Month: November 2017

Don’t Take the Bait

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trump-tweets

So Trump retweeted videos from a right wing ultranationalist UK group showing purported violence by Muslims. It’s just his usual routine, a surprise to noone. The group has a history of trumped up video-perhaps that explains the attraction. Or maybe he got them from Ann Coulter, one of his sycophants. The leader of the group, Britain First, tweeted their thanks to 45, adding “GOD BLESS AMERICA” for reaching out to their 44 million followers compared with the group’s own 24,000. Or maybe it’s payback for Britain First’s pro-Trump hoaxes and anti-Muslim videos posted by websites they created during the 2016 campaign. Of course, the British Labor Party was incensed by this defamation, alienating one of our closest allies even further. Trump has taken a page from his hero Vladimir by exploiting divisions among the British to pump up his Trumpophants.

But it’s not new and the press should not take the bait. It’s just a distraction from the looming crises in Congress – passage of the tax cuts, government shutdown without continued funding, expiration of the Child Health Act, confirmation of the new HHS secretary, resolution of the status of DOCA recipients, North Korea’s arrival as a nuclear power, among others. It is worth noting that press secretary,  Sara H, perfectly summed up Trump’s position on veracity; in essence, what does it matter about the authenticity of the videos, it only matters that the danger from Muslims is real. “Our cause is higher than any truth!” is a daily White House rule. Ah, echoes of all good dictators.

Mainstream media, please don’t fill the news with graphics of Trump’s tweet with  the videos embedded and run around in a flurry covering the tweet, immediately multiplying its influence immensely. We don’t need an endless stream of comments from every politician under the sun interested in enlarging their own profile. Leave some space to develop the larger implications of this nonsense over the next few weeks – are there wider implications for our relationship with the UK; will Queen Elizabeth cancel Trump’s visit in response to protest; will Twitter take down those damn videos, etc. Or maybe the relief effort in Puerto Rico or federal judges being appointed. And of course, the newest additions to the famous sexual harassers and abusers list.

The Coup That Will Bring Down the Consumer Protection Agency

More important is the victory of Nick Mulvaney over Leandra English, deputy director named by the retiring director Richard Cordray to take charge at the CPA. Again, no surprise that 45 won out over the legislative intent of Congress which specifically crafted a line of succession when the directorship changed hands, a move to safeguard the independence of the agency from executive hands. The federal judge making the decision is a recent Trump appointee, an example of the president’s impact on the judiciary, weighing heavily against progressive hopes that that branch will counterbalance the Trump/Kochopolus assault on democratic government. Mulvaney has already halted the retribution payments to victims of bank fraud, part of the $11 million already paid out in settlements by the agency. We can look forward to the paring down of the 1600 agency employees next, accompanied by abandonment of ongoing investigations and a sudden lack of interest in pursuing complaints. Mulvaney, who has said that the banks are being victimized and hamstrung by the agency, is content to leave the banks to pursue whatever new nefarious devices they can muster to wring a few more dollars out of consumers. Clearly, financial institutions don’t have enough lawyers and corporate protections to fight off a single consumer or even a group. We can see how a defenseless automobile industry, which is exempt from the CPA, has suffered. Mulvaney has said he wants to give financial institutions a free hand to run roughshod over customers, and so they shall have it. Billionaires 5362, US 0.

But there is a larger issue here: the independence of the Consumer Protection Agency itself. Because Congress believed that the agency should be independent of the Chief Executive, he was given one power, the nomination of the director. The Senate has one power, in line with the Founders’ notion of balance of power, and that is to confirm the nominee. In this case, 45 has nominated someone who has another position in the administration and so can be removed at the president’s whim. The deeper concern is that Mulvaney is directly obligated to Trump, significantly compromising his independence. In addition, this is an interim appointment which under the Vacancies Act, can last for 8 months. That sets up the possibility for consecutive interim appointments far into the future, yet another way to cause the agency to become dysfunctional under rotating heads, each beholden to the president.

