Tax Reform: “Let Them Eat Cake”

Hey you Trump fans! Do you really think these people care about you?

The problem with fraud is you usually can’t tell its happening until its too late and the damage is done.

Early in my career, I invested in a small technology company that was hiding returned inventory.  When the lies of its senior management were discovered, and the company was slammed into bankruptcy, trading was suspended.  It was impossible to sell my shares, and I lost my whole investment.

Often in this kind of situation, the perpetrators of the fraud end up doing just fine.  They have already squirreled away millions, often in off-shore accounts, and have high-powered lawyers to help keep themselves and their fortunes beyond the reach of the law.

In similar fashion, we are being defrauded by our current government.  Those who see it happening are fearful and angry.  Those who are unaware–because they have so effectively been kept in the dark by the President and his minions–must be warned.

Sadly, those shouting warnings, even if they are experts, are dismissed as anti-Trump liberals.

One expert is Robert Reich, former Secretary of the Department of Labor.  In his blog post yesterday entitled “Fools or Knaves,” he describes the lies supporting the Republican tax plan—among others, the lie that people earning more than $1 million per year will bear a greater tax burden than the rest of us, and the companion lie that the tax cuts and resulting deficits will be more than offset with the effects of “trickle down” economic activity.

The Joint Committee on Taxation, the Tax Policy Center, the Tax Foundation and virtually every qualified economist disagrees.  The legislation will mainly benefit the already rich; the upper-middle-class will actually see a tax increase; the tax savings for everyone else will be modest; and the deficit will skyrocket.

President Trump will be on the Hill this week to twist arms and help the legislation hurtle ahead.

Reich wonders why Mnuchin, who surely knows better, is aiding and abetting this alarming process with his own repetition of the blatant, supporting lies. History will not be kind to those who have participated in such a fraud and failure of duty, Reich concludes.

One explanation of Mnuchin’s unseemly behavior, according to Reich:

“Apparently Mnuchin will say anything to retain his power and influence in the Trump administration.  He knows he’ll never have anything close to this power again.”

This explanation inspires another:  Mnuchin, like the President and every other member of the super-rich Trump cabinet, already has plenty of money. He and the rest are using their offices to get more of it and to otherwise obtain maximum financial advantage for themselves and major donors.

By the time the poor and middle-class members of the Trump base fully understand the effects of the fraud–as their tax bills and healthcare costs rise and the economy stalls out–Trumpian robbers like Mnuchin will be long gone, living in their security-gated mansions or bobbing, far from view, on their super yachts.

Why, then, should they care how history treats them?

Tax Reform: Rage Against the Machine

The current tax legislation before the Senate, and the bill passed by the House, are evidence capitalism is being allowed to gut our democracy.

In the United States, democracy and capitalism are bad bed fellows.

Democracy aspires to give equal voice to everyone. Capitalism does the opposite with its appeal to economic greed and its transactional, competitive division of the world between “winners” and “losers.”

Democracy aspires to inclusion and compromise. Capitalism promotes self interest and conflict.

Understanding the conflict between democracy and capitalism should make us feel rage about the tax reform legislation passed by the House and now before the Senate.

With the tax legislation before Congress, capitalism is being allowed to overtake and 2 - 1overwhelm our democracy.

While the legislation is promoted as benefitting the middle-class, it mainly benefits the rich and the companies they own. The working middle-class and poor come last, if at all, in the list of beneficiaries.

In violation of democratic institutions and principles, the legislation is being rushed through Congress, without hearings and with purposeful avoidance of bi-partisan support or input.

How can we trust our best interests to the advocates of this legislation–to the super rich Republicans and Wall Street capitalists who control the Executive Branch and their puppets in Congress?

Senator Crapo campaigned on a platform of reducing deficits and the crushing national debt.  Yet, post-election, he said this to Bloomberg:

“Senator Mike Crapo of Idaho, a member of the tax-writing Finance Committee, said Monday he wants a tax cut that’s ‘as big as we can get’ within the budget window, though he declined to put a number on it.'”

The tax cut he now supports is around $1.5 trillion and over the next 10 years, the national debt is expected to increase by at least this amount.

He is also supports the elimination of the Affordable Care Act mandate and subsidies, which will have the effect of putting affordable health insurance beyond the reach of many Idahoans.  From the Washington Post:

“‘Did we take away their money? No,’ says Sen. Mike Crapo (R-Idaho). ‘There’s not $1 taken away from them if they make that choice’ not to buy insurance.”

That is like telling homeless people, “You should be happy with all the money you’re saving because you can’t afford a home.”

Senator Risch expressed mealy-mouthed support from the Senate Floor:

“Tax reform will bring relief to American families and under the plan released by the Senate Finance Committee, middle-class Americans will see a benefit in the form of a lower tax bill, which means more money for households to bring home.”

