Groups Targeted by I.R.S. Tested Rules on Political Activities

The far right and the Congressional Republicans have been whining and belly aching over the IRS's review of conservative political organizations trying to secure tax exempt status so that all of us could indirectly subsidize the groups' political activities.  What these folks haven't been talking about is the fact that many of these groups deserved strict scrutiny because their own filings suggested impermissible activities under the IRS Code and regulations.  Having assisted numerous clients with their applications for tax exempt status, if you describe certain types of activities among the entity's purposes, you WILL get targeted for increased scrutiny.  A piece in the New York Times looks at what is being said now about some of the filings in question and why they deserved stricter scrutiny.  Here are excerpts:

When CVFC, a conservative veterans’ group in California, applied for tax-exempt status with the Internal Revenue Service, its biggest expenditure that year was several thousand dollars in radio ads backing a Republican candidate for Congress.

The Wetumpka Tea Party, from Alabama, sponsored training for a get-out-the-vote initiative dedicated to the “defeat of President Barack Obama” while the I.R.S. was weighing its application.

And the head of the Ohio Liberty Coalition, whose application languished with the I.R.S. for more than two years, sent out e-mails to members about Mitt Romney campaign events and organized members to distribute Mr. Romney’s presidential campaign literature. 

Representatives of these organizations have cried foul in recent weeks about their treatment by the I.R.S., saying they were among dozens of conservative groups unfairly targeted by the agency, harassed with inappropriate questionnaires and put off for months or years as the agency delayed decisions on their applications. 

But a close examination of these groups and others reveals an array of election activities that tax experts and former I.R.S. officials said would provide a legitimate basis for flagging them for closer review.

“While some of the I.R.S. questions may have been overbroad, you can look at some of these groups and understand why these questions were being asked.”  

The I.R.S. is already separately reviewing roughly 300 tax-exempt groups that may have engaged in improper campaign activity in past years, according to agency planning documents. Some election lawyers said they believed a wave of lawsuits against the I.R.S. and intensifying Congressional criticism of its handling of applications were intended in part to derail those audits, giving political nonprofit organizations a freer hand during the 2014 campaign. 

The New York Times examined more than a dozen of the organizations, most of them organized as 501(c)(4) “social welfare” groups under the tax code, or in some cases as 501(c)(3) charities. None ran major election advertising campaigns  .  .  .  .  some organized volunteers, distributed pamphlets and held rallies leading up to the 2010 elections or the 2012 presidential election, as conservatives fought to turn out Mr. Obama.

I.R.S. agents are obligated to determine whether a 501(c)(4) group is primarily promoting “social welfare.” While such groups are permitted some election involvement, it cannot be an organization’s primary activity. That judgment does not hinge strictly on the proportion of funds a group spends on campaign ads, but on an amorphous mix of facts and circumstances.  “If you have a thousand volunteer hours and only spend a dollar, but those volunteers are to help a particular candidate, that’s a problem,” Mr. Tobin said. 

At least some of the conservative groups that are complaining about I.R.S. treatment were clearly involved in election activities on behalf of Republicans or against Democrats.  

Some groups appeared to be confused or misinformed about the I.R.S. rules applying to their activity.

Tom Zawistowski, president of the Ohio Liberty Coalition, another Tea Party group that has complained about the scrutiny it received from the I.R.S., sent out regular e-mails to members about Romney campaign events and organized protests around the state to “demand the truth about Benghazi” when Mr. Obama visited before the 2012 election. The coalition also canvassed neighborhoods, handing out Romney campaign “door hangers,” Mr. Zawistowski said.

In short, many of these groups WERE political organizations that not only deserved scrutiny but also deserved to have their applications denied.  Either some of these groups were headed up by cretins - a distinct possibility given the GOP's open embrace of ignorance - or they were trying to flout the law.   Either way, I have little sympathy for their crocodile tears.

IRS Asked to Investigate Illegal Activities of Catholic Bishops

Norfolk priest who is crossing the line on allowed activities of 501(c)(3) charities

In a move that is long overdue given the huge amounts of money being spent by the Roman Catholic Church to influence legislation and advocate against Democrats - all of which is forbidden conduct for supposed charities enjoying tax exempt status under Section 501(c)(3) the Internal Revenue Code -  Citizens for Responsibility and Ethics in Washington wants the federal Internal Revenue Service to investigate the U.S. Conference of Catholic Bishops for allegedly engaging in prohibited political activity in violation of its protected tax status.  If you want to hurt the bishops where it really counts other than jailing them for obstruction of justice in the cover ups of sexual abuse by priest, hit them in the pocket book.  Money is, after all, the true god.  The Wisconsin Gazette looks at this welcomed action.  Here are article highlights:

The complaint filed recently notes press reports indicating a number of bishops are using their positions to advocate against the re-election of President Barack Obama and sermons this weekend likely will involve other political activity.

CREW says that in Illinois, Bishop Daniel Jenky, who has compared Obama to Josef Stalin and Adolf Hitler, is requiring priests in his diocese to read a statement accusing the Obama administration of an "assault upon our religious freedom simply without precedent in the American political and legal system." Jenky says that Catholic voters who fail to heed his warning have no hope of salvation.

Said CREW executive director Melanie Sloan in a news release, "This weekend, the Catholic bishops plan to use every tool in their arsenal, including warning parishioners that they may go to hell, to promote the candidacy of Gov. Mitt Romney. While the bishops are free to hold their own opinions, tax law is clear that this sort of political activity is prohibited."

The group, in its complaint, also raised concerns about the political activity of Nicholas Di Marzio in New York, David Ricken in Wisconsin, Edward J. Burns in Alaska and Paul Loverde in Virginia.

To qualify for tax exemption under IRC 501(c)(3), an organization must not participate or intervene in any political campaign on behalf of or in opposition to any candidate for public office. The publication or distribution of written or printed statements on behalf of or in opposition to a candidate is also prohibited. The U.S. Conference of Catholic Bishops, as a 501(c)(3) group, and, according to CREW, "is clearly prohibited from opposing a candidate as it is clearly doing with its presidential election." 

Sloan continued, "In completely unqualified terms, the IRS should immediately tell the Conference of Catholic Bishops that the conduct of its members is beyond the pale. If the Catholic bishops would like to continue receiving the tremendous tax benefits on which they rely, they should follow U.S. law and stay out of American politics."

