Politics – Page 45 – The Wrongologist

The Political Stylings of Donald Trump

We see a torrent of Trumpism, and viewed from the sidelines, it is a presidential candidacy based on emotion, while shockingly lacking in policy. It is difficult to see him succeeding, unless Republicans believe that being a vain, obnoxious and unapologetic old uncle is all that it takes to run the world’s largest superpower.

If that’s what they think, they have found their man.

The Donald has co-opted Tea Party rage. But, there’s nothing to grab onto, except the rage itself. He and his supporters hate immigrants. They hate Mr. Obama’s withdrawal from our blundering wars in the ME. They hate the vastly expanded access to healthcare coverage, and apparently, they hate being rescued from a Republican Depression. They do love them some American Exceptionalism, though.

As Bloomberg’s Melinda Henneberger comments about a recent Trump rally in New Hampshire:

Very little of what the conservatives in the hall were going wild over could be characterized as conservative, and most of it wasn’t political at all.

What Trump wants us to believe is; “I’ve got this.” His strategy is to have us believe he is a strongman brimming with rage. His “tell it like it is” approach has a true populist appeal, but his slogan “Make America Great Again” is as vague as it can be. Here are a few NH quotes: (brackets by the Wrongologist)

We will make great trade deals.

We will have Social Security without cuts.

We will come up with health care plans that will be phenomenal, phenomenal, [and] that will be less expensive.

Describing a future-perfect conversation between President Trump and the Ford Motor Co. officials, he’ll change their minds about building cars in Mexico. He says:

This is too easy, too easy! This is a couple of phone calls.

Some Trump supporters will vote for him, some will not, but all like his honesty, his lack of PC, his ability to run without outside money, his success, his independence from America’s political elite.

Krugman says the conservative explanation of the GOP’s onset of Trumpism is that their base voters are victims of celebrity. What they really want is a true conservative, but they’re being hoodwinked by someone who is entertaining on TV.

Krugman thinks the liberal version is that Trump is appealing to resentment that ultimately rests on economic failure: working-class whites have been left behind by growing income inequality, while they mistakenly blame immigrants taking their jobs. But he thinks Trump’s supporters look a lot more like the Tea Party, who are:

For the most part not working-class…They’re relatively affluent, and not especially lacking in college degrees.

Republicans seem to be in a mood to require heavy doses of impatience, resentment and outrage from any successful 2016 presidential candidate. Trump realized that sooner than his competitors, and neatly fills the bill. He is disorienting the Establishment Right. His supporters don’t give his political platform much thought, which works, since thoughtlessness is at the base of most of Trump’s policy cure-alls. He is cleaving the Republican Party into one camp that gawks helplessly at its past and a new camp that is inserting a shiv in the Establishment Right’s tired old body.

For progressives, what’s not to love? Trump said on Meet The Press: (brackets by the Wrongologist)

And if I’m president, we’re going to have a great country…And then we will really have [it] better than Reagan, better than anybody. We will make America great again. That’s what it’s all about.

Ok, Chuck Todd, you can’t ask: “How?”

Trump is the expression of today’s conservatism: loud, abrasive, and vacuous. Forget data, forget policy. Why search for evidence when you can rely on belief and tradition?

There are two options: Republicans either oust Trump and his Trumpeteers, perhaps forcing them to form a third party. Or, Republicans can accept that Trump is in their mainstream, and run a populist platform, laced with doses of anger and vague policies. If he is the Republican nominee for President, Republicans will then witness the Trumpocalypse, and be picking up the pieces for years.

Those are the choices. Either way, contemporary conservatism will be in ruins.

What’s not to love?

Monday Wake Up Call – June 29, 2015

Mylan, a generic drug maker based outside Pittsburgh, abandoned its status as a US corporation, gaining tax advantages by moving its headquarters to the Netherlands. The move reduced the taxes the company pays on profits from sales of drugs overseas, but Mylan continues to maintain most of its operations in Pennsylvania.

Mylan was viewed by some in Congress and the Obama administration as a symbol of corporate greed when they undertook a corporate inversion that placed profits above any commitment to its home country.

