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Trump Administration Continues to Attack the Environmental Projections First Put Into Place by the Nixon Administration

If you, the reader, are uncertain whether to support Trump or whoever the Democratic candidate turns out to be, I urge you to consider the devastating reduction in protections for clean air, clean water, and clean land (thus also clean air/water and food) under the Trump administration's 'hate anything Obama' approach that has put industry blowhards in charge of the Environmental Protection Administration, an agency created on December 2, 1970 to ensure federal research, monitoring, standard-setting and enforcement of environmental protection. 

(Image of Trump at West Virginia campaign rally in August 2017, from CNBC article on Trump rollbacks of regulation, cited below)

Under Trump, we have instead a complete disregard for the environment, a view that harks back to the times when rich owners of factories, mines, or corporate farms exploited and polluted land, waters, and people in their greed for profits. For example, in July 15, 2019, the New York Times reported that the Government Accountability Office found that the administration "did not consistently ensure" that its appointees to EPA panels satisfied federal requirements.  This was during 2017, when the Trump administration dismissed academic scientists from EPA advisory boards in order to replace them with industry-connected appointees.  Panels that had in the past included a very high percentage (more than 80%) of academic scientists were reduced precipitously under Scott Pruitt, Trump's first EPA head.  Pruitt, of course, resigned in scandal (as so many in the Trump adminsitration have done) in 2018 after loading EPA advisory panels with industry hacks .  See, e.g.,  E.P.A. Broke Rules in Shake-Up of Science Panels, Federal Watchdog Says, NY Times, July 15, 2019; Removing Academic Scientists from Science Advisory Panels, Harvard Environmental & Energy Law Program, Feb. 26, 2018 (noting replacement of scientists with industry insiders and consultants, including a climate change skeptic, following Scott Pruitt's October 31, 2017 directive).  Scientists removed from the panels refused often to be silent.  For example, some formed their own air pollution panel after Andrew Wheeler, Trump's next EPA administrator, disbanded the Particulate Matter Review Panel in October 2018.  It had "some of the nation's top scientists, who were tasked with reviewing how soot and other microscopic air pollutants impact human health."  Rebecca Beitsch, Scientists booted from EPA panel form their own group, The Hill (Sept 26, 2019).

The Trump Administration labels environmentalists with the same type of derogatory terms that Trump uses for all of his "enemies"--i.e., almost everybody in the country that isn't loyal to the bully-in chief because they recognize his shallow, egotistical, narcissistic lack of knowledge and caring about the well-being of the country or its citizens--even while he claims with his typical bravado and fluff that his administration makes "the very cleanest air and cleanest water on the planet" a top priority.   Meanwhile, Trump is busy rolling back as many environmental protections as possible.  See, e.g., Emma Newburger, Trump is rolling back over 80 environmental regulations.  Here are five big changes you might have missed in 2019, CNBC (Dec 24, 2019) (rollbacks including fewer protections for endangered species).  Trump and other people of wealth think they can live in a cocoon of luxury that doesn't suffer damage when the earth's species die out from pesticides and pollution, when the earth's climate changes to create fires and storms hostile to life, when the earth's waters are no longer clear and drinkable by plants, animals (and humans), when the earth's land is destroyed by overlumbering, fracking, the rapacious thirst of oil drillers, and the careless destruction of mountains of surface mining.  They are wrong, but they may not recognize it until too late.  Trump's stupidity is thinking that he who doesn't read, hasn't studied, and doesn't care about science or life generally is suited to make decisions about wilderness or any of the myriad environmental issues facing us.   He leads rallies where people become mesmerized by being part of a raving crowd, with little recognition themselves of the way the ultra rich are taking advantage of them in their daily lives.  He knows nothing, and cares even less about what he doesn't know.  Yet his administration continues to move to change environmental policy to favor big corporate interests and disfavor local decisionmaking.  He appoints industry hacks as Interior Secretary--there was Ryan Zinke, and then extraction industry lobbyist David Bernhardt.   See, e.g., Michael Greshko et al,A running list of how Trump is changing environmental policy, National Geographic, May 3, 2019 (pipeline order, David Bernhardt as Interior Secretary, safety regulations rolled back, oil and gas access to Arctic National Wildlife Refuge, Keystone XL pipeline approval, etc.). Preservation of pristine natural areas such as the Arctic Wildlife Refuge or the Big Bear Monument are eroded with no concern, so long as corporate grandees are satisfied.  Trump's final budget plan, released Feb. 10, 2020, is yet another example: steep cuts to the agencies and programs that protect our climate, air, water and wildlife.  See, e.g., Trump's final budget enshrines climate denial, war and cruelty into conservative manifesto, Friends of the Earth, Feb. 10, 2020.

This Trump no-holds-barred war on the environment is devastating for most Americans.  The Flint water crisis, where local and state administrators made stupid decisions about switching to cheaper water without protections against lead poisoning are just an early example of what awaits the entire country under this approach.  It is, as Friends of the Earth policy analyst Lukas Ross notes, "an immense moral disgrace" that is hardest on "our society's most vulnerable".  Id.  Communities of color, unsurprisingly given the GOP's empty rhetoric about caring about equality and justice, are the most harmed by these policies.  See, e.g., Amy Patronella & Saharra Griffin, Communities of Color Bear the Brunt of Trump's Anti-Environmental Agenda, Center for American Progress, Feb. 27, 2020.  That piece notes that systemic racism and segregation (including redlining of residential districts) have resulted in low-income communities and people of color being "disproportionately vulnerable" to climage change impacts of greenhouse gas emissions. The column lists key examples of Trump administration anti-environmental actions, including the following:

• removing protections for one-third of U.S. drinking water sources "by weakening the Clean Water Act, finalizing a so-called dirty water rule, and delaying action to protect against toxic chemicals in drinking water;
• easing regulations surrounding disposal of coal ash to prevent its leaking into groundwater sources, which tends to affect communities of color disproportionately with cancer, low birth-weight babies, and premature deaths;
• proposing a roll-back of standards established in 2011 to protect against mercury and other toxic chemicals, including mercury emissions from coal and oil fired power polants, with a particularly negative impact on those living in close proximity, which tend to be African Americans;
• gutting the Clean Power Plan designed to reduce climate-change inducing pollution and improve public health;
• lowering the standards for nitrogen oxide emissions from coal plans, affecting again people of color who tend to make up a large percentage of those living within 3 miles of such plants;
• deregulating oil refineries by changing two Obama-era rules that were expected to lower cancer risks for 1.4 million people;
• requiring air quality standard reviews to consider economic and other costs rather than the health impacts required under the Clean Air Act (and thus favoring polluters, since any improvement from the status quo always comes with an economic cost);
• limiting the role of public comment under the National Environmental Policy Act (NEPA) enacted 50 years ago, in order to keep communities from having a voice in projects that affect them and handing that voice instead to corporate polluters who profit from pollution;
• proposing slashing funding for Superfund site cleanup, when such sites tend to be located in nonwhite communities (note that Andrew Wheeler as head of EPA is now overseeing sites his clients created when he was a lobbyist for the chemical industry);
• refusing to ban toxic pesticides that are linked to brain damage in children after EPA scientists studied and recommended the ban;
• Reducing EPA's budget by more than 25% to decrease its ability to regulate industry polluters;
• continually rolling back regulations and working against climate change remediation, resulting in increases in greenhouse gas emissions and extreme weather damage ($45 billion in 2019 in the U.S. alone);
• diverting FEMA funding to immigration enforcement (which has included dragging children away from parents seeking asylum).