OK?  But Senator Risch is one of the wealthiest members of Congress.  How will this legislation benefit his family?  And what about the offsetting negative impact on poor working Idahoans of the repeal of the Affordable Care Act individual mandate?

We could only know the extent of his self-dealing and conflict of interest if he discloses the impact of the tax legislation on his and his family’s tax bill.

In summary, until the moment of the vote, we should scream at both Senators to oppose a tax bill that will add to the deficit and national debt and which contains provisions that will hurt Idahoans.

The rushed process by which this tax bill is being hurried through Congress is outrageous.

Equally outrageous:  the unnecessary, long-term negative economic impact the legislation will have on our country and state.  We will all end up worse off in the end.

As Corva Korax recently commented on my “Campaign for Idaho” Facebook page:

“Every tax cut for the rich is a new tax on the poor and middle class whether higher health care premiums or loss of access altogether, higher tuition, higher education costs and fewer opportunities, worse civic services.”

Amen.

Stop the Tax Reform Shell Game

Tax reform is a fraud that will make the rich richer and life worse for everyone else.

The House just passed “The Tax Cuts and Jobs Act” as a first step toward a $1.5 trillion tax cut.

Even the name of the House bill is a hoax.  Tax cuts will benefit mostly the rich and will not create jobs.

Of course our Congressmen, Simpson and Labrador, both voted the party line today.  I suspect Senators Crapo and Risch will do likewise with the Senate bill.

We can only hope there is enough courage and intelligence in the Senate to stop this train wreck.  There are many reasons to vote against tax cuts.  Here are at least two:

  • With the vast wealth now accumulated in the hands of a few Americans, why do rich people need a tax cut?
  • With the national debt at record levels, why a tax cut at all?

Huge tax cuts at this point in our history makes as much sense as the ancient medical practice of bleeding, instead of feeding, a sick patient.

Cutting Taxes Increases Wealth Inequality

Wealth inequality in the United States is now the highest in the world and, other than during the 1920s, the highest in our history.

The increasing rate of US wealth inequality is illustrated with this chart:

171103080726-wealth-gap-wider-than-ever-780x439

Cutting Taxes Increases the Deficit and the National Debt

United States deficit spending and national debt have reached levels unmatched since World War II.

You can see it in the following graph, which shows US national debt as a percentage of GDP since 1790:

debt_gdp-full copy

In summary, the tax cuts will create more wealth inequality, will increase the deficit and balloon the national debt.

The Middle-Class Will Suffer

The House and Senate forms of “tax reform” are being sold as tax breaks for the middle-class.  This is wildly misleading.

The legislation benefits the already rich more than anyone, hurts the poor and, for many in the middle-class, actually increases taxes.  This is particularly worrisome in light of the Senate bill’s sleight-of-hand elimination of the Affordable Care Act individual mandate and subsidies.

This backdoor repeal of the the essential mechanism of Affordable Care Act will lead to tens of millions losing health insurance and making health insurance premiums rise for everyone else.

Meanwhile, the rich, directly and indirectly, will receive billions in “tax relief,” with, among other things, repeal of estate taxes, elimination of the Alternative Minimum Tax and slashing of the corporate tax rate.

Remember who ultimately owns corporations:  mainly rich people, who are always hungry for dividends.  Cash from corporate tax savings will first be used to satisfy shareholders.

The Trickle Never Trickles Down

Tax cuts are being rationalized with a re-hash of the economic myth of “trickle down” economics, which has been used to justify every tax cut since Reagan.  It has never worked.

Sure, the middle-class might be lucky enough to get a small tax break (even after losing the mortgage and other deductions).  Maybe some will end up with a few hundred dollars to help pay down credit cards–or ease the pain of increased healthcare costs.

The poor and the uninsured?  I am sure they will be calling their brokers and trying to get into the stock market.

 

 

 

 

Surprise! Over the Weekend, Graham-Cassidy Went from Bad to Worse!!

It’s hard to believe this Zombie bill could get any worse. But it did.

Last night Politico received a leaked copy of a revised Graham-Cassidy bill.  I presume the “leak” was by someone who recognizes this effort as so ill-conceived and harmful that the country should know about it ASAP.  In good time, at the eleventh hour, before this terrible legislation is put to a vote.

http://www.politico.com/story/2017/09/24/obamacare-graham-cassidy-repeal-243079

Thank you, dear leaker, whoever you are.  You have exposed this last-ditch Republican effort to undo Obamacare.  Instead of getting better, Graham-Cassidy has gone from bad to absurd, which might be laughable if it were not so cravenly cruel.

This latest effort amounts “bribery” of the “swing senators” from Arizona, Alaska and Kentucky, with more block grant monies promised to each of their states.  However, as the Politico article points out, this masks the overall slash-and-burn assault on Medicaid.

