“There’s Plenty Of Money, Really”: Congressional Republicans Continue To Make Believe That Spending Cuts Are Good For Everyone
Don’t think for a second that congressional Republicans sincerely believe draconian cuts in federal spending stimulate the economy.
I know. They uniformly claim that spending cuts spark growth. But consider this.
During the 15-day shutdown of the federal government one and a half years ago, the United States lost some $24 billion in economic activity, according to a 2013 Standard & Poor’s report. Only Texas senator Ted Cruz and the conservative wing wanted the shutdown, while the rest of the Republican Party bore the brunt of cratering public opinion polls.
So when House Budget Committee chair Tom Price, a Georgia Republican, introduced a plan last month to cut more than $5 trillion in spending to balance the budget in nine years, take it for what it is — a purely political ploy to arouse conservatives in preparation for 2016.
The Price plan has no chance of becoming law with a Democrat in the White House, and a slim chance even with a Republican president. In repealing the Affordable Care Act and eviscerating food stamps while allocating tens of billions in defense spending (more than requested), it’s irresponsible. But in calling for the partial privatization of Medicare, it’s politically toxic. Beyond that, a Price plan put into law would be downright destructive. Sucking that much money out of the economy could possibly trigger, at the very least, another painful recession.
Still, congressional Republicans will continue to make believe that spending cuts are good for everyone, because like all make-believe stories, the Price plan has the advantage of sounding plausible. And because it sounds plausible, it feels persuasive to many voters. After all, growth is sluggish. Wages are flat. There isn’t enough money. It’s time to get serious and cut. That’s why Price titled his plan “A Balanced Budget for a Stronger America.”
In fact, there is enough money. Always has been. The trick is looking beyond one class of taxpayer dutifully paying its fair share to another class with the power, and the privilege, of avoiding paying its share.
According to a new report by Citizens for Tax Justice (CTJ), 304 of the 500 top U.S. corporations stashed more than $2 trillion in profits in offshore accounts in 2014, avoiding as much as $600 billion in U.S. taxes.
Among these are the most popular American brands: Apple, Nike, Microsoft, Safeway, and Clorox. These are among just 28 of the top 500 companies to report the tax rate they would pay if they had repatriated profits to the U.S. The rest didn’t bother. They don’t have to report.
But even those reporting to the IRS were probably lowballing their total U.S. tax liability. If they said they earned their enormous profits in tax havens, they probably didn’t, because the countries that shelter the money, like Bermuda or the Cayman Islands, don’t have economies that can produce such enormous profits. Those profits can only be earned in countries with robust economies like the U.S.
Furthermore, the foreign tax rate they paid was far lower than the tax rate they would have paid in the U.S. Indeed, the 28 firms bothering to tell the IRS what they would have paid in U.S. taxes paid a foreign tax rate of about 10 percent on a total of $470 billion. You almost certainly paid a higher percentage on less income.
Ironically, the offshoring trend has grown since the economic collapse of 2008, the very event Republicans cite when calling for more and deeper spending cuts. The CTJ survey found 77 firms increased their caches by at least $500 million while another seven U.S. companies — Apple, General Electric, Microsoft, IBM, Google, Oracle, and Gilead Sciences — piled high their cash hoards with more than $5 billion.
The trend is poised to become permanent. CTJ researchers report an acceleration of what’s known as “corporate inversions,” meaning American firms reincorporate in foreign countries to avoid paying most or all taxes on profits earned in the U.S.
And — no surprise here — the firms with the most money overseas are the first to lobby Congress to avoid paying taxes on that money. To stop this vicious cycle, CTJ researchers recommend putting an end to something called “deferrals,” an SEC rule that incentivizes tax sheltering. Then all profits earned by U.S. corporations anywhere in the world would be subject to U.S. taxes in the year they were earned.
The CTJ report does more than offer advice on creating a more equitable tax code. It reminds us that the frame of our budget debate is much too narrow. It is typically limited to spending, not revenues, much to the benefit of Republicans, while Democrats are left complaining about the unfair treatment of the middle class.