I would hope complaints will also be filled against individual parishes with priests who see themselves as above law such as Holy Trinity in Norfolk.  Sadly, the actions of these bishops (and priests) is yet another example of how the Catholic clergy and the Catholic Church hierarchy as a whole arrogantly think them selves above the law be it through abetting and covering up for child rapists or blatantly violating the tax laws.  All deference and special rights need to cease and violations need to be criminally prosecuted where applicable

Super-Rich Hiding $21+ Trillion In Tax Havens; GOP Says Obama Focus Too Much on Middle Class

To listen to Mitt Romney and his GOP brethren one would think that things are really rough for the 1% and the super wealthy.  Hence why  the GOP wants to give these folks each over $250,000 in tax cuts.  Meanwhile, most of us are struggling to hold on to what we have - much of which has been seriously devalued given the collapse of the real estate market and the performance of the stock market.  A new study shows that many of these hard put super wealthy have followed Romney's example and stashed assets in tax havens and overseas accounts.  How much have they stashed?  At least $21 trillion.  Think Progress looks at the massive tax avoidance scheme used by the ultra-rich while the GOP seeks to throw grandma off of Medicare and reduce many of the lower and middle class to poverty.  Oh, and did I forget to mention that the GOP claims to be the party of Biblical values - even thought the Gospel message of helping the poor, the sick, the homeless and the hungry has apparently been ripped from their Christianists issued Bibles.  Adding to the hypocrisy is Mitt Romney's new line that Barack Obama is too focused on the middle class - a section of society Romney seems to want to wipe out.  First, here are some story highlights from Think Progress:

According to a new study, the world’s super-rich are shielding at least $21 trillion in secret offshore tax havens. Using data from the Bank of International Settlements, IMF, World Bank, and national governments, the Tax Justice Network found that an astonishing 100,000 people worldwide hold nearly $10 trillion of offshore wealth, equivalent to the size of the Chinese economy. According to the study:

1. Big banks manage the wealth. The three private banks handling the most assets offshore are UBS, Credit Suisse, and Goldman Sachs.
2. Offshore wealth is creating a global economic “black hole.” If the $21 trillion in offshore earned a conservatively-estimated 3 percent rate of return, and that income was taxed at just 30 percent, this would generate tax revenues of nearly $200 billion — roughly twice the amount OECD countries spend on international development assistance.
3. High impact on developing countries. In the 139 developing countries highlighted in the report, the richest citizens had amassed $7.3 to $9.3 trillion of unrecorded offshore wealth that is beyond the reach of local tax authorities. The report reveals that many developing “debtor” countries are actually quite wealthy, but the money is held by a few individuals.
4. Huge tax haven growth in the last few years. In 2005, the world’s top 50 banks managed $5.4 trillion in offshore money. By the end of 2010, the figure is over $12 trillion, representing an average annual growth rate of more than 16 percent.

Obviously, the USA's portion of these lost revenues could go a long way to shore up budget gaps and rebuild the nation's crumbling infrastructure.   Meanwhile, the GOP is complaining that Obama is too focused on the middle class.  Here are highlights from another Think Progress article:

President Obama’s plan to allow the Bush tax cuts for incomes above $250,000 to expire at the end of the year has revived the Republican talking point that he is waging “class warfare” against the wealthy, a point Arizona Sen. Jon Kyl (R) drove home in an entirely new fashion today.

Speaking on the Senate floor, Kyl claimed that the president’s usage of the phrase “middle class” is “misguided and wrong and even dangerous.” Calling for an end to rhetoric about classes, Kyl blasted Obama for “incessantly” talking about class, “particularly the middle class”:

KYL: Most prominently, we have a president who talks incessantly about class, particularly the middle class. Maybe you’ve noticed that. He defines class strictly by your income. In the president’s narrative, someone who makes $199,000 a year is a member of one class and someone who makes $200,000 belongs to another class. Does that make sense? Indeed, each day the president’s out on the campaign trail championing himself as the great protector of what he calls the middle class and pitting these Americans against their fellow citizens by arguing that the wealthiest class is victimizing them through the tax code.

Excuse me, but the wealthy with the help of the Republicans ARE victimizing  the rest of us. 

GOP Lies About Excessive Corporate Tax Levels

One of the many disingenuous mantras of the Republican Party is that corporate tax rates are harming family owned small businesses.  The mantra is a lie for many reasons, not the least of which is that most family owned small businesses are operated either under limited liability companies or corporations that have filed for what's called sub-chapter S status, the result of which is that ZERO taxes are paid at the corporate level.  While the companies file a tax return - a form 1120S - it merely discloses the profit or loss for the year and how the results are allocated between the principals of the company.  As for larger corporations, the current tax code allows all kinds of loop holes and deductions.  Indeed, as Think Progress is reporting, between 2008 and 20011, twenty-six (26) large corporations paid no U.S. corporate tax despite in some cases earning billions of dollars.  It must also be noted, that what one needs to look at is the effective tax rate versus the highest marginal tax rate.  The two are entirely different things.   It's a system that Mitt Romney and the GOP seek to make even more egregious even as the middle class would be hit with higher burdens and/or decreased benefit.  Here are some highlights:

Over a four years period from 2008 to 2011, Corning Inc. was one of 26 companies that managed to avoid paying any American income taxes, even though it earned nearly $3 billion during that time. In fact, according to Citizens For Tax Justice, the company received a $4 million refund from 2008 to 2010. That didn’t stop Susan Ford, a senior executive at the company, from telling the House Ways and Means Committee this week that America’s high corporate tax rate was putting her company at a disadvantage:

American manufacturers are at a distinct disadvantage to competitors headquartered in other countries. Specifically, foreign manufacturers uniformly face a lower corporate tax rate than U.S. manufacturers, and virtually all operate under territorial systems which encourage investment both abroad and at home.

Ford told the committee that Corning paid an effective tax rate of 36 percent in 2011, but as CTJ notes, she is counting taxes on profits earned overseas that haven’t yet been paid and won’t be unless the company decides to bring the money back to the United States. Corning’s actual tax rate in 2011, according to CTJ’s analysis, was actually negative 0.2 percent.

