits?   Apple is one, then there’s Exxon Mobil, IBM, General Electric, Pfizer, and McDonald’s. [CNBC]  If Apple is one of the ‘monsters,’ then why would anyone believe that allowing the tech giant to “repatriate” more money at reduced tax rates would make them do anything other than what they’ve been doing — using the capital to buyback stock?  McDonald’s?  If they have enough cash on hand to indulge in financial engineering to increase their stock prices, what would make anyone believe they’d change midstream and start advocating for raising the minimum wage?

Mythological Means

It’s really hard to imagine where that $4,000 pay raise is supposed to come from if corporations are given more tax breaks.  There’s a question of the provenance of that $4,000 number in the first place, and in the second place it’s a dubious estimate at best.  We should also notice that the claim isn’t being framed in context; there may be some gains for employees BUT they are long term, certainly not short-term or annual gains. [FC]

“It’s important to note that any gain to workers would only come in the long term — over several years. Furthermore, most households would not see a gain as large as the “average” or mean figure, which is pulled up by very high incomes of a relative few. In 2016, the average household income was $83,143 as we’ve already noted, but the median or midpoint for household income was $59,039, meaning that half of all households received less.”  [FC]

This is another version of the old story:  The Sultan of Brunei walks into a room with nine members of the Little Sisters of the Poor and the average (mean) wage skyrockets.  Take that $4,000 figure with a couple of boxes of Morton’s Salt.

The Bottom Line 

So, what do we know?  We know that there’s no direct correlation between low top marginal rates for individual filers and wage increases.  We know that corporations make decisions about off shore operations for a variety of reasons, taxes being only part of the equation.  We know that corporations have several options for investing cash (foreign or domestic) only one of which — seemingly the least likely — is to pay increased wages and salaries.  We know that corporations use “financial engineering” to increase their stock value, or increase dividends to their shareholders.  We know that even accepting the 20-25% labor liability for corporate taxation the returns to labor are long (not short or annual) term benefits of little value in terms of household budgeting; it’s NOT like having any useful amount of “cash in your pocket.”

In short, we probably know what we’ve suspected all along.  The current Republican version of “tax reform” is simply a gift to corporations, extremely wealthy persons, and a nice gesture from the Haves to the Have Mores.

And for this we are to accept cuts in Medicare to the tune of $472.9 billion over the next ten years, between $1 and $1.5 trillion in cuts to Medicaid, cuts to food assistance programs, cuts to low income heating assistance programs, cuts to children’s health insurance, cuts to education, small business support, and Meals on Wheels….

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Filed under Economy, income tax, Politics, tax revenue, Taxation

Translating Republican Discomfort with Racism

It’s inevitable.  Every time a racial issue highlights problems in American society and politics we can count on Republicans to reach back into their barrel of excuses and rationalizations — by now these are clearly obvious, equally transparent, and hopelessly irrelevant.

There’s the predictable from Rep. Peter King (R-NY):

“It’s not just stunning, it’s really disgraceful,” King responded. “They’re talking about somehow trying to unify the nation, and instead they’re using the most divisive type language, the most hysterical rhetoric, and that’s totally out of bounds—it’s wrong. And politically, I think it hurts them because that alienates the American people.”

Who’s alienated? The Representative surely isn’t speaking about people who have seen their DMV offices shut down in Alabama making it more difficult to get the identification necessary to vote?  Is he talking about those whose districts have been gerrymandered to prevent them from living in a Congressional district that’s competitive? Or, does raising issues such as these make white people uncomfortable?

Meanwhile back in Pennsylvania:

 “…on Thursday morning, the Pa. Dems challenged Mango and Wagner again – this time to denounce President Trump over his widely criticized “both sides” remarks. All of the party’s releases were issued after the President’s Tuesday press conference and resulting backlash.

“The Democrats are simply trying to exploit the events in Charlottesville for political gain. It’s shameful, and everyone involved should be embarrassed,” Wagner said.”