But the CTJ report does something else, something its authors don’t come right out and say. Our very narrow budget debate is as much about patriotism and national character as it is about justice and fiscal responsibility. Or at least it should be.
Billions and billions are hidden overseas while the rest of us are forced to fight over crumbs. That’s degrading and undignified but also unpatriotic. Prosperity is not only for the very few with the power to enjoy it. This isn’t feudal England.
This is America.
By: John Stoehr, The National Memo, April 14, 2015
“How Long Can This Go On?”: There’s No Such Crime As ‘Driving While White’
The shooting of Walter L. Scott in South Carolina prompts the question:
When is the last time you heard of a white man in a Mercedes-Benz being pulled over for driving with a broken taillight?
It has probably happened somewhere, sometime, but there’s a better chance of your car being hit by a meteor.
Getting shot dead during a minor traffic stop also isn’t a prevailing fear among white males in America, no matter what type of vehicle they own.
Scott himself didn’t imagine he was going to die when he was pulled over. Unfortunately, he happened to be a black man driving a Mercedes, which is what got him noticed. He was behind on child-support payments and probably didn’t want to go to jail.
Something happened at the scene, Scott got Tased and then tried to run away. Officer Michael Slager fired eight times, hitting the unarmed 50-year-old in the back. The killing was caught on cellphone video by a bystander.
Slager told the dispatcher that Scott had snatched his Taser, but the video shows the officer dropping an object that looks just like a Taser near Scott’s handcuffed body. Slager has been charged with murder and fired from his job.
The shooting was shocking to watch, as the whole world has, yet the sequence of events leading up to it is sadly familiar to black men in this country. They can’t afford to drive around as carefree as us white guys.
In September, a South Carolina state trooper shot and wounded another unarmed black motorist after pulling him over because he allegedly wasn’t wearing his seatbelt.
I’ve got white friends who rarely buckle up, yet I don’t know of one who has been ticketed for it, or even stopped and warned. Maybe they’re just lucky.
The black comedian Chris Rock uses his Twitter account to record his traffic-stop encounters. In a recent seven-week period, he was pulled over three times (once as a passenger).
It’s possible he and his friends aren’t very good drivers. It’s also possible they’ve been targeted merely for “Driving While Black,” an unwritten offense that still exists in many regions of the country, not just the Deep South — and not just in high-crime areas.
The odds would be fairly slim for a black man driving a luxury car not to be pulled over at least once on a road trip between, say, Utah and North Dakota. Even in a ’98 Taurus he’d need to be watching the rear-view mirror for blue lights.
Generalizing about traffic stops can be problematic. The numbers often spike in certain neighborhoods at certain times of day, and a small number of officers can account for many incidents of racial profiling.
Still, the evidence that it exists is more than anecdotal.
Using a “Police-Public Contact Survey,” the U.S. Justice Department analyzed traffic stops of drivers aged 16 or older nationwide during 2011, comparing by race and weighting by population.
To the astonishment of hardly anyone, black drivers were about 31 percent more likely to be pulled over than white drivers, and approximately 23 percent more likely to be pulled over than Hispanic motorists.
A series published by the Washington Post in September reported that minority drivers had their cars searched (and cash seized) at a higher rate than white drivers. That jibed with the Justice Department’s conclusion that vehicle searches occurred substantially more often when the driver wasn’t white.
Another unsurprising fact: Compared to other races, white drivers were most likely to get pulled over for speeding. Black drivers were statistically more likely to be stopped for vehicle defects or record checks.
Which is what happened to Walter L. Scott in North Charleston.
Never in almost five decades of driving have I been pulled over for a busted brake light or a burned-out headlight, even though I’ve had a few.
It didn’t matter whether I was in a Dodge, Oldsmobile, Jeep, Ford, Chevy or even, for a while, a Mercedes SUV.
The only thing I’ve ever been stopped for is, like many impatient white people, driving too fast.
And every time a police officer walked up to my car, I knew exactly why he or she wanted to chat with me. It was no mystery whatsoever.
That’s not always the case for a black man behind the wheel of a car in this country. This is not just a perception; it’s a depressing reality.