The territorial system Ford testified in favor of would actually encourage the offshoring of profits earned by American companies, thereby reducing the amount they pay in taxes even more. And rather than helping remove a disadvantage that prevents companies from creating jobs, an economic analysis of such a tax system found that it could actually cost the United States as many as 800,000 jobs.

The United States does, indeed, have one of the highest marginal corporate tax rates in the world. In reality, however, few corporations pay it, and the nation’s effective tax rate is far lower than the rate in other developed countries.

Bloomberg Businessweek: How the Mormons Make Money

With all of the recent media coverage on Mitt Romney's focus on money - can we say greed? - and secretive financial transactions, the timing of a new Bloomber Businessweek article on how Mormons and the Mormon Church make money is perfect.  The net impression is that Mitt Romney comes by his secrecy and unrelenting focus on making a buck as a matter of religious upbringing.   As the article states, the Mormon Church sees no distinction between spirituality and making money - as much money as possible.  And like Mitt Romney who doesn't miss a chance to avoid paying taxes, the Mormon Church gets a lot of tax sheltering (not to mention competitive advantages against for-profit businesses) for its commercial enterprises via its tax exempt status as a church.  Perhaps it is no coincidence that Mitt Romney was once a Stake President in the LDS church - making him the lay Mormon equivalent of a church figure in charge of a diocese.   Here are some article excerpts:

Late last March the Mormon Church completed an ambitious project: a megamall. Built for roughly $2 billion, the City Creek Center stands directly across the street from the church’s iconic, neo-Gothic temple in Salt Lake City. The mall includes a retractable glass roof, 5,000 underground parking spots, and nearly 100 stores and restaurants, ranging from Tiffany’s (TIF) to Forever 21. Walkways link the open-air emporium with the church’s perfectly manicured headquarters on Temple Square. 

Watching a religious leader celebrate a mall may seem surreal, but City Creek reflects the spirit of enterprise that animates modern-day Mormonism. The mall is part of a vast church-owned corporate empire that the Mormon leadership says will help spread its message, increase economic self-reliance, and build the Kingdom of God on earth. “

 It’s perhaps unsurprising that Mormonism, an indigenous American religion, would also adopt the country’s secular faith in money. What is remarkable is how varied the church’s business interests are—and, at a time when a former Mormon bishop is about to receive the Republican Party’s presidential nomination, that so little is known about the church’s financial interests.

[S]ays historian D. Michael Quinn, who is working on a book about the LDS Church’s finances and businesses, “The Mormon Church is very different than any other church. … Traditional Christianity and Judaism make a clear distinction between what is spiritual and what is temporal, while Mormon theology specifically denies that there is such a distinction.” To Latter-day Saints, opening megamalls, running a Polynesian theme park, and operating a billion-dollar media and insurance empire are all part of doing God’s work. Says Quinn: “In the Mormon worldview, it’s as spiritual to give alms to the poor, as the old phrase goes in the Biblical sense, as it is to make a million dollars.”

Mormons make up only 1.4 percent of the U.S. population, but the church’s holdings are vast. 

First among its for-profit enterprises is DMC, which reaps estimated annual revenues of $1.2 billion from six subsidiaries, according to the business information and analysis firm Hoover’s Company Records (DNB). Those subsidiaries run a newspaper, 11 radio stations, a TV station, a publishing and distribution company, a digital media company, a hospitality business, and an insurance business with assets worth $3.3 billion.

AgReserves, another for-profit Mormon umbrella company, together with other church-run agricultural affiliates, reportedly owns roughly 1 million acres in the continental U.S., on which the church has farms, hunting preserves, orchards, and ranches

As a religious organization, the LDS Church enjoys several tax advantages. Like other churches, it is often exempt from paying taxes on the real estate properties it leases out, even to commercial entities, says tax lawyer David Miller, who is not Mormon. The church also doesn’t pay taxes on donated funds and holdings. Romney and others at Bain Capital, the private-equity firm co-founded by Romney in 1984, gave the Mormon Church millions’ worth of stock holdings obtained through Bain deals, according to Reuters.  

According to U.S. law, religions have no obligation to open their books to the public, and the LDS Church officially stopped reporting any finances in the early 1960s. In 1997 an investigation by Time used cross-religious comparisons and internal information to estimate the church’s total value at $30 billion.  .  .  .  .  a recent investigation by Reuters in collaboration with sociology professor Cragun estimates that the LDS Church is likely worth $40 billion today and collects up to $8 billion in tithing each year.

 Many Mormons see their church’s economic success as a sign of good stewardship, but at least a few I spoke to say they are uneasy about the price tag of the new Mormon mall, the church’s lack of transparency, and its centralized finances. “The money may be perfectly administered, for all we know,” says Ron Madson, 57, a lawyer and lifelong Mormon who once served as a church bishop. “But we don’t know. … When we see these expenses for the City Creek Mall, for the hunting preserves, these commercial enterprises, Ensign Peak, we don’t know where it’s going.”

A recently published article co-written by Cragun estimates that the Mormon Church donates only about 0.7 percent of its annual income to charity; the United Methodist Church gives about 29 percent.

There's a lot more, but these excerpts give readers the drift of the article.  Huge inflows of money and small charitable outflows.  Much like Mitt and Ann Romney's finances - or so it would seem since they refuse to release their tax returns which might show that they value something other than making and hanging onto lots and lots of money.

Obama v. Romney - Romney/GOP Plan Raises Taxes on Middle Class

Many in the middle class have been particularly hard hit by the winds of the great recession and have seen their net worth diminished if not wiped out by the collapse of the residential real estate market.  So what is the GOP/Romney tax proposal?  Raise taxes on the middle class while the wealthy such as Romney himself get more tax breaks.  As I have noted before, I cannot fathom why the loons in the Tea Party cannot see that the GOP is out to use them and then f*ck them over.  They rail against Obama - because he's black? - even though his policies are actually in their best interests and likely will support their real oppressors in the GOP.  Yes, Romney and the GOP will deny that they are poised to screw over the middle class, but new analysis of the tax proposals says otherwise.  And did I mention what the plan does to the national deficit?  $4.5 trillion more in debt over the next decade.  So much for the GOP's concern about "job killing deficits." Here are highlights from the Washington Post:

 The tax reform plan that House Republicans have advanced would sharply cut taxes for the wealthiest Americans and could leave middle-class households facing much larger tax bills, according to a new analysis set to be released Wednesday.