Beyond the issue of agency independence is the legitimacy of Congressional power. The agency succession plan crafted by Congress specifically rejected the Vacancies Act, which had been initially proposed and substituted a plan where a director would name his deputy director to succeed them until a new director was approved by Senate confirmation. When enacted, the Vacancies Act applied to all the agencies in existence at the time, but stipulated that future agencies could be exempted if Congress designated its own succession plan, as is the case with the CPA. The implications here are clear; there was no vacancy at the agency, because Leandra English became the acting director as soon as Richard Cordray resigned. The federal judge chose to rule against this argument in favor of the man who appointed him. The decision may be appealed, but as it stands now, shield for consumers has been turned into a spiked club for wealthy corporations and financial institutions.

It’s just more of the same from a faux populist president who is showing his true allegiance to the ranks to which he aspires. After all, the Donald wants us to believe he’s a billionaire, but how do we know that it’s not an inflated claim where lifestyle is substituted for cash money. This is certainly not the first thing 45 has enlarged about himself; it’s a daily ritual with him.  We have never seen a president who consumes so much energy browbeating us with accomplishments that are so often smoke and mirrors. His administration is a giant sound stage where any effect, limited only by imagination, can be whipped up.

Still, 45 continues to thrust against the bounds of executive power, not just as in this instance, by usurping Congressional powers, but in any area resistant to his desire, like with multiple approaches to congressional leaders in an attempt to shut down the investigation into Russian influence in his campaign. His public pronouncements to force the Justice Department into investigating political opponents like Hillary Clinton is another example. The MakeAmericansPoorer president refused to disclose and divest his business interests, which he shamelessly continues to promote across multiple government platforms while enticing foreign government representatives as well as a full range of organizations seeking to do business or influence the government. A short list of other affronts includes attacks on the free press and attacks on the judiciary, all part of a campaign to insidiously grind away at the American government  and the way it has it  functioned until his arrival. Republicans are surrendering a centimeter at a time to the enemy of democratic government within the White House.

Well, It’s Alabama

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Georgians’ reaction to the Washington Post story alleging serial sexual assaults by Judge Roy Moore, Republican Senate candidate from Alabama while he served as a district attorney is simple – ” well, it’s Alabama.”

As alleged in a Washington Post article, Moore, a 32 year old assistant District Attorney, at the time, met a 14 year old girl in front of a courthouse where he volunteered to watch her while her mother made an appearance inside for a custody hearing. Later, on their first date, he took her to his home in the woods and kissed her. On the next visit to his home, he undressed her and himself, and asked her to touch his genitals through his shorts as he fondled her breasts and labia through her underwear. She asked him to take her home. She told her friends at the time that she was seeing an older man named Moore and confessed the abuse to her mother ten years later when Moore had become a judge.

There is a lot of corroborating evidence that supports that pursuit of adolescent girls was Moore’s characteristic behavior. Two other girls between ages 16 and 18 said they were flattered at the time by the attentions of a man in his early 30s, but later came to be more unsettled by it. Each had several dates with not more than kissing. One said the assistant DA gave wine when she was 18, not yet legal drinking age in the state. None of them said that there was any sexual contact.

Since the initial reports, another woman reports that Moore sexually assaulted her in a car in 1979 after he had become the DA. He fondled her breasts and tried to force her to commit fellatio and when she resisted, he stopped and told her she was just a child.  She worked at a restaurant in a diner where Moore ate frequently but has lately denied knowing. Her supporting evidence is Moore’s message in her high school yearbook, signed with his title of DA and the restaurant name included. She said that Moore threatened her by saying that he was the DA and who would believe a young girl’s word against his if she ever disclosed the assault. Two other women have since come forth as well, each adolescents who had been approached.

Moore was a well known figure at the Gadsden Mall, where a store clerk says that she tried to watch out for the younger clerks because he made the girls nervous.

 Moore was a well known figure at the Gadsden Mall, where a store clerk says that she tried to watch out for the younger clerks because he made the girls nervous. Moreover, an assistant district attorney in his office said that it was well known in town that Moore dated adolescents. A woman who worked at the YMCA during those years said she noticed that Moore generally talked to adolescent girls in ways that just seemed “unseemly”.

