Thursday, September 28, 2017

Watch Your Wallet!

Everybody wants to pay less taxes. Most of us want a fairer distribution of the tax burden, and a simpler tax code. But overhauling tax law has always been treacherous territory, often vital to the wellbeing of the republic but always prone to political skullduggery even when in the hands of competent administrators. Under current conditions, with know-nothings in control of Congress and the White House, and power in the hands of the party most likely to kowtow to the wealthy, the vast majority of us have good reason to worry. Watch your wallet! Watch the wallets of the wealthy! And watch the government’s wallet!

Demand that your representatives explain their proposals in terms of “effective” tax rates. The effective tax rate is the percentage that people actually pay, the bottom line. Partisans will deliberately try to confuse you by talking about “tax rates,” by which they mean “nominal” tax rates. These are something different altogether. Nominal tax rates are the percentages that identify tax brackets and appear in tax tables. They are mere theories, goals, or hopes; they are not real. Thousands of pages of tax code, defining what is income, how income is classified, and who gets what kinds of exclusions and deductions, stand between nominal tax rates and effective tax rates. In particular, don’t be fooled by talk of the 39.6% tax rate for people in the highest income bracket, or the 35% corporate tax rate. These are both nominal rates, in fact paid by very few.

Don’t let them fool you with the tried-and-true tactic of slithering back and forth between percentages and dollar amounts.To say, for example, that the wealthiest Americans pay so many millions or billions in taxes is meaningless except as a percentage of their income. Conversely, talking about changes in various categories of budgets and deficits in terms of percentages is often quite misleading. If they’re talking about the fairness of the distribution of taxes, or comparing one group or entity to another group or entity, they need to express that in percentages. If they’re talking about budgets and deficits, they need to explain things in terms of total dollars. Anything else is just a blizzard of numbers designed to confuse.

Be very careful about the use of the term “loophole.” The difference between a “loophole” and a “deduction” is merely one of perspective. Closing a “loophole” means somebody, somewhere is paying more taxes. You have a right to ask who and how much, and having that information might change your evaluation as to whether closing the “loophole” is a good idea or a bad idea.

Demand a plain statement of the effective (not nominal) tax rate of the wealthiest American people and businesses. Ask what they’re actually going to pay as a percentage of their income. Under the current system America’s wealthiest pay a shockingly low percentage of their income in taxes, and aren’t going to want that to change. Why do you think Mitt Romney and Donald Trump refused to release some of their tax returns? Insist that your representatives explain this to you.

Don’t believe anyone who says that lowering taxes raises revenue. Only idiots or liars can look you in the eye and tell you that.

Demand an up-front explanation of where the federal budget is going to be cut in order to remain balanced. This is vital because the proponents of the current tax reform project aren’t even bothering to pretend the new plan will be revenue-neutral. If they keep taxes low for businesses and the wealthiest people, which seems inevitable, and they lower taxes for the middle class, which they’ve promised, then the total dollars taken in by the federal government will be dramatically reduced. This means that government spending must be reduced by the same quantity. Honest legislators and executives would set the budget first, then structure the tax system to generate the necessary revenues, distributing the bills evenly. Dishonest legislators and executives push tax reduction first, and worry later about what government programs will be cut. Tax reform, then, becomes a process of creating a fearsome weapon that can be used to ram through the Republican agenda for the impoverishment of the federal government. Do you think you might someday need Medicaid or Social Security? Ask your legislators how those programs will fare under their proposed new tax system!

Pay attention to the analyses of real experts who are less partisan than the President or Congress. Watch the evaluations made by the Congressional Budget Office. Check the summaries made by credible organizations outside of government.

Taxes are going to be reformed. The proponents of the current round of tax reform are going to try to lie to us all. Don’t let them get away with it!

Tuesday, July 18, 2017

Killing ACA

The House tried once and failed. The Senate tried twice and failed. The plans they proposed would have been disastrous by most measures. Senate leader Mitch McConnell is still calling for "Repeal then Replace," although he seems not to have the votes to do that, and President Trump is calling to "let ObamaCare fail."

Let's be honest about what this really means. First, in spite of seven solid years of complaining about the ACA, Republicans have never had a replacement plan. Their endless harping was just political haymaking, without substance. When Trump surprised everybody, including House and Senate Republicans, by getting elected, they had to scramble to turn their empty posturing into some kind of legislation. But they couldn't do it. They couldn't even get the numbers at the bottom of the spreadsheet to balance.

A second take-home lesson is that this failure is entirely the fault of Republicans. They had time, years in fact, to work this out and align their votes. And as of January they've controlled the White House, the House, and the Senate. While Mr. Trump and party leaders have tried to paint Democrats as being obstructionist, the fact is that the practical differences on the ACA and its repeal and/or replacement lie between Republicans and Republicans, not between Republicans and Democrats. 