The report, prepared by Senate Democrats and reviewed by nonpartisan tax experts, marks the first attempt to quantify the trade-offs inherent in the GOP tax package, which would replace the current tax structure with two brackets — 25 percent and 10 percent — and cut the top rate from 35 percent.

Those changes would benefit virtually every taxpayer, but they also would reduce federal tax collections by about $4.5 trillion over the next decade, according to the nonpartisan Tax Policy Center. To avoid increasing the national debt by that amount, GOP leaders such as House Budget Committee Chairman Paul Ryan (Wis.) have pledged to get rid of all the special-interest loopholes and tax shelters that litter the code.

Republicans have declined to identify their targets. However, some of the biggest “loopholes” on the books are popular tax breaks for employer-provided health insurance, mortgage interest, state and local taxes, and retirement savings, which disproportionately benefit the upper middle class.

The net result: Married couples in that income range [$100,00 t0 $200,000] would pay an additional $2,700 annually to the Internal Revenue Service, on top of the tax increases that are scheduled to hit every American household when the George W. Bush-era cuts expire at the end of the year.  Households earning more than $1 million a year, meanwhile, could see a net tax cut of about $300,000 annually.

“According to this report, while millionaires will receive a huge tax break, earners making under $200,000 will see their taxes rise significantly,” said Sen. Robert P. Casey Jr. (D-Pa.), who chairs the Joint Economic Committee.

Roberton Williams, a senior fellow at the Tax Policy Center, reviewed the Joint Economic Committee report. Although the numbers are rough, he said, the conclusions are largely accurate. 

“Even with eliminating fairly major tax preferences, the Ryan tax plan remains regressive. That’s the bottom line,” he said. “Unless you go after the tax preferences that benefit the wealthy” — capital gains, dividends, tax-free interest on municipal bonds — “it’s really hard to undo the regressivity of the rate changes. You’ll be shifting the burden of the tax code toward the middle class.”

Failed GOP Policies Wipe Out 2 Decades of Family New Worth

I continue to be amazed at how the GOP gets away with using religion - i.e., anti-abortion and anti-gay stances - and racial prejudice against blacks and Hispanics to dupe working Americans into to supporting GOP policies that have proved utterly toxic to the well being of voters being duped by Republicans.  For working class and middle class Americans, one doesn't need other enemies when it comes to bringing on financial ruin.  The GOP's unfunded wars, excessive tax cuts for the wealthy, a woefully under regulated Wall Street, obstruction of stimulus spending and serious plans to salvage the devastated housing market, and now the slashing of government employment all add up to a truly poisonous mix.  The result?  Family/household wealth has been wiped out and two decades of economic gain is gone.  Were back at 1990 levels in terms of family net worth overall, and many families are far worse off.  An article in the New York Times looks at this horrific situation.  Here are highlights:

The recent economic crisis left the median American family in 2010 with no more wealth than in the early 1990s, erasing almost two decades of accumulated prosperity, the Federal Reserve said Monday.
 

A hypothetical family richer than half the nation’s families and poorer than the other half had a net worth of $77,300 in 2010, compared with $126,400 in 2007, the Fed said. The crash of housing prices directly accounted for three-quarters of the loss. 

Families’ income also continued to decline, a trend that predated the crisis but accelerated over the same period. Median family income fell to $45,800 in 2010 from $49,600 in 2007. All figures were adjusted for inflation. 

While the numbers are already 18 months old, the survey illuminates problems that continue to slow the pace of the economic recovery. The Fed found that middle-class families had sustained the largest percentage losses in both wealth and income during the crisis, limiting their ability and willingness to spend.  

Given the scale of those losses, consumer spending has remained surprisingly resilient. The survey also illuminates where the money is coming from: American families saved less and only slowly repaid debts. 

More families said they were saving money as a precautionary measure, to make sure they had enough liquidity to meet short-term needs. Fewer said they were saving for retirement, or for education, or for a down payment on a home. 

Families with incomes in the middle 60 percent of the population lost a larger share of their wealth over the three-year period than the wealthiest and poorest families.   One basic reason for this disproportion is that the wealth of the middle class is mostly in housing, and the median amount of home equity dropped to $75,000 in 2010 from $110,000 in 2007. And while other forms of wealth have recovered much of the value lost in the crisis, housing prices have hardly budged.  Those middle-income families also lost a larger share of their income. 

Wealthier families, which derive more income from investments, were also cushioned against the recession.     .   .   .  Ranking American families by income, the top 10 percent of households still earned an average of $349,000 in 2010.  The average net worth of the same families was $2.9 million.

John Bolton: Bush and GOP Left Obama a Mess

As noted many times on this blog, to listen to Mitt Romney and those running attack ads against Barack Obama Democrats, one would think history began in January, 2009, and that everything had been sweetness and light prior to Obama's swearing in as president.  It's the only way that the Republican Party can escape responsibility for the financial markets melt down and the orgy of deficit spending that Bush/Cheney  left as their biggest legacies - not counting, of course, the thousands of needless deaths in Iraq and Afghanistan and the billions of wasted dollars squandered in those countries.  Thus it is surprising that the always caustic John Bolton (with whom I nearly never agree) has called a spade a spade and admitted that Obama was left a disastrous mess by Chimperator Bush, Emperor Palpatine Cheney and the rubber stamp GOP controlled Congress of the Bush/Cheney years.  It's a truth that more Americans need to grasp, especially those who listen to Fox News as if it were a legitimate source of information.  Here are highlights from The Daily Telegraph on Bolton's all too true statements:

John Bolton, Mr Bush's ambassador to the United Nations, said it would not be helpful for the Republicans to more vigorously defend the former president's record, which Democrats have sharply criticised.

Mr Bolton urged Mitt Romney, the party's nominee to face Mr Obama in November, to focus on the future and resist arguing over whether their last president left behind "a big mess or a little mess".

 "I think people would agree with Obama that he was left with a mess," Mr Bolton told The Daily Telegraph. "They're not arguing about that, and that's why it doesn't pay for Romney to argue whether it was a big mess or a little mess. 