If it had been me or Matt Lauer or even faux Hispanic Jeb Bush driving that Mercedes-Benz in South Carolina, Officer Slager wouldn’t have stopped the car. Not for a busted taillight, no way.
Which prompts another question: How long can this go on?
By: Carl Hiaasen, Columnist for The Miami Herald; The National Memo, April 14, 2015
“Rubio’s Blast From The Past”: More Like A Paean To The Gilded Age Than A Plan For The Future
Marco Rubio, 43, kicked off his campaign yesterday by telling voters that he is the future and Hillary Clinton is the past. He is young, she is old. He is 21st century, she is 20th century.
But there is one very basic and glaring flaw with his argument: His views fit well into the 1800s, while Clinton’s views are modern and look very much like the America of today and tomorrow. Age isn’t everything, Marco.
Let’s try equal pay for equal work. Rubio is against the Lilly Ledbetter Act, while Clinton co-sponsored it. He voted twice against the Paycheck Fairness Act. Clinton is a strong supporter and became the lead sponsor when Tom Daschle left the Senate.
How about equal rights for the LGBT community and support for gay marriage? Rubio is solidly against gay marriage and supported not only the recent Indiana law on “religious freedom,” but even the Arizona version in 2013. He is consistently out of step. Clinton, of course, supports gay marriage and equal rights.
On the minimum wage, Rubio is not only opposed to it being raised but has said, “I don’t think the minimum wage law works.” Clinton favors raising the minimum wage.
On tax policy, Rubio has consistently supported the late 19th century, Gilded Age tax policy that benefited the wealthy at the expense of the middle class. Once again, his answer is to cut taxes for the wealthiest of Americans. According to the Washington Post, “If he wins his party’s nomination, though, Rubio will have to defend a tax plan that, while said to address the challenges of the middle class, includes a huge break that all-but bypasses the middle and greatly boosts the rich. It was a tax plan that was even too large for Romney himself to run on.” Rubio would eliminate all taxes on dividends and capital gains. That sounds like it was written by the robber barons of old to me. Clinton, of course, believes that kind of tax policy is the way of the past, not the wave of the future.
On one of the most critical issues of our time, climate change, Rubio again has his head in the sand, along with most of the other Republican candidates for president. Last May, he told ABC News that “I do not believe that human activity is causing these dramatic changes to our climate the way these scientists are portraying it. And I do not believe that laws that they propose we pass will do anything about it. Except it will destroy our economy.” Clinton, as we all know, supports efforts to combat climate change, such as the president’s Clean Power Plan.
So, who really has a vision for the future – on equal rights, on equal pay, on tax policy, on the environment – on where this country should be headed? And who does not learn the lessons of history, but seems condemned to repeat them, as if he were back in the 1800s?
If Rubio truly believes his views are appealing, maybe his slogan should actually be “Back to the Future.”
By: Peter Fenn, U. S. News and World Report, April 14, 2015
“Lots Of Candidates, Fewer Accomplishments”: Judge Me For My Position On The Issues, Not What I’ve Actually Done
CNBC’s John Harwood sat down with Sen. Ted Cruz (R-Texas) this week for an informative interview, which included an interesting exchange about the senator’s limited record.
Harwood: When I asked a couple of other campaigns, “What would you ask him if you were me?” they said, “Ask him to name his biggest accomplishment.” And the reason they said that was, “He doesn’t have any.” What is your yardstick for when you’re succeeding, as opposed to tilting at windmills, getting publicity, all that?
Cruz: What I have endeavored to do in my time in the Senate is to stand up and lead on the great issues of the day.
The Texas Republican went on to talk about his ongoing effort to destroy the Affordable Care Act, which he has not done, but which he believes he’s “built the foundation” to do.
Whether or not one takes the argument seriously, this probably won’t be the last time Cruz is asked about his record. John Podhoretz, a prominent voice in conservative media, recently ran a piece with an unflattering headline: “Ted Cruz’s challenge: The other guys have done things.”
Shortly after the GOP senator launched his presidential candidacy, The Hill published an “infographic” on Cruz’s legislative history, which concluded that the Texas Republican has successfully passed just one bill into law.