Judge Moore’s response was the predictable denial with the familiar evocation of Establishment conspiracy against the Christian right, amped up to include his status as the savior of the GOP 52 vote majority. He noted in his statement that after 40 years of constant investigation, it’s a strange coincidence they couldn’t come up with anything but this, insinuating that the accusations were fabrications. One might ask why he thought he was the subject of investigation, but this story didn’t seem that hard to flesh out, given the number of residents willing to comment on the record and even in TV interviews. Breitbart announced that it was sending reporters to expose the truth; it will be interesting to see if they start with people already on the record or create a coterie of deniers.

Moore built his reputation on being a leather vested, cowboy hatted Christian Super Hero toting a pistol. But early on in his career, he was twice investigated by the state bar for “suspect conduct” and lost several Democratic races for office. After a turn rustling cattle Down Under, he returned to his home state to finally win an elected judgeship. He was then sued for opening his court sessions with prayer and asking divine guidance for the jury under a wooden 10 Commandments plaque on the wall. He was later removed from his Alabama Supreme Court justice position for defying an order to remove his own commissioned granite Ten Commandments monument from the courthouse. After reelection to the bench, he was removed again for ordering court clerks to refuse to issue marriage licenses to same sex couples.

In Alabama, defying the federal government is popular. The Trumpophants embraced Moore’s pronouncements that Muslims should not be allowed to serve in Congress. In addition to routine  right wing positions like pro-forced childbirth, homosexuality is equivalent to bestiality, he has made more extreme statements like calling 911 God’s vengeance for American sin. His qualifications for a Trump style Senator include his disdain for the courts, the law and the Constitution even as he served as an officer of the court, the heartfelt support from Steve Bannon and as a kindred spirit sexual predator. And importantly, Moore says he will follow Trump to the ends of the earth.

Moore’s supporters followed a traditional playbook. If not fabricated, why did it take 40 years for these charges to surface? They asserted that the Washington Post probably paid the women for false testimony. This is always the first line of defense. Next comes the attack on a woman’s reputation. Men, in the universal delusion that women are generally trying to “gittem” by alleging some sexual offense, always employ doubt as their first weapon. Both these approaches are effective as they align with cultural norms that still unconsciously blame the victim for their enticing behavior rather than understand that sexual violence is all about the power and not about the sex. Power has its own erotic allure. Moore told his victims that very thing – “I am the powerful DA and you are just a kid.” A man in his 30s has little in common with a junior high school student, but he can control her and entice her into sexual encounters.

Women know the playbook too. Why would any women take on the character assassination and the shaming, when the likelihood for justice is so slim, especially in the 70s and 80s? Raised in the same culture, victims often feel that same sense of guilt and blame themselves. Their reputation in the community would have been destroyed. In fact, in that era, fondling of adolescents might have been considered creepy, but not criminal.

I don’t remember dating any girl without the permission of her mother”.

In any case, it’s the district attorney who’s responsible for filing charges and prosecuting the case. In the 70s, the police, with their close working relationship with the DA in this small county would have dismissed this as “boys will be boys” and wouldn’t even have filed a report. One of the victims considered coming forward when Moore was running for judge years later, but the struggle would have been the same then. At least now, in the wake of Bill Cosby and recent #metoo revelations, there seems to be at least more support, even as no criminal action will result. And for victims, revealing a secret that had been a burden for years can help them begin to heal.   

Sean Hannity, one of numerous high profile conservatives, tried to use his radio show to support the judge, well that and boost his audience and ratings and income stream. During the interview, Moore inadvertently revealed some pretty damning evidence of his own, seemingly unaware of both the repeated opportunities Hannity gave him to flatly deny the allegations and his essential confirmation of pursuing adolescents. When asked if he remembered dating adolescent girls around that time, Moore responded “ not generally . . .but I don’t remember dating any girl without the permission of her mother”. In that response, Moore disclosed that dating adolescent girls as a 35 year old was normal in his view as is hanging around the mall and high school football games to accomplish that. Imagine a 30 year old man asking the mother of a 9th grader if he could date her daughter? I wonder if the girls had curfews? One girl said that she was allowed to stay out later with Moore, while he was enticing her into underage alcohol drinking. There is something perverse about that. Well, you can get married at 16 in Alabama with your parent’s permission.