But now, Mylan is demanding that the US Federal Trade Commission (FTC) protect it from a hostile takeover bid by an Israeli company, Teva Pharmaceuticals. Mylan asked the FTC to examine Teva’s purchase of Mylan stock for possible violation of the requirement that large purchases of stock of US firms must be reviewed by antitrust authorities, because Mylan is still listed on the NYSE. The company claims that its principal office remains in Pennsylvania, which makes it a “US issuer” of stock for federal anti-trust purposes.

The irony of this is not lost in Washington. Rep. Chris Van Hollen (D-MD), the senior Democrat on the House Budget Committee said:

Mylan is trying to have its cake and eat it too…It is an intolerable abuse of a loophole when US corporations pretend they are based overseas in order to get out of paying their fair share and duck their responsibilities to the United States. It’s just plain hypocrisy when one of those same inverted companies claims that it is actually a US company because it needs the special protections US law gives to American companies.

Mylan may have a case. Its plea for help from the US government could pass legal muster but, the optics of a company that abandoned its US citizenship in order to pay less in federal taxes, and then seeking the protection of a federal agency is problematic.

Compounding the farce, Mylan is attempting its own hostile takeover of Perrigo, in order to stave off Teva.

Mylan’s unabashed lack of shame is impressive. Maybe the FTC’s decision-making on this case should take quite a while.

So, wake up Congress, and deal conclusively with corporate inversions! Our wake-up calls for the next few weeks will be songs about summer. We start with the Lovin’ Spoonful’s only #1 hit, “Summer in the City”:

For those who read the Wrongologist in email, you can view the video here.

Monday’s Hot Links:

The return trip often seems shorter than the initial trip, even though the distance traveled and the actual time spent traveling are identical. This is called the “return trip effect”. Two studies say it is real, but you already knew that.

Trucker jobs will be the first casualty of driving robots. Trucker salaries average $40,000/year. Most truck accidents are due to user error: Driving too fast, driving while tired, or driving while intoxicated. Robots don’t drink, don’t get tired, and won’t drive unsafely in order to get to a destination faster. Drivers will still be needed for inner-city driving (at least initially), but most long-haul operations will quickly vanish as soon as licensing is complete in most states.

Three years ago, Saudi Arabia announced a goal of building, by 2032, 41 gigawatts of solar capacity by 2032, slightly more than Germany has today. The Saudis burn about a quarter of the oil they produce—and their domestic consumption has been rising at 7% a year, nearly three times the rate of population growth. According to a British think tank, if this trend continues, domestic consumption could eat into Saudi oil exports by 2021 and make the kingdom a net oil importer by 2038.

Privail Diagnostics, has developed a simple, portable blood test that can detect the HIV virus (not antibodies) for the first time. That means an earlier diagnosis, and reduced infection rates. Privail’s at-home testing device is like a diabetes test, needing only one drop of blood. It shows the results in a color bar, like an at-home pregnancy test or digital output, like a diabetes meter. Invest at your own risk.

Hackers have apparently cracked the computer systems responsible for issuing flight plans to pilots of every airline. The apparent weak link? The flight plan-delivery protocol used by every airline. Ground computers calculate the appropriate flight plan for planes, and someone on ground approves the plan before distributing it to pilots. Pilots receive plans before taking off, as well as enroute, when a change occurs during a flight. Plans are uploaded to planes via a datalink. Once a hacker figures out those protocols, it is possible to issue a bogus flight plan. But, the industry says, not to worry.

Your thought for the week: Giving money to poor people is socialism, or even communism…..giving money to AIG or Goldman Sachs is capitalism, and that’s what made this nation grrrreat!!!

Sunday Cartoon Blogging – June 28, 2015

There will be limited blogging for the next seven days, as the Wrongologist and Ms. Right head to Bermuda.

It was an epic news week, from the killings in Charleston to the ACA decision by the Supreme Court, 6-3, in which Antonin Scalia wrote the 21 page dissent. Then came the Marriage Equality decision. Antonin Scalia wrote another dissent, starting with:

I write separately to call attention to this Court’s threat to American democracy

Here is the Cliff notes version of both Scalia dissents: “I stole the 2000 election for this”??