As the article concludes:

In the midst of this systemic elimination of federal protections and willful inaction on climate, the science is resoundingly clear: We must move to a 100 percent clean energy future with equity at the forefront. The Equitable and Just National Climate Platform, co-authored by the Center for American Progress, 12 environmental justice groups, and seven national environmental organizations, recognizes the importance of justice and equity as “central components of our climate agenda.” Additionally, it calls for “healthy climate and air quality for all” as well as “[s]afe, healthy communities and infrastructure.”  All communities, particularly communities of color, can no longer afford the Trump administration’s attacks on public health and the environment.

So what does this have to do with tax policy?  My friends, our tax money is currently supporting the Trump administration industrial lobbyists in their efforts to undo environmental and natural area protections across the country.  This is class warfare at its heart--the lobbyists and corporate managers of the most polluting firms colluding to ensure that they can freely pollute our world without facing any liability for doing so. Our tax revenues are making it possible for Trump to fly to his own resort in Florida for which the US government pays millions in secret service guest quarters so Trump can spend most of every weekend golfing.  Instead, our tax revenues should be supporting good government programs that protect our land, water and air, as well as endangered species, so that our children can enjoy a healthy life and appreciate the natural beauty of this country.  Ultimately, taxes and spending are intricately entwined.  Bad government--like the corrupt Trump adminsitration--means both are working to the detriment of the American people.

Bloomberg's Plan for Addressing Economic Inequality: not a wealth tax

A week ago (Jan 8, 2020), the New York Times described Michael Bloomberg's plan¹ for addressing the income and wealth inequality in the United States that has been a constant topic of discussion by Democratic candidates.  Briefly, as with the robber barons of Teddy Roosevelt's age, the wealth of the global commerce titans and particularly the private equity fund buyers and sellers of companies (and layers off of employees) has exploded over the last four decades in the US, beginning in earnest with Ronald Reagan's presidency.  Most of the benefits of productivity gains have gone to a very few people at the top, and the bottom 50% of the wealth distribution actually owns a smaller share of the nation's wealth than 40 years ago.  The top 1% have gained enormously, and the top 0.5% have been even more enriched.  We have ultra multibillionaires like Jeff Bezos who can pay $9 billion to his wife in a divorce settlement and still be the wealthiest man in the world with more than $130 billion in net worth.  He earns about $78.5 billion a year (counting value of his Amazon shares) or more than $6.5 billion a month² and thus exemplifies this new "gilded age" of ultrawealthy tycoons.  This exists at the same time that the Trump administration proposes work requirements that will eliminate food stamp aid for 700,000 of hungry Americans and, with other initiatives, will take  food stamps from 3.7 million beneficiaries who simply cannot get work that pays well enough to fund a sustainable lifestyle for themselves and their families.³  This will "save" the U.S. about $5.5 billion over five years--less than Bezos 'earns' in a month.  This disparity--$5.5 billion to feed 3.5 million hungry Americans versus provide a month's additional wealth for a person already wallowing in wealth like Jeff Bezos--is why it is clear that the US needs to figure out how to respond to the inequality crisis in order to protect American democracy and ensure Americans have a decent standard of living.

Bloomberg's plan seems to be a moderate stance like Obama and Biden that attempts to focus on factors other than the wealth gap and the accompanying power gap that wealth provides.  As the NY Times reports, he "frames the economic divide primarily in regional terms--and not along ... rich-versus-everyone-else class lines."¹  The Times article notes that his plan is not unlike the charge Obama gave to Joe Biden for the Middle Class Task Force.¹

Bloomberg's proposals for addressing the problem are similarly centered on things long discussed and tried that are difficult to do at a large enough scale to make any inroads into the inequality problem or the power gap problem. He is most definitely not proposing a wealth tax.  His proposals include a focus on education and skills training, infrastructure projects, and entrepreneurial training centers.  Although the GI Bill was a significant part of the post-WWII economic boom because it allowed vast numbers of returning veterans to get a college education, Bloomberg seems to be thinking more of apprenticeships and community colleges (training for a job) rather than university (training for a career and an approach to learning throughout life).  The Times notes his interest in raising the minimum wage to $15 an hour, expanding the Earned Income Tax Credit, and encouraging unions while disallowing noncompetes for low- and middle-income jobs. 

All those are minimal steps that any progressive candidate should take, but while they may have marginal impact on middle class mobility, they will not do much at all to ease the income and wealth gap that has been caused by technology, globalization, and financialization of the economy together that has measured success almost solely from stock market numbers and thus allowed corporate and private equity tycoons to garner the major gains in productivity over decades while paying their workers too little (or moving offshore to pay even less), combined with a tax system that privileges wealth, including, among a host of others, extremely favorable corporate tax provisions after the 2017 tax legislation, ridiculously low maximum rates on ordinary income, carried interest provision, section 1031 exchanges, section 1202 exclusion for gains on original issue small business stock, capital gains preference, and an absurdly low flat estate tax above a too-high exemption amount with a step-up in basis for heirs. 

Bloomberg is a billionaire who is at least aware that the inequality in this country is problematic and needs to be addressed.  But like most of the "have-so-much" class, he shows little interest in what is truly required--a shift in the direction of redistribution to balance the distorted seesaw of billionaires getting all the height and the rest sitting at the bottom.  FDR's New Deal is said to have worked because the robber barons were scared that the proletariat would rise up in support of communism--the so-called 'red scare' behind the success of social security enactment.  There may not be a red scare now (though the Trump campaigners try to paint democratic socialist programs as communism), but there is a real likelihood that the contrast--and possibly real class warfare-- between the squalor and despair of poor families who work hard but cannot fend for themselves and rich kids with silver spoons that only grow bigger and bigger  may eventually threaten the global nation of the plutocrats.⁴

 

1 Jim Tankersley, Michael Bloomberg's Jobs Plan is Focused on Place over Class, New York Times (Jan 8, 2020).

2 Hillary Hoffower, We did the math to calculate how much money Jeff Bezos makes in a year, month, week, day, hour, minute, and second, BusinessInsider.com (Jan 9, 2020).

3 Phil McCausland, Trump administration proposals could cause millions to lose food stamps, NBC News (Nov. 30, 2019) (discussing proposed changes to SNAP program that would impose stricter work requirements, cap deductions for utility allowances and 'reform' the way states automatically enroll families when they receive other aid).  See also

4. See, e.g., Chrystia Freeland, Plutocrats: The Rise of the New Global Super-Rich (2012) (described in The Guardian book review as "a necessary and at times depressing book about the staggeringly wealthy").  Freeland is neither Marxist nor socialist, and as I am reading the book, not evenappropriately skeptical of the amount of merit behind the plutocrats' self-claimed meritocracy.

Trump celebrates his (very expensive) tax cuts for himself and his rich golfing buddies

Remember how Trump sold the Republicans' $1.5 trillion-deficit-creating tax cut plan as a boon for the middle class that was going to create jobs and raise wages?  That was in September, when he told congressional lawmakers at the White House that "The rich will not be gaining at all with this plan."  See Washington Examiner (Sept. 13, 2017).

Let me repeat that:  Trump said "The rich will not be gaining at all with this plan." (emphasis added)

No tax lawyer or professor believed that statement.  Nobody that knew anything about the early drafts of the bill believed that statement.  But quite a few Trump supporters have believed that statement.

It wasn't true.  It was a bald-faced lie, and Trump knew it was a bald-faced lie.  He has no trouble making such lies and does it multiple times a day.  But this one was both manipulative and deceptive.  Manipulative, because it helped to prevent any outcry from his core supporters that might have caused a Senate vote loss.  Deceptive, because it was intended to mislead, as so much of what this man does in the office of the President.

Trump made absolutely clear what he really is proud of at his holiday golfing retreat at Mar-a-Lago, where memberships now cost $200,000 (were $100,000 before they counted as access to the Presidency) and members are part of the oligarchic ultra rich set that Trump so adores.  Here's what he told them just before Christmas:  "you all just got a lot richer" from the passage of the Republican tax cut legislation.  See Bobic, Trump Told Friends 'You All Just Got a Lot Richer" From Tax Bill: Report, HuffPost (Dec. 24, 2017).