Nothing like loading the language.  I “point to specific examples,” you, on the other hand “exploit.”   I’m not in the least bit convinced that pointing to the Neo-Nazis and White Supremacists gathered in Charlottesville as the worst examples of human beings at hand is something which should embarrass anyone, any time.

So, here they go again,

“I would say this about the president’s critics as a whole: If nothing will quiet them, than they don’t have America in their sights,” Faulkner said. “They don’t care about us. They don’t care about Americans. And shame on them. They need to step aside and let justice be done. Because if there is going to be justice, it’s going to take all of us together.”

Oh, “togetherness,” how nice.  Yes, it’s going to take all of us to condemn white supremacy and institutional racism, and if this makes Republicans uncomfortable, so be it.   “They don’t care about Americans.”  White Americans?

White Americans expressed their ‘economic anxiety:’

“Obama set racial relationships in the nation back 100 years with his divisional rhetoric. Being a Southerner, the KKK was always Democrat. So to blame it on Republicans is ridiculous. Did they have the right to march? Absolutely. Did the antifa have the right to stop them? No. That’s how violence begins — the two polar opposites don’t want the other to be heard.”

Really? “Divisional rhetoric?”  What might that have been?  Something about his reaction to the murder of Trayvon Martin?

Apparently President Obama, being African American, was just too much for some Alabama Republicans:

“I think Barack Obama is to blame. I think this country is more divided than it ever has been. I think almost all racism in world history can be tied back to liberalism, socialism, the idea everyone’s supposed to have an equal outcome as opposed to equal opportunity — those are liberal ideas that have been propagated over the past eight years through the administration, with just terrible things going on and the rhetoric w’ehe had coming out of the White House during that time.”

“Speaking while Black” makes some whites nervous.  Notice how the logic doesn’t form a chain in the comment above.  There are fragments placed in a series which logically don’t make a bit of sense, but do make an emotional framework to buttress the feelings of the white apologist.  Racism bad + racism/socialist + Obama/Black + ‘rhetoric’ = I’m Okay, those other people are bad.   It’s hard to move from the Racism is good argument of the Jim Crow era to Racism is bad BUT it’s the other side making me feel uncomfortable position of contemporary politics.   It’s hard to find “divisiveness” in the President’s comment on the Trayvon Martin case:

“…finally, I think it’s going to be important for all of us to do some soul-searching.  There has been talk about should we convene a conversation on race.  I haven’t seen that be particularly productive when politicians try to organize conversations.  They end up being stilted and politicized, and folks are locked into the positions they already have.  On the other hand, in families and churches and workplaces, there’s the possibility that people are a little bit more honest, and at least you ask yourself your own questions about, am I wringing as much bias out of myself as I can?  Am I judging people as much as I can, based on not the color of their skin, but the content of their character?  That would, I think, be an appropriate exercise in the wake of this tragedy.”

Then, there’s downright historical revision:

“I think they’re misled — I understand why they’re doing it; you can’t rewrite history, and so forth. I don’t think Gen. Lee would be disappointed in them moving the statue because I think he would want to preserve the union.  I understand that the guy who drove the car was a Democrat. … You obviously have to be a little crazy to drive a car [like] that. [He says he heard this on Facebook.] Americans need to learn how to resolve issues without violence.”

Someone went to sleep during American History — Lee wanted to ‘preserve the Union?”  That would be no, a resounding, four year NO.  The guy who drove the car was a Democrat? No, he was a Neo-Nazi.  No, you can’t rewrite history, but there seem to be lots of erasures in the history of the Confederacy going on.

Where do we go from here?  If there are people who felt stifled because having an African American president made it socially unacceptable to be an outright racist, and view having a white man in the White House as cover for re-emerging into the public, then it’s time to demonstrate — as the good citizens of Boston surely did — that this is still socially unacceptable.  It would be nice to hear Republicans replicate Bob Dole’s August 1996 speech:

“The Republican Party is broad and inclusive. It represents — The Republican Party is broad and inclusive. It represents many streams of opinion and many points of view.

