Sunday, December 9, 2012
Tuesday, December 4, 2012
Congressional House Leader John Boehner(R-OH) Is Hoping The Middle-Class Cannot Do Tax Math
Countering President Obama’s plan to avert the fiscal cliff released last week, House Republicans unveiled their own plan this afternoon that is presented as a major gesture of compromise as it finally puts tax revenues on paper and with House Republicans’ endorsement.
The big question, of course, on the fiscal cliff negotiations is what happens to tax rates for the wealthiest Americans — Democrats want them to go up, Republicans want them to stay the same. Realizing that they have to offer some kind of revenue increases, Republicans have been searching for a way to do that that doesn’t actually raise tax rates and thus violate Grover Norquist’s pledge. Boehner did that today in his proposal, which keeps revenues where they are today (by extending the Bush tax cuts on the top 2 percent of Americans), but calls for the elimination of tax deductions.
Boehner does this by leaning on the Simpson-Bowles plan, which, in case you haven’t been watching “Morning Joe” or reading David Brooks, was put forward in 2010 by a deficit-reduction commission convened by President Obama and co-chaired by former Republican Sen. Alan Simpson and former Clinton Chief of Staff Erskine Bowles.
Setting a target of $800 billion in new revenue, Boehner writes in his letter to Obama, “Notably, the new revenue in the Bowles plan would not be achieved through higher tax rates, which we continue to oppose and will not agree to in order to protect small businesses and our economy.”
Boehner has one key thing very wrong, though, as others have already noted. While the entire purpose of Boehner’s tax plan is to preserve the tax breaks for the top 2 percent, the Simpson-Bowles plan begins by allowing those rates to go up by assuming the expiration of all the Bush tax cuts. It then eliminates deductions and uses the money saved to reduce all tax rates a bit. Boehner’s plan does the opposite: It assumes the extension of the Bush tax cuts and then tries to find ways to pay for them by eliminating deductions.
The problem with this approach is that it’s basically impossible to raise any significant amounts of money without hitting the middle or lower class. Capping deductions gets you closest to that goal, as the wealthy are the most likely to take advantage of deductions, but it still doesn’t quite add up.
A $50,000 deduction cap would yield about $760 billion, just shy of what Boehner is aiming for. That cap would mostly impact the rich, according to the Tax Policy Center, but not entirely. At least 4 percent percent of the increased tax burden would fall on the lower 80 percent of Americans.
That might not seem like much, but think about that this means. Essentially, Republicans are proposing a way to preserve tax cuts for the wealthy by likely increasing taxes on the middle class, even if just a little.
So conservatives do not mind raising taxes as long as they are raising taxes on sales clerks, teachers and truck drivers. Boehner seems to think Republican leadership is a contest with Paul Ryan (R-WI) to see who can be the best at pretending to be a wonk who understands numbers. His offer is a joke, What's Wrong With the Republican Fiscal Cliff Counteroffer.
Rupert Murdoch's Wacky Anti-American Fox News Pushes Conspiracy Theory That DOJ Wants To Release Gitmo Terrorists Onto U.S. Streets
Sunday, December 2, 2012
America Panders to The Plutocrats: Apple, Google, Microsoft Avoid Taxes By Keeping Billions In Profits Offshore
America Panders to The Plutocrats: Apple, Google, Microsoft Avoid Taxes By Keeping Billions In Profits Offshore
The Microsoft logo. Microsoft and other companies have been accused of using complicated schemes to avoid paying taxes.
American multinational corporations have something in common with Republican presidential nominee Mitt Romney, aside from being people, too: They both keep a lot of their income overseas to cut their tax bills.
Companies such as Microsoft and Apple quietly dodge billions of dollars in taxes each year with potentially illegal schemes to move their profits offshore, according to a Senate subcommittee report released on Thursday.
"Some multinationals use our current tax system to engage in gimmicks to avoid paying taxes they owe," Sen. Carl Levin (D-Mich.), chairman of the Senate Permanent Subcommittee On Investigations, said in a hearing on Thursday. Levin described "a system used to shift billions of dollars of profit offshore and avoid billions in taxes."