They shot and missed:

Clay Bennett, Chattanooga Times Free Press

Republicans secretly happy about SCOTUS decision on ACA:

Marriage equality decision not popular with everyone:

And the Supremes said, “Let them eat cake”:

The big change on the Confederate flag doesn’t change much:

What the Flag means:

Why Don’t Low-Wage People Get Better Jobs?

Regarding Tuesday’s post, “More About Taxpayers Subsidizing Corporations“, which deals with taxpayers subsidizing the low-wage employees of restaurant chains, long-time blog reader Kevin asks: “Why don’t the folks who flip burgers go out and get better jobs?” Excellent question.

Two thoughts. First, they should move up whenever possible, and the chart below about restaurant employee turnover should lead us to believe that they do move out, if not up. When it comes to workplace changes, everyone deserves the chance to move up into higher positions and therefore, this will increase the rate of employee turnover. Research from Work Institute has suggested that 22% of turnover was due to career development and a higher chance of job growth. Being able to excel in your chosen career can only happen if these people decide to make this change. But, whether they leave or not, those jobs will remain at or below minimum wage, and the taxpayers will continue to subsidize these restaurant corporations who underpay them. It falls to the social safety net to make up the difference. Take a look at restaurant employee turnover statistics:

Source: People Report, a division of TDN2k

The burger flippers turnover is the highest among restaurant hourly employees, and it is growing. These are the people who don’t even get tips, so since employee turnover is the highest where wages are the lowest, it’s the burger flippers who move on. This could also be due to job satisfaction they may feel in the workplace. It could be argued that they do not feel the same level of appreciation within a service profession as they would in an office environment that would buy gifts for employees in order to boost their morale in an attempt to keep them for longer.

A second thought is, what jobs can they move up to? Here is a little background:

The US lost more than 8.84 million private sector jobs in the Great Recession. Now, five years after employment hit bottom in February 2010, private sector employment has returned to prerecession levels. The National Employment Law Project (NELP) indicates in a study that low-wage job creation didn’t just happen in the first phases of the recovery, but today, five years in, job growth is heavily concentrated in lower-wage industries. Lower-wage industries accounted for 22% of job losses during the recession, but 44% of employment growth.

Worse, low-wage jobs account for 100% of the net job growth in the economy. Today NELP reports that there are:

• 958,000 fewer mid-wage jobs than at the start of the recession
• 976,000 fewer high-wage jobs than in 2008

The National Restaurant Association’s 2015 economic forecast says the restaurant industry in 2014 added 1,000 jobs per day. It is projected to provide a record 14 million jobs in 2015.

So, where do the motivated, striving burger flippers go?

The glibertarians say the burger flippers should work hard, save money from their minimum wage jobs, get a better education, and move on to a higher paying job, maybe in an office or a laboratory. OK, that’s possible for some.

They say that Mr. Market determines what the value of a burger-flipping job should be. And, if it isn’t a living wage, the burger flipper should study some more.

But when they move on, odds are that they will move to another low-wage job, more likely than not, in the restaurant industry.

And regardless of what new low-wage job they take, the taxpayers’ subsidy of the Corporatists will continue.

Monday Wake Up Call – June 1, 2015

How many hours does it take to make rent at the minimum wage? The National Low Income Housing Coalition looked at the number of hours minimum-wage employees have to work per week in each state just to rent an apartment and survive financially. Their headline conclusion is there is no state where a minimum wage worker can earn enough to make the fair market rent for a two-bedroom place on 40 hours a week. West Virginia tallied the fewest hours at 63 to make the average fair market rent. Hawaii was 175 hours. California, Maryland, New Jersey, New York and Washington, DC were all over 130 hours. So, no chance to get an average place for a family while working 40 hours. Here is a chart from their report:

The Wrongologist would have preferred if the study had used median rents rather than average rents. The red bars show the gap in hourly wages between the state’s minimum wage and the cost of an average two bedroom place. This is another artifact of the Great Recession. Let’s recap what has happened since it ended:

• The percentage of people employed in the US has never recovered
• All income gains went to the top 1%
• There has been a huge bull market in stocks, despite stagnant income for all but the top few

If we don’t wake up, America will be a banana republic, with the emphasis on the “banana”, since the “republic” is already dying. The US will be small enclaves of massive wealth run by a few oligarchs. Think of it as Manhattan, a few square miles where the Corporations and their top employees reside, surrounded by a sea of low wage cast-offs.

