Category: Daily Escape

Saturday Soother – July 10, 2021

The Daily Escape:

Sunset at White Sands NP, NM – 2021 photo by Guyin6300dollarsuit.

Gabriel Zucman and Gus Wezerek had an opinion piece in the NYT about the divergence between personal and corporate tax rates:

“In the decades after World War II, close to 50% of American companies’ earnings went to state and federal taxes. Economically, it was a golden period. Middle-class incomes grew at roughly the same rate as those of the richest Americans.

But as globalization gave companies the ability to choose where they recorded profits, Congress scrambled to keep their business by lowering corporate taxes. In 2018, American companies were taxed at an average effective rate of less than 14%, by our calculations.”

For the past 30 years, corporate tax breaks have helped business owners amass huge amounts of money, much of which is kept offshore. Their gain has been the loss for middle-class Americans, who have footed the bill, as Congress has supported our federal budgets by raising taxes on wages:

This chart shows the result of Republican policies. Corporate taxes are at an all-time low, while many profitable corporations pay no tax at all, and workers’ taxes on wages have risen. This has caused a huge and still growing gap in income and wealth between the rich who lead America’s corporations and the rest of us.

Let’s spend a minute on some tax arcana. There used to be a tax regulation that kept income out of tax havens. It is called unitary taxation, a method of allocating corporate profit to a particular state (or country) where that corporation has a taxable presence. It attributes the corporation’s total worldwide profit (or loss) to each jurisdiction, based on factors such as the proportion of sales, assets, or payroll in that jurisdiction.

If this were in effect, it would slow the parking of profits in tax havens by multinationals. California and other states used to use unitary taxation. It was the subject of two US Supreme Court cases: Mobil Oil v. Vermont and Exxon v. Wisconsin, both decided in 1980 in favor of the unitary tax principle. In other words, in favor of the states.

In 1983, the US Supreme Court again ruled in favor of unitary taxation but this time on a worldwide basis in their Container Corporation vs. Franchise Tax Board decision.

That’s when St. Ronnie pressured California and other states to adopt a restricted version known as the water’s edge method that excludes the profits of foreign affiliates from a state’s pre-apportionment tax base. This allowed profit-shifting to tax haven affiliates to mushroom to what we see today.

Biden is trying to end the race to the bottom on corporate tax rates. But even if Congress approves the 15% global minimum corporate tax, it won’t be sufficient to close the growing economic gap between America’s corporations and its workers. Taxing multinationals at 15% would still leave them facing a lower rate than the average American pays in state and federal income tax.

What’s really needed is a 25% percent minimum corporate tax. That would bring in about $200 billion in additional revenue annually. Over 10 years, that would be enough to pay for nationwide high-speed internet, free community college and universal preschool for 3- and 4-year-olds.

All are worthy uses of tax dollars, but it’s doubtful that all Senate Democrats, much less enough Senate Republicans would support a 25% floor for corporations.

A Republican Congress took a shot at reforming the hiding of offshore profits with their 2017 Tax Cut and Jobs Act, which failed. Data from the Bureau of Economic Analysis suggest profits booked in foreign tax havens have not declined since the law was passed.

In 2018, US corporations reported more profit in Ireland than in Mexico, China, Germany and France combined. For example, in 2018, Facebook made $15 billion in profit in Ireland, about $10 million for each of its Irish employees, while Bristol Myers Squibb’s reported profit in Ireland worked out to about $7.5 million per employee.

For decades, Congress tried unsuccessfully to play catch-up as business owners and a handful of tax havens have driven our tax policy. The result is that we’re a nation where working-class Americans are left with underfunded public schools while the wealthiest Americans are boarding rocket ships in some ego-fueled game.

Time for a post-tropical storm Elsa break! Just when you think all is lost, you discover it isn’t. For the first time, Queen Elizabeth has decided that you can now have a picnic on the front lawn of Buckingham Palace. Don’t get too excited, there are rules: No knives to slice your cheese, no dogs, no prosecco. Besides, 78,000 people are already on the waiting list:

Now take a moment, and listen to Czech composer Bedƙich Smetana’s String Quartet No.1 In E Minor “From My Life“, the Largo movement by the Amadeus Quartet, recorded in 2013:

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Deferred Maintenance is America’s Exceptionalism

The Daily Escape:

West Cornwall Covered Bridge, West Cornwall, CT – photo by Juergen Roth Photography. The 172’ bridge spans the Housatonic River.

America runs on deferred maintenance. We won’t do a thing today that can be put off for another day, another year, or several years. The ongoing disaster of the collapsed condo at Champlain Towers South in Florida is a perfect metaphor for America. A quick look at some details is instructive.

The NYT had a story about the conflicts among residents and the Champlain Towers South condo board. A report indicated that major repairs were needed to maintain the structural integrity of the building. But the repairs weren’t popular with the residents: (brackets by Wrongo)

“Steve Rosenthal, 72, a restaurant advertising executive, went to the gym in the building nearly every day. Afterward, he would stop at the pool, where he could see a crack on a third-floor balcony that he described as ‘atrocious.’ But he called the $135,000 assessment [to fix the problems] on his condo, a corner unit with double balconies, a ‘second mortgage’.