Microsoft, Apple, Google and Hewlett-Packard were among the companies Levin singled out for criticism over their tax-avoidance practices, but they are not alone. Most multinational companies pay a tax rate well below the 35 percent rate mandated by law. Some avoid paying taxes altogether, or even get the government to pay them money. These loopholes cost the U.S. government billions of dollars in revenue that could be used to help close the budget deficit.
Using complex schemes to shift U.S. revenue overseas, Microsoft was able to avoid paying taxes on $21 billion in revenue between 2009 and 2011, amounting to about half its total U.S. sales, according to the subcommittee report. The company avoided paying $4.5 billion in taxes, or about $4 million per day, during that time, according to the report.
Using similar schemes, Levin said, Apple avoided taxes on $34.5 billion between 2009 and 2011, and Google has dodged taxes on $24 billion.
Hewlett-Packard, meanwhile, used a series of constantly revolving short-term loans between itself and its subsidiaries that have helped it avoid paying billions of dollars in taxes since at least 2008, according to Levin. Though he didn't say how much money H-P has avoided paying, Levin did say that H-P has kept billions of dollars in cash offshore -- more than $17 billion in 2010, for example -- that it would then "lend" to its U.S. parent company in a steady stream.
"HP has complied fully with all applicable provisions of the U.S. Internal Revenue Code and auditor Ernst & Young has consistently reviewed and approved the accuracy of HP’s financials," Hewlett-Packard responded in a statement emailed to the Huffington Post. "HP has always had an extremely productive and professional relationship with the IRS, who has permanent offices at two of our facilities and has been continually auditing HP since the filing of our 1962 tax return. They have never raised any concerns about these programs. We are disappointed to see what appears to be a politically motivated attack on one of America’s largest employers.”
Apple and Google did not immediately return requests for comment. A Microsoft representative was scheduled to address the subcommittee later on Thursday.
"In conducting our business at home and abroad, we abide by U.S. and foreign tax laws," Microsoft said in a statement emailed to the Huffington Post. "That is not to say that the rules cannot be improved -- to the contrary, we believe they can and should be. U.S. international tax rules are outdated and not competitive with the tax systems of our major trading partners."
The ranking Republican on the subcommittee, Tom Coburn (R-Okla.), defended the companies, saying they were following the letter of the law to avoid what he called onerous tax rates and an overly complex tax code.
"This is perfectly legal tax avoidance," Coburn said, arguing that the 35 percent corporate tax rate mandated by law is twice that of the average rate around the world. "They take advantage of every loophole we have created in the tax system. There is nothing heinous in that. Nothing illegal in that."
Levin responded that he wasn't sure, but it seemed "highly dubious" that Hewlett-Packard's revolving loan program, for example, "complies with current tax law." He also blamed the IRS for lax enforcement of that law.
Just because something is legal does not mean it is ethical. All of these companies depend on U.S. infrastructure and the U.S. military to create a safe and economically advanced country that makes it possible for these companies to even exist.
Freaky conservative columnist Charles Krauthammer has accused Amb. Susan Rice of totally unfounded misdeeds, FLASHBACK: When Krauthammer Excused Condi Rice For Pushing "Defective" Iraq War Intelligence
The Republican Speaker of the House is clueless, John Boehner(R-OH): No ‘Difference’ If Revenue Comes From Middle Class Or Super Rich
Friday, November 30, 2012
It’s Not a Fiscal Cliff, It’s an Austerity Crisis
Washington is not known for the stunning clarity with which it frames and addresses tough issues. But has there ever been a debate so mired in confusion as the one around the so-called fiscal cliff?
The trouble starts with the term “fiscal cliff,” which misstates the nature of the problem and provides no hint of how to solve it. I prefer the term “austerity crisis,” which at least describes the real issue -- too much austerity, imposed too quickly. (This has the added advantage of sidestepping an increasingly inane discussion over whether the problem is really a “cliff,” “curb,” “slope” or perhaps a “bomb.”)
