Feeding The Rich And Starving “The Beast.”

The top 10 percent control 76 percent of the nation’s wealth. Yet a new study* found that the bottom 99.9 percent pay 175 times as much income tax as the top 0.1 percent! That’s because the wealthy use a variety of tax shelters, both offshore and in tax havens such as Delaware and South Dakota. In addition, our largest, multinational corporations dodge taxes by moving their headquarters offshore (at least on paper) and by parking large sums of cash in offshore tax shelters.

Obviously, tax reform is sorely needed, and it’s the next big item on the Trump agenda. But, with Trump and the GOP in charge, don’t expect it to benefit you. While true reform would be almost universally welcomed, the people shaping the process are all billionaires and multi-millionaires with ties to Wall Street.

What are the chances that they will introduce a bill to benefit ordinary working-class Americans?

The short answer is zero if you look at the framework being considered by the administration as reported by Politico. For example, the administration is planning to raid your 401k savings account by forcing you to pay taxes on the money up front. Other proposals include eliminating the mortgage interest deduction for homeowners, eliminating federal deductions for the money you pay for state and local taxes, and eliminating charitable deductions. All of these proposals will result in a substantial tax INCREASE for ordinary Americans. They will also punish the poor by eliminating incentives for taxpayers to donate to charities.

Even more worrying are the tax rates being proposed.

At the heart of the “reform” is a plan to reduce the number of tax brackets from 7 to 3. That, alone, will punish taxpayers at the bottom of each bracket.

Of course, there is plenty of good news in the plan for the wealthy. The new plan would repeal the Alternative Minimum Tax – a boon to many well-off households. It would repeal the estate tax, a tax that currently applies only to 2 out of every 100 estates. (The tax is levied only on the portion of an estate’s value exceeding $5.49 million per person.) The plan would repeal the tax on investment income that helps pay for Obamacare. And it would cut the top marginal rate for the wealthiest Americans from 39.6 percent to 35 percent.

The Tax Policy Center estimates that the administration’s tax “reform” plan will cut taxes by $6 trillion over 10 years with almost half of the savings going to the top one percent.

And if you’re an executive for a large corporation, the news is just as good.

Though the current top marginal corporate rate of 39 percent is one of the highest in the world, very few US corporations actually pay that rate. Indeed, according to the 2015 ranking by World Bank, the total corporate tax burden for US corporations as a percentage of profits is tied with Tanzania for 64th in the world! And our corporate taxes as a percentage of GDP are lower than 22 of 32 of the world’s most advanced nations. Yet the Trump plan would cut the corporate tax rate to just 15 percent, making it one of the lowest tax rates in the world. The plan would also create a territorial tax system permitting multinational corporations to pay tax only on income earned in the US. Just what they need – yet another tax dodge! Additionally, Trump’s proposed tax plan would gift multinationals a one-time reduced tax on the trillions of dollars currently being held offshore.

The Center for a Responsible Federal Budget estimates that the cuts in corporate taxes alone will deprive the federal government of at least $2 trillion in the next 10 years! The administration’s belief is that the cuts in revenue will be offset by a yuuuge spurt of business growth. But that belief is wildly optimistic. Indeed, except in times of deep recession, there is no evidence that tax cuts grow the economy. And, following 8 years of private sector job growth, we are most certainly not in a recession.

If this plan – or anything approaching it – is approved, Grover Norquist will finally realize his dream. The federal government will be starved to the point where he can “drown it in a bathtub.”

* Study by John Hatdioannides of the Cass business school, Marika Karanassou of Queen May University and Hector Sala of the Universitat Autonoma de Barcelona and IZA in Bonn.

There Is No Freedom Without Responsibility.

The Fourth of July has long been declared a national holiday so Americans can take time to celebrate our freedom. To many Americans, that makes us unique. But, in reality, the US is not the only country with freedom. Indeed, based on a study by the Economist Intelligence Unit, which looks at 60 indicators in five separate categories measuring pluralism, civil liberties, and political culture, the US ranks only 19.