‘It’s an upscale building, but it’s not the Ritz or the Four Seasons….The people that live [here]…aren’t Rockefellers or Rothschilds. We’re upper middle class, I guess, and a lot of us are retired’….When a neighbor knocked on his door, 705, with a petition against the assessment, Mr. Rosenthal signed it. The first payment was due on July 1.”

BTW, Rosenthal survived the condo collapse. He was rescued from the intact part of the collapsed building, and he’s staying in a Residence Inn a few blocks away. Worse, Rosenthal has filed a lawsuit against the condo board for negligence and against the property for shoddy construction!

America is filled with assholes like Rosenthal. They’ve taken over – they dominate our politics (I’m talking to you Mitch). They dole out promotions to other assholes. They punish anyone who tries to do the right thing. They tell us how to vote, and who to love. (Hat tip: Jessica Wildfire)

Their attitude that “This seems bad, but if I have to pay to fix it, count me out” is the position of many, many Americans, regardless of what kind of deferred maintenance is being considered. Fixing our roads? Sorry, no gas tax increases. Better school buildings? Property taxes are too damn high. Better Internet? Why? Better health insurance? Socialism!

DC politics is infested with a “we can’t afford this” knee-jerk reaction whenever the subject of dealing with America’s deferred maintenance is on the table. And of course, that’s the thinking that deferred the maintenance in the first place.

It’s particularly bad when the subject is how to deal with climate change. What incentives are there to alter behavior to prevent change that will have most of its effects after 2050? The answer is none, except for an intangible feeling that you’ve done the right thing for posterity.

Current stakeholders (regardless of whether they have a stake in a property, a city, or the entire country), willingly defer maintenance to the next generation of stakeholders, when it will be much, much more expensive. Eventually, the problem can’t be remedied. Like In the Florida condo, that’s when things start collapsing, and people start dying.

Perhaps someone should have said to the condo residents: “You can probably play Russian roulette without dying, but do you really like your odds?”

There was a 1981 ad by Fram Oil Filters  that had the tag line: “pay me now or, pay me later.” Imagine, accountability and wisdom brought to you by Madison Avenue! When we move from car maintenance to the country, the answer is you’ll pay WAY more later. We’ve been blowing off serious repair and replacement of our infrastructure for decades.

We’ve blown off making sure that all Americans have safe bridges and roads.

We’ve blown off making sure that all Americans have basic health insurance.

We’ve blown off immigration reform.

We’ve blown off gun sanity.

We’re blowing off moving from fossil fuels to renewables.

Do you see the parallel in how we respond to these issues? First, there’s a warning, then there’s evidence, followed by denial, delay, and ultimately, disaster. There’s no problem, if there is a problem, it’s too expensive to fix. Maybe we can fix it in a few years, eventually followed by incalculable cost and misery.

We’re the only rich country that kicks the can down the road on anything that’s politically difficult. You know that’s true if you’ve been to an airport in China or Europe. If you’ve taken public transit in Europe or Hong Kong. If you’ve seen the ports in Rotterdam or in Asia.

Time to kill all the assholes.

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Saturday Soother – Fourth of July Weekend Edition, July 3, 2021

The Daily Escape:

People in the Sun – 1963 painting by Edward Hopper. Notice that they are not dressed for summer.

(The Wrongologist will be taking a break for the July 4th weekend. Regular ranting will resume on Tuesday, July 6.)

As we head into the 4th of July weekend, let’s remember that in a remarkable coincidence, both John Adams and Thomas Jefferson, the only signers of the Declaration of Independence who later served as presidents of the US, died on the same day, July 4, 1826. That was the 50th anniversary of the signing of the Declaration. Four years later, James Monroe, also a president and founder of our country, but not a signatory of the Declaration, became the third president in a row to die on July 4th in 1831.

For many, Jefferson and Adams dying on the same day seemed too coincidental. After all, the chances of two people dying on the same day is 1 in 365, but dying on a significant date that was the historic anniversary of an event for which they had intimate involvement? That seemed suspicious.

Some suggested a conspiracy among both physicians and family members to help the patients make it to the 4th. Margaret P. Battin observed in a 2005 Bulletin of the Historic Society article, that Adams’ granddaughter reported their doctor gave her grandfather an experimental medicine which he said could either prolong his life by as much as two weeks, or bring it to a close within 24 hours. Others wondered if something more sinister had been afoot. In a letter, John Randolph mused that Adams’ death was “Euthanasia”, adding “They have killed Mr. Jefferson, too, on the same day.”

Americans love conspiracy theories. Today, none more so than the ongoing belief that Trump won the 2020 election. Or that Democrats are Marxists, or pedophiles. Or that Obama was from Kenya.

In 2021 America, politicians always seek to amplify their differences with the other side, regularly accusing their rivals of deliberately trying to harm the country. And these conspiracies have trickled down to the rest of us, so much so that we’ve become a country at war with ourselves.