Here is the crux of it: Depending on what you throw into the pot, the sum of the expiring Bush tax cuts along with currently mandated spending cuts would equal somewhere between $500 billion and $700 billion in deficit reduction in 2013. That’s more than enough fiscal contraction to throw the U.S. into recession. The tax increases alone would reduce the average family’s take-home pay by more than 6 percent. Because everyone agrees that’s a bad thing, Congress could pass a law, tomorrow, preventing it. Done.
But Congress won’t pass that law. Although the problem may be too much austerity too quickly, most everyone in Washington is insisting that the solution should encompass much, much more. In theory, this crisis should be easily resolved: If you have too much austerity, lighten the load. The reason the austerity crisis has become so messy is that the connection between the problem and its solution has been severed.
In fact, proposed solutions inevitably include four or even five distinct categories of policy. There are proposals to address the crisis itself -- to reduce the dangerous size and speed of the scheduled deficit reduction in 2013. There are proposals to replace the scheduled deficit reduction with a different set of deficit-reducing tax increases and spending cuts, to be phased in over a longer term. There are policies to redesign the tax code or reform certain entitlements. There’s the need to raise the debt limit, as the Treasury is expected to run out of borrowing authority in February. Finally, there are policies to increase the amount of short-term stimulus and boost infrastructure investment.
So while the proximate problem is too much austerity, too quickly, the solutions being offered address an array of other concerns. Meanwhile, amid these wide-ranging proposals, the conversation in Washington tends to focus exclusively on achieving deficit reduction -- even though the economic threat we face in January is too much deficit reduction.
A more sensible approach would deal directly with the problem at hand: the austerity crisis. And that could be defused fairly simply, without doing overly much to harm the deficit. The path would involve identifying policies that pack a big stimulus punch without significantly increasing the deficit. Such “mismatched” policies abound.
The liberal Economic Policy Institute estimates that continuing the payroll-tax cut would create 1 million jobs in 2013 at a cost of about $115 billion. By contrast, maintaining the Bush tax cuts -- yes, all of them, including those on income less than $250,000 -- would create only 600,000 jobs while costing $202 billion. Adding to the appeal of the payroll- tax cut is that it’s designed to expire once the economy has strengthened. The Bush tax cuts, once renewed, will probably continue costing the Treasury year after year.
This is what the public sees - we have to make balancing the budget a top priority and we have to make massive spending cuts. You know why the public sees the fiscal "cliff" in that frame, because the media have become hand maidens for the radical Right conservatives. Conservatives do not want to admit that we have a revenue crisis, another way of saying austerity crisis - because that would point to one somewhat simple solution -raising revenue from taxes on people who have so much money they ponder how many McMansions they feel like owning or whether they should have the chauffeur wash the Mercedes seven days a week or just every week day.
Wednesday, November 28, 2012
Values? That is When Wal-Mart Uses Layers of Foreign Contractors To Evade Responsibility
Bangladesh is half a world away from Bentonville, the Arkansas city where Wal-Mart is headquartered. This week, Wal-Mart surely wishes it were farther away than that.
Over the weekend, a horrific fire swept through a Bangladesh clothing factory, killing more than 100 workers, many of whose bodies were burnt so badly that they could not be identified. In its gruesome particulars — locked doors, no emergency exits, workers leaping to their deaths — the blaze seems a ghastly centennial reenactment of the Triangle Shirtwaist fire of 1911, when 146 workers similarly jumped to their deaths or were incinerated after they found the exit doors were locked.
The signal difference between the two fires is location. The Triangle building was located directly off New York’s Washington Square. Thousands watched the appalling spectacle of young workers leaping to the sidewalks 10 stories down; reporters and photographers were quickly on the scene. It’s not likely, however, that the Bangladesh disaster was witnessed by anyone from either the United States or Europe — the two markets for which the clothes made inside that factory were destined. For that, at least, Wal-Mart should consider itself fortunate.
The Bangladesh factory supplied clothing to a range of retailers, and officials who have toured the site said they found clothing with a Faded Glory label — a Wal-Mart brand. Wal-Mart says that the factory, which had received at least one bad report for its fire-safety provisions, was no longer authorized to make its clothing but one of the suppliers in the company’s very long supply chain had subcontracted the work there “in direct violation of our policies.”