None of this is inevitable. We could increase wages, we could rebuild our decaying infrastructure. This approach is dismissed as “Keynesian” by our right-wing brothers. The only kind of Keynesian stimulus they will accept is military Keynesianism. It’s not that peaceful Keynesian stimulus doesn’t work, it’s just that they won’t benefit from it. They see war as prosperity. China is next in their battle sights.

Wake up America, time is running out to keep us on a course that avoids our demise as a middle class economy. The next election may be the most important in our lifetimes. Here is today’s wake-up call, Amy Speace, a folk singer featured in a NYT Money section article. Here is her song, “Spent,” about trying to make rent:

Sample lyric:
We’re head over heels,
In over our heads,
We borrow and steal
To pay the rent.
How are we gonna save any money
When it’s already spent?

For those who read the Wrongologist in email, you can see the video here.

Today’s breakfast links:

Study shows human attention span now lags that of a goldfish. Who is behind the study? Microsoft, who wants to learn how modern technology impacts the attention span of people who use it. (Insert your own joke here)

Sudden loss of ice in Antarctica was large enough to affect Earth’s gravity. The ice loss causes small changes in the gravity field of the Earth, which were detected by a satellite mission, the Gravity Recovery and Climate Experiment (GRACE).

What do you get if you take the blades off a wind turbine? A better wind turbine. This new turbine is a hollow straw that sticks up 40 feet up in the air and vibrates like a guitar string when the wind blows. Its 50% cheaper than blade turbines, and while it is also 30% less efficient at capturing energy, a wind farm can double the number of bladeless turbines that occupy a given area. That’s a net energy gain of 40%. The company is Vortex Turbines. Invest at your own risk.

A new salt reactor will use spent nuclear fuel to make energy. This nuclear reactor generates 75 times the electricity per ton of uranium compared to today’s light-water nuclear reactors, since it burns 96% of its fuel, compared with only 4% in light-water reactors. The company is the venture-funded Transatomic Power. They hope to build a 20-megawatt demonstration reactor by 2020. With nearly 80,000 tons of radioactive waste in the US (and with 2,000 tons added every year), it could turn something toxic into something useful. Invest at your own risk. With this being said, it could be as simple as doing some research into something like uranium mining stocks and finding out about this sector in this particular industry. The more people know about investing, hopefully, the more clued up they will become and potentially make better decisions.

A PA newspaper published a letter calling for President Obama to be executed, but now they’re apologizing. The paper says: “We will strive to do better in the future.” Another example of our media’s inexorable descent. They are only sorry they got caught.

Here is a list of Zagat’s best brunches in Manhattan.

Sunday Cartoon Blogging – May 10, 2015

The Republicans seem to have a bumper crop of presidential candidates. We can expect about 20 Republican candidates to announce before the running really starts. While it raises talk about the “Clown Car”, it also shows the strength of the Republican’s “bench.” Republicans have multiple governors and senators who could run a credible campaign in the presidential election. Contrast this with the Democratic Party. Who has what it takes to challenge Hillary Clinton’s position for the Democratic nominee?

It’s partly the strength of Hillary’s resume, but the Democrats have no viable alternatives. If Ms. Clinton stumbles, the Democrats would be stuck trying to win with Bernie Sanders, Martin O’Malley, or Jim Webb. This is indicative of a huge problem for Democrats: It has no bench. Consider this:

• Before the 2010 election, the Democrats controlled 61 of the 99 state legislative bodies in the US. By the end of the 2012 election cycle, they controlled 36; today, they control 30.
• The number of Democrats in the House dropped from 257 in mid-2010 to 201 after the 2012 election. Now, that number stands at 188.