People speak with complete contempt about others. Some express contempt for the president, and the entire US government. What we hear routinely today is a level of contempt that in the past, we have reserved for enemies in a time of war. But now, we’re continually contemptuous of our fellow citizens. Contempt is particularly toxic because it implies that the attacker has a position of moral superiority, and through that, has the agency to attack another, possibly even physically.

So, on our most patriotic day, put down that hot dog, and ask the question: How do we unify a secure, wealthy country that is playing a zero-sum political game?

Our true patriots are those very few who are fighting to preserve our voting rights.

They’re the people who are adding new jobs in our jobs-short economy.

They’re the military who return time and again to the front lines, enduring the unendurable. They’re the families of those military personnel.

They’re people who serve on school boards, zoning boards and town councils, who get mostly only a psychic return for their efforts, compared to national politicians who are working hard to become millionairess – assuming they weren’t millionaires when they were elected.

They’re average Americans who see the decline of our institutions and infrastructure, wondering where to turn if we are to reverse all of these bad trends.

Is anyone ever “High as a kite on the 4th of July” with patriotic feeling anymore?

Since it’s Saturday, and the start of our national summer holiday, let’s hit pause for a few days before jumping in to the second half of the year. Let’s spend these days enjoying the end of lockdowns, and the revving up of our economy. Here in northwest Connecticut, on the 4th, we’re looking forward to going to our first indoor performance, an afternoon concert by the Shanghai Quartet at the wonderful Music Mountain in Falls Village, CT.

But to start the weekend, we all should listen to Ray Charles’ “America the Beautiful“. His version of the song is spiritual, emotional, soul stirring and amazingly timeless. Here, Ray is performing it live on the Dick Cavett Show in September 1972.

 

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How Voting Shifted from 2016 to 2020

The Daily Escape:

The Palouse from Steptoe Butte, Whitman County, WA – 2019 photo by Kristen Wilkinson Photography

Pew Research Center just published a new analysis of validated 2020 voters that’s worth your time. Pew surveyed adults it could identify as definitely having voted last November, based on voting records, a methodology considered more accurate than exit polls.

Suburban voters were a major factor helping Biden win. While Trump won the suburbs by 2 points in 2016, Biden won them by 11 points in 2020, a 13-point swing. Considering that the suburbs accounted for just over half of all voters, that was a big win for Biden.

  • Biden improved on Clinton’s share of suburban voters: 45% supported Clinton in 2016 vs. 54% for Biden in 2020. Trump’s share of the rural vote grew: In 2016, he won 59% of rural voters, but tallied 65% in 2020.

Trump gained in both rural and urban areas. He won 65% of rural voters, a 6-point increase from 2016. And while cities remained majority-Democratic, Trump’s support there jumped by 9 points, to 33%.

According to Pew, Biden made larger gains among married men than with any other demographic group. That’s an even larger gain for Biden than Trump made among Latino voters.

  • Trump won married men only by a 54% to 44% margin, a 20-point decline from his 62% to 32% victory in 2016. He won veteran households by a 55% to 43% margin, down by 14 points from 2016.

Biden’s winning electoral coalition looked like Hillary Clinton’s losing one: Black, Hispanic, and Asian voters and those of other races cast about 40% of all Biden votes. Black voters remained overwhelmingly loyal to the Democratic Party, voting 92%-8% for Biden.

  • The gender gap in 2020 was narrower than in 2016, both because of gains that Biden made among men, and because of gains Trump made among women.
  • In 2020, men were almost evenly divided between Trump and Biden, unlike in 2016 when Trump won men by 11 points.
  • Trump won a significantly larger share of women’s votes in 2020 than in 2016 (44% vs. 39%), while Biden’s share among women was nearly identical to Clinton’s (55% vs. 54%).
  • Trump won a majority of White women: 53% of White women chose Trump, up by 6 points from 2016.

Biden improved among White non-college voters:

  • White voters without a college degree were critical to Trump’s victory in 2016, when he won the group by 64% to 28% over Clinton. In 2018, Democrats won 36% of the White, non-college vote, and in 2020, Biden maintained the Democrats’ 2018 share with the group, improving upon Clinton’s 2016 performance by 5 percentage points, to 33%.

Even though voter turnout rose by 7 percentage points over 2016, the turnout battle wasn’t decisive. Democrats thought they would overwhelm Trump with a surge in turnout among young and nonwhite voters, but Pew shows that neither candidate held a decisive advantage in the highest turnout election since 1900.

Instead, Trump turned out his base, while Biden lost ground among nearly every Democratic base constituency. The data show that Trump turned out 5% more of his base (73%)  than Biden turned out of his (68%).

This was an improvement for Trump, who had a 2% turnout margin over Clinton in 2016. Bottom line, there was a far deeper support and enthusiasm for Trump than Democrats had imagined: 13 million more people voted for Trump in 2020 than did in 2016.

It was Biden’s gains among more moderate voting groups that carried him over the goal line.

From a demographic perspective, for the first time, the silent and boomer generations were a minority of voters. Gen X, Millennials, and Generation Z accounted for a majority. Generation Z (18 to 23 in 2020) and the Millennial generation (24 to 39 in 2020) favored Biden over Trump by a margin of 20 percentage points, though Trump gained 8 points among Millennials compared with his 2016 performance.