So September, Trump is claiming that the rich won't gain a thing from the tax cut but come December, Trump is boasting about how much richer the rich got from the tax cut.

Next up?   The Republicans who didn't care if they created a $1.5 trillion deficit with their tax cuts for the rich now whine about the dreadful deficit (that they created) and the oh so shocking necessity, now, of cutting back on

• Social Security (they want to privatize it so the rich can get rich off of passing risk onto the vulnerable elderly but this is less likely since they can't do it by reconciliation with just GOP votes) and
• Medicare (they want to decimate it- and can do that with reconciliation-GOP apparently doesn't want us to have the kind of universal and cheaper health care that the rest of the developed world enjoys because there's no money in that for them) and
• Medicaid (GOP can't make money off it and they don't care about the poor kids and families and old people that depend on that anyway).

See, e.g., Jeff Stein, Ryan says Republicans to target welfare, Medicare, Medicaid spending in 2018, Washington Post (Dec. 6, 2017) ("Republicans will aim next year to reduce spending on both federal health care and anti-poverty programs, citing the need to reduce America's deficit");  Republicans are headed for a collision in 2018, Business INsider (defunding Social Security or funding infrastructure). 

And of course Trump is all in favor of cutting spending on ordinary Americans and the poor. As the article in WaPo notes, "Trump recently called on Congress to move to cut welfare spending after the tax bill." (emphasis added)  Ryan says Republicans to target welfare, Medicare, Medicaid spending in 2018

That, my friends, is the kind of character we have in the White House--a man who doesn't give a damn about the ordinary people that put him in office, except when it comes to stirring up their hatred of "liberals" so that they will keep voting for him under his claimed (but false) "conservative" mantle, a man who cavorts with the ultra-elite and caters to their every need and doesn't give a damn whether they pollute our air, water, or land or destroy our public lands and oceans and wilderness areas and sacred places; a man who is as two-faced as they come--claiming no benefit from his tax cut bill and then boasting about how much richer the rich get from the bill. 

And it is also the kind of so-called "leader" we have in Congress-.  There's multi-millionaire Paul Ryan--p who wants to cut Medicare because it "has been my big thing for many, many years."  His Ayn Rand callousness is coming to the fore. And there's (for now) multi-millionaire Orrin Hatch, who attacked programs for the poor as "wasting America's money."  Id.  Hatch may well be replaced by multi-millionaire Mitt Romney, who thinks anybody that isn't in the upper class economically is just a wasteful "taker" while it is the rich people that really count.  (I've got news for Romney--without those hard workers at the bottom of the income scale, this country would NOT be great.)  Romney's not really much different from Trump, just less crass about it when in public.

These rich Republicans are part of the new oligarchy pent on class warfare against the poor and middle class that they disdain while waving the flag and pretending they love their low-income voters.  Nah, they just love the votes.  They don't give a damn about anyone but themselves, and they are set on a course to destroy all the common decency that this country has established over the years, the core of moral fiber that is really what makes America great.

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What is the GOP goal? A return to the "gilded age" (or worse)

When right-wing Roy Moore said that the time when America was great was during slavery, he revealed something key to the current GOP members of Congress and state legislatures--their primary goal is to return to a time when owners of property held all the keys to the kingdom and workers were just serfs expected to do as told and whose lives didn't really matter much to the boss capitalists.

Historian Nancy MacLean suggests that this is the reason for the tax bill's largesse to corporatists and the wealthy, the reason the GOP wants to undo Medicaid, Medicare, Social Security and essentially all the progressive programs introduced in the twentieth century to form the basis for a thriving middle class and surging democratic union.  See Cahuncey DeVega, Historian Nancy MacLean on the right's ultimate goal: rolling back the 20th century, Salon.com (Dec. 13, 2017).

Here are some key points from the article.

1) "[T]he Democratic Party is terrible at translating complex questions of public policy into simple narratives that evoke emotion and, in turn, action from the American people." Id.

Indeed, having an able, sympathetic messenger who can translate the issues that truly matter into terms that make sense to ordinary people is something the Democratic Party lacked in the last election.  The tone deafness of Debbie Wasserman Schultz and, much of the time, Hillary Clinton, meant that ordinary people didn't understand that Trump is merely a blowhard capitalist who doesn't care if he cheats or lies or exploits other people so long as he gets notoriety and money, while the Democrats have been the party working for a decent sustainable economy, environmental protection and preservation, protection from pollution and diseases, and working wages for ordinary folk.

The GOP, on the other hand, has mastered the art of lying to the point that they can pat themselves on the back for fooling the majority of the people the majority of the time, while blaming anything that goes wrong on Democrats (even when it is--most of the time--entirely GOP policy that the 'wrong' occur).  So a tax bill that enriches the oligarchs and ultimately raises taxes on the ordinary people is exactly what they have in mind, but they rush it through without any public hearings and discussion because they don't want people to realize it.

2) The GOP tax "reform" bill is intended to create a deficit that will justify "huge automatic cuts to Medicare, Social Security and Medicaid", to be followed by a "push for a constitutional convention, at which the No. 1 agenda item will be a balanced budget amendment" with the goal ultimately of privatizing Social Security.

MacLean calls this Ayn Rand-brand of hateful thinking followed by GOP House majority leader Paul Ryan "economic eugenics".  Since the GOP right-wing libertarians believe that only people who are successful have any merit, they are comfortable "inflict[ing] harm on other people.  At its most basic, this libertarian moral system says that it would be better for people to die than to get health care financed by government from taxes paid by others."

3)The GOP emphasis on voter fraud (and consequent efforts across the country to make it harder for people to register to vote or to actually vote) allows the oligarch-led anti-democratic movement to disregard the will of the people because they have "gamed the system to maintain power."

The majority of Americans opposed the tax bill that almost every single Republican representative and senator voted for (no Democrat voted in either house of Congress to support the GOP tax scam).  But the GOP legislators think they can ignore what the voters want, because they have held discussions behind closed doors, and are "using the power of national government to prevent voters in more progressive lcoalities and states from being able to choose more progressive policies" by enacting a bill that penalizes voters living in high-tax, progressive states that actually already send more money to low-tax, economically suffering "red" states.

MacLean notes that George Mason University's Mercatus Center, funded by Charles Koch, has been leveraging universities for their political project of undoing progressiivism for decades.  They think people will be "absorbed with Facebook and binge-watching Netflix" so will disregard the way that the GOP and their oligarchic allies are using the national government to return to the late 19th century when oligarchs with property had all the power.  That's what is the "stealth nature of this tax bill."  Returning to a world where "only the wealthy were doing well and everybody else was screwed", a world preferred by James Buchanana, who "devised the playbook that the Koch network is using."

This tax legislation is, indeed, class warfare.  It represents a huge blow in favor of wealthy corporatists though creation of a gaping $1.5 trillion deficit hole that will be used by the GOP to decimate New Deal and Great Society programs on which most ordinary Americans depend --Medicaid to pay for nursing homes in the last years of life, Medicare to help afford needed medical care, Social Security to make up for the gap between the meager savings in retirement plans and the increasing costs of living after retirement.  These wealthy people in Congress just don't give a damn for ordinary working Americans, whether black or white, rural or urban, "conservative" or "liberal".  All they care about is making sure that people with property have even more property.  It has nothing to do with creating or promoting a sustainable economy that will lift ordinary workers stagnated wages.  It has everything to do with appeasing the top one percent.