The response from Alabamians has been even more mind numbing. In a bizarre example of blame shaming, one Alabama legislator suggested that the women should be prosecuted for failing to report the incidents since that failure left a predator free to continue his spree.  In terms of timing, one official asked why the Post didn’t publish the story in August or last year. He’s probably not very knowledgeable about investigative reporting or read the article which details that the reporter heard rumors about Moore’s attempts to have relationships with teenage girls while doing a story on Moore’s Senate campaign supporters. It takes time to flesh out the story with interviews and confirmation. But this is not a story that the Post set out to write, it just evolved in the course of other reporting.  

The rise of Trump has meant some imaginative pretzel twisting in the minds of conservative Christians. Apparently, the more devout, the more creative the Bible thumping. Alabamians have their own Bibles or at least the way they read them, perhaps reflecting some deficits in the state’s school systems, which are uniformly among the lowest ranked in national testing. Or maybe their preachers have their own local interpretations of the scriptures. It is a fairly unique interpretation of the birth of Jesus to say “Mary was a teenager and Joseph was an adult carpenter. They became parents of Jesus. There’s just nothing immoral or illegal about that” said Alabama State Auditor Jim Ziegler. Of course, that was immaculate conception before Joseph and Mary were married for a lifetime. Perhaps Moore was going for some variation of immaculate conception since his offenses were groping breasts or attempts to force fellatio. Maybe in his religious fervor, he was abstaining until marriage. One might even suspect that he was suppressing homosexual urges, although he did marry a 24 year old when he was 38, cited by a supporter as another example of his penchant for “younger women”.

The Trump administration has sought refuge in the notion that the allegations against Moore need to be proven under the doctrine of presumed innocence. Proof is an impossible standard in a he said-she said case that will never be tried in a court, a justification for the neutral position 45 has taken, or rather his refusal to comment while leaving the door open that the mercurial Trump can later change his position. But this is not a situation with an isolated charge; it is a pattern of behavior over several years that has been corroborated by neutral observers. There are more women coming forward by the day. 

Senators have tried to hide in the “we’re too busy legislating” defense, although McConnell has said he believes the women and is looking at party alternatives to Moore who the party never supported. The RNC has withdrawn its funding. McConnell has even floated Jeff Sessions as a write in candidate, who couldn’t be enthusiastic about relinquishing his far more powerful independent position as Attorney General for a return to the Senate. He worked his ass off in support of America First during the campaign to secure this plum. Still, it could create some kind of do-over, where Sessions would win, be reappointed to replace himself as Attorney General, leaving a new vacancy in the Alabama Senate seat, while being able to vote if something crucial comes up. That seems fanciful at best, when most Republicans would like to stay out of a local race and contend that the people of Alabama must be able to select their own choice. In that case, the Senate should accept a child molester in their midst if that’s what Alabama wants. Yuck. Sounds like the question of whether to seat a victorious Judge Moore is already answered.

37% of Christians in Alabama say they are more likely to vote for Moore because of the allegations of sexual abuse.

The hearsay element has led other Alabamians to minimize or dismiss the allegations. Supporters don’t want to get too much into the weeds, for fear of being forced to reevaluate their behavior. Reinforcing those thoughts is the immediate reaction to being strong armed into doing what the national party wants. That’s anti-states’ rights which is baked deep into Southern red clay. One poll says 29% of Alabamians overall and over 37% of Christians in the state say they are more likely to vote for Moore since the allegations. This is another manifestation of what DavidBrooks @NYTopinion has characterized as the “siege mentality”.

The siege mentality which arises from a sense of collective victimization, seems to be going around, not just with conservative Christians but across the country and around the globe. People feel under siege, not simply by opponents but by a hostile culture or the world at large. The fear and anxiety that results gives rise to a deep-seated pessimism as expressed in the apocryphal vision put forth in 45’s inaugural address. Things are bad and getting worse as their enemies are growing stronger.