This is the clearest view we’re gotten on how different groups voted in 2020, and crucially, how those votes had shifted since 2016. It shows that Biden failed to improve his margins among virtually every voting group that Clinton won in 2016, whether it was young voters, women, Black voters, unmarried voters or voters in urban areas.

What about 2022? Hispanic voters, along with suburban Whites, will remain major focuses for both Parties. Both will be trying to cement their gains while working to improve in the other areas. The 2018 mid-terms were a referendum on Trump. The GOP will be making the 2022 mid-terms a referendum on the Democratic Party.  As Wrongo said here, Democrats need to stop focusing solely on the issues, when the opponent is focusing on killing democracy.

The headline is that we should brace for more years of grueling trench warfare between the two Parties. And to top it off? The Parties seem to be evenly matched.

Turnout will be even more crucial in 2022.

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Democrat’s Messaging Needs a Rethink

The Daily Escape:

Sunrise, Motif #1, Rockport MA – 2020 photo by Kristen Wilkinson. Motif #1 is among the most painted fishing shacks in the world. It was originally constructed in 1840, and reconstructed in 1978.

Dr. Rachel Bitecofer is a political scientist who became famous 2018 and 2020 by predicting the midterm and presidential election results of those years nearly perfectly. By doing that, she was way ahead of most pollsters. Bitecofer has now declared her true colors by forming a Democratic PAC called StrikePAC, designed to show Democrats how to fight today’s Trumpy GOP.

Bitecofer is warning Democrats that they could face a wipe out in 2022 if they continue to focus on policy and “kitchen table issues” to the exclusion of the toxic effort by Republicans to brand them, because those issues will not resonate against the GOP’s messaging of cultural issues and the Big Lie.

In a sense, Republicans are branding experts. They fuel the grievances of their supporters every day by waving the cultural wedge issues (abortion, LBGTQ, Critical Race Theory, voter fraud and BLM) in the faces of their followers, while simultaneously demonizing Democrats as against freedom, and for socialism.

Paul Rosenberg at Salon interviewed Bitecofer, and her analysis seems intuitively correct to Wrongo. She argues that the 2018 midterms were more a referendum on Trump’s presidency than on individual candidates and individual races. She foresees that the Republicans will be similarly motivated in 2022: (brackets by Wrongo)

“Look, the GOP doesn’t really run anything except a marketing/branding op [operation] and it’s predominantly a branding offensive against the left.”

More:

“They don’t spend a lot of time on their own brand, but they do spend a lot of time in their messaging on discounting, discrediting, and debasing our brand…..so it’s always about showing us as unattractively to voters as possible. We’ve never answered that.”

Bitecofer says that the Dems have been told by their consultants that they shouldn’t push back on the “socialism” or “defund the police”, or “destroy democracy” messaging, but some of those stones are starting to land, just like they did in the 2020 down ballot elections in which the Democrats badly under-performed. More from Bitecofer:

“…you can’t just stand there and pretend it’s not hitting….The GOP is saying, ‘We’re going to have a debate about these topics,’ and when you enter…that field, you are basically on the defense the whole time because you’re having a conversation that’s been structured by the opposition party.”

Bitecofer thinks it’s time to flip the script on the GOP’s tactics by making the 2022 election a conversation about their anti-democratic power grab, including contesting the results of 2020, their Jan. 6 insurrection, that Trump tried to use the Justice Department to stage a coup, and the Republican Party’s embrace of all of the above.

Republicans have normalized anti-democratic behavior by going into state legislative sessions to try and restrict voter access, even trying to take the vote certification process away from nonpartisan actors and placing it into partisan hands.

So, her basic point is that Democrats need to make the electorate realize that American democracy is on the ballot in 2022. A final quote from Bitecofer:

“To me, ‘bringing a brand offensive’ pretty much describes how Republicans have run the vast majority of their national campaigns at least since Ronald Reagan….Democrats have virtually never done so—not even when Trump first ran in 2016…. we are not engaged in a campaign technique that matches the moment.”

The collective decision by Republicans to stay on the anti-democratic, racist trajectory that the GOP had been on, even before Trump, is perhaps the most important story in American politics right now. The modern GOP messaging tries to turn out their side using the wedge cultural issues, but they also try hard to nationalize politics by making local races be largely about the differences in the two Parties.

Bitecofer says that started with the 2010 midterms which they made a referendum on Obamacare and Nancy Pelosi. They tied every candidate to that as tightly as they could. So candidates didn’t stand for re-election on their own performance and voting record, things that people traditionally thought mattered most. Instead, it was all about whether they were Democrats. And it worked.

Democrats noticed the strategy, but never adjusted to it. In some ways, it seems like Democrats fail to recognize how distinctly different voter behavior is inside the two Parties, and how hyper-partisanship has changed branding and messaging.

The GOP is running a strategic, intentional branding campaign. And Democrats are still talking policies and whether the filibuster should be dumped. Are we making a huge mistake by focusing solely on the issues when the opponent is focusing on killing democracy?

You bet. We need to find and deliver messaging that creates both persuasion and mobilization for our 2022 midterm candidates.

Make it a referendum on Republicans.