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The GOP Tax Bill Disses the Working Class

Here's something about the GOP House and the GOP Senate:  they each passed tax bills (supposed to come out in a "conference" agreement sometime today) that diss the United States' working class taxpayers.  White or black, Christian or Jew or other, citizen by birth or naturalized citizen--workers are treated as an inferior "taker" class and owners are treated as a superior "maker" class--the same old GOP class warfare that has been evidenced in Republican-driven tax legislation for decades.  That shows in the provisions that have been discussed quite a bit already, even though there is no official distributional analysis and even though the Treasury Department put out a one-pager claiming to provide an analysis showing huge economic growth would eliminate any deficits (based on both the tax "reform" legislation and promised cost-cutting "reforms" to Medicare and Social Security):

• the  significant reduction in impact of the estate tax,
• the huge reduction in the statutory corporate tax rate of most benefit to officers/shareholders (it was 35%, it will be 21% under the conference agreement, apparently, even though the "effective" corporate tax rate ranged from negative to around 24-25%--essentially more favorable than many of our fellow advanced economies' corporate tax rates);
• the territoriality of the corporate tax (generally, zero tax on foreign earnings of U.S. companies);
• immediate expensing of company investments (a five year provision that allows companies huge tax benefits for those five years);
• the elimination of the corporate alternative minimum tax (AMT), at a cost of about $250 billion in revenues.
• the reduction in the top rate for wealthy individuals (from 39.6% to 37%),
• the substantial reduction in the  State and Local Tax Deduction for workers (thus changing entirely the economics of paying for a house already purchased, while allowing sole proprietors, partnerships and other "owners" of equity in businesses the ability to deduct such State and Local Taxes in full);
• a larger standard deduction but the elimination of personal exemptions;
• a larger child tax credit that only becomes refundable over time (limiting how much it helps the poor) but is available to wealthy households (starting to phase out at half-a-million of income!);
• the only slight reduction in the ability of wealthy individuals to take advantage of the mortgage interest deduction (reducing the debt limit to $750,000 instead of $1,100,000)
• the elimination of the corporate AMT (which cuts taxes for wealthy shareholders/owners/managers) but the retention of the individual AMT (which primarily affects the upper middle class and not the wealthiest taxpayers under the current rate bracket system);
• the elimination of the Affordable Care Act mandate and penalty (which reduces the amount of Medicaid and insurance subsidy funds for poor and middle-income taxpayers, as well as guaranteeing the deconstruction of the health care system for 13 million or more Americans by 2027 and  increasing insurance premiums for upper-middle-class taxpayers); and
• the opening of the Arctic National Wildlife Refuge to rape by fossil fuel oligarchies (a piddling amount of revenue, but sufficient to buy off the principle-less Sen. Lisa Murkowski from Alaska );
• making the corporate tax changes permanent (and effective without any transition period) while making the individual tax cuts other than benefits for the wealthy like the estate tax changes temporary.
• (just to name a few).

When the health care mandate removal is combined with the other provisions,  "On net, the poor would actually lose out in all years once this effect is taken into account."  Dylan Matthews, The Republican tax bill that could actually become law, explained, Vox.com (Dec. 14, 2017).  The following Tax Policy Center graph from the Vox article (using the Urban-Brookings Microsimulation Model) shows that by 2027 the top 0.1% end up doing much better (average tax cut for the top 0.1 percent is $221,550 a year).  The bottom 20% do worse while the middle--the second and third quintiles--have a very insignificant plus (average tax cut of the third quintile is $490).   Within the third or middle quintile, more than 62% of taxpayers that earn between $54,700 and $93,200 would see their taxes go up, "[b]ut only about 0.1% of the very richest one-thousandth of Americans would see a tax hike."  Id.  Early gains--though small, intended perhaps to benefit the GOP in earlier votes--don't last because the individual cuts aren't permanent.  A change to chained CPI for indexing brackets amounts to a tax increase on individuals, while the permanent corporate tax cuts mean rich and very rich do well while middle and upper-middle lose out. 

 

Maybe the most damnable characteristic of these House and Senate provisions, other than the sheer favoritism for the already wealthy, is the favorable treatment in determining the rate at which income is taxed for "owners" compared to the disfavored treatment for taxation of workers' wages.  As the Tax Policy Center notes, the Senate version of the tax bill "would reduce taxes on business owners, on average, about three times as much as it would reduce taxes on those whose primary source of income is wages or salaries."  Paul Krugman, Republicans Despise the Working Class, NY Times (Dec. 15, 2017), at A27.  And this dissing of the working class goes along with treating partners in real-estate partnerships (like the Trump family and many other real estate developers) with kid gloves:  "a partner in a real estate development firm might get a far bigger tax cut than a surgeon employed by a hospital, even though their income is the same." Krugman, Republicans Despise the Working Class, NY Times (Dec. 15, 2017) (quoting Howard Gleckman at the Tax Policy Center). 

The Vox article describes the pass-through provision as part of its "here's who would be better off" section:

Pass-through companies, like the Trump Organization, which get a new deduction reducing their tax burden. The House-Senate compromise bill allows people with pass-through income to deduct a portion of that income from their taxes; the deduction is reportedly for 20 percent of pass-through income, less than the 23 percent under the Senate-passed bill.  Dylan Matthews, The Republican tax bill that could actually become law, explained, Vox.com (Dec. 14, 2017).

Note that this is an off-the-top reduction of what would otherwise be personal taxable income taxed at the taxpayer's individual tax rate.  Workers who are paid wages get no such break. And wealthy people will use good lawyering and tax planning to organize their businesses so that their income is counted as pass-through income rather than wages. This is just a continuation of a trend of favoring passive ownership of capital in this country.  See, e.g., the Berkeley Blog, Wealthy investors to win bigly with Republican tax plan ( Nov. 9, 2017).

Imagine a company where two siblings as owners and a third sibling is the principal employee.  They all receive about the same income from the company--for the worker bee, as wages and for the other two, as a profit share.  The worker bee does all the creative thinking and working.  So the two owners pay tax under this provision on 20% less income than the worker bee.  And this is true in an economy in which economists are generally agreed that pass-throughs are currently taxed favorably, taking everything into consideration, and "don't need another break".    Dylan Matthews, The Republican tax bill that could actually become law, explained, Vox.com (Dec. 14, 2017).  This pass-through provision is as clear a snubbed nose to all those who work hard to earn a decent living as one can imagine.  Fact is, the "owners" are often the takers, and the "workers" are the makers.

 

PS. The Vox article suggests that the corporate tax break is justifiable, based on the GOP "economic theory" that claims that a lower corporate tax rate will "spark so much additional investment in the United States that it would bid up wages and leave the middle class better off through its indirect effects."  Id.  This is just another way to state the "supply-side" "trickle-down" theory that has been relied on  for decades by right-wingers but has never been shown to be justified empirically.  In 2004, the GOP made the same claim for its "repatriation tax holiday" for multinational corporations, claiming that the low tax would allow those corporations to invest and expand, leading to job creation.  It didn't.  It led, instead, to share buybacks and more money for the shareholders.  In fact, a large number of repatriating corporations that did share buybacks with the money also laid off thousands of workers.