And they are counting on older, war horse candidates for open Senate seats in 2016: Their nominee in Ohio will be Ted Strickland, who will be 75 by the 2016 election. In Pennsylvania, Democrats will likely go for former Governor Ed Rendell, or former Representative Joe Sestak. In Wisconsin, Democrats will probably look to former Senator Russ Feingold, and in New Hampshire, current Governor Maggie Hassan is the top choice.

Only in Florida and Illinois, where Reps. Patrick Murphy and Tammy Duckworth are slated for Senate nominations, are younger incumbents likely to move up.

A party with a strong, young bench in each state is like a basketball team with lots of young talent; they may not be all that good yet, but everyone knows they will be at some point. This void threatens to limit the Democrats in the not-too-distant future, and needs to be remedied quickly, or the party will be in a minority position for a very long time.

Contrast with Republicans:

Jade Helm brought out the best in Texas:

“Deflate Gate” came back to haunt the Patriots:

Tom Brady’s homoerotic moment:

In Great Britain’s election, the Scots declare independence from England, and England from Europe:

Britons vote after six weeks of campaigning. That’s only 42 days for the pundits to make their dough. The NY Times reports that in the UK, each party is limited to spending $29.5 million in the year before the election.

All TV channels are required by law to give the main parties and their leaders carefully measured free time at peak viewing hours to state their cases. Paid TV advertisements are forbidden. And on election day, television and radio shows are forbidden from discussing campaign issues, talking about polls or dissecting individual candidates until the polls close at 10 pm.

Let’s try it, America!

Moving the Goal Posts on Obamacare

Gallup has an informative chart about the declining percentage of uninsured in the US:

The percentage of uninsured Americans climbed from the mid-14% range in early 2008 and peaked at 18.0% in the third quarter of 2013. The uninsured rate has dropped sharply since Obamacare (the Affordable Care Act) took effect at the beginning of 2014.

It is possible to argue that an improving economy and a falling unemployment rate may have accelerated the steep drop in the percentage of uninsured over the past year. However, the uninsured rate is significantly lower than it was in early 2008, before the Great Recession, suggesting that the recent decline is due more to Obamacare than to just an improving economy.

From NY Magazine on this trend:

It is starting to look possible that this trend is not some random fluke that has happened six straight quarters but is somehow related to the enactment of Obamacare. So any day now, we can expect conservative politicians and intellectuals to begin publicly rethinking their analysis of this law.

They were correct. Here is the 2010-2014 short version of the Republican viewpoint on the ACA:

The ACA will not reduce the number of people without health insurance. Indeed, it might make this problem we don’t consider a problem, even worse.

Now that the ACA looks to be doing the job, the 2015 short version of the Republican viewpoint is:

Everyone knew that the ACA would result in a huge drop in the number of people without health insurance — what does that prove? Besides, how can we really know that it all isn’t a big coincidence?

This is called “Moving the Goal Posts”. Wikipedia says it means

To change the criterion (goal) of a process or competition while still in progress, in such a way that the new goal offers one side an intentional advantage or disadvantage.

Here is an example of moving the goal posts. From Cliff Asness: (emphasis by the Wrongologist)

In contrast, the rise in coverage is heralded by a myriad of Obamacare supporters as one of two major pieces of proof the law is working. But, how can something we knew before the fact be proof of anything?

Shorter: If we predict that something good will happen as a result of a new law, and that good thing happens, it doesn’t count as proof that the law served its purpose or was any good at all, unless Republicans say so.

The goal post movers also said Obamacare was a job killer. House Speaker John Boehner announced on March 17, 2010, five days before President Obama signed the ACA into law:

The President … continues to push his job-killing government takeover of health care that will hurt small businesses at a time when they need certainty, not more Washington tax hikes and mandates.

In 2011, House Republicans even passed the “Repealing the Job-Killing Health Care Law Act” — the first time that any piece of congressional legislation ever had “job-killing” in its title. Sadly for both Mr. Boehner and the House Republicans, we have added 12 million new private sector jobs since the bill was passed.

There is a new J.D. Power survey which looks at enrollee satisfaction with the ACA. It finds that people who signed up for insurance on the exchanges were slightly more satisfied (69.6%) than people with non-exchange plans, usually through employers (67.9%). People re-enrolling on the exchanges were 74.4% satisfied. New enrollees for 2015 were 5.5% more satisfied than 2014 enrollees, who endured the disastrous roll-out of healthcare.gov. So people like the subsidies and they like their actual insurance policies.