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Monday Wake Up Call – June 28, 2021

The Daily Escape:

Sunset, Thumpertown Beach, Eastham, Cape Cod MA – June 2021 iPhone photo by Wrongo

Today’s new Republican talking point is that the main reason violent crime is on the rise is that Democrats have “stigmatized one of the most honorable professions in America.”

How is it that the Party that wants to drown the government in a bathtub, that worships guns, and believes Americans must be armed against their government, holds on to its brand as the Party of “law and order”?

Murder is up all over America. The GOP wants to blame “defund the police”, the Black Lives Matter movement, and whatever Antifa is. Toss in the horror of Critical Race Theory, and in a way, they’re trying out another “Willie Horton” political argument on the rest of us. (hat tip to WaMo)

For those who don’t remember, GHW Bush exploited Willie Horton’s 1986 rape of a woman in Maryland that occurred while Horton skipped out of his furlough. He raped and stabbed her.

Bush used this to trigger voters’ conscious and unconscious racial biases about African American men in his 1988 presidential election run against Michael Dukakis, who was governor of Massachusetts, the state Horton fled after his early release.

No one really knows why murders are up, but surely, it’s a multi-factor problem. Last week, Derek Chauvin was sentenced to 22.5 years for murdering George Floyd. That’s about 10 years above the usual sentence recommended by law. But Chauvin’s sentencing doesn’t begin to solve America’s problem with policing.

And it won’t do anything for America’s murder rate.

A few things are certain. The NYT reported on a survey of almost 200 police departments nationwide that indicated retirements were up 45% while resignations rose by 18% in the last year, compared with the previous 12 months. From the NYT:

“New York City saw 2,600 officers retire in 2020 compared with 1,509 the year before. Resignations in Seattle increased to 123 from 34 and retirements to 96 from 43. Minneapolis, which had 912 uniformed officers in May 2019, is now down to 699.”

This is happening while most cities are contending with a rise in shootings and homicides. It raises in Wrongo’s mind a certain aroma of White fragility among police specifically, and Republicans generally.

The idea that Republicans are now wringing their hands and cops are quitting the job because activists carry signs that say defund the police, seems a disproportionate response to what the police continue to do to minorities.

These topics are far too complicated for one column, but let’s touch on a few high-level concerns: Killings are a direct result of the prevalence of guns in our country. We know that in most countries, police are under significantly less stress because they are don’t fear that every encounter will be with someone with a gun. From the NYT:

“…officers said they were asked to handle too much; they were constantly thrown at tangled societal problems like mental health breakdowns or drug overdoses, they said, for which they were ill-equipped — then blamed when things went wrong.”

This leads to the deliberately misunderstood (by Republicans) “defund” concept, which wants to redeploy some public spending on better services and better outcomes for citizens. It does that by providing additional resources that remove cops from situations that they are neither well-trained for, nor well-suited to address.

Second, law enforcement culture must change. The militarization of America’s police forces must be reversed. The power of police unions to influence police department culture must end.

Third, Democrats are running a big risk by not also focusing on the public safety issues of minority voters. Too many five-year-olds have been shot on their front stoops this year, and their grandmas who vote know that.

Axios reports that the Democratic messaging group Future Majority has identified areas where Republicans hold a political advantage. Republicans outperformed Democrats on jobs and the economy, gun rights, and “keeping you and your family safe.” In addition, of the issues polled, “defunding the police,” “open borders” and “reparations for slavery” were by far the biggest turnoffs for independents and voters in general.

The question for Democrats is how to balance changing police culture while seeing that people are protected? There’s a growing cop shortage, and Democrats are scrambling to develop a more complete response on crime.

So far this year, 21,099 Americans have been killed by a gun, including 11,550 suicides. Another 18,596 people have been wounded. Of that number, 720 children and teens under age 18 have been killed by guns, and another 1,852 have been wounded. And there have been 298 mass shootings resulting in 334 deaths and 1,244 injuries.

It’s time for action Democrats! Stop letting the GOP define your policies for you. To help you wake up, listen to Bananarama’s “Cruel Summer”. The video is a time capsule of 1980s NYC. If you remember, in 1980, people said: The future will be awesome! In 2021 Republicans are saying: I want to go back to the 80s:

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Saturday Soother – June 26, 2021

The Daily Escape:

Low tide, Thumpertown Beach, Cape Cod MA – July 4, 2018 iPhone photo by Wrongo

After Biden and a bipartisan group of US lawmakers announced a deal on infrastructure, it soon became clear that Democrats would only support it if it was passed alongside a big reconciliation bill, something that Wrongo suggested was the only way to play infrastructure with the Republicans.

The American Society of Civil Engineers says that we need to spend $2.59 trillion in the next decade on pure, traditional infrastructure. According to a fact sheet released by the White House, Part 1 includes just $579 billion in new infrastructure spending over the course of five years, with $309 billion going to transportation and $109 billion earmarked for roads, bridges, and other projects.

That means there needs to be two bills: one, a “hard infrastructure” bill along the lines of the framework agreed on Thursday, and the second, a “broadly defined infrastructure” bill containing the other provisions Biden originally wanted in his big infrastructure bill.