If there is something they find ennobling about succumbing to the siege mentality, it is the near martyrdom for engaging in the battle against overwhelming odds. Armed with their superiority, the victims have a simple way to interpret the world–us versus them, where the us is clearly defined by group membership and a clear social identity and the them is everyone else. The ensuing paranoia tends to drive the group to extreme positions making it a parody of itself. The perverseness of evangelicals defending a serial child molester, even in a state where Roy Moore’s lawyer maintains that older men dating adolescents is a cultural norm, seems to fit neatly in that space. Well, it’s Alabama, so maybe.

Alabamians were quick to take issue with the source of the initial report as well, having been primed by Trumpian/Bannonesk attacks on the press. One supporter said he’d believe Vladimir Putin before the Post. So sad! Even more sad was the fake robocall, no doubt a Republican dirty trick, that featured a trumped up Washington Post reporter, notable for a southern inspired impression of a New York Jewish accent, asking if the resident was a 50 plus year old woman who might have information on Roy Moore. The caller offered $5000 plus compensation. Eminently believable by any Alabamian shielded from the reality that newspapers don’t pay for information and the Jewish accent could only have been a caricature.  But the piece de resistance is pressure from the national Republican party. Washington trying to dictate to Alabama is just trampling all over states’ rights. In part, this explains some of the reluctance of Senate Republicans to comment too much; they knew it would agitate Moore supporters, fed by the propaganda musings of Steve Bannon. 

A spokeswoman for Vice President Mike Pence said, “If true, this would disqualify anyone from serving in office.”

Most importantly, the alternative to a vote for Moore is a vote for a Democrat, Heaven forbid! Pedophile versus Democrat, let’s see. As @Jim Jeffries summed it up, “I’m fine with him [Moore] f@*king kids, as long as he doesn’t force me to get health care!” There is another choice, just don’t vote; if an individual can’t bring themselves to vote for a Democrat. At least one could retain their partisanship without sacrificing their moral integrity. But then there is that special Alabama brand of morality, so-o-o-o

Should Roy Moore be seated if the people of Alabama elect him to the Senate? There is political expediency and then there is the right thing to do. Must good be sacrificed so Republicans can pass a tax reform bill that’s a slap in the face of the middle and working classes? The GOP seems to think so and why not, they slay truth every day. They have no moral core, as codified in the Judeo-Christian tradition, even as evangelicals claim unstained purity of belief. Do people who elevate a serial child predator to the august body of the Senate represent what Americans stand for?  If states know best, perhaps we should encourage Alabama to secede from the Union again.

A Little Help To Explode Obamacare

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pinochhio trump45 has donned a new cape: Demonist in Chief, oops, that’s Demolitionist in Chief. His latest executive order is only one of a series of moves meant to put truth into “failing Obamacare.” Obamacare is not “imploding” as Republicans like to say, it’s being dynamited by administration efforts to blow it up. First the constant repetition of the phrase “failing Obamacare” during the failed attempts to repeal Obamacare may have left the impression among those not closely following the debate that Obamacare was on its last legs and would not be issuing new policies this year. In addition, frequent remarks by Republicans as well as administration officials about counties with none or only one insurer were intentionally meant to discourage people in those locations from even exploring the website.

During that same period, the HHS website was badmouthing the program. It’s unlikely that a history of modern government can recall any other government program trying to convince the public that it’s just no good. When Obamacare survived to live another day, HHS had to make a 180 degree about face. An enthusiastic “we’re still here” was out of the question for Price, so he opted to cut the budget for advertising the upcoming enrollment period by 90% and eliminate the navigator program that assists applicants with the enrollment process. Next up was shortening the enrollment period by 50%, from 90 days to 45 days. To further lower enrollment, the healthcare.gov website will be down for maintenance for 12 daytime hours on 5 of the 6 Sundays, one of the peak enrollment days. The enrollment process takes a considerable investment of time to compare and choose plans, so many people wait until the weekends. The HHS assertion that this maintenance schedule was similar to that in years past is the typical Trump administration falsehood; the shutdowns, for essentially half of the day during day hours rather than the traditional overnight time will reduce the enrollment period by an additional 5%. In addition, the administration also announced that it would loosely enforce the individual mandate which can only add to the number of people, including the healthy ones, who opt out of the medical insurance pool.