That means 18 nations in the world offer greater freedom than the US. Further, 75 of the world’s nations are democracies. Another 41 are governed by a hybrid system. In fact, of the 167 nations measured, only 52 are listed as authoritarian regimes, including several friends of the US, such as Jordan and Saudi Arabia.

Obviously freedom is something to celebrate. But have some Americans taken the concept of freedom too far? And are all of the citizens of the US truly free? The answer to those questions may well depend on who you ask. Certainly, the thousands of people incarcerated or on probation for drug use might not consider themselves free. Likewise, those who have been convicted of felonies and can no longer vote or find a suitable job despite having served their time may not consider themselves free.

In addition, the African-Americans who have been segregated into the poorest areas of our largest cities with under-funded schools, disproportionately high unemployment and few opportunities might not consider themselves truly free. American Muslims who are discriminated against for the way they choose to dress and worship might not consider themselves entirely free. The so-called “Dreamers” who were brought to the US by their parents at a very young age, and now live in fear of deportation, are unlikely to celebrate their freedoms. And the Native Americans who live in some of the nation’s worst conditions, and who continue to watch their traditional lands stolen by large corporations without fair compensation, may not think themselves free.

At the same time these people are denied their freedom, others – namely some greedy and mean-spirited Americans – abuse theirs.

For example, many corporate leaders, bankers and hedge fund managers use their freedom and wealth to buy favor with politicians. They then use a variety of legal tricks to “legally” steal money from ordinary Americans. They ship American jobs offshore. At the same time, they use their wealth to convince politicians to cut taxes. And for good measure, they often stash their money in offshore tax havens in order to avoid paying their fair share of taxes. Faced with less revenue, our federal and state governments cut the funding of public schools and universities. The inevitable result is that our nation lags behind many others in terms of upward mobility.

Corporate-owned news media have used their freedom to boost ratings with propaganda. Instead of reporting on things that really matter, such as bringing transparency to our government, they focus on sensational trials and violent crimes – especially those involving people of color. The result is to create more fear leading to more segregation.

Following gains by the civil rights movement, some racists in the South resurrected the Confederate battle flag under the guise of celebrating history. To the descendants of slaves, this was an obvious show of power intended to keep them in “their place.” At the same time, a small portion of our citizens have stockpiled weaponry with the express purpose of intimidating their neighbors and threatening the government to which they pledge allegiance. (Does the name Cliven Bundy ring a bell?)

Freedom, then – at least in the US – is relative. For some in the US, there is too little. For others, there is too much.

Some excuse such things by claiming that freedom is, by its very nature, noisy and messy. However, Germany is free. As a matter of fact, it currently ranks 6 places ahead of the US. Yet in Germany, it is illegal to display the Nazi flag. That may restrict the freedom of some, but it shows a clear sense of responsibility and a compassion for those harmed by Hitler’s regime.

Maybe it’s time the US embraced such values. Even after 239 years, we can still learn and improve our nation. We should understand that with great freedom comes great responsibility – that in a nation of more than 330 million, you cannot do everything you want without infringing on someone else’s freedom. That’s where responsibilities and regulations come into play. As well-educated men of means who celebrated enlightenment, I believe the Founding Fathers assumed our citizens would understand that concept.

Unfortunately, too many don’t.

20 Things President Obama Should Do After The Mid-Terms.

In no particular order of importance:

  1. Normalize relations with Cuba.
  2. Support Palestine for UN membership.
  3. End the War on Drugs and begin the process of decriminalization.
  4. Renew calls for a Public Option as part of the Affordable Care Act.
  5. Negotiate pharmaceutical prices as all other industrialized nations have done.
  6. Rally Americans to aggressively deal with Climate Change.
  7. Push for an end to mandatory sentences for non-violent criminals.
  8. Order the Justice Department to aggressively pursue criminal charges against the banksters who collapsed our economy in 2008.
  9. Order the Justice Department to aggressively pursue charges of war crimes against those involved in the CIA’s torture program.
  10. Deny permission for TransCanada to build the Keystone XL pipeline.
  11. Push for changes to the tax code to prevent the use of offshore tax havens by individuals and corporations.
  12. Push the IRS to prevent 501c3s and 501c4s from engaging in politics.
  13. Aggressively push for immigration reform.
  14. End drone assassinations except as an absolute last resort to deal with terrorist leaders and increase transparency.
  15. Order the removal of ALL American troops from Afghanistan.
  16. Offer government-backed, interest-free college loans based on need.
  17. Demand that Congress pass common-sense gun control measures, including universal background checks and a ban on large ammo clips.
  18. Order the Justice Department to create uniform voting rights across all states.
  19. Aggressively push for an end to human trafficking.
  20. Order the Department of Defense to reduce its reliance on private contractors.