Think about it: ACA forecasted costs have been consistently revised downwards. The number of uninsured are dramatically lower. Satisfaction with Obamacare is higher, and it didn’t kill jobs.

It’s utter Tyranny.

Maybe that’s why the Senate’s top five Republican leaders have cosponsored legislation to extend Obamacare insurance subsidies until 2017. The extension will give Republicans more time to again move the goal posts.

They should try this one: Now that Republicans control Congress and most state governments, we have way fewer uninsured.

Conservative policies work!

Is a Mob at The Gates?

There is an idea deep in the American psyche that there always is “a mob at the gates”. The mob wants in so that they can take advantage of the good things we have, or they want to lay waste to our culture and way of life. Therefore, we must be vigilant, because our innocence and openness makes us vulnerable to exploitation or infection from outside. This is well-documented in Robert Reich’s 1986 book, Tales of a New America.

We have a history of fearing and demonizing the “others”. It has been a strong weapon in hands of America’s conservatives. In the 1950’s we were visited by McCarthyism. In the early 1950s, conservatives were deeply frightened by Communism’s advances overseas (communists were ruthless and Godless!). By hunting alleged communists in the State Department, suggesting that the real threat lay not overseas but at home, Joseph McCarthy played brilliantly to those fears.

Sadly, the McCarthy period wasn’t the first time in American history that we demonized outsiders who we thought were trying to climb inside the gates. When they tried to get in, we attacked people from their homeland who were already here. We had slavery, followed by Jim Crow. Hyper-nationalists went after German-Americans during World War I, and we rounded up Japanese-Americans during World War II. After McCarthy was discredited, cultural conservatives moved on to “protect” America against supposed internal threats from black militancy, feminism, and the gay-rights movement.

After 9/11, President Bush defended Islam. He called Islam “a faith based upon love, not hate,” and even visited a mosque. In a Presidential debate with Al Gore, Bush condemned the fact that “Arab-Americans are racially profiled.”

But today, would-be Republican presidential candidates are turning on Muslim-Americans. From Peter Bienart in the Atlantic:

In January, the Republican presidential hopeful Bobby Jindal argued that “it is completely reasonable for [Western] nations to discriminate” against Muslims in their immigration policies, on the grounds that radical Islamists “want to destroy their culture.”

In February…Mike Huckabee, declared, “Everything [President Obama] does is against what Christians stand for, and he’s against the Jews in Israel. The one group of people that can know they have his undying, unfailing support would be the Muslim community.”

In March, after New York City announced that public schools would close for two Muslim holidays, Todd Starnes, a Fox News contributor, lamented, “The Islamic faith is being given accommodation and the Christian faith and other religious faiths are being marginalized.”

In fact, Bienart thinks that if George W. Bush were seeking the Republican presidential nomination today, he’d be excoriated for his view of Islam. Why are Republicans more hostile to Muslims and Islam today than they were after 9/11? And why are American Muslims, who in 2000 mostly voted Republican, replacing gays and feminists as the right’s chief culture-war foe?

Could there be a new McCarthyism emerging in the Republican Party?

A 2014 poll by the Pew Research Center found that Republicans were 31 percentage points more likely than Democrats to be “very concerned” about the threat of “Islamic extremism” around the world, and were 25 percentage points more likely to be concerned about Islamic terrorism in the US.

Most conservatives are happy to bomb ISIS or drone the Taliban, but many have lost the appetite for American boots on the ground against Islamic terrorists. And by reconceiving the Islamist danger as a domestic problem, (exactly as McCarthy did with Communism in the 1950’s), conservatives can now appear to fight it ferociously, without having to invade yet another Arab country.

Republicans all across the US have warned that Sharia might be adopted in parts of the US, and that American Christians might thus be subjected to Muslim law. Bobby Jindal said (falsely) that Muslims have established “no-go” zones for non-Muslims in some neighborhoods in Europe, with the implication that they might do the same in the US.