Behind the scenes, 45 personally intervened to deny an exemption to the state of Iowa, one that did not take advantage of expansion of insurance coverage through Medicaid, seeking a waiver under Obamacare to reduce premiums for more than 30,000 people by 30% using state funds. Likewise, state officials in Indiana requested a waiver to reduce premiums in their state, but HHS missed the deadline to respond allowing the request to simply expire. Both of these interventions fly in the face of GOP rhetoric that states are best suited to chart their own solutions, one of their sacred cows in the numerous failed Obamacare repeal bills.

More publicly, Trump announced that he would veto ACA supplements to insurance because he would no longer send payments to rich insurance companies to add to their profits. A laudable sentiment, but it’s not applicable here. The supplements help to pay out-of-pocket co-pays and deductibles for about 7 of the 10 million buyers of insurance on the exchanges. These cost sharing subsidies are mandated by law to reimburse the insurance companies. The law also mandates that the funds must be used for patient care costs. If not, companies that do not comply are required to return the money. While a court case challenging the validity of these federal supplements which rests on Congressional failure to appropriate funds is still pending, HHS has continued to pay them. Regardless, the companies will have to continue to pay plan enrollees whether they ultimately get government reimbursement or not.

The real victims will be a different set of 7 million people on the exchanges whose incomes are too high to receive the supplements because they will see rising premiums and co-pays and possibly face fewer choices as insurance companies flee the marketplaces in their area.  

The obvious solution is for Congress to appropriate the money. But Trump’s objective is clear; to unsettle insurance companies, encourage them to pull out of the exchanges and discourage consumer enrollment on the exchanges during this current enrollment period.  

The latest Trump edict resurrects the Ted Cruz amendment from the failed attempt to repeal the ACA. One minor provision extends the time frame for short term bridge plans from 90  days to one year which is simply a reversion to the rules in place before Obama changed them at the end of his administration. Yet another instance of erasing Obama down to the slightest detail. But the major provision is that which allows for the formation of association health plans made up of similar types of small businesses to buy less comprehensive plans. In theory, this will encourage insurance offerings across state lines, although it is up to the insurance companies themselves and any independent associations that may opt to create self insured entities. Insurance company decisions about new markets are based primarily on the profitability of policies in those locations, down to the county level, as is happening under the ACA. And theoretically, premiums would be lower because of the competition between companies across a region and because coverage could be more limited than the required ACA benefits. The problem with the theory is that it doesn’t take into account the realities of the healthcare insurance business. Premiums are based on the amount spent on the cost of the medical care, which varies widely between locations. As the prices rise by at least twice the rate of inflation, so too will the premiums.

 The most important aspect of this false alternative is that it offers no additional discount on premiums over that offered through the healthcare exchanges. The strength in numbers from a small association wouldn’t exceed the advantages of the larger exchange pool and thus any savings will come solely from limitations on policy coverage. The feature that these association plans can purchase insurance across state lines comes with the disadvantage that they are exempt from state oversight. As such, in the past, many of these plans were underfunded and financially unstable, causing them to fail without adequate funds to cover customers’ medical bills. They were also less than transparent, misleading buyers about the extent of coverage. In fact, association type health insurance plans are already available but in this instance the provision of less comprehensive plans is what will make them less expensive. They are cheaper to buy but far more costly when people have to use them. In general, customers of this type of insurance are people who need to use it to cover costs of the medical care they are receiving, creating a pool with higher premiums. Even groups composed of companies with primarily young and/or healthy employees, will have to choose higher premiums and/or limited coverage. Because healthy individuals may opt for limited coverage outside the Obamacare exchanges, association plans could undermine the exchanges by drawing healthy people out of the plans offered on the exchanges, leading to even higher premiums. That’s precisely Trump’s agenda.

Administration spokesmen have said that employees in an association plan would be protected from premiums based on individual medical conditions but there are no restrictions on the health plan charging different employers different rates. A company where employees have large medical expenses could be charged higher premiums than one where employees typically get less medical care. Insurers are always in the driver’s seat where premiums are concerned; if they can’t raise premiums, they just pick up their marbles and go home!