So, promising more money to the “swing states,” is less like a bribe and more like a mugger telling you to be grateful to be mugged because you can keep your watch.

Another retrograde revision tries to win over Senators Cruz and Lee by effectively removing federal regulation of health insurers in favor of the states.

Among other things, this would lift existing caps on out of pocket costs and lead to the unwinding of protections for individuals (like my hard-working diabetic daughter) who have “pre-existing conditions.”

On this point, Politico quotes Larry Levitt of the Kaiser Family Foundation:

“This revised bill is tantamount to federal deregulation of the insurance market.  If there were any doubt that people with pre-existing [conditions] are at risk of being priced out of individual insurance, this bill removes them.”

It’s high time to put aside political differences and mend the problems of the Affordable Care Act.  While Congress continues to battle over health care, with perennial waste of time and money, people are dying.

Americans should demand congressional collaboration and cooperation and an end to this hyper-partisan nonsense.

[Check out my March 15, 2017 blog post:  https://jerrysturgill.blog/2017/03/15/fix-obamacare-stop-wasting-time-and-money-tearing-it-down]

Meanwhile, you have probably seen news of our own Idaho Senators’ willingness to vote for Graham-Cassidy.  (Which makes me wonder why they didn’t try to be hold out votes too, to attract more hush-up, block-grant money to Idaho and make the proposed Medicaid mugging less bad.  Oh well.)

Whether or not Graham-Cassidy passes, Messrs. Risch and Crapo should be held accountable–now and at future ballot boxes–for their cowardly toeing of the far-right party line and their abject failure to help make health care available and affordable for more Idahoans.

 

Graham-Cassidy-oppose

 

Another Zombie Health Care Bill

We hoped it was dead!  But it still isn’t.  Repeal and replace has risen again.  A Senate vote is expected next week.

Senators Graham (R-SC) and Cassidy (R-LA) have proposed a last ditch budget amendment.  Apparently, they think the news cycle is so saturated with natural disasters we will not be paying attention to a man-made one.

cemetery hand

However, we MUST pay attention, especially here in Idaho.  We should pummel our Idaho U.S. Senators with demands to vote against this terrible, zombie bill, before next week’s vote.

There is so much wrong with this process, even before you get to the relative badness of the bill.  Like prior attempts at repeal and replace, Senators Graham and Cassidy, with alarming Senate and White House support, are trying to avoid the deliberative process of the Senate (remember, that failure of “regular order,” about which Senator McCain so passionately spoke in the last round).

The political subterfuge of this “rush job” is obvious and represents hyper-partisanship at its absolute worst.

The proposed process for Graham-Cassidy is even more compressed than before, and is intended to avoid exposure to political and public scrutiny.

It will squash the budding potential for bipartisan collaboration and cooperation and is a violation of democratic process.  As a result, we will careen from one half-supported half-baked result to another.

Because of the short deadline, no scoring will be done by the Congressional Budget Office before a vote.  Even so, the Republicans appear ready to hurry ahead, no doubt because the CBO fueled criticism of their last repeal and replace efforts.

This is like prescribing medicine before the test results are back and a proper diagnosis can be made.

As for the badness of the bill, the Graham-Cassidy amendment is clearly worse than previous repeal and replace efforts.  Suffice it to say that, if passed, it would have a massive negative impact on Idaho and the rest of the country.

The insurance markets, now relatively stable, would be turned upside down.  Even more people (32 million) would lose health insurance.  Federal protection for people with pre-existing conditions would disappear.  Planned Parenthood would be defunded.  Medicaid would be crippled and ultimately disappear.

The whole idea is to kick-the-can-down-the-road to the states with block grants, shifting the burden of fixing health care to disparate state legislative and executive bodies.

The result will be an uneven system of health care “haves” and “have-nots,” with hugely damaging economic and social consequences, especially for thinly-populated, heavily-rural states like ours.

Given the poor performance of the Idaho state legislature on health care generally, Idahoans especially should be screaming “foul.”

Call our Senators, today, and every day, until next week’s vote.  Senator Crapo’s number in D.C. is (202) 224-6142, and Senator Risch’s is (202) 224-2752.  Call Senators McCain (202) 224-2235, Murkowski (202) 224-6665 and Collins (202) 224-2523) too, if you have time.

 

People of Good Will Unite!

We must overwhelm the attitudes of white supremacy, nationalism and insularity that take us backward and harm us all.

David Duke, KKK Imperial Wizard was correct in his weekend Tweet to @realDonald Trump:  White Americans put Donald Trump in office.

david duke
KKK’s David Duke in Charlottesville, Virginia -August 12, 2017

By “White Americans,” though, he surely refers to members of a distinct minority for whom whiteness and white privilege is essential to identity.  They cling to it desperately as they watch their whiteness diluted and dismissed as cultural and historic artifact.

