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.

 

 

 

 

Things Not Learned from Vietnam

In this particularly strange and dangerous time, we should revisit the history of the Vietnam War. It is surprising how much we have not yet learned.

I finished watching all 18 hours of Ken Burn’s and Lynn Novick’s film on the Vietnam War.   If you have not seen it, you can still stream it from or buy it at the PBS website. http://www.pbs.org/show/vietnam-war/

It is truly impressive, informative and alarming.

Born on the heels of the Korean conflict, I was too young to have been exposed to the full horror of that war.

The Cold War, however, was in full chill, and U.S. engagement to combat the threat of Communism in Vietnam was escalating.

As a young child, before JFK waded into Vietnam, I remember wondering at people digging bomb shelters in their backyards.  By age six, I knew about nuclear annihilation.

When Kennedy was assassinated, our kickball game against the wall of Harrison Elementary halted and we stood in stunned silence, trembling and weeping for fear of unknown threats happening beyond the boundaries of our playground.

As Vietnam unfolded under LBJ and then Nixon, the black and white basement TV screen nightly carried grainy images and horrifying reports of escalating violence, showing dead bodies, body counts, constant bombing.

One seventh grade football practice, a teammate, Charlie, was summoned away by news of his older brother, who, while serving in Vietnam, had been maimed and blinded by a land mine.

After high school, as anti-war sentiment raged, we registered for the draft and submitted to the last lottery before American withdrawal.

These memories have been resurrected and now placed in the historical narrative of the Burns/Novick documentary.   Certain lessons are now clear.

Arrogance.  American leadership at the time arrogantly believed the war in Vietnam could be won with overwhelming air power and young men and women with superior weaponry.  This hubris led to a horrific waste of lives and materiel.

Ignorance.  Blinded by this arrogance, U.S. leadership (and voters) failed to understand Vietnamese history and culture; supported authoritarian and unpopular South Vietnamese regimes; and, chronically underestimated North Vietnamese motivation and capability.

The late Sam Wilson–a former Army counter-intelligence expert and President Emeritus of Hampden-Sydney College–one of the many veteran voices included in the documentary, summarized this fateful intersection of arrogance and ignorance:

“It is very, very difficult to dispel ignorance if you retain arrogance.”

Making Enemies.  Because of arrogance and ignorance, the Vietnam strategy had the effect to firming the North’s anti-American resolve, losing support in the rural areas of the South and enabling Viet Cong recruitment.  America thus strengthened its enemies and alienated its allies.

Divisiveness.  At the same time, Vietnam drove deepening division in our own country, giving rise to consequent hatred and extremism.  The country was so divided and angry Americans even shot fellow-Americans (as at, for example, at Kent State).

Corrupt Leadership.  Add to all the above stunning examples of corruption, especially of Richard Nixon, who lied about the contraction and expansion of the war and propagandized a “silent majority” (his “base”) who blindly accepted his lip service to freedom, American exceptionalism and Communist threat.

Illegal Campaign Activity; Illegitimate Presidency.  Before Nixon’s first election, and to improve his prospects of winning, he made illegal contact with North Vietnamese peace negotiators and told them to back away from the peace table — this, to advantage his presidential campaign and secure his election victory.  In sum, the U.S. elected a President based on misinformation and illegal political activity, someone willing to perpetuate war and sacrifice American lives for his own political gain.

I wish we could say such arrogance, ignorance, falsehood, propagandizing, hate-mongering and division could never happen again in America.  That we have learned the lessons of history.  Sadly, we cannot.

Our current and ongoing dysfunction arises from a noisome combination of historical ignorance, national wounds still unhealed, politicians willing to exploit division and fear, failure of educational processes and the rising gullibility of a fearsome conservative “base” unwilling to accept factual evidence or engage in critical thinking.

We can and must resist this downward national spiral, by educating ourselves and others, speaking up, getting involved, maintaining resistance and voting for change.

 

For historical learning, the Burns and Novick documentary is a must watch.  Reading of books also helps.  Would someone please tell the President?

Alt-transcript of Yesterday’s Alt-reality Press Conference at the Alt-White House, Trump Tower

President Trump has an uncanny ability to spot moral equivalence, as demonstrated in this alternative transcript of yesterday’s press conference.

. . . .

Reporter: Senator McCain said that the alt-right is behind these attacks, and he linked that same group to those who perpetrated the attack in Charlottesville.

Trump: Well, I don’t know. I can’t tell you. I’m sure Senator McCain must know what he’s talking about. But when you say the alt-right…uh, define alt-right to me. You define it. Go ahead.

[Cross talk. Reporters shout questions.]

Trump: No, define it for me. Come on, let’s go.

Reporter: Senator McCain defined them as the same groups.

Trump: OK. What about the alt-left that came charging at-

[Indistinct.]

Trump:  You know what?  Listen.  Last night I decided to do my own historical research.  So, I watched the History Channel.  You may not know about this, fake news, but there was a war.  Not so very long ago.  The alt-right was occupying France.  There they were, the alt-right, minding their own business and you what?  You know what? The alt-left came charging at them across the English Channel and attacked them.  Surprise attack.  Very violent.  Very violent.

[Cross talk. Reporters shout questions.]

Trump: Excuse me, what about the alt-left that came charging at the, as you say, the alt-right. Do they have any semblance of guilt?

[Cross talk. Reporters shout questions.]

Trump: Wait a minute. I’m not finished. I’m not finished, fake news. That was a horrible day.

Reporter: Is it the same level as the Nazis?

Trump: I will tell you something. I watch TV very closely, much more closely than you people watch it, and you have- You had a group on one side that was bad and you had a group on the other side that was also very violent. And nobody wants to say that, but I’ll say it right now. You had a group, you had a group on the other side that came charging in without a permit, or visas, and they were very, very violent.