Often not mentioned in the ongoing debate is the fact that increased premiums can only cost the government more because higher premiums by law will trigger higher supplements. Obviously, as 45 prevents larger numbers of buyers from purchasing policies on the exchange, fewer people on the exchanges do not represent budgetary cost-savings even as it means more Americans go without health insurance and needed medical care. It is hard to know how these maneuvers could impact CBO estimates of insurance coverage, since no projections have modelled them.

All of these maneuvers are designed to drive premiums even higher by ultimately culling healthy people out of the insurance pool. Large numbers of healthy individuals is the elusive gold ring for medical insurers. Young healthy people, gifted as they are with a sense of youthful immortality, are more likely to count on the low statistical probability that they are going to need medical care or even preventive care. Many preferred to pay the individual mandate penalty, much less expensive than buying insurance. So each additional barrier to enrollment only reinforces the inclination of the healthy to opt out of health insurance.

Insurance companies have already committed to premiums for this year calculated to include the possibility of the elimination of subsidies, but this move is certain to force more insurers out of specific markets and further destabilize the exchanges. But there is a remedy; Congress with its power of the purse could simply appropriate money for the supplements, and though unlikely to succeed, there is a bipartisan effort to create legislation to stabilize the marketplaces while allowing states to obtain waivers of some Obamacare requirements. Trump has strongly opposed this Alexander-Maury bill; well first he did, then he didn’t then he did, but that’s par for the course. Bipartisan efforts have had little success in Congress for several years, but at least theoretically, representatives could respond to the pleas of their constituents to continue their healthcare insurance; pleas to which legislators have so far remained deafened by Republican ideology headphones. Still Republican legislators seem to be waking up to the futility of listening to anything 45 says, and may be ready to chart a different course, even as that course will be deleterious to most Americans, except the rich ones.

The reality is that any changes, no matter what source, cannot come into effect until federal agencies write and adopt regulations implementing them, something Trump still seems unaware of. Maybe he isn’t; maybe he is simply invested in the Theater of the Moment rather than the actuality of change which he has left to cabinet members. There will most certainly be more legal challenges and court decisions. The process will take months and probably will have little impact until 2019 except for the impressions left with the public confused about what is possible in health insurance and less likely to pursue what is still both the law of the land and good medical insurance coverage for people in the individual market, Obamacare.

Tell anyone you know that’s looking for a healthcare plan that open enrollment has just opened for this year. Go to healthcare.gov and do it early.

Tax Reform’s Comin’

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u deserve meEach morning I wake and wonder how the president, administration surrogates and Republican Congressional leaders can continue to lie every single day. By now, of course, it is a second skin that they’ve lived in for a long time. I’m not sure why I, a rational, intelligent thinker find it so difficult to accept. I get the rationale to keep the Trumpophants pumped. I understand that the GOP is racing to get their agenda done before the midnight hour when the coach turns into a pumpkin and there’s no telling if they’ll get back to another ball. But it’s so demoralizingly depressing to watch politics boiled down to “the most outrageous display wins the day” play out in front of us. In the meantime, the oligarchs are playfully bleeding the citizens dry, intent on making us poorer and sicker and poisoned by the environment for mo money, mo money, mo money.

Trump really threw in a zinger when he maintained that the GOP had the votes to pass Graham-Cassidy but couldn’t vote because one member was in the hospital. He kept repeating it like an audiotape glitch. Or more like a dotard, hardly capable of running a government. It seems incredulous that POTUS, despite easy Google invalidation, could brazenly recite his wildest fantasies. It is his sense of invincibility that allows him to do it; that and the personality disorder of pathological liar. So far, it’s working for him with minimal political resistance except for the yapping of a frustrated media, complicit in the notion that the coverage of the CelebrityPresident will grab better advertising rates than serious reporting about issues. Still my heart seizes to the verge of stopping each time. Sometimes I just want to roll over and pull the covers over my head. But then it happens the next day and here I am, typing away my anxiety and frustration. And this MoFo thinks kneeling dishonors the American flag! Yes, I’m having trouble letting go of that one too.