Charlottesville is evidence of this virulent white minority and the sad fact that the fight for civil rights in America is not over.  As hard as it is to imagine in this modern era, there are young, khaki-clad white Americans, wearing MAGA hats, who cling to a past of confederate white supremacy, anti-Semitism, slavery and segregation.

Don’t they see their mindset holds them and the rest of our society back?  Overcoming such attitudes and practices has been essential to cultural and economic progress.  Watch the movie Hidden Figures and wonder if we could have been first in space and sooner to the moon if American society had not committed the crimes of slavery and post-slavery segregation.

Even the Neanderthals intermingled with Homo sapiens and gave up their “big brow” identities.

Charlottesville was an odious clash between progress and those willing to do violence for their identities of color, race, religion and nationality.  For what purpose?

Return to slavery?  Segregation?  Closed borders?  Travel bans?  Trade wars?  All these hobble progress and diminish economic activity.  The only modern hypothetical I can think of is a Walmart closing its doors to customers and allowing only its employees to do business within its walls.  Its “economy” would shrink and failure would loom quickly.

Historic examples include the many failed “utopian” experiments where groups of people walled themselves away from the of rest society, “drank the Kool-Aid” and otherwise spiraled into dysfunction and self-destruction.

Diversity, acceptance, inclusiveness, respect, open doors:  These are not just long-accepted American values, they are essential to American economic progress and prosperity.

Add smart investments in education, job growth and upward mobility, and the economy can soar—for the benefit of everyone.

 

Coming Soon:  Dragging the Anchors of Economic Inequality

Senator Crapo Responds . . . to My Letter

Our federal delegation seems to be failing us on one of the most important issues of our time: health care. For what matters most, they are doing least.

In response to my recent personal letter to Senator Crapo about health care, I received a “form letter,” email response.  (What was I expecting?)

The response completely ignores the issues I raised and reads like an apology for the heartless legislation now before the Senate.  [Senator Crapo’s email is copied verbatim below.]

  • No mention of the CBO scoring that shows tens of millions will lose health coverage under any version of the Senate legislation.
  • No mention of the disproportionate impact on Idaho, because of our already shameful “coverage gap” and the likely losses to already-stretched medical services in our far-flung rural communities.
  • No mention of the disproportionate benefit of tax cuts for the wealthy at the cost of the poor.
  • No acknowledgement that the problems of the current law can be traced to conservative, compromise provisions inserted in the Act; the virulent Republican opposition since; and, the new administration’s squeezing off of legally-mandated support in an effort to force failure–which is like a “caregiver” pressing a pillow over the head of a struggling hospital patient.

Senator Crapo’s email response makes clear the opposition to the current law (the “PPACA”) is based on the right-wing imperatives of unfettered markets and lower taxes. Facts, logic and a concern for the health of society (and our state) do not seem to matter.

For Idaho and Idahoans, this may be the most impactful decision our Senators ever make. Unfortunately, like lemmings (and our Congressmen before them), they appear to be following the partisan crowd in their “rush to the sea.”

In a show of courage, Senators Crapo and Risch should pull back their support and advocate for collaboration with the rest of the Senate (the whole Senate) to find ways to improve the PPACA.

I hope they will muster the courage.  Sadly, Senator Crapo’s apologia does not give me much hope.

 

Senator Crapo’s response to my letter:

July 21, 2017

Jerry Sturgill
Boise, ID

Dear Jerry:

Thank you for contacting me about health care reform. I value the constructive thoughts, opinions, and ideas shared by all Idahoans and welcome this opportunity to respond.

Prior to the implementation of the Patient Protection and Affordable Care Act (PPACA), America’s health care system was in need of reform; however, PPACA favors a one-size-fits-all, top-down approach that has led to increased premiums, smaller provider networks and stifled competition between insurers. It is necessary to work toward implementing consumer-driven, state-based health reforms that ensure the American people have access to the health care coverage that is right for them. On May 4, 2017, the U.S. House of Representatives took the first step toward comprehensive health reform by passing H.R. 1628, the American Health Care Act.

The Senate is currently considering various proposals to repeal and replace PPACA. Any successful reform initiative must include provisions that stabilize the insurance market, repeal the individual and employer mandates and job-stifling PPACA taxes. With premiums rising and coverage options disappearing, the status quo of PPACA is no longer an option.

Congress remains actively engaged with governors, stakeholders and consumers to develop an effective system that works for all Americans. America deserves a better process and a better product, and I look forward to doing my part to make this happen.

In the meantime, please feel free to continue to contact me about health care reform or on other matters of interest to you. For more information about the issues before the U.S. Senate as well as news releases, photos, and other items of interest, please visit my Senate website, http://crapo.senate.gov.

Sincerely,
Mike Crapo
United States Senator