Of course, Bolton failed to go on and say that the proposals of the Romney campaign and the GOP are largely nothing more than a repackaged version of the idiocy that got America in trouble in the first place or that these policies would not benefit anyone but the very wealthy.  More tax cuts will only deepen the deficit and less regulation will only enable more recklessness on Wall Street.  And with Romney wanting to attack Iran, the military disasters would only increase.

Quote of the Day: Romney Has Lived a Lifetime of Bullying

A letter to the editor in the Cleveland Plain Dealer in my opinion seems to sum up pretty well Mitt Romney both as a person and in terms of the policies that he supports:

The true story of Mitt Romney bullying a boy in high school and cutting off his hair fits with the same Romney of today, who still believes that there are rich, important people in the "in crowd" who count, and then there's the other 99 percent.

In business, Romney picked on struggling companies and fired many in their work forces in order to make profits for the owners and his buddies at Bain Capital. In politics, he would have "let Detroit go bankrupt" with thousands of job losses, would raise taxes on the bottom 20 percent of taxpayers and would lower them for the top 1 percent, who currently pay the lowest marginal tax rate in the last 80 years. 

These attitudes and policies would help the "in crowd" and bully 99 percent of Americans -- the ones who don't count.

 No doubt some readers will howl their disapproval of this, in my view, correct analysis.

Glimpses Into the True Republican Agenda

For some time it has been fairly clear that the true agenda of the GOP is to implement policies that benefit the wealthy and to pander to the far right Christian extremists. It's also evident that the Republican politicians will say whatever they deem expedient at the moment, apparently believing that the voting public is so stupid that they'll forget statements and proposed policies within a few months. A column in the Washington Post looks at events of the last week that underscore the foregoing assessment. Here are some highlights:

Clarifying moments are rare in politics. They are the times when previously muddled issues are cast into sharp relief and citizens get a chance to look past the spin and obfuscation. Americans were blessed with three such moments last week.

Rep. Paul Ryan made absolutely clear that he is not now and never was interested in deficit reduction. After a couple of years of being lauded by deficit hawks as the man prepared to make hard choices, he proposed a budget that would not end deficits until 2040 but would cut taxes by $4.6 trillion over a decade while also extending all of the Bush tax cuts, adding an additional $5.4 trillion to the deficit. Ryan would increase military expenditures and then eviscerate the rest of the federal government.

Oh yes, Ryan claims he’d make up for the losses from his new tax cuts with “tax reform” but offered not a single detail.

Robert Greenstein, president of the progressive Center on Budget and Policy Priorities, is tough on deficits, careful in his use of numbers, and measured in his choice of words. These traits make his assessment of Ryan’s proposal all the more instructive.

“It would likely produce the largest redistribution of income from the bottom to the top in modern U.S. history and likely increase poverty and inequality more than any other budget in recent times (and possibly in the nation’s history),” Greenstein wrote. “Specifically, the Ryan budget would impose extraordinary cuts in programs that serve as a lifeline for our nation’s poorest and most vulnerable citizens, and over time would cause tens of millions of Americans to lose their health insurance or become underinsured.”

Last week the nation also focused seriously on the “Stand Your Ground” laws that the National Rifle Association has pushed through in state after state. These statutes came to wide attention because of the tragic killing of Trayvon Martin, an unarmed black teenager.

These laws perfectly reflect the NRA’s utopia. No longer will we count on law enforcement to preserve the peace. Instead, we will build a society where all citizens are armed and encouraged to take the law into their own hands. If you feel threatened, just shoot. . . . . Surely this moment should inspire the peaceable majority to challenge the entire gun lobby worldview — and that most certainly includes the legions of timid Democrats who have been cowed by the NRA.

There was, finally, that toy metaphor from Eric Fehrnstrom, a top aide to Mitt Romney. Asked on CNN if the primary campaign had forced Romney “to tack so far to the right it would hurt him with moderate voters in the general election,” Fehrnstrom replied that “everything changes” after the primaries. “It’s almost like an Etch a Sketch,” he added, “you can kind of shake it up, and we start all over again.”

[T]he lesson Fehrnstrom taught: To win, Romney is willing to change not only his own positions but also reality itself. Conservatives will need an exceptionally powerful Etch a Sketch to wipe the nation’s memory clean of the education it received during the 2012 campaign’s most enlightening week so far.

Let's hope that the public has a better memory that Republicans think is the case.

The Republicans' Selective Memory

The chart set out above speaks volumes and underscores the fact that the GOP attacks on Barack Obama are severely misplaced. The real big spender was Chimperator George W. Bush not to mention his GOP sycophants in the U. S. Congress. Lest we forget, the big explosions in the nation's debt levels were fueled the most by the Chimperator's fool's errands in Iraq and Afghanistan and the tax breaks given to the wealthiest Americans. One can only hope that this chart is shown over and over again between now and November. Otherwise the GOP will try once again to play the public for fools.

John Boehner - The Biggest Loser

I'd be lying if I'd said I like - or even feel a shred of sympathy for - House Speaker John Boehner. The man is all too willing to pander to demagogues, not to mention that he's in way over his head as Speaker of the House and unable to control the lunatic fringe within the GOP House membership. Even if calling the wingnuts and Neanderthals within the GOP "fringe" may be inaccurate since insanity is now the GOP norm. The GOP debacle on the payroll tax holiday extension underscores this reality about Boehner. Not that it wasn't fun spectator sport to see Boehner being attacked and whip sawed from all sides. A column in the Washington Post looks at Boehner's biggest loser status. Here are highlights:

Speaker John Boehner’s announcement that a deal has been reached on a two-month extension of the payroll tax cut (to buy time to negotiate a year-long deal, mind you) is welcome news. That means 160 million Americans won’t get slapped with a tax increase on Jan. 1. That means unemployment benefits will continue to flow to millions of Americans who want to work but can’t find work. That means the drag on the economy analysts warned it would have would not happen. Merry Christmas, everyone.

Boehner’s colossal cave comes after three days of being pummeled by Senate Republicans, President Obama and the Wall Street Journal editorial page, the latter being the equivalent of the Republican principal’s office. Boehner said, “The Senate will join the House in immediately appointing conferees, with instructions to reach agreement in the weeks ahead on a full-year payroll tax extension.” He added, “We will ask the House and Senate to approve this agreement by unanimous consent before Christmas.”