The Politics Of Division And Deception.

For many years, the GOP has used so-called “social” issues, such as proposed anti-abortion legislation and “sanctity of marriage” laws to divide the voting populace and fire up their base. The Democratic Party has focused on issues like social safety nets, minimum wages and availability of health care. And the debate has left our government largely paralyzed.

In some ways, arguing about the issues that divide the rank and file of the two political parties is akin to rearranging deck chairs on the Titanic. It’s not that the issues aren’t important. But compared to other issues, they are mere distractions…the political equivalent of a con artist bumping your shoulder while picking your pocket.

The con artists are working for large, multinational corporations and the very wealthy. In order to grow and thrive, these companies need two things: A plentiful supply of natural resources and cheap labor. Over the course of history, those needs have led the wealthy to finance exploration, nations to build wide-ranging empires, and corporations to destroy collective bargaining movements.

Following World War II, the desire for access to oil, rubber, timber, tin and other resources led the British, the US and the Soviet Union to attempt to divide much of the world culminating in the Cold War. The desire to acquire resources led us into conflicts in the Caribbean, Central America, South America, the Middle East and Southeast Asia. It was the cause of the Spanish-American War, the war with Japan, the war in Vietnam, and the war in Iraq. It led our CIA to orchestrate the overthrow of elected leaders in Brazil, Chile, El Salvador, Honduras, Indonesia, Iran, Iraq, Nicaragua and elsewhere.

Similarly, the need for cheap labor led mining companies to create company stores and to build entire towns designed to trap workers into becoming hopelessly obligated to the owners. It caused companies to hire thugs to brutally beat striking workers. It led to shooting wars between corporate interests and labor unions. More recently, it led corporations to move factories to Southern “right-to-work” states then on to Mexico to China to India, Pakistan and Sri Lanka.

The executives behind these actions aren’t evil. They’re just doing business. They claim that it’s not their responsibility to worry about social or environmental problems. They believe that their only responsibility is to increase the return on investment for shareholders by decreasing costs and increasing productivity. To them, picturesque mountains merely cover the precious minerals they covet. Pristine forests are merely the lumber needed for construction. Impoverished people in distant lands are simply motivated laborers.

And so it goes.

While we argue over the debt ceiling, corporations and billionaires quietly park their profits in off-shore tax havens then lobby for a tax “holiday” that will allow them to bring the money home at greatly reduced tax rates. While we argue over extending unemployment benefits, corporations lobby for more subsidies and government giveaways. While we argue over food stamps, corporate agribusinesses pocket billions in taxpayer funds. While we argue over Social Security retirement benefits, too-big-to-fail financial institutions steal trillions from 401ks, IRAs, pension funds and foreclosed homes. At the same time, all of these corporations continue to lobby for reduced government regulation and oversight.

It is because of our inattention that a mere 85 individuals now own as much wealth as half of the world’s population…the equivalent of the populations of China, India, the United States, Indonesia and Brazil combined. It’s why unemployment has grown and why most salaries have not. It’s why a few corporations now control most of our food supply. It’s why those same corporations are able to poison the food supply in search of ever larger profits. It’s why the incidence of chronic disease has skyrocketed despite government-funded technology and research that give us the ability to end it. It’s why our climate is rapidly changing while we continue to subsidize the companies responsible for changing it.

As long as we focus on the distractions instead of the actions, things will only get worse.