PSS.  The Vox article also suggests that the limitation of the state and local tax deduction for individual taxpayers (but not for businesses) has a "reasonable case" supporting it.  Sure, the benefit of the state and local tax deduction is regressive, in that higher income taxpayers in larger houses with larger property taxes and larger incomes get more of a deduction.  And yes, it tends to benefit those states with higher state income taxes that are used to develop infrastructure and education.  But that misses several points in response.  First, for people at the upper-middle income bracket, the Alternative Minimum Tax generally limits the availability of the state and local tax deduction.  Second, people who currently own homes and are paying taxes on those homes and living in states with higher taxes likely took the availability of a property tax deduction into account in determining what they could pay for their home: the bill does nothing to provide a reasonable transition for these folks that takes their expectations into account.  Third, when the GOP is trying to counter a Democratic president, it always makes the argument that it makes more sense to support states in allowing them to experiment with different ways of raising revenues and supporting their economics.  That's what the "blue" states have done:  they have recognized that having higher taxes allows development of infrastructure, support for education, funding for research and other priorities, and these expenditures have created a more sustainable economy and better standard of living in those states--exactly what the "state experimentation" is supposed to do.  Yet the GOP provision on state and local taxes is now justified as a way to undo the benefit for "rich" states without doing anything to help the "poor" states.  (In fact, Ryan and McConnell have made it clear that their goal is to harm the poor states by reducing funding for Medicaid, Medicare and Social Security on which those states in particular depend.)

 

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The Republican Party's Heartlessness--the Casualty Loss Provision of the purported "tax reform" legislation

The GOP is cruising towards passage of its class warfare tax legislation that continues the long trend of Republican tax policy to redistribute upwards to the very rich.  The legislation, however, is supported by a small minority of the American public (latest polls put support for the tax legislation at less than 30%). See, e.g., Allan Smith, Polls show key Republicans could get whacked by the tax bill, Business Insider.com (Dec. 4, 2017). That's astonishing when you consider that one provision in both the House and Senate bills that is used as a "revenue raiser" to pay for the huge tax subsidies to corporations and wealthy taxpayers will be especially hard hitting to lots of middle class and lower-income people, including many who voted for Trump.

The legislation will gut the "casualty loss" provision that currently allows taxpayers to deduct losses from hurricanes and fires and other accidents and forces of nature, to the extent those losses aren't covered by insurance (after a $100 per loss limitation).  Thus, people who were flooded by Harvey can claim casualty losses on their 2017 tax returns for amounts not covered by insurance.  People who lost their homes in the fires that raged earlier this fall in northern California can claim casualty losses on their 2017 tax returns for amounts not covered by insurance.  But, as Bob Cesca notes for Salon.com, As L.A. Burns, Republicans Vote for a Tax Hike on the Victims (Dec. 8, 2017).  See also Thomson Reuters Tax & Accounting News, 2017 Tax Reform: proposed individual tax changes in the 'Tax Cuts & Jobs Act' (Nov. 3, 2017) and Sally Schreiber et al, Details of Tax Reform Legislation Revealed, Journal of Accountancy (Nov. 2, 2017) (noting that the personal casualty loss is repealed, except, in the House version, for such losses associated with special disaster relief legislation--which requires congressional action for each one); Tony Nitti, Senate Releases Tax Bill: Here's How It Compares to Current Law & the House Plan, Forbes.com (Nov. 10, 2017).

You have to wonder just how the Republican Party and Trump administration became so completely heartless.  And why they think that Americans won't notice that they only care about multimillionaires in the "one percent".

Hope Lives: Pressing Collins and Corker and Flake on Tax Bill

The Republicans' proposed tax legislation--whether the House or Senate version--is despicable.  It will exacerbate the already devastating income and wealth inequality in this country, leave the federal government without adequate funds for real infrastructure and social safety net needs, and place in almost inviolable power the wealthiest oligarchs of the country (and even the good ones exert a power that no one should possess in a democracy).

My previous posts on this so-called "tax reform" "simplification" package (it is neither) have outlined a number of pernicious provisions in the bills.  There are a few I haven't mentioned, such as the likely inclusion of taxation of tuition benefits to undergraduate and graduate students.  That will have an immediate impact on education and on basic scientific research.  Not surprising, given Paul Ryan, Donald Trump, and Mitch McConnell's aversion to fact-based science and intellectuals, but nonetheless devastatingly harmful to the country in loss of prestige for our universities, loss of the top minds to other countries, and loss of entrepreneurial and innovational thinking that will hamstring commerce and productivity.  Another is the "new" talk in the House of lowering the tax rate on the weathiest bracket by as much as two and a half percentage points--adding to the largesse for the wealthy otherwise larding the legislation and making it even more obvious that the only Americans the Republican Party sees itself as serving are those with at least millions and probably billions of net worth.  The Republican charade of right-wing "alternative facts" (shown most clearly by the Treasury Secretary's inability to provide a supported rationale for the absurd corporate and oligarch-favoring tax cuts) would have a destructive impact on the entire U.S. economy.  And it is not simplification--it is a huge complication that is ripe for tax abusers to abuse the complicated categories of differently taxed income.

But today there is a ray of hope that this tax scam might just not get passed --or might get turned around very quickly if it does get passed.  Doug Jones' defeat of constitutional scofflaw and likely multiple-sexual-predator Roy Moore should cause any thinking Republican in the House and Senate to take a step back and listen to the views of constituents across the country, where dislike of this tax legislation is the majority view.  The #MeToo movement and its impact on powerful media and other industry harassers, together with the fact that Democrats and Independents got out the vote in Alabama and defeated Roy Moore -- and another 20,000 likely lifelong Republicans decided to  write-in another Republican name other than Roy Moore--should tell current GOP congresspeople that "the times they are a changin' ".  Reaganomics--trickle-down, supply-side tax policies--don't work.  Kansas proved that, if anybody actually had any doubt before.  If the Republican majorities in the House and Senate pass this " Class War" tax legislation--written and argued and honed to a tee to serve the wealthiest multinational corporations and individual campaign donors while stabbing the middle and low-income classes in the back--they will potentially pay a big price at the polls in 2018 and 2020.   They will pay that price because their tax legislation will send the U.S. economy into another tailspin that will lead to cuts in the standard of living of ordinary people so people like the Trumps can have even more gaudy gold faucets in their many mansions.

I call on everyone who can to write and call Jeff Flake (Arizona)--ask him to stand on principle and vote against the end of the Obamacare mandate, the giveaway to the wealthy and big corporations, the ridiculous scammable complication of different rates for the same income depending on what job the taxpayer worked at or whether the taxpayer owned the business or was an employee.  Ask him to vote down this despicable tax legislation for the good of the country and ALL the people.  Do the same for Susan Collins (Maine), who already has expressed real concerns about the impact of the elimination of the health insurance mandate.  Even her 'bargained for' (but not actually promised) two-year patch wouldn't do much good:  millions of people, the most vulnerable amongst us, will lose health insurance and therefore health care if this tax legislation passes.    And let Bob Corker (Tennessee) know how much we all respect him for actually standing firm against this tax legislation travesty--and ask him to stand even taller by resisting the pleas to compromise principles 'just to get a win for  Trump'.  Let's push our Senators and Representatives to stand tall for a sustainable economy based on fiscal responsibility (don't create a $1.5 trillion dollar deficit) and distributive justice (don't push the middle class into dead-end living conditions) and end the giveaways to the wealthy oligarchs.

I predict that if this bill passes the expected accounting for the Republican Party will come even sooner and with even more  strength against those who supported Trump's daily vitriol of falsehoods and the Trump Administration's filling the DC swamp with those who put pollution, despoiling the environment, destruction of the wilderness and national public lands foremost on their agenda.

The Utterly Terrible GOP Tax "Reform" Scam

The Republicans in the House and Senate continue on their downhill rush to pass their so-called "tax reform" plan before the holiday break.  It's a mad rush to nowhere, a corrupt process of "please the oligarch" that will cause a huge deficit increase (on the scale of $1 to $1.5 TRILLION over ten years) and be used by the Ryan, McConnell and Trump cadre of liars to justify a domino effect of Medicare, Medicaid, and Social Security cuts.  It is class warfare of the one percent against everyone else.  And it is being sold to the American people with a litany of falsehoods.

Almost all the provisions in the bill are designed to be generous to the ultra wealthy and stingy to the middle class and poor. 