But during his live press conference late Thursday afternoon, Boehner looked like and sounded like a haunted man. Unlike this morning, when he stood with fellow GOPers to defy a demand from Senate Minority Leader Mitch McConnell (R-Ky.) to pass the two-month extension, the leader from Ohio stood alone to deliver the news. House Majority Leader Eric Cantor (R-Virg.), who slammed President Obama for going Christmas shopping yesterday with his dog Bo rather than help save House Republicans from themselves, wasn’t there. House Majority Whip Kevin McCarthy (R-Calif.), who failed in his job to be an early-warning system for the Speaker by knowing where the votes were or weren’t, wasn’t there, either.

The American people are the winners in this latest bit of Washington craziness. But Boehner comes out the biggest loser. The man from Ohio has little to no control over his recalcitrant caucus. The inmates are running the asylum.

Is the GOP Set to Self-Destruct Over Payroll Tax?

As a number of commentators have noted, the GOP's no tax increase mantra apparently doesn't apply to working class folks - only the wealthy seem worthy of the GOP's anti-tax vigilance. Frankly, it's part and parcel with the GOP's increasingly anti-middle class agenda which wants all burdens shifted from those most able to pay to those who are struggling to keep a roof over their families and food on the table. Oh, and let's not struggling to keep health care coverage. Despite the GOP's anti-middle class agenda, cretins in the Christianist/Tea Party base of the party remain too stupid to figure out that the party is in reality their economic enemy. All they see is gratuitous statements about "family values" and a consistent anti-minority platform. A piece in The Daily Beast looks at what could hopefully cause the GOP to self-destruct if its idiot supporters, a/k/a Fox News viewers, finally wake up. Here are some highlights:

Every blessed once in a great while, all artifice is stripped away, rhetoric collapses under the weight of its own absurdity, and we get to see things as they really are. Such will be the case later this week when the Senate tries to vote on extending the payroll-tax holiday. The Republicans will oppose it—that is to say, the Republicans will support a tax increase on working Americans. And why? Because the Democrats want to pay for it with a small surtax on the very top earners. So the choice couldn’t be more direct: which is more important, giving the middle class a tax cut or protecting those who make more than $1 million a year? Republicans are making it clear.

The facts: The Social Security payroll tax comes to 12.4 percent of an employee’s salary—employers and employees each pay 6.2 percent. The money goes into the Social Security Trust Fund and finances benefits. At the end of last year, the Obama administration, in exchange for temporarily extending the Bush tax rates on all income levels, got Congress to agree to a one-year 2 percent payroll-tax holiday for employees, down to 4.2 percent. For a $50,000 earner, that meant paying $1,000 a year less in payroll taxes. It was agreed in that law that the holiday would cost the Social Security Trust Fund nothing—the depleted revenue would be replaced out of the general treasury. So the holiday adds to the general deficit but does not affect the trust fund.

The cut proved popular, or is presumed to be popular, so now, as many people predicted last year, Congress wants to extend it. Republicans of course say (as they say of everything) that it hasn’t done any good. But economists attest to its stimulative value.

What the Senate Democrats want to do now is this. They want to increase the employee’s reduction from 2 percent to 3.1 percent (that is, to cut it in half from the normal 6.2 percent rate). And they now want, for the first time, to extend the holiday to employers as well. This is important, and it probably won’t be well explained in very many places. But the Democrats would have employers pay 3.1 percent (rather than the 6.2 percent they now pay) on the first $5 million of their payroll. Also, if employers add to their payrolls, they would pay no payroll tax on new hires. So the new bill is specifically aimed at helping the job creators. The total cost is $255 billion.

The Democrats want to pay for it with a 3.5 percent surtax on dollars earned over $1 million per year. In other words, if someone earns $1.3 million a year, she will pay the extra 3.5 percent only on the last $300,000 in earnings; that is, an extra $10,500 a year (bear in mind that this person takes home, after taxes, around $30,000 every two weeks). So it certainly raises the taxes of the very wealthiest. But it gives more money back to middle-class people, and it stimulates the economy, perhaps to the tune of 50,000 jobs a month, maybe even more.

[E]xtending the holiday will help the economy at a moment when Republicans are now very clearly trying to hurt the economy. This is not even a controversial thing to say anymore, it’s so obvious. And . . . now there’s a price tag on it; it has to be paid for in some way, and that way is a surtax on super-high incomes. And this above all is what the GOP cannot accept.

So the bill will cut taxes on middle-income people and on small employers. And it won’t get a single Republican vote. Maybe one—Scott Brown might have to back it. But they will block this.

It just never ends with these people. . . . . How a party can so nakedly represent only the top 1 percent while at the same time try to stop anything that will help the economy, and survive while doing it, is just beyond me. Obama should give an Oval Office speech Wednesday night and say: “If you are an employee and make less than $1 million, or if you are an employer of any size, I am trying to give you a tax cut.

I totally concur with the writer's sentiments. And this travesty is yet another reason I have fled the GOP brand. I hope many more will do likewise.

The True Picture of Discretionary Spending

I saw this chart on Think Progress which shows the lie to some of the talking points of the GOP - particularly when the GOP continues to look out for the interests of the top 1% of income earners while the rest of us are kicked under the bus. Rescinding the Bush tax cuts, of course, would pay for roughly 55% of the discretionary spending set out in the chart above.

Paul Krugman - We Are the 99.9%

Once again, Paul Krugman gets to the heart of what's happening to the middle class in America and the soaring inequalities in wealth and power that are making the USA look more and more like a 1950's banana republic rather than a nation of opportunity and liberty for all. It's not a pretty picture - especially for the early 20's generation that is facing bleak employment prospects and which is likely to never see the economic security know to my parent's generation. Most distressingly, the power holders in Washington seem to care little about acting in any meaningful way to address the middle class' downward spiral. Here are highlights from Krugman's column in the New York Times:

“We are the 99 percent” is a great slogan. It correctly defines the issue as being the middle class versus the elite (as opposed to the middle class versus the poor). And it also gets past the common but wrong establishment notion that rising inequality is mainly about the well educated doing better than the less educated; the big winners in this new Gilded Age have been a handful of very wealthy people, not college graduates in general.