The third take-home lesson is that Mr. Trump's campaign bluster was never more than empty hot air. He promised Americans coverage for all, coverage that was better and cheaper. He didn't deliver. Realistically, he never had the slightest inkling of how to deliver on any of it This was, of course, painfully obvious to more thoughtful American voters even during the campaign, but was sadly irrelevant to Trump voters.

Mr. Trump and Republicans in Congress now have a huge opportunity, although there is reason to doubt they have the mental wattage to take advantage of it. They could save the Affordable Care Act. It works in broad outline, and needs some propping up in places, some additional funding here, some tightening of regulation there. While funding and regulating -- rather basic functions of government -- are things Republicans are philosophically opposed to doing, they could make a pragmatic choice for the good of the American people as a whole. 

The alternatives to saving the ACA remain terrifyingly cruel. Make insurance unaffordable to anyone with a pre-existing condition. Let insurers offer sub-standard policies. Lock healthy people who get sick out of health care. In other words, insist that health care in America remain the inefficient, expensive, and inaccessible mess it has been for decades. "Let the ACA fail" and "Repeal then Replace" mean the same thing. They mean ordinary Americans will suffer because Trump and the Republican party could not deliver on their promises. 

Friday, May 26, 2017

Another Bad Day for Trump

It's already been a tough week for Trump and his administration, and today (Friday) certainly added to their misery.  

Former Speaker of the House John Boehner said today that he felt the President was focusing on the right issues internationally, but has been "a complete disaster" at everything else, and complained that "he's still learning how to be president." Boehner has long been known for his candor, but having resigned from Congress in 2015 is now freer than ever to speak his mind. Although the typical Trump voter might be immune to even so damning a turn of events as this, the fact is that a conservative Republican who has decades of experience in government and has known Trump personally for some 15 years has publicly acknowledged that Trump is not up to governing.

If that's not enough, the Washington Post has reported that Jared Kushner, son-in-law to Trump and now a senior White House adviser, actively sought a secret channel of communication between the Trump team and the Kremlin. It is alleged that this request was made in early December, AFTER the election. It is also alleged that this was a deliberate attempt to keep communication between Moscow and the Trump team hidden from U.S. Intelligence operations. Thus ongoing investigations are no longer just about the campaign and campaign advisers, but are now about the Trump administration and Trump's innermost circle. 

Of course, Trump supporters and the administration itself continue to claim this is all fake news, a witch hunts undertaken by sore losers. The noose is tightening nevertheless. 

Wednesday, May 24, 2017

It's a Schadenfreude Kind of Day

I'm sure I'm not alone in finding an odd kind of pleasure in the sufferings of our lost administration and the Republican establishment as revealed in today's news:
  • The New York Times (24 May) has an article titled "Top Russian Officials Discussed How to Influence Trump Aides Last Summer." New details confirm what is already clear, that Russian intelligence attempted to influence the November election and were knowingly manipulating campaign advisers to influence Trump himself. It is increasingly clear that U.S. intelligence agencies have known about this all along.
There is more and there will continue to be more, but let's not belabor the point. This is life in the Trumpocene.

I'm looking forward to tomorrow's news. I've been greatly relieved to to see that Trump managed to stay on script in Saudi Arabia, Israel, and the Vatican. But tomorrow he'll meet with NATO officials and explain that he didn't really mean it when he called the institution "obsolete" during his campaign.

Wednesday, May 17, 2017

Despite the President's Harsh Criticisms During the Campaign . . .

On May 17th the New York Times reported:
"The Trump administration signaled on Wednesday that it would not, for now, jettison the Iran nuclear deal, despite the president's harsh criticisms of the agreement during the campaign."
This phrase, "despite the president's harsh criticisms during the campaign," has become a major theme of Life in the Trumpocene. Trump spent the campaign loudly and repeatedly proclaiming his ability to fix all the failures he said his predecessors had left behind. He had a secret plan to put an end to ISIS, Hillary was to be locked up, the North American Free Trade Agreement was to be renegotiated or junked, NATO was obsolete, China was a self-serving currency manipulator, climate change was a hoax, repealing and replacing the Affordable Care Act was going to be easy, and the Nuclear agreement with Iran was the "worst deal ever." On these and so many other issues Trump has reversed course in a very short period of time.

None of this is surprising to the more analytical observer. It was painfully obvious that Trump's campaign rhetoric was "a tale told by an idiot, full of sound and fury, signifying nothing" (to quote Shakespeare's MacBeth).

More mysterious is the unwavering support of so many Trump voters. In endless arguments on social media, Trump supporters often cited one or more of the issues above as evidence that Trump was as superior as he claimed to be and therefore ought to be elected. With so many hopes dashed, what do continuing Trump supporters have left? Perhaps they still dream of a wall to keep out Mexicans, a travel ban to keep out Muslims, and a conservative Supreme Court to keep out abortion. Are simple Racism and Misogyny enough to sustain a failing administration?