Corporations and their owners and managers--among the wealthiest people in the country--get the only permanent tax breaks.  It's done in the name of competitiveness, but that's bunk.  It essentially encourages corporations to continue to move profits out of the US because foreign profits are taxed at zero while US profits are taxed at 20%.  It pretends that the multiple tax breaks for big corporations are necessary (under disproven trickle-down and supply-side theories) to lead to more investment in business in the US and to more jobs and higher pay for workers.  But in fact corporations are enjoying record profits under current law and they aren't using those record profits to pay their workers more or to create more jobs or even necessarily to invest in the US.  Mostly they are just doing share buybacks for shareholders (ie, owners/managers and other shareholders) that include the  wealthiest people who own the most corporate stock.  That's because it is demand, not capital, that determines what business expansion is needed and results in labor shortages that give workers leverage to demand more pay.  Tax cuts for corporations just add to the already existing capital glut.

The estate tax cut (elimination in the House bill; doubling the exemption to levels that only the very few multi-billionaires will pay any at all in the Senate) ensures that the wealthy will pay almost no tax at all.  They borrow against their wealth while alive.  Their estates pay no tax on the accumulated wealth when they die.  Their children inherit with a "step up" in basis so they get a huge windfall.  And their children can pay off the parents' debt by selling a few items (because of the basis step-up, with no taxes either) and live on their windfall without ever lifting a finger to do any real work.

Individual workers really lose out in these bills.  Under the House bill, the rate on the lowest wage earners is INCREASED 20%--from 10% to 12%.  And all of the 'tax cuts' for ordinary taxpayers sunset after a few years, while the corporate cuts are permanent.  Shows where the GOP loyalties lie--not to the worker base that put them in office, but to the wealthy oligarchs like the Koch Brothers who donate to the GOP political campaign chests.

The pass-through provisions (a 23% "deduction" from income before tax is one version)--along with the ability of businesses but not individuals to deduct state and local taxes--are a great boon for wealthy owners of real estate partnership interests, like the Trump family.  But they make no sense at all.  The more different kinds of income categories that are created with different rates, the more you empower the wealthy to gamesmanship with the tax system.  That's what this legislation does in spades.

And after the American people spoke up in Town Hall after Town Hall that they wanted the Affordable Care Act health insurance system protected, the Senate's version of the so-called "tax reform" bill (developed in utter secrecy by Republicans bargaining with Republicans as though nobody else counts) eliminates the individual health insurance mandate (and accompanying penalty).  Without that, the entire idea of affordable insurance through government-operated exchanges fails, because the only people on those exchanges will be those who are sick enough or old enough or vulnerable enough to realize that they will need health insurance soon.  Insurance works by diversification of risk--that's why the Republican insurance plan in Massachusetts, the model for Obamacare, called for an individual mandate and penalty.  Without that core feature, the exchanges can't work because the risk isn't sufficiently diversified.  The Republicans who are trying to gut Obamacare know that, and apparently they don't care that this particular "tax cut" will in fact cost more than 8 million Americans the possibility of having affordable health care, likely leading to early deaths for a large number of that group.  They don't care, I guess, because "those people" are less likely to be wealthy and less likely to vote Republican.  If you are so blinded by partisan fealty that you no longer care about legislating for the good of the nation, you descend to the garbage dump level of this Republican tax bill.

Of course, the elimination of the individual tax cuts, the expansion of the real-estate-industry favorable tax cuts, the inclusion of what can only be called a 'mock' provision to deal with carried interest (it doesn't), the elimination of the medical expense deduction (in the House bill) that will leave the disabled, the injured, and the elderly in dire straits, the decimation of the casualty loss provision that helps ordinary people recover from natural disasters, the huge cutback to the state and local tax deduction for individuals (while continuing to allow it for all businesses)--all these provisions prove that Republicans don't care a fig about ordinary people.  We won't be spending money on basic scientific research (needed to be competitive in a global marketplace and needed to save lives from cancer and other diseases).  We won't be spending money on infrastructure (needed to have safe roads, trains, airports. etc).  We won't be spending money on  education (other than Betsy DeVos's favored religious charter schools that teach falsehoods on a daily basis).  We won't be creating a sustainable economy that serves all of our citizens.

Oh, but we will be decimating the environment, as Trump's lineup of industry trolls continues to reduce wilderness areas, as Lisa Murkowski sells her tax and healthcare vote to get to open pristine and irreplaceable Arctic wildlife refuge to the oil and gas fossils that have grown obese off 200 years of government subsidies (see The tax bill is bringing drilling in the Arctic National Wildlife Refuge closer than ever, Vox.com (Nov. 28, 2017)), as Zinke reduces FOR THE FIRST TIME EVER national monuments set aside by other presidents so that those obese coal and oil and gas guys can get even wealthier (see Zinke backs shrinking more national monuments and shifting management of 10, Washington Post (Dec. 5, 2017)), as Pruitt ensures that nobody at the EPA does anything to protect the air, water and land from industry pollution, see Goodby science, hello industry, LA Times editorial board (Nov. 6, 2017). .....

The passage of a tax bill that will create an additional one-to one-point-five trillion-dollar deficit is proof that the Republicans don't care if they destroy this country in their effort to return to the Gilded Age of the past (or, in Roy Moore's definition of the time that America was great, the slavery era when (white) families stayed together and were able to sell black babies away from their black mothers (or half white babies away from their raped black mothers)).

What is the Republican response to the deficit and mal-distribution problems created by such a huge tax cut for the already wealthy?

1) The tax cut will pay for itself.  This is trickle-down gobbledy-gook.  The vast majority of economists and tax experts are quite clear that this is simply not a supportable claim.  It's pie-in-the-sky ideology with no basis in fact when there have been a number of attempts to find such a basis.  It wasn't true for Reagan, back in an economy for which tax cuts held much more promise of economic stimulus than they do for our current situation.  The Kansas experiment shows this trickle-down reasoning is without foundation. Russell Berman, You Better Learn Our Lesson: Kansas Republicans say they are worried that Congress and the Trump administration will repeat the mistake they made in enacting budget-busting tax cuts, The Atlantic (Oct. 11, 2017).  But Treasury has now put out a one-page analysis--compared to the careful, extensive, fact-based analyses usually prepared to support well-researched tax proposals--saying that the GOP plan would produce record growth and that growth would pay for the tax cuts.  See Alan Rappeport and Jim Tankersley, Treasury Defends Tax Plan Cost with One-Page Analysis (Dec. 11, 2017).  Event the speculative Treasury 'defense' assumes away half of the deficit with legislative cuts that aren't even on paper yet.  It's pure fiction.

2) Medicare, Social Security, Medicaid (the "entitlement" programs) will have to be cut to make up for any deficits.  That, of course, is the underlying plan. See Jeff Stein, Ryan says Republicans to target welfare, Medicare, Medicaid spending in 2018, New York Times (Dec. 5, 2017).  Create a deficit and use it to 'starve the government' to justify cutting any programs that don't serve the oligarchs.  Most of that minority of people who voted Trump into the presidency (assuming there wasn't a good bit of ballot falsification, which I think went on in Detroit to not count everyone's ballot) will suffer from this--they depend on Social Security when they retire and on Medicaid when they become incapacitated in their old age and need nursing home or assisted living care.  Under the Republicans, we'll return to the "good old days" of the Great Depression when old folks became homeless and the government didn't have to bother with caring about the vulnerable.

We all should be hitting the phones and telling every GOP member of Congress that they are not there to protect their wealthy donors: they are there to protect us and ensure that the economy is sustainable and viable for all of us.  This tax legislation stinks. Tell Congress to ditch it in the sewers where it belongs.