Muslims make up only 1% of the US population. They are not marching in the streets. For the most part, they constitute a small, culturally conservative minority that wants little more than to be left alone. They don’t have the numbers to punish Republicans at the ballot box for demonizing them.

For the rest of us, that makes the immorality of the Republican’s position clear.

Promoting Islamophobia is unlikely to hurt the GOP politically, and it will help them with their base. The February and March 2016 primaries are predominantly in southern states, where Islam is more reviled than elsewhere in the country.

So, look for the rhetoric on culture war issues, including the threat allegedly posed by Muslim-Americans to become even more outrageous in 2016, as Republicans launch their new McCarthyism against the mob both inside, and outside our gates.

Tax Day and the Estate Tax

Today is tax day, and most good American doobies will have filed their taxes by midnight tonight. It takes the temperament of an accountant who’s passed the relevant CPA exam parts to self-prepare your taxes, and Wrongo has that temperament for less than 2 hours a day, so doing the Wrong family taxes never gets easier.

You might like “Tax Rap” by Go Remy. It was a submission to a Turbo Tax contest. While it didn’t win, it is very funny:

For those who read The Wrongologist in email, you can find the song on YouTube here.

On Tax Day, we have to talk about the Estate Tax, or as the Republicans call it, the “Death Tax”. Why? Because House Republicans are going to repeal the Estate Tax this week. In their ham-handed way, they will link the two events to show Americans that Republicans are lowering taxes for the people.

But as Bloomberg points out, the Estate Tax is now paid by only 0.2% of US estates. That translates into about 5,500 households a year. The Hill reports that the Congressional Budget Office (CBO) estimates that repeal of the Estate Tax would add $269 billion to the federal deficit from here to 2025.

The Republican logic for repeal is that the tax unfairly steals the family jewels from ordinary hard-working Americans, but the current estate tax doesn’t kick in unless an individual has assets totaling more than $5.43 million. For married couples, the threshold for avoiding the tax is $10.86 million.

Not chump change.

Under the Republican plan, estates would pay no taxes. Furthermore, families would be able to pass assets across generations and avoid paying capital gains taxes on both real gains and so-called phantom income attributed to inflation, a loophole called “stepped up basis” in the tax code. Subsequent heirs could continue this strategy so that the gain is effectively never taxed.

Here are a few quotes from Republican supporters of Estate Tax repeal:

Rep. Paul Ryan (R-Wis.):

This tax doesn’t just hit the big guy, it hits the little guy — like the small business and the family farm.

Rep. Kevin Brady (R-TX) made the “double taxation” argument:

The death tax is the wrong tax at the wrong time, and it hurts the wrong people…They are double and triple taxed.

Sen. John Thune (R-SD):

The death tax imposes a tax rate as high as 40 % on family farms, ranches and small businesses, which hurts economic growth by discouraging savings and development.

But, the nonpartisan Tax Policy Center estimates that only 120 farms and small business, where at least half the assets are in farm or business assets, had to pay the estate tax in 2013. And double-taxation shouldn’t be so hard for Republicans to understand. No one claims that when a worker gets paid a wage, and pays a tax on that income, and who later spends some of that after-tax income paying someone to mow their lawn, that it is double-taxation for the lawn guy to pay income tax. This is really simple: Money moves from entity, to entity, to entity, and each time, tax applies.

So, the facts don’t support the case against the estate tax, but this does not matter to Republicans.

It has become an ideological issue, even if the data show that that relatively few small farms or businesses appear to be affected. Even if it’s only a handful, that’s apparently too many for Republicans.

The truth is that repealing the Estate Tax would mainly benefit the very wealthiest Americans. In 2016, the wealthiest 1,300 or so estates (those worth $20 million or more) would receive 73% of the benefit, with each receiving a tax windfall averaging roughly $10 million, according to the Joint Committee on Taxation’s analysis of the repeal proposal approved by the Ways and Means Committee.

This is a special kind of welfare. It is welfare for the rich. This will give multimillionaires, who are the only people we are talking about, an additional 40% of wealth transfer upon the death of a parent. This undresses Republicans as planning to create a permanent aristocracy based on inherited wealth.