Friday, May 12, 2017

Richard Milhous Trump

President Trump has now fired three different officials who were investigating him or his campaign: a US attorney, a Deputy US Attorney General, and the Director of the FBI. Since news coverage isn't going the way he wants, he has threatened to cancel press briefings altogether. It seems not to occur to him that these are the actions of a man with something to hide, of a man deaf and blind to the parallels he is fast creating between his own presidency and that of Richard Nixon.

These are just the latest additions to an already lengthy list of symptoms of a failed presidency, doomed before day one by the unfitness of the candidate. Trump has described the US Constitution as archaic and unfair, phrases that would have provoked apoplexy among self-styled "conservatives" had they come from a Democrat, the same apoplexy that campaign collusion with Russian intelligence should provoke, but does not. In a radical contravention of law and custom, Trump allegedly demanded a pledge of personal loyalty from the FBI director he later fired. Trump was angry that he didn't get that pledge, and angrier that Comey dared to use logic and evidence in contradicting Trump's claims that the Obama administration had wiretapped him. Just yesterday Trump signed an executive order establishing an "election integrity" commission, hoping to further his claim that he lost the popular vote because of voter fraud, a bit of dementia that even conservative media call a "baseless claim."  Trump praised Australia's socialized healthcare system even as he strong-armed congressional Republicans into passing a healthcare bill few understood and will price millions of Americans out of the market. The list goes on and on.

There is no doubt that Russian intelligence meddled in the American election and succeeded in keeping Clinton out of the White House. There is no doubt that Tump, members of his family, and members of his campaign staff had dealings and contacts with Russian agents. Whether or not any of that amounts to collusion between Russian intelligence and Trump's campaign remains to be seen. With nothing to hide, Trump could have taken the high road by practicing glasnost (openness). He has, instead, chosen the low road of smoke screens and obstruction of justice, and the public is justified in asking why.

Saturday, April 29, 2017

Trump’s Rare Opportunity

After 100 days in office, the policy directions of the President of the United States remain as vague and unpredictable as they were during his campaign. This is, of course, no surprise to Mr. Trump’s opponents, who have always been painfully aware of his lack of readiness for that office. Mr. Trump’s supporters seem largely unfazed by the shifting enigma they elected, the idea of verifying assumptions against observable facts being foreign to them.

The only major campaign promise in which the President has remained steadfast is his desire for a border wall, although he is no more likely now than he was a year ago ever to get it. In so many other ways he has confusingly dithered. NAFTA will now be “renegotiated” rather than cancelled, NATO is suddenly relevant again, military action in the Middle East is once again feasible, and Putin might not be the ally Trump imagined. The President’s attempts to repeal and replace the Affordable Care Act failed spectacularly, and the entire health insurance fracas is now the fault and responsibility of the GOP. He has announced a planned reduction in the top corporate tax rate from 35% to 15%, but this is meaningless rhetoric without the details, since very few corporations pay anything near the nominal 35% rate now. Strategic thinkers on the Right and the Left, both domestically and internationally, can do little more than wonder what the future might bring.

There is a very small glimmer of hope, or at least some kinds of change upon which one might place a positive spin: Donald Trump appears to have learned a few things. Trump the campaigner was so delusional he actually claimed he’d be able to run his business empire and the U.S. government at the same time. He seems to have believed that the President governed by fiat, and that ideological commitment could substitute for governmental experience and knowledge of public policy. If his recent rhetoric can be trusted, though, it seems to be dawning on him that policy issues are often complex, that running the country is hard work, that the government is comprised of three separate branches, two of which are outside of his control, and that the internally conflicted Republican Party can’t or just won’t always deliver the votes he wants.

The President has an opportunity, here, if he has sufficient insight and strength of character, to be of great service to America. The best thing Donald Trump could do right now would be to confess to America what he didn’t know and what he now seems to be learning. He could confess that knowledge and experience matter, and that electing officials without them is a recipe for failure. He could confess that there are complex reasons for international treaties and trade pacts, and that changes need to be deliberated carefully by people with the expertise to understand their impacts. He could acknowledge that the manufacturing jobs he says “left” America have actually ceased to exist worldwide, and that government has a role to play in reskilling American workers. He could acknowledge that mere assertions cannot substitute for science and observable facts.

Such a confession by so influential a person might be one of the few ways to inject a critical dose of reality and practicality into the worldview of Trump voters. This is vital, because having an inexperienced know-nothing in the White House is really only the second biggest problem confronting America today. Our biggest problem is that a quarter of the American electorate were happy to give the presidency to that inexperienced know-nothing. Whether he resigns, is impeached, loses a bid for reelection or is President for eight years, the Trump presidency will end. But the ideological dysfunction that gave him the White House will still be a significant aspect of our culture. Trump is one of the few people who actually has an opportunity to change that.