If a bipartisan Part 1 appeases enough moderates of both parties sufficiently to get them not to raise hell over a reconciliation Part 2, then Biden will be acknowledged as better at politics than the pundits.

OTOH, McConnell says Biden can have Part 1 only if he doesn’t ask for Part 2. That sets up the possibility that Democrats must choose between something that’s admittedly terrible, or nothing. Biden says he won’t sign the first unless he is also given the second one to sign, while Pelosi says the first bill won’t pass the House until the reconciliation bill passes the Senate.

As with everything in DC, the usual caveats apply: So. Much. Can. Go. Wrong. The two-track Senate strategy (one bill bipartisan, another through reconciliation) requires extraordinary political deftness, possibly a bridge too far for the craptacular Senate Majority Leader Schumer.

A few words about Part 1 from Common Dreams:

  • Rather than pushing for taxes targeting rich individuals and corporations, a White House fact sheet on the bipartisan package outlines other potential financing sources, from unused Coronavirus funds to reinstating Superfund fees for chemicals.
  • The proposal also relies on public-private partnerships, (P3s), private activity bonds, and asset recycling for infrastructure investment.

When politicians say “asset recycling” they mean the sale or lease of public assets to the private sector so the government can put that money toward new investments. But the devil is in the details, and how we fund new infrastructure can’t be through privatizing our existing infrastructure.

America won’t get a redo once its public infrastructure is privatized.

In some places public/private partnerships can be tolerable. Think rail policy where Amtrak’s funding is contingent on some sort of matching grants for private freight service improvement. This can be better justified as both are connected as part of the same rail network and improvements can be easily tracked.

But elsewhere, it can’t, especially in power and telecom, where P3s only serve to prevent public services from being offered. This sounds like how Philadelphia and other cities sold off infrastructure like parking garages and parking meters. The city derived no recurring income, while private companies collected the monies.

From Benjamin Studebaker:

“In most democracies, a working legislative majority allows the government to pass legislation. In the United States, things don’t work this way….As our problems slowly mount, neither the Democrats or the Republicans are able to experiment with policy solutions. The policies that do get passed are the result of fraught compromises. It’s never clear who is responsible for the policies that issue from the federal government, and every time anything goes wrong every part of the US government passes the buck to every other part.”

The failure to make essential investments in the basic infrastructure of the country is not consistent with having a functioning state. Either the filibuster must go, or the primary system must go. The primary system is here to stay because it is equated with democracy itself in the US. Therefore, sooner or later, the filibuster will go.

So, rather than teasing Americans with the promise of a new Roosevelt administration (in aviator shades), it looks like we’re in for another round of gridlock.

That’s enough politics for this Saturday. It’s time for our Saturday Soother. Wrongo and Ms. Right are spending a few days on Cape Cod, which is always enjoyable. So, before going off to watch another beautiful sunset, let’s take a few minutes to relax and listen to the Second movement (largo) of Dvoƙák’s “From the New World“, performed here in 1985 by the Vienna Philharmonic, directed by the late Herbert von Karajan:

 

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Why Won’t Manchin Help Keep Jobs in West Virginia?

The Daily Escape:

Grand Canyon NP at golden hour – photo by indieaz

Viatris is a new pharmaceutical company formed by the merger of Mylan and Upjohn late last year. Their strategy for improving profits post-merger was as is usual, to restructure and cut $1 billion in costs. One victim of the cost-cutting is the Viatris plant in Morgantown, West Virginia. The company announced the plant would close last December.

The Morgantown plant has been in operation since 1965. It employs between 1,500 and 2,000, whose jobs will be offshored to India and Australia. These are well-paying jobs in one of America’s poorer states. The bulk of the layoffs will occur on July 31, when 1,246 people will be let go, including 764 union workers and 482 nonunion staff. Complete closure will happen by March 2022.

Mylan reported $3.9 billion in profits in 2019. Naturally, local union president Joe Gouzd had harsh words for Viatris:

“This is the last generic pharmaceutical manufacturing giant in the US, and executives are offshoring our jobs to India for more profits. What is this going to do to us if we have another pandemic?”

The local union represents about 900 workers. Gouzd said:

“…we’re going to rid ourselves of 2,000 high-paying jobs in north central West Virginia, taking out $150m to $200m out of the local economy…”

The West Virginia legislature passed a bill calling on Governor Jim Justice and Joe Biden to save the jobs. Biden has proposed taxing companies that offshore jobs, but it remains to be seen whether he will be successful.

Senators Elizabeth Warren and Marco Rubio introduced the Pharmaceutical Supply Chain Review Act to study America’s over-reliance on foreign countries in pharmaceutical industry, but neither West Virginia Senator has sponsored the bill.

The Guardian reports that Republican Senator Shelley Moore Capito has ignored pleas to work with Biden officials to save the plant. Democrat Joe Manchin, whose daughter Heather Bresch served as Mylan’s chief executive until she retired in 2020, didn’t fully ignore their requests to get involved; he held a Zoom meeting in December that might as well have focused on “thoughts and prayers.”

Isn’t it curious that the state’s two Senators aren’t trying hard to keep jobs in their state?