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Trump Administration Plays Havoc with Education--and your tax dollars

Betsy DeVos was confirmed as Secretary of Education in a Senate vote that had every Democratic Senator voting against her, along with two brave Republican Senators (Lisa Murkowski, Alaska; and Susan Collins, Maine).  Thanks to those no-voters who showed integrity.  Regrettably, the vote created a tie, broken in DeVos's favor by Trump's Veep, Mike Pence.  Note that the result is that Senators representing by far the vast majority of the American people voted AGAINST DeVos.

As a Michigander, I can tell you firsthand that this is a disastrous choice for the head of the most important Education agency in the country.  Betsy DeVos is just another one of Trump's billionaire crony capitalists who are using service in the government--which  is supposed to be about service on behalf of We the People--as a way to funnel more money to their fellow crony capitalists through elimination of protective regulations, open exploitation of federal lands, and willful ignorance about the harm that their crony capitalist policies have done and will do to the economy. 

ASIDE:  Check out, for example, Melania Trump's new lawsuit claiming $150 million in damages from The Daily Mail because it's article on the company she modeled nude for suggesting that the company was an 'escort service' cost her the "once-in-a-lifetime opportunity" to get rich off of her "multi-term" exposure to being the most photographed woman in the world--i.e., (not explicitly stated but clearly implied) her status as First Lady.

Betsy DeVos  is an heiress with billions who married into another crony capitalist family with billions.  The DeVos family has used its wealth to curry favor and influence in state and federal government.  IN particular, Betsy DeVos has been busy using her wealth to remake public education in Michigan in line with her own particular religious and crony-capitalist views on Michigan's education.  She supports junk science including "intelligent design", the pseudo-science replacement term for religious "creationism", in an attempt to undo scientific support for evolution.   She has pushed charter schools on Detroit--blaming any education shortcomings on dedicated teachers and disadvantaged students in public schools that have been deprived of hundreds of millions of state dollars owed them while turning a blind eye to the abject failures of for-profit charter schools in which 'management companies' rip off taxpayer dollars to overpay executives without having to comply with any of the accountability measures that are pressed on public schools that are underfunded.  Betsy DeVos knows nothing about public education, knows very little about the privatized charter schools she pushes, knows nothing about education law, and knows nothing about improving education in inner cities or poor rural areas.   What she does know is that she supports any way possible to take taxpayer money and give it to religious and other private schools to use without accountability to the public. 

I predict that the result of her term as Secretary of Education will bring further devastation of public schools, more funneling of taxpayer money to line the pockets of private school managers and even less requirements of assessment and accountability from those very managers, a dearth of fact-based evidence for anything in education, more and more rip-offs of ordinary Americans by for-profit purported schools like the fraudulent so-called "university" that was "Trump University"--i.e., a precipitous slide in American education caused by the crony capitalist privatization impulse and real harm to the children and grandchildren of that minority of the American population that voted Trump and his ilk into office.

The result is that tax dollars that public education so desperately needs will be  sent instead to the pockets of the already rich.  Public education will continue to struggle to innovate and expand programs that can reach underprivileged children who don't have enough food, shelter or home stability to learn well.  MOre and more children will be subject to religious indoctrination rather than education, and be less prepared to deal with the global world we all live in and to take the kinds of jobs--like renewable energy, and engineering and medical research--that provide the basis for a broad-based, stable, productive economy that makes life better for all of us. 

Trump voters, beware.  You thought Trump's promise to 'restore energy jobs' was one devoted to helping you.  Look, there are already more jobs in electric power generation from renewable energy in this country than in coal.  See, e.g., US solar power employs more people than oil, coal and gas combined, report shows (Independent.co.UK, Jan 23, 1017); There are now twice as many solar jobs as coal jobs in the US (Vox Feb. 2, 2017).  The way to 'restore jobs' (whether energy or otherwise) isn't to try to drive the country back to the 1950s when white men were almost the only workers at any decent paying jobs and the multinational corporations had not yet taken over U.S. businesses and moved much manufacturing to other countries.  The way to create jobs in the United States is to embrace the creativity and ingenuity of the American people, build an environmentally better world with clean water, clean air, clean food, regulating the companies to protect the people, and teach our children facts rather than "alternative facts" about the world we live in.  Climate change denialism, continuation of the hundred-year-old giveaways to  oil and gas and coal industry polluters while squelching assistance to the new renewable energy industries; privatizing education and health care (including moving Medicare to the States in a way that would allow them to make serious cutbacks in health care for those on Medicare)--these things that the Republicans stand for will ultimately leave America the Great more of a third-world country and seriously hurt that group of rural and suburban ordinary Americans  that voted for Trump more than anyone else.  Betsy DeVos is the most obvious example of a Trump crony money-bags who has no business in government, but there are plenty of others that Trump has put forward, such as the EPA director nominee (a person who has filed numerous lawsuits intent on destroying the EPA and doesn't want the government to act to protect Americans from rich polluters), the Labor Secretary nominee (a person whose company has frequently violated worker protection laws and who wants businesses able to make profits by exploiting (and harming) their workers), and the Attorney General nominee (Jeff Sessions, a person who in his career made a point of trying to squelch black vote organization drives). 

The Trump administration is engaged in class warfare in its most heinous form--using the agencies of the federal government that are designed to protect ordinary American people to roll back those protections and give away federal resources to crony capitalists.  And the Republican party leaders, after their obstructionism of health care and environmental protection for working class folk during the last 8 years, are now rolling over backward in spineless obedience to the Trump machine steamrolling over ordinary Americans' needs.

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Both the rich and ordinary Americans misunderstand their economic interests

There is class warfare going on, right now, all across this country.  It's highlighted by the election gimmicks and gambits of those on the right who claim to be supporting ordinary Americans but whose real intentions show in the results. And it is ultimately a sad statement about Americans' understanding of what is required for a sustainable economy that supports decent lifestyles for all.

Let's start by looking at the maps resulting from studies of well-being that identify the states where people are not at all well-off, such as the 2013 survey done by Gallup Healthways, available here.  Those poor states are the reddest of the red belt in Mississippi, Tennessee, Florida and elsewhere across the Deep South--places where I grew up in a decidedly Republican household that bought the GOP economic fallacies hook, line and sinker, and places where today's populations are worse off in terms of the various measures of economic well-being and happiness than the more progressive northeast and west.  

Isn't it likely that the anti-government, low-tax and pro-wealthy/pro-big business policies of the GOP politicos that have run these states for several decades have something to do with these negative results, and that the more progressive policies in the northeast and northwest are reflected in the much more positive results in those areas? 

Yet rural, southern populations continue to proudly proclaim their allegiance, against their own economic interest,  to ill-fated Reaganomics that favors tax cuts (for the wealthy and big business) coupled with  use of  old-time, regressive consumption taxes (toll roads, sales taxes and property taxes),  privatization of public functions (e.g., charter schools managed by for-profit, nontransparent corporations), socialization of losses, militarization, and de-regulation. 

The results are harmful at national and state levels, as those same right-leaning voters suffer from poor K-12 education, low-quality public services including neglected roadways, nonexistent or outdated public transportation systems, inferior safety nets, inferior health results, lower literacy rates, higher teenage birth rates, less access to universities, and, yes, fewer and lower-paying jobs.

Of course, those in the top 5% like to think of themselves as suffering, and therefore see any demands for increased minimum wages (that they consider cutting into their ability to capture more and more (rentier)  profits beyond their already unreasonable percentages) as "class warfare."  See, for instance, this Wall Street Journal video "Do You Make $400,000 a Year But Feel Broke?" from September 5, 2014 depicting the purported hard times for a couple in Chicago making $400,000 a year, buying a $60,000 car every four years, paying a mortgage on a $1.2 million house along with $25,000 a year in maintenance and , entertainment ($10,000 a year) going on vacations ($25,000 a year), club dues ($12,000 a year), and paying for their children's sports ventures ($10,000 a year). These and other  "necessities" and (purportedly reasonable) discretionary expenditures take all of their after-tax money. 