[Cross talk. Reporters shout questions.]

Reporter: Mr. President, are you putting what you’re calling the alt-left and alt-right on the same moral plane?

Trump: I’m not putting anybody on a moral plane.

[Stunned silence.]

. . . .

 

Bodies Were Lying in the Street

One night in New York City, I happened upon a mafia hit, the result of competition for leadership of the Gambino crime family. Current events take me back to that night.

After law school I worked as a corporate finance lawyer at a prominent law firm and spent 10 years in the firm’s New York City office.

My wife and I had both grown up in the West and, to us, the East had always been distant and forbidding.

“It will be an adventure!” I said to her cheerfully. “We’ll spend a couple of years out there, and then move back West.” She glared at me.

I went out ahead to work and look for housing.  For a week or so, I wandered Manhattan in the evenings, searching for an affordable apartment.

On one of those nights, as I made my way back to my humble Lexington Avenue hotel, I passed Sparks Steak House on 46th Street, close to Third Avenue.

It was the night “Big Paulie” Castellano, head of the Gambino crime family, was gunned down on his way to dinner. Police tape closed off 46th street. Lights were flashing. Sirens blared. Bodies were still lying in the street, covered with sheets.

John Gotti, who had ordered the hit, would become head of the Gambino family. Guess he thought he could do a better job than Castellano.

“Better not tell my wife about this,” I thought, as I skirted the crime scene.

This was a dramatic introduction to an ugly part the City at that time. The mafia was distinctly present and projected an image of being above the law, cocky, arrogant and unrepentant.  Just look at this mug shot of John Gotti.

Gotti mug shot

At that time, some in the New York business world seemed to have inherited mafia-like arrogance, rudeness and winner-take-all attitudes. They showed little concern for relationship and trust. In negotiations, I experienced their blatant misrepresentations, threats, verbal abuse and crudeness.  This always injected stress, distrust and delay in the transactional process.

At law school, in my business negotiations class, I had learned that a negotiator will more quickly achieve optimal outcomes with a collaborative approach.  Humility, listening, honesty and respect build trust, foster cooperation and reach mutually beneficial outcomes.

In the face of the belligerent, bullying New York business style, I consistently applied what I had learned in school. My team succeeded in getting hard things done quickly and our practice grew.

This experience keeps coming back to mind (and you can probably guess where I am headed with the story).

I shudder watching from afar the negotiation style of our new President. So far, his lurching administration has left more bodies “lying in the street” than John Gotti.

This approach to “winning” shows little regard for the “other side,” or the greater good, and, with huge arrogance and a small attention span, fails to understand issues, details, process or people.  It is, to me, mafia-like and poisonous to the political setting.

Our governing institutions, with checks and balances, exist to reach collaborative solutions and achieve optimal outcomes for the whole country, without regard to political party, group identity, winners or losers.

As citizens, we must demand collaboration and resist the “me-first” attitudes promoted by the new administration and worse-than-ever partisanship.

Those attitudes are causing our country, and the world, to become more fearful, angry and divided—and more dangerous and dispirited than ever.

“Fix Obamacare! Stop Wasting Time and Money Tearing It Down.”

The Republicans have burned a lot of time and money trying to dismantle Obamacare. Instead, they and the Democrats should be collaborating to fix it.

For more than 20 million previously uninsured Americans, health insurance through the Affordable Care Act (the “ACA” or “Obamacare”) has been a boost in ways that cannot be measured in dollars and cents:  better health, lower stress, more productivity, making life better for everyone.

“Instead of collaboration to make Obamacare better, Congress spent $87 million of taxpayer dollars on 60 efforts to repeal it.”

The efforts to “repeal and replace” appear to give priority to cutting taxes for the wealthy, and assuring big profits for health insurers, rather than bringing health care to more Americans.  (By the way, can you imagine how great it would be if everyone here was healthy–or at least healthier?)

What is most upsetting is that these same conservatives, through their politics, have done their best to cripple Obamacare and now use the damage they have wrought as a cover for their efforts to repeal and replace it.

I am not saying Obamacare is perfect.  Even President Obama called for improvements. But instead of collaboration to fix the current law, Congress spent $87 million of taxpayer dollars on 60 unsuccessful attempts to repeal it.

Those who sponsored those efforts knew full well that President Obama’s veto pen was always ready.  The only explanation for their bullheaded behavior is that it was a craven, partisan effort to manipulate public opinion and weaken Obamacare.

“Conservatives, through their politics, have done their best to cripple Obamacare and now use the damage they have wrought as a cover for their efforts to repeal and replace.”

They have now turned up the volume on words and phrases, like “disaster,” “imploding,” “death spirals,” and other highly-charged rhetoric that exaggerates and misleads.  (Remember “Death Panels”?)

Of course, this has been calculated to further undermine confidence in the current law and drive away demand from the individual insurance markets.

In addition, on the very day of his inauguration, President Trump’s first order of business to call for “repeal and replacement” of Obamacare and non-enforcement of its mandate and penalties.  For the continued viability of Obamacare, this was like draining the air from your tires and putting sugar in your gas tank.

The new American Health Care Act (the “AHCA” or “Ryancare”) has problems that become more apparent every day.  It is based on false economics, false hope and deserves to fail.  Then, attention should turn to fixing Obamacare, to make it work better, more fairly and for more people.

It’s time to fix Obamacare and to stop the waste of time and money tearing it down. “Collaboration” is NOT a dirty word.

Nor, by the way, is “Public Option.”

10-ways-Congress-could-have-spent-87-million-if-they-hadnt-blown-it-on-60-Obamacare-repeal-votes