And Republicans say they will address income inequality if only America votes for them in 2016?

The GOP proves again that they are not what they claim. They claim to be for balancing the budget and decreasing the deficit, but leap at the chance to lavish more $ billions on the rich, while increasing the deficit.

The facts mean nothing to President Nordquist, or to our right-wing friends when discussing taxes.

Happy Tax Day!

Why Are Republicans Actively Undermining Obama’s Foreign Policy?

“Your purpose, then, plainly stated, is that you will destroy the Government, unless you be allowed to construe and enforce the Constitution as you please, on all points in dispute between you and us. You will rule, or ruin, in all events.” – Abraham Lincoln, Cooper Union Speech

This is a short meditation about the Republican Party. Last week Sen. John McCain (R-AZ) took to the Senate floor, to encourage the Israelis to bomb, bomb, bomb, bomb, bomb Iran:

The Israelis will need to chart their own path of resistance. On the Iranian nuclear deal, they may have to go rogue. Let’s hope their warnings have not been mere bluffs. Israel survived its first 19 years without meaningful US patronage. For now, all it has to do is get through the next 22, admittedly long, months.

Those 22 months would be the remainder of Mr. Obama’s term as president. You can see a video of McCain’s speech here.

And so, the Republican effort to make our foreign policy a partisan mess continues.

You may have heard the phrase, “politics stops at the water’s edge”. That thought dates to 1948, when the idea of a Treaty to establish NATO was debated in Congress. The Senate was controlled by Republicans, Harry Truman was president. Senator Arthur Vandenberg (R-MI) worked with the Truman Administration to create and pass the Vandenberg Resolution, which paved the way for the US to negotiate an agreement with our European allies.

Vandenberg was chairman of the Senate Foreign Relations Committee, and it was he who said “politics stops at the water’s edge”. He helped the Truman administration get bi-partisan support for the Treaty.

You can connect the dots from John McCain’s love affair with Middle East war, to John Boehner’s (R-OH) love affair with Bibi, to Sen. Tom Cotton’s (R-AR) letter to Iran, undermining Obama’s negotiations on their nuclear program. In them, we see a complete repudiation of Vandenberg’s principle.

The Lincoln quote should remind us that he was speaking to his fellow Republicans in February, 1860. The issue then was slavery, and it was dividing his party along with the country. Lincoln urged fellow Republicans not to capitulate to Southern demands to recognize slavery as being right, but to “stand by our duty, [opposing slavery] fearlessly and effectively.” But, his comment about “rule or ruin” has resonance today.

As the 2016 presidential race picks up speed, we can expect foreign policy to be the key issue for Republicans. The strategy starts from Mr. Obama’s foreign policy approval ratings holding at 37% in a January 2015 NBC News/Wall Street Journal poll. As we can already see today, the Republican presidential contenders will inevitably compete to appear more hawkish on foreign policy.

Republicans will run away from the economy and towards their testosterone-laden policy positions of more guns, less butter, lower taxes. The public clearly believes that Mr. Obama should have done more to manage Iraq, Syria, Ukraine, Iran, and Yemen. And with so much to be unhappy about, Republicans should have little trouble making the case that it is time for a change.

The ISIS stalemate most likely is helping Republicans. A recent CNN poll finds that 58 % disapprove of his handling of the campaign against ISIS. It will play even better for Republicans if the situation worsens, and Americans grow more frustrated with setbacks, or just a lack of progress. The Republicans will try to lure Mr. Obama into sending in ground troops. If he does, there is a high likelihood of things going wrong, which will only help the Republicans in 2016. The GOP has cards to play on Iran, Syria and ISIS, but sadly, they may only be playing politics, positioning the Democrats for a failure that cannot be explained or papered over in the 2016 election.

The Vandenberg precedent is not a part of our Constitution, so there is nothing illegal about the Republicans abandoning it. It is also a good thing to review principles and historical precedents to see if they are still useful. But the precedents the GOP are so busy abandoning are the guidelines established years ago to allow our representatives to work together, despite their differences, for the good of this country.

This new, more politicized approach will hurt us all.

The Wrongologist

Geopolitics, Power and Political Economy

Category: Politics