If anything, however, the 99 percent slogan aims too low. A large fraction of the top 1 percent’s gains have actually gone to an even smaller group, the top 0.1 percent — the richest one-thousandth of the population.

And while Democrats, by and large, want that super-elite to make at least some contribution to long-term deficit reduction, Republicans want to cut the super-elite’s taxes even as they slash Social Security, Medicare and Medicaid in the name of fiscal discipline.

The recent Congressional Budget Office report on inequality didn’t look inside the top 1 percent, but an earlier report, which only went up to 2005, did. According to that report, between 1979 and 2005 the inflation-adjusted, after-tax income of Americans in the middle of the income distribution rose 21 percent. The equivalent number for the richest 0.1 percent rose 400 percent.

For the most part, these huge gains reflected a dramatic rise in the super-elite’s share of pretax income. But there were also large tax cuts favoring the wealthy. In particular, taxes on capital gains are much lower than they were in 1979 — and the richest one-thousandth of Americans account for half of all income from capital gains.

[I]f you look at who really makes up the 0.1 percent, it’s hard to avoid the conclusion that, by and large, the members of the super-elite are overpaid, not underpaid, for what they do.

For who are the 0.1 percent? Very few of them are Steve Jobs-type innovators; most of them are corporate bigwigs and financial wheeler-dealers. One recent analysis found that 43 percent of the super-elite are executives at nonfinancial companies, 18 percent are in finance and another 12 percent are lawyers or in real estate. And these are not, to put it mildly, professions in which there is a clear relationship between someone’s income and his economic contribution.

Meanwhile, the economic crisis showed that much of the apparent value created by modern finance was a mirage. . . . . So should the 99.9 percent hate the 0.1 percent? No, not at all. But they should ignore all the propaganda about “job creators” and demand that the super-elite pay substantially more in taxes.

The Most Ignorant GOP Presidential Hopefuls

Talk about a wonderful title to a news article! The caption of this post is from a new Daily Beast article that looks at the ignorance and untruthfulness of the GOP slate of would be presidential candidates. The piece looks at each of the candidates and lays out the worse of their lies and/or batshitery, with some of the biggest loons underscoring their unfitness for office. Read the full piece for a run down on each. Here are highlights from my favorites:

Rick Perry - The candidate with most falsehoods hails from the state where more is always better. Rick Perry’s biggest whopper has been repeated at several debates, including in Tampa in September and in Hanover in October: namely, that Texas created 1 million jobs while the country was losing 2.5 million jobs. The good governor goes back to January 2009 to get the national number, and during that span Texas created only about 100,000 jobs. Must be that Lone Star optimism.

Michele Bachmann - During the Hanover debate in October, Bachmann said that the Democrats’ ostensible victory following the debt-ceiling debacle of the summer past gave the president “a $2.4 trillion blank check.” That money, however, was used to make sure the country could meet its obligations.

Herman Cain - During the October 18 debate in Las Vegas, Cain claimed that his flat-tax plan would not raise taxes for 84 percent of Americans. As Factcheck points out, a Tax Policy Center report says the opposite—that, in fact, a large majority of Americans, 83.8 percent to be exact, would face higher taxes under Cain’s plan.

Rick Santorum - At the CNN debate in Manchester, New Hampshire, Santorum revived a tired GOP talking point when he said that health care for the elderly would be rationed under the federal health-care bill. As Factcheck points out, the law specifically says the health-care program “shall not include any recommendation to ration health care.”

Is Obama's New Combative Game Too Little Too Late?

With the 2012 election still 13 months away, it seems like Barack Obama is finally waking up and starting to act like he should have been doing from day one of his presidency or at least soon after the GOP members of Congress made it clear they were not going to play ball with him. In the meantime, rank and file Democrats have become largely demoralized and convinced in many cases that Obama and the Democrats are incompetent in countering the GOP propaganda machine and never ending Christianist/Tea Party lies. With control of the Virginia Senate - the sole bulwark against the worse policies of the GOP - up for grabs a month from now, the Democrat apathy is frighteningly similar to that in 2009 which allowed Taliban Bob McDonnell and Ken Kookinelli to win their state wide offices. It's hard to be enthused when you don't even feel the Democrats are out there fighting the forces of ignorance and evil in the GOP. The result? According to a new Washington Post-ABC News poll, only 58 percent of Democrats in believe that Obama will be reelected. What's sad, it's largely because of Obama's self inflicted wounds. The Washington Post looks at Obama's belated more confrontational behavior. Here are excerpts:

There is a noticeably more aggressive, confrontational President Obama roaming the country these days, selling his jobs plan and attacking Republicans for standing in the way of progress by standing up only for the rich.

In Texas on Tuesday, the president went after a leading Republican by name: “Yesterday the Republican majority leader in Congress, Eric Cantor, said that right now he won’t even let this jobs bill have a vote in the House of Representatives,” Obama said. “I would like Mr. Cantor to come here to Dallas and explain what exactly in this jobs bill does he not believe in, what exactly he is opposed to. Does he not believe in rebuilding America’s roads and bridges? Does he not believe in tax breaks for small businesses or efforts to help our veterans?”

The emergence of this more pugnacious Obama has heartened Democrats, especially the most liberal ones, who spent the past few months dejected by what they saw as the president’s unwillingness to engage his opponents in political combat.

The president’s problems, even within his own party, remain formidable; only 58 percent of Democrats in a new Washington Post-ABC News poll believe that he will be reelected. Many supporters remain skeptical of his tendency to seek compromise with Republicans, and recently he angered some black supporters by urging them to stop complaining. Still, in recent weeks, Obama has begun to blunt some of the criticism among Democrats that he is not up for the fight.

[T]he only good news for Obama relates to his jobs plan and his Republican opposition. An even higher percentage of poll respondents, about 76 percent, say they disapprove of the way Republicans in Congress are handling the economy. Given that dubious advantage, the president may have few options other than to attack.

The president’s jobs plan is one remaining bright spot for him. A narrow majority in the poll supports the package. Nearly six in 10 say Obama’s plan would help improve the unemployment situation.

Obama has begun to frame the 2012 contest as a referendum on values. . . . The president also has drawn a values contrast with Republicans over how to pay for his jobs plan, which features a “Buffett rule” that would eliminate some tax loopholes for people earning more than $200,000 a year. Republicans have labeled Obama’s approach “class warfare,” a term the president has embraced — with a twist.