If this were an isolated incident of Wal-Mart denying responsibility for the conditions under which the people who make and move its products labor, then the Bangladeshi disaster wouldn’t reflect quite so badly on the company. But the very essence of the Wal-Mart system is to employ thousands upon thousands of workers through contractors and subcontractors and sub-subcontractors, who are compelled by Wal-Mart’s market power and its demand for low prices to cut corners and skimp on safety. And because Wal-Mart isn’t the employer of record for these workers, the company can disavow responsibility for their conditions of work.
This system isn’t reserved just for workers in faraway lands: Tens of thousands of American workers labor under similar arrangements. Many are employed at little more than the minimum wage in the massive warehouses in the inland exurbs of Los Angeles, where Wal-Mart’s imports from Asia are trucked from the city’s harbor to be sorted and packaged and put on the trucks and trains that take them to Wal-Mart stores for a thousand miles around.
The warehouses are run by logistics companies with which Wal-Mart contracts, and most of the workers are employed by some of the 200-plus temporary employment companies that have sprung up in the area — even though many of the workers have worked in the same warehouses for close to a decade. Last year, the California Department of Industrial Relations, suspecting that many of these workers were being cheated, charged one logistics company that runs a warehouse for Wal-Mart with failing to provide its employees with pay stubs and other information on their pay rates. Wal-Mart itself was not cited. That’s the beauty of its chain of deniability.
A small band of these warehouse workers has been demonstrating for the past couple of months to bring attention to the bizarrely contingent nature of their employment and the abuses that flow from it. Their numbers were augmented Friday byactual Wal-Mart employees in stores around the nation, calling attention to the everyday low wages and absence of benefits that the vast majority of the company’s 1.4 million U.S. employees receive.
Other discount retailers — notably Costco and Trader Joe’s — pay their workers far more, train them more extensively, have much lower rates of turnover and much higher rates of sales per employee, according to a Harvard Business Review article by Zeynep Ton of the MIT Sloan School of Management. Costco is a very profitable business, but Wal-Mart maintains an even higher profit margin, which it achieves by underpaying its employees.
If Wal-Mart brought half their foreign contractor work back to America and paid employees at factories and at retail stores a living wage, they would still make billions in profits. What they are doing is doing their best to redistribute the fruits of labor to themselves and other wealthy investors. The radical anti-American conservative movement knows that this is the best way to weaken the economic and political will of the average American and make a lot of money doing it.
Fox says Thomas Ricks apologized for 'wing of the Republican party' comment; Ricks says no
9 Plutocracy Alert: Greedy CEOs Trying to Shred the Safety Net While Pigging Out on Corporate Welfare
There is nothing more harmful for the middle class than Republican Members of the House in districts that have been gerrymandered so that caricatures like Michele Bachmann (R-Homophobia) only fear in life is a primary challenge from an even more ridiculous Republican.
Fox News' Benghazi Madness Proves The Network Won't Change
Monday, November 26, 2012
The Bizarre Attacks on Susan Rice by The Radical Anti-American Conservative Movement
SINCE THE Senate is solely responsible for the confirmation of Cabinet officers, it’s not often that members of the House of Representatives jump into a debate about the nomination of a secretary of state — particularly before there has been a nomination. That’s one of the reasons a letter sent to President Obama this week by 97 House Republicans, challenging his potential choice of U.N. Ambassador Susan Rice for the State Department job, is remarkable.In addition to their multitude of sins against America and enlightened thought, we can add willful illiteracy to the list. And that is giving them some benefit of a doubt, since the other possibility is they really are as idiotic as they sound.
Another is blatant disregard of established facts. Drawn up by Rep. Jeff Duncan (R-S.C.), the letter alleges that “Ambassador Rice is widely viewed as having either willfully or incompetently misled the American public” about the Sept. 11 attack on the U.S. Consulate in Benghazi, Libya. But as congressional testimony has established, Ms. Rice’s comments on several Sunday television talk shows on Sept. 16 were based on talking points drawn up by the intelligence community. She was acting as an administration spokeswoman; there was nothing either incompetent or deliberately misleading about the way she presented the information she was given.