But if there’s anyone who has mistakenly attached themselves to our party in the belief that we are not open to citizens of every race and religion, then let me remind you, tonight this hall belongs to the Party of Lincoln. And the exits which are clearly marked are for you to walk out of as I stand this ground without compromise.”

Denying history, rewriting it to fit one’s personal prejudices, playing “what-aboutism,” are counter productive.  The sooner the Republican Party disavows the racists and the bigots the sooner it will be free of the anchors weighing it down in the politics of prejudice.

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Filed under Nativism, Politics, racism

Please, No More Mr. Moderate

Here’s the beltway narrative du jour:

“Majority Leader Mitch McConnell has proposed phasing out higher federal payments for people who sign up for Medicaid under the health law’s expansion in three years. Ohio Republican Rob Portman and others such as Nevada’s Dean Heller are pushing for a seven-year phaseout ending in 2027. Senators also are debating how much to reduce federal funding for Medicaid as compared to current law.”

Cutting to the chase, there’s nothing “moderate” about support for dropping federal payments for Medicaid — in three years, in seven years, or even in ten years.  It’s almost tantamount to arguing that Poison X is better than Poison Y because X won’t kill you for another 7 years.

There’s also a pattern to Senator Heller’s carefully crafted media image.  First, he expresses “great concern” about Republican legislation; then, he comes out against the legislation “in its present form.”  When the time comes for a vote on the bill Senator Heller suddenly finds his “concerns” have been addressed and he can support the measure.  There are clocks in this house that don’t function with this kind of regularity.

On May 4, 2017 Senator Heller is reported by the Reno Gazette Journal as “opposed to the Obamacare repeal in its present form.”  Notice that prescient loophole — “in its present form,” because it’s guaranteed that the “form” will change just enough for Senator Heller to announce his support when the roll is called.   McConnell is pushing for a vote before the end of the month:

“McConnell and his leadership team hope to have a preliminary framework submitted to CBO by the end of the week and a floor vote by month’s end, Republican sources said. On Tuesday, the Senate Budget Committee said the House bill cleared the Senate’s stringent reconciliation rules, allowing the House to formally send the bill to the Senate. Otherwise, the House would have had to vote again on a modified bill, further derailing the repeal effort.”

There are some ironic touches in the GOP controlled Senate — the Republicans once cried into their towels that the Affordable Care Act was jammed through the Congress, this has been thoroughly debunked:

“This is a bizarre description of a bill that spent a year working through Congress, eventually passing numerous committees, two full House majority votes, one Senate supermajority vote and, in fact, many, many, many hearings. While the law did use a budget-reconciliation bill to enact minor fiscal adjustments, a maneuver that Republicans decried as akin to a death blow to the Republic, in fact its major provisions all received 60 votes in the Senate. The bill was evaluated by the independent Congressional Budget Office, and the projected premium levels in the new exchanges turned out to be accurate, and its predictions of overall federal health spending turned out to be too pessimistic, as the federal government is now spending less on health care with Obamacare than it was projected to spend without it. The bill was enacted in a democratic, deliberate, transparent, and excruciatingly slow fashion.”

In contrast to the “excruciatingly slow” enactment of the ACA the current Senate is (1) seen to be fond of that budget reconciliation procedure; (2) holding the work sessions on the bill behind closed doors; and (3) has not scheduled any hearings on the bill to date. Not to put too fine a point to it, the Republicans are doing exactly what they falsely accused the Democrats of doing — and thus far getting away with it.

Senator Heller’s constituents can contact his office at 202-224-6244 (DC office); 702-388-6605 (Las Vegas Office), or 775-686-5729 (Reno Office)  Senator Heller’s aide assigned to health care issues is Rachel Green.

 

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Filed under Health Care, health insurance, Heller, nevada health, Nevada politics, Politics