You probably hadn’t heard that Bresch collected $37.6 million when she stepped down from Mylan. You also missed that under her leadership, Mylan recently undertook what’s called a “tax inversion”, changing its headquarters for tax purposes from Pittsburgh, PA to the Netherlands, reaping big tax breaks. So, less tax revenue for America.

Earlier, Mylan disclosed that it is in an ongoing lawsuit by the Public Employees Retirement System of Mississippi that alleges misconduct by the company. The suit alleges “misrepresentation and concealment of violations of FDA regulations governing pharmaceutical product quality and safety.” In 2016 and in 2018, the FDA found documentation, record-keeping, quality-control and cleaning issues. The plant was shut down temporarily after the 2018 findings. It then reduced production volume by about two thirds, and “right sized” plant staff.

But we initially heard about Ms. Bresch during Mylan’s EpiPen pricing controversy. They had been hiking prices for years on their epinephrine injector to the point where many people could no longer pay for it. Along with the EpiPen fiasco, Mylan paid $465 million to the federal government to settle claims it underpaid Medicaid rebates.

Understandably, the town and the state are looking for ways to head off the layoffs. Last week, members of the union and others rallied outside the state capitol in Charleston to urge Republican governor Jim Justice to help save the facility. According to the union, Justice said his administration was trying to find an alternative to closure, including holding talks with two companies that have expressed an interest in buying the plant.

But Justice said that Viatris was not cooperating:

“We’ve talked with Viatris, and we continue to struggle with them….They’re difficult to work with. The least they could do …is be cooperative.”

So, Viatris isn’t the best of corporate citizens. That doesn’t make them different from most multinationals. That means political pressure is the only leverage that will keep these jobs in America.

Yet, when you see these two “bipartisan” Senators not lift a finger to help the soon-to-be unemployed citizens of their own state, you have to ask: Why haven’t they done more?

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Monday Wake Up Call, Bipartisan Kabuki Play Edition – June 21, 2021

The Daily Escape:

North Umpqua River, Glide OR – 2021 photo by Bobbie Shots Photography

We’re hearing a lot of talk about a bipartisan infrastructure plan. The plan would spend about $1 trillion over the next eight years. But that’s only about half of what Biden had asked for and won’t accomplish anywhere near all that he wanted. But half is better than nothing, and if the plan were fair, Wrongo would support it.

Sen. Lindsey Graham (R-SC) made headlines on Sunday by saying he’s the latest Republican Senator to support the bipartisan infrastructure deal in the Senate. On Fox News, he said:

“I think the difference between this negotiation and the earlier negotiation is that we are willing to add more new money to infrastructure in this package and I am hopeful that the White House and Joe Biden stay involved, we can get there,”

He also said that the “bipartisan” support will disappear if Democrats signal that they intend to follow it up with a second infrastructure package passed via reconciliation.

But is there any reason to believe he, or other Republicans involved in these negotiations are acting in good faith? Or is this another game like what happened with Obama’s Affordable Care Act negotiations? Will Republicans simply try to run out the clock on the legislative calendar and then ultimately vote no on the final bill?

The bipartisan proposal is led by Sens. Rob Portman (R-OH) and Kyrsten Sinema (D-Ariz.). It costs about $973 billion over five years or $1.2 trillion over eight. The plan would have $579 billion in new spending. That makes the bill’s total new investment about one-fourth the size of  Biden’s initial proposal. Graham joined the group, including 10 Democrats and 10 other Republicans, as its 21st member.

But as always in DC, the devil is in the details.  Their plan uses public infrastructure funds for “public private partnerships” in the form of thousands of new toll roads. It uses money already earmarked for COVID relief funds, rather than paying with more progressive taxation. It imposes new taxes and surcharges on electric vehicles, a disincentive when we should be doing our best to phase out fossil fuels. But more about that below.

OTOH, there are worthwhile elements of their funding methodology. They are suggesting ramped-up IRS enforcement to pay for a portion of the spending. In a NYT op-ed last Wednesday, five former Treasury Secretaries Timothy Geithner, Jacob Lew, Henry Paulson, Robert Rubin and Larry Summers all agreed that the country should strengthen its tax system by collecting uncollected taxes.

The Treasury’s Office of Tax Analysis estimates that this could generate $700 billion over the next 10 years. But the former Treasury Secretaries say that is a modest estimate, citing former IRS commissioners who say it could be as large as $1.6 trillion.

The taxes on electric vehicles can be justified, since drivers of EVs do not pay gas taxes that fund highway maintenance, even though they use roads and highways just like gas-powered cars. But an EV tax must be paired with investments in electric charging stations or else the net effect would be to slow America’s transition off fossil fuels.

We’re watching as, Eric Levitz says, a staring contest between moderates and liberals. Liberals can’t pass anything without Manchin and Sinema’s votes. Moderates won’t get federal dollars for their states without the liberal’s cooperation. Both factions are waiting for the other to blink, while Republicans are happily trying to keep the stare down going: The longer it lasts, the less time Democrats will have to pass new laws before midterm season begins.