Though the Benghazi attack involved clear failures of U.S. security, Republicans have concentrated on a dubious subsidiary issue: the alleged failure of the administration to publicly recognize quickly enough that the incident was “a terrorist attack.” In fact, Mr. Obama has acknowledged that “the information may not have always been right the first time.” But if there was a White House conspiracy to cover up the truth, Republicans have yet to produce any evidence of it — much less a connection to Ms. Rice, who had no involvement with the Benghazi attack other than those television appearances.
Nor was her account of what happened as far off the mark as Republicans claim. Though investigations are not complete, what has emerged so far suggests that the attack was staged by local jihadists, not ordered by the al-Qaeda leadership in Pakistan. Officials believe that it was inspired in part by demonstrations that took place that day in Cairo. That is not so far from Ms. Rice’s explanation that “this began as a spontaneous .?.?. response to what transpired in Cairo.” Republicans claim that Ms. Rice “propagated a falsehood” that the attacks were connected to an anti-Islam YouTube video. How then to explain the contemporaneous reports from Western news organizations quoting people at the burning consulate saying that they were angry about the video?
The oddity of the Republican response to what happened in Benghazi is partly this focus on half-baked conspiracy theories rather than on the real evidence of failures by the State Department, Pentagon and CIA in protecting the Benghazi mission. What’s even stranger is the singling out of Ms. Rice, a Rhodes scholar and seasoned policymaker who, whatever her failings, is no one’s fool.
Could it be, as members of the Congressional Black Caucus are charging, that the signatories of the letter are targeting Ms. Rice because she is an African American woman? The signatories deny that, and we can’t know their hearts. What we do know is that more than 80 of the signatories are white males, and nearly half are from states of the former Confederacy. You’d think that before launching their broadside, members of Congress would have taken care not to propagate any falsehoods of their own.
Paying Workers at Big Retailers Like Walmart Something Closer to a Living Wage is Good For Everyone
Chances are you missed this particular bargain on Black Friday: Agree to spend 15 cents more on every shopping trip, and Walmart, Target, and other large retailers will agree to pay their workers at least $25,000 a year.Big box retailers like Walmart, Target, Best Buy and even upscale retailers like Macy's have a not so rare disease called near-sighted tunnel vision. They see quarterly profit statements and bonuses dancing like Christmas faeries, they do not see the USA as a community writ large and what is best for the community in the long run.
Big box retailers aren't actually offering that deal, but a new study by the liberal think tank Demos argues that it would be a great bargain for us all if they did. Increasing the average wage at large retailers from $21,000 to $25,000 would probably cost you less than $20 a year at the register yet lift some 1.5 million people out of poverty (including your cashier), create 100,000 new jobs, and boost GDP by some $13.5 billion.
Demos argues that retailers would benefit, despite higher labor costs, because their low-wage employees could suddenly afford to buy more of the basic necessities that they scan and load into plastic bags every day.
If you are still wondering what's in it for you, however, then consider this tidbit from Sasha Abramsky:
In 2004, a year in which Walmart reported $9.1 billion in profits, the retailer's California employees collected $86 million in public assistance, according to researchers at the University of California-Berkeley. Other studies have revealed widespread use of publicly funded health care by Walmart employees in numerous states. In 2004, Democratic staffers of the House education and workforce committee calculated that each 200-employee Walmart store costs taxpayers an average of more than $400,000 a year, based on entitlements ranging from energy-assistance grants to Medicaid to food stamps to WIC—the federal program that provides food to low-income women with children.
Seen through this lens, the worker protests that erupted after Thanksgiving at Walmart locations around the country might end up being the best Black Friday specials of them all. Think of them as 2-for-1 coupons: Spend more on wages now, improve the economy AND save us all lots of tax money down the road—money that we can spend instead on more important things, like, well, parachutes for our cats.