Given that perspective, no wonder those in the top have so little consideration and sympathy for ordinary Americans who have incomes in the $50,000 to $60,000 range, much less for the poor who struggle to put food on the table and heat in the furnace!  They can't even imagine such limited lives. With the growing inequality in this country, the gap between the upper class and the rest of us is increasingly wider.

The broad trend is clear from a diverse set of data. Median household income growth has badly lagged per capita GDP growth, corporate profits as a share of national income have risen, and stock markets have reached record highs.

Outside the sphere of political debate, you also see the real world impact of inequality. Merrill Lynch recommends an investment strategy to its clients based on the growing economic clout of plutocrats, Singapore Airlines is now selling $18,400 first class cabin tickets, and observers think Apple is going to start selling a $10,000 watch. Conversely, Walmart is now primarily worried about competition from dollar stores. The executives at these companies are not hysterical liberals trying to drum up paranoia about inequality, they are trying to respond to real economic conditions — conditions that have entailed very poor wage growth paired with decent returns for those proserous enough to own lots of shares of stock.

 Matt Iglesias, Vox.

The ability to care about those so distant from the well-heeled in-group appears to be diminishing as the gap between the well-heeled and the rest of us widens.  Those super-wealthy corporate managers and CEOs and super-rich shareholders are not likely to recognize in themselves the greed and exploitation of others that their excess returns on capital represent.  As Mitt Romney made so clear, rich folks (i) think of themselves as "meriting" their outsized incomes, in spite of the fact that they often start out with silver spoons and garner greater returns than ordinary folks simply because they have larger capital portfolios to start with and can't possible achieve a level of productivity of 100s times that of ordinary workers, as current CEO pay-levels claim under "free market" theory; and (ii) find it much easier to blame the misfortune of ordinary Americans on their purported laziness and "lack of personal responsibility."  (See earlier Taxing Matter posts on Romney's self-justifying 47% remarks during his presidential campaign.)

But that means the rich (and the GOP most closely aligned with big business and big capital) often support policies that can only lead to greater income and wealth inequality, fewer and fewer Americans able to enjoy a decent, sustainable lifestyle, and the growth of a very small oligarchic elite.  Those policies include making it harder for poor people to vote (justified on the basis of non-existent voter fraud), making it harder for middle class and poor people to go to college (less state monies to universities, less grants and more (profitable-for-big-banks) loans), making it harder to support a family (less public transportation, lower wages, more jobs outsourced, refusal to fund Medicaid expansion, yammering for the repeal of the Affordable Care Act even though the US's market-based health care system is less efficient, more costly, and lower quality than single-payer systems in most other advanced countries), etc.  The long-run result of these pro-elite pro-corporate policies may well be social chaos, as the rich oligarchy faces off against a suffering and shrinking middle class and a grievously disadvantaged lower class.  That may not be so far away as many of us once thought, given the rapidly growing wealth inequality and the more radical right-wing policies that have moved into the GOP mainstream in the form of Rand Paul and other free-marketarian extremists who denigrate government and want to remove the social-economic safety nets put in place under the New Deal.

They denigrate government, that is, except when they recognize that they need it, such as when the ebola crisis erupted.  Suddenly, they want a Center for Disease Control that really functions well, even though they have pushed government spending down. And they want a TSA that can screen arriving passengers, even though they hated the TSA before.  And they wanted the President to appoint an "Ebola Czar", even though they scoffed at the idea of administrative officials appointed to oversee important areas before.  They want a vaccine for ebola, but they have made it much harder to accomplish because of their constant push for "reducing government" and cutting research funding (making one of their pet projects to seek out what they think are silly projects that have been funded by the federal agencies).

The free market, in other words, is claimed to be the be all and end all -- until push comes to shove and it is obvious that market forces require government intervention.

Consider the compaign for governor here in Michigan.  In his ads, current GOP governor Rick Snyder claims to be a hands-on non-partisan fiscally responsible type who cares about everybody in Michigan.  Those ads brag about how Snyder cares about senior citizens and education --using the (meager) increases in "meals on wheels" to claim that Snyder has made life better for senior citizens, and the state's increase in support for purportedly public charter schools.  Behind that facade of political PR is a deeply partisan governor who has consistently supported the elite rich capitalists over the majority of Michiganders who are ordinary salary earners working hard (or working hard to find work).

• Snyder signed a "free rider/right to freeload" bill permitting non-union workers in a unionized environment to free-ride on union contracts without paying their share of the costs of the contracts they benefit from and prohibiting unions from using paycheck deductions to collect union dues.  That kind of legislation, sought by the elite owners of capital who benefit from paying lower non-union wages, is (mis)labelled by the pro-wealthy right as "right to work".  It is really a "right to freeload" law since the union rules it replaces never required anyone to join a union and always allowed workers who benefitted from a collective bargaining agreement to pay only the 'fair share' payment of the considerable costs of negotiating an agreement and supporting workers in grievances rather than support all union activities.  As a result, workers can now pay nothing yet call on the union whenever they have a grievance against their employer.  The goal of such laws is to eliminate union support for workers and thereby increase the power of capital owners, so it is particularly sad to see how many workers are fooled into supporting these "right to freeload" laws.
• Snyder supported Michigan legislation that gave big businesses a huge tax cut, while supporting another bill that gave seniors a huge tax increase by taxing their (often meager) pensions.  No wonder the wealthy who own most of the financial assets in the country and benefit from the decades of lobbying by right-wing propaganda tanks against buinsess and capital taxation think he's a good friend. 
• And of course, much of Snyder's 'support' for education has been cuts to state funding for Michigan universities (especially Wayne State, which serves the predominately Democratic southeastern region of the state) that has affected the state's economy in real ways, as students have to pay more of the cost and universities have less funding for research that directly impacts economic development.  Snyder has also supported an unprecedented increase in charter schools in a system that provides no accountability, doesn't provide improved educational results, and siphons off public dollars for private profits, through the mechanism of private charter management corporations that run the purportedly "public" charter schools.
• Snyder doesn't think we need increases in the minimum wage, and his administration has generally shown little interest in figuing out how to help minimum wage workers revive from the Great Recession.  For example, his administration has done nothing to deal with the myriad fly-by-night companies that cheat workers coming and going on wages. 

ASIDE:   Here's one real-life tale illustrating the problem.   I know personally of a man in Michigan hired by a Michigan-registered cleaning corporation that had contracts with at least  two major national corporations to clean stores in southeast Michigan.  The cleaning company claimed that the man was "in training" and therefore not required to be compensated after two weeks of full-time working for the company, including being locked inside a cavernous store overnight to do a major cleaning job. The company refused to pay for the next two weeks, claiming that "corporate headquarters" had made an error and would straighten it out in the next paycheck a month later.  The man ultimately was paid only  a couple of hundred dollars for that entire month, because the company  produced a purported check stub showing a paycheck even when the man representing the company acknowledge that paycheck had never been issued to the man.  The company paid the man on a "piecework" basis for cleaning stores, claiming that a 30,000 square foot store with public restrooms could and should be cleaned for $25(that's mopping, vacuuming, and cleaning toilets) and that the work could be done in one hour!  The company required the man to pick up cleaning equipment and the company van at the "corporate headquarters" (many miles from his home and many miles from each of the stores to be cleaned) but claimed that it did not have to pay the man for the 3-4 hours per day that he had to spend to drive the company van and equipment to and from various worksites.   The man quit, but has never gotten the company to issue the paycheck that he never received and has never received pay for the many hours spent working for the company moving its van and equipment.  

 

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