The Republicans are bragging that the plan doesn’t raise taxes. That’s not exactly true. They mean the plan doesn’t raise taxes on corporations or the rich. They don’t seem to mind that the plan would take money out of the pockets of working- and middle-class people.

The legislative calendar is a scarce resource. The Senate has only six more workweeks before summer’s end. Time to wake up Democrats! Biden can support this $1 trillion bill, but he must also keep pressing forward with a reconciliation bill to address other infrastructure priorities.

To help you wake up listen to the great Pink Martini perform their song, “Hang on Little Tomato“. Here it’s performed live in Portland, Oregon in December 2005, featuring vocalist China Forbes.

The song was inspired by an ad for Hunt’s Ketchup in a 1964 issue of Life magazine telling a green tomato to stay on the vine and ripen. It’s been popular lately as a song of hope:

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Saturday Soother – June 19, 2021

The Daily Escape:

View of Lake Champlain from Hog Island, VT – photo by Kim Brown

A few items that were lost in the noise this week: First, the House voted 268-161 to repeal the 2002 AUMF, the Iraq War Authorization for Use of Military Force. The 2002 AUMF allows military action to defend the national security of the US against the continuing threat posed by Iraq. The other AUMF, the 2001 AUMF, issued to allow the president to order the invasion of Afghanistan, remains in effect.

The rationale for repealing these AUMFs is that the power to declare war properly belongs with Congress. Congress’s delegating a blank check to the president via the AUMF’s to make war promoted the indefinite, Middle East military engagements that turned Onion headlines about sons patrolling the same routes in Afghanistan as their fathers into a horrible reality.

Congress has been negligent in reclaiming their power. And while there’s a case for the kind of open-ended military actions of the 21st Century, that case should be made in Congress, where the strategy can be deliberated, and if approved, funded by Congress, our ultimate authority for both war-making and war-funding.

The 2002 AUMF repeal now goes to the Senate and if passed, to Biden, who has suggested he would sign a repeal.

Even if the repeal passes the Senate, the standard Republican line on AUMF repeal is that a replacement resolution must be passed at the same time. That will possibly kill the repeal. And depending on how it is written, it could defeat its entire purpose.

Second, this week, Lina Khan, the author of “Amazon’s Antitrust Paradox” was confirmed by the Senate (with 19 Republican votes) as Federal Trade Commissioner. A 32-year-old, British-born woman of Pakistani heritage is now Chair of the FTC, facing down the most powerful corporations in American history, backed by the full power of the US government.

Khan inherits an antitrust lawsuit against Facebook, which seeks to break up the company over allegations that it copied or acquired and killed its rivals. The lawsuit is a test of Washington’s ability to check Silicon Valley’s power amid a broader debate about changing tech regulations. Kahn will be running an agency that lawmakers and experts for years have warned is under-resourced and lacking technical expertise.

Our existing antitrust laws are robust, but they have been weakened by business-friendly judges and clearly aren’t optimized for our digital world. A bipartisan group in Congress introduced a series of bills that would outlaw many of the allegedly anticompetitive tactics that tech companies used to solidify their dominance. But as with all reforms, it’s unclear whether they’ll pass.

Ms. Khan will be getting more resources. Biden has proposed an 11% funding increase for the FTC, boosting its spending from $351 million to $390 million. The president’s proposal will also allow the FTC to increase its headcount to 1,250, its largest staff since it was eviscerated in the early 1980s.

She enters the FTC with a 3-to-2 Democratic board majority, but it’s unclear how long that will last. Rohit Chopra (D) is awaiting his confirmation to the Consumer Financial Protection Bureau. If he leaves, it could be difficult for Biden to build the bipartisan support needed to install another commissioner.

Finally, it was disconcerting to hear Putin, in his post-summit news conference, play back Republican disinformation. From the WaPo’s Dana Milbank:

“For the past few years, Republicans in Congress have echoed Russian propaganda. On Wednesday, in Geneva, Vladimir Putin returned the favor: He echoed Republican propaganda.”

Milbank notes that the Russians have adopted the talking points of right-wing media about January 6. Putin mentioned that the January 6 insurrectionists are not looters or thieves:

“Many of the suspects, have been hit with very harsh charges…. Why is that?”

Putin read some more from the Republican playbook:

“As for who is killing whom or are throwing whom in jail, people came to the US Congress with political demands….Over 400 people had criminal charges placed on them. They face prison sentences. 
 They’re being called domestic terrorists.”

It’s surprising how awful Republican talking points sound when spoken by Putin.

On to the weekend, and our Saturday Soother! We will be continuing our yard work on the Fields of Wrong. You know you live in the wilds when Ms. Right can find bear poop 20 feet from our front door. Interestingly, it smelled like the bear had dined on fish. That’s probably enough outdoors reality for this week!

Let’s start our Juneteenth and Fathers’ Day weekend by listening to Harold Darke’s “Fantasy in E Major”. It is arranged here for string orchestra by Clive Jenkins because Drake’s arrangement is lost. It’s played by the Chamber Ensemble of London, conducted by Peter Fisher:

The video is beautiful because it includes paintings by English landscape artist, James Lynch. They’re lovely. Enjoy!

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