The piece didn’t specify the metrics – it’s unclear, for example, whether this includes amendments and/or resolutions – but it does help explain why Cruz, when asked about his accomplishments, emphasizes “standing up and leading on the great issues of the day.”
It’s an effective euphemism for, “Judge me for my position on the issues, not what I’ve actually done to advance my agenda.”
The challenge is not limited to Cruz, of course. Take Sen. Rand Paul (R-Ky.), for example.
Congress.gov shows the Kentucky Republican co-sponsoring a handful of bills that became law during his four years on the Capitol Hill, when it comes to measures on which he was the lead sponsor, none of his proposals became law. Sen. Marco Rubio’s (R-Fla.) record points to the exact same problem.
In fairness, these three senators are relatively new to Capitol Hill – Paul and Rubio were elected in 2010, Cruz in 2012 – which means they’ve been legislators during a time in which Congress has accomplished practically nothing. Indeed, the last two Congresses have been the least productive for passing bills into law since clerks started keeping track nearly a century ago.
No one has racked up an impressive list of legislative accomplishments in recent years because the business of lawmaking effectively collapsed after the Republican gains in the 2010 midterms. This, however, may not make for a compelling 2016 pitch: “My excuse for not having any accomplishments is that I’ve been part of an unpopular institution that hasn’t gotten anything done.”
In other words, Cruz, Paul, and Rubio will soon hit the national trail, competing against credible rivals, talking with great passion about “standing up and leading on the great issues of the day” – all the while hoping no one asks what they’ve actually done since joining the Senate.
Whether Republican primary voters find this persuasive remains to be seen.
By: Steve Benen, The Maddow Blog, April 10, 2015
“The Distracting Game Of Mirrors”: How To Survive The Hillary Hype; Liberal Dreams And The Media’s Big Elizabeth Warren Trap
Hillary Clinton is reportedly set to end the biggest non-mystery in American politics today by announcing her presidential candidacy. But even as we learn that she’s running, along with when and how she’ll make the announcement (via social media and video, we’re told, on Sunday afternoon), it seems the only actual mystery about the race will remain unsolved: How does Clinton propose to restart the engines of American opportunity that built a broad middle class after World War II, which began to sputter and fail over the last 30 years?
With neither a grand thematic backdrop for an announcement – Seneca Falls? Ferguson? McAllen, Tex.? Outside a small-city McDonald’s during a fast food workers’ strike? – nor a big address to outline the themes of her campaign, Clinton will leave defining what she stands for to the media for a little while, at least, and that’s risky. So far, journalists only seem able to define Clinton in contrast to a past or future opponent, asking whether she’ll attack President Obama (it’s a dumb media given that she has to), distance herself from her husband, the popular former president, or push back against the economic populism of Sen. Elizabeth Warren, even without Warren in the race.
If that limbo is risky for Clinton, it’s even more dangerous for progressives. As we wait to find out how Clinton will respond to the increasingly populist pulse of her party’s base, we’re beset by substitute, over-personalized storylines, heavy on drama but light on issues: Will Clinton co-opt the Warren wing of the party, or will she stand up to it? Is she going to rebuke Wall Street, a la Warren, or offer succor?
We’ve even got a surrogate battle of Ivy League economists: Is she closer to Harvard’s Raj Chetty, whose studies of upward mobility focus on how to restore it (which is said to be a more optimistic, plutocrat-friendly analysis), or Columbia’s Joseph Stiglitz, who recently wrote, in an essay shared with the Clinton team, that an effective economic policy must go beyond incremental policies like raising the minimum wage and improving education, to include “redistribution” of income – a once-routine assumption of public policy that now sounds like communism to a lot of business-oriented Democrats. (For the record, Clinton has met with both men.)
Without a Clinton challenger – and specifically, without Warren – most of the media struggle to explain what will matter to Democrats in the race. Witness this bizarre exchange between CBS’s Charlie Rose and Warren herself last week. Exasperated at Warren’s failure either to declare her own candidacy or critique Clinton’s, the respected interviewer – the “Charlie Rose” brand has long stood for substance, at least – began to badger the senator for more “specifics” about her agenda – after she’d already talked about reducing student loan interest rates and hiking the minimum wage.