“You’re already hearing the Republicans in Congress dusting off the old talking points,” Obama told New York donors two weeks ago. “You know what? If asking a billionaire to pay the same rate as a plumber or a teacher makes me a warrior for the middle class, I wear that charge as a badge of honor.”


Neera Tanden, a former Obama administration official, said the president tried to position himself as the “adult in the room” during the debt fight, remaining above the partisan fray in hopes of striking a “grand bargain.” The strategy collapsed after House Speaker John A. Boehner (R-Ohio) balked under pressure from the tea party and the White House agreed to cut spending by $900 billion without raising taxes.

Tea Party Ignorance

Click image to enlarge.

The ignorance and stupidity of the Tea Party crowd is truly breath taking at times as illustrated by the photo above which has been notated to indicate the many things that government - funded through taxes, of course - does for society. While the Tea Party rails against taxes, nowhere do they ever explain how they think infrastructure and utilities are going to come from if taxes are eliminated or reduced to nothing. Candidly, instead of the signs they are brandishing, they ought to be carrying signs that read "I'm a freaking Moron" or "I'm severely mentally challenged."

Why the Political Center-Left is Fed up with Obama

I'm sure that I will hear from Obama defenders because of this and past posts who will as is the norm chastise me about Obama being better than the GOP alternative. That may be true as far as it goes, by why ares too many willing to a mediocre lesser of two evils instead of demanding something better? This willingness to accept the lesser evil only seems to encourage Obama to ignore those who put him in office and assume that he's free to do so because we'll come running back to support him rather than the GOP bogey man. Matt Miller has an op-ed in the Washington Post that expresses much of my exasperation - and that of growing numbers of voters. Here are highlights:

I know who the real villains are at this volatile moment. So why am I so mad at Barack Obama? I know I’m not alone. In conversations with folks across the center-left in recent days, everyone’s basically had it with the president.

[S]omehow the debt-ceiling fiasco and the downgrade, punctuated by these horrific jobs numbers and stock market gyrations, has made something in me (and, I suspect, millions of others) snap. It’s the sound of confidence in Obama’s leadership breaking.

Yes, other forces may be “responsible” for the bad news. But in the end a president has the most power to shape the debate. How could Obama have let the entirely foreseeable debt-ceiling standoff turn into a hostage drama? Why didn’t he have the spine to say “send me a clean debt limit increase or I’ll raise it myself and see you in court”? How could he leave us in a position where every future debt-limit hike now becomes an occasion for blackmail?

Events keep screaming that the president is weak, weak, weak. That this can happen so soon after his gutsy call to take down Osama Bin Laden is striking. First the president gets rolled on the debt limit. Then S&P lowers the boom. Then China piles on. Then the White House rushes out word that Tim Geithner is staying put. Can anyone explain exactly who that news was meant to reassure?

Then there’s the president’s measurably ineffective pep talk as the market plunged on Monday. And the cynically inadequate “pivot” to jobs. Coupled with what will surely be a more-than-ample pivot to character assassination, with news that Team Obama’s plan for 2012 is to metaphorically “kill” Mitt Romney.

Will Obama go big? I think not, because no honest agenda for American renewal can avoid trims and taxes that impose costs on the middle class (as part of a long-term plan to save it). Yes, the president will sound “big,” and so will his opponent. But it’ll be phony. Instead, we’re in for another season of charades as both parties fight for 51 percent with symbolic “ideas” unequal to the size of our challenges.

If this is how it plays out, people like me won’t just be mad at Obama. We’ll be mad at ourselves for believing he was going to be different.

USA's Largest Corporations Made $170 Billion Yet Paid No Taxes

Let's face it - the USA's tax code is beyond screwed up. As Forbes is reporting, twelve of the nation's largest Fortune 500 companies, while making $170 billion in profits during the period of The Great Recession, paid NO taxes. That's right, zero! The GOP, of course, would have you believe that businesses are over taxed. While this may be true in some cases for the little guys, the big corporation with in some cases obscene profits are paying little or nothing even as more and more homeowners find themselves wiped out financially. It drives me to distraction to watch as idiots in the Tea Party movement remain blind to the fact that they are being sold down the river by Republicans. Add to the list of fools, the Christianists who are more concerned about stigmatizing gays than looking out for the future of the nation. Here are highlights from the Forbes story:
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Yesterday, I wrote about how the GOP is falsely pushing the argument that America’s corporations are overtaxed. I included some great data courtesy of conservative commentator Bruce Bartlett whose New York Times piece did an extraordinary job of putting the lie to the Republican assertions.
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Today, and not a moment too soon, the non-profit Citizens For Tax Justice (CTJ) has put out their findings revealing that twelve of the nations largest Fortune 500 companies, while making $170 billion in profits during the period of The Great Recession, paid an effective tax rate of negative 1.5%.

Yes, you read that correctly. Not only have these twelve companies paid zero in taxes for the years 2008-2010, they actually received tax subsidies that added $62.4 billion to their bottom lines.
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The companies were chosen by the CTJ . . . include – in alphabetical order – American Electric Power, Boeing, Dupont, Exxon Mobil, FedEx, General Electric, Honeywell International, IBM, United Technologies, Verizon Communications, Wells Fargo and Yahoo.
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According to the study, not a single one of these companies paid an amount even close to the 35% statutory tax rate. In fact, the tax rate paid by Exxon Mobile, when spread over the full three years, was only 14.2% – a full 60% below the 35% rate that corporations are supposed to be paying. And if we take a look at what Exxon paid over just the past two years, it totals a mere 0.4% on their pre-tax profits of $9.9 billion. And get this – Exxon Mobile paid the most in taxes of any of the twelve companies on the list.
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We, as voters, also have a duty to react when the GOP majority in the House of Representatives tries to tell us we need to reduce this phantom corporate rate from 35% to 25% so that these corporations can pay even less in taxes while they pocket even greater amounts of taxpayer money via corporate subsidies.
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Worse still, Boehner, Ryan and friends have the unmitigated gall to make their pitch while asking the rest of us to give up the social programs that are so essential to most Americans. Seriously, people, do we need an anvil to fall on our heads before we get it?
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This chart from Think Progress tells it all:
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