ROSE: It’s hard to get to you be more specific. You talk about the Democratic Party’s a fluid thing and is going here and there and it’s always changing. But we want you to really-
WARREN: I’m sorry, what was nonspecific about let’s reduce the interest rate on student loans to 3.89%?
ROSE: You’ve been saying that in a lot of different–
WARREN: I’m there.
ROSE: I know. You’ve been saying that in a lot of different places and that’s a very specific position.
WARREN: And I have supported our efforts to try to get the minimum wage—
ROSE: And you say, well—
WARREN: I’ve supported it at $10.10. I would support it at a higher number. And I’m willing to sit down and negotiate with those who are willing to raise the minimum wage.
ROSE: What we’re trying to understand is that you represent — you really have become the voice of a wing of the Democratic Party, and maybe all of the party. What we want to know is where does Elizabeth Warren want to see this party go?
WARREN: Oh golly, how could you not know?
ROSE: In terms of minimum wage. In terms of income inequality. In terms of a whole range of things.
WARREN: I’m ready.
ROSE: You’re ready to tell them where you are and where you think the country…And where you differ from former Secretary of State Clinton. Why can’t you tell us that? Why isn’t that interest in the interest of a full debate about the future of the country, the future of the Democratic Party and who the nominee ought to be?
WARREN: Charlie, I’ll tell you where I stand on all of the key issues. It’s up to others to say whether they stand there as well or they stand in some different place. I’ll tell you where I stand on minimum wage. I’ll tell you where I stand on equal pay for equal work. I’ll tell you where I stand on expanding—
ROSE: Name me one thing you would like to see — name me one thing that you would like to see Hillary Clinton do and say and commit to that she has not committed to?
In fact, Warren has laid out her agenda in an eight-point plan to restore the middle class, which includes a minimum wage hike, protecting and expanding Social Security, strengthening labor laws, restoring a more progressive tax code, and building infrastructure. Similar ideas are in the “Ready for Boldness” statement the Progressive Change Campaign Committee is organizing around (Senators Harry Reid and Al Franken are among 5,000 Democrats who’ve signed their names to the statement), trying to “incentivize” Clinton to move to the left. PCCC leaders recently met with members of Clinton’s campaign team.
But if journalists can’t frame these ideas in terms of someone “attacking” Hillary Clinton, they’re not interested, and they’ll insist there’s no progressive agenda.
Meanwhile, frustrated in their efforts to gin up a fight between two popular Democratic women, some will find surrogates elsewhere that let them frame the narrative in terms of “centrist” Clinton facing down and “taming” progressive critics – or being tamed by them. Politico gave us an example this week with “Rahm shows Hillary how to tame the left.”
As Elias Isquith explained, however, the piece took itself apart, as it argued that Emanuel won because he co-opted progressive ideas, not because he ran away from them. Still, it was framed as a “lesson” for Clinton to thumb her nose at the party’s base. Let’s hope she’s not listening.
There are real divisions among Democrats – and maybe even within the Clinton camp – over both tone and substance when it comes to economic policy. Personally, I’m with Joseph Stiglitz, who wrote in an essay shared with the Clinton campaign:
The increase in inequality and the decrease in equality of opportunity have reached the point where minor fixes — such as modest increases in the minimum wage and continuing to strive to improve education and educational opportunity — will not suffice. A far more comprehensive approach to the problem is required, entailing redistribution and doing what one can to improve the market distribution of income and to prevent the unfair transmission of advantage across generations.
But we have no evidence that Clinton herself disagrees, and progressives should ignore the distracting game of mirrors the media will continue to play with the Democratic frontrunner and her base. Personally, I’m not seeing Sunday as the kick-off to Clinton’s campaign (though there are reports that her announcement tweets will deal with issues). That will come when she begins to outline her own substantive agenda for closing the widening income and opportunity divide.
By: Joan Walsh, Editor at Large, Salon, April 12, 2015
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