Trump is riding high in anticipation of tax reform that will launch his “ratings” into outer space. Likewise, the Republican Congress is bent on proving that the party can govern and they love the common man enough to put a few bucks in every pocket. One administration official felt that Americans care more about the taxes they save than what other people are paying. Or at least they’re hoping that’s the case. They’re going to spin their way into selling the corporate tax cuts as leading to higher wages and more jobs and the appearance that the wealthy will benefit more is because they pay more taxes. Trump doesn’t know what’s in the bill, but no one does except the gaggle of legislators caucusing somewhere unseen. In the run-up, he’ll be poking as many Republican bears as he can tweet. And whatever they come up with, Trump will maintain that it was all him if it passes, but if Congress falls short, it’s all Congress sabotaging the CelebrityPresident’s agenda.                                                                                                                                        

To date, discussions of the new tax proposal, or rather the leaks of the as yet unrevealed legislation are following a familiar path; leak details and send out brigades of spokesmen to lie about the contents to “get the public on board.” The big lie, that it is aimed at the middle class and will not benefit the rich, is just counterintuitive to the essence of the GOP. Trump represented himself as the champion of the forgotten man, but that was never the Republican party pitch. They always smooze about the middle class when they are cutting the legs out from under it. The major party funders bought the government so they could cut their own taxes. The corporate tax cut is supported by the drivel that it will stimulate corporate creation of a windfall of jobs which will stimulate the economy to replace the federal deficit with a surplus. That’s just fake economics.

Corporate tax cuts and those for the wealthy is the premier raison d’etre for the unholy dominance of the party by the Koch brothers and their coterie of billionaire financiers. Since the 1980s, the Kochs created a playbook to make tax free status for the rich and regulation free government for corporations the central platform of the Republican Party; shifted from the John Birch Society fringe to mainstream GOP. They have been steadfastly devoted to this goal, through all its twists and turns, across conservative think tanks, invasions of Ivy League university academic towers, several iterations of increasingly anonymous trust funds funding fictional organizations and “social welfare” groups, formation and funding of the Tea Party, PACs, the Citizens United ruling and superPacs. That’s just the basics. But after the Obama detour, which they bitterly resented, they have finally seized control of the government and they’re looking for a huge return on their gigantic investment.

The administration’s recent travel scandals are indicative of who these people are. They have no problem requesting military planes and chartering private jets for personal trips, thinly disguised as government business because this the travel they’re used to. Admittedly, Tom Price isn’t in the league with Steve Mnuchin; he’s only a wealthy physician who turned the combination of Congressional privilege, campaign funds and the boondoggle that instantaneously enriches an elected official into his fortune. During his confirmation hearings, there were ethical questions about insider stock trades and shaky interactions with drug companies, but the Senate was in such a hurry to give 45 his millionaire cabinet that they didn’t want to be deterred by questionable ethics in an administration already awash with ethical breaches. Besides, the murky ethical pool in which the Congress swims leaves them ill equipped to judge.

Among other trips, Price took a private jet to Nashville to have lunch with his son and another to a medical meeting in Sea Island Georgia, a posh island retreat once the site of a G8 meeting, where he owns a home. Perhaps, he could only agree to repay the $52,000for his seat out of the over $400,000 cost for the flights because he can’t afford to shoulder the whole cost. But that doesn’t mean he shouldn’t be responsible for the whole cost since he chartered the planes. If the ethics agency had any muscle, it would pursue this, but it doesn’t; so it won’t. Perhaps the Congressional committee investigating the travel scandal will insist, in light of the vicious budget cutting across all government agencies. Oh yeah, Price was also reopening the executive dining room at HHS, long shuttered during the Bush administration, because, God forbid, he should leave his luxuriously appointed offices for lunch and risk mixing with regular staff.

But Price was cut loose; to believe that he resigned is just silly. And it’s unlikely that plane trips were the reason. Price failed to deliver on Obamacare repeal despite his selection for Secretary as a preeminent Congressional healthcare expert with a detailed replacement plan. For him to screw up his job and embarrass the administration was too much for 45. Besides, if he’s out, he won’t be forced to pay the full amount of your tax dollars spent on private charters.

On the other hand, Steve Mnuchin, a billionaire with a multimillionaire wife who is obviously supplementing her income with celebrity endorsement fees for tagging luxury items on Twitter, requested a military jet for his honeymoon but was denied. Still he seems big on a military planes; he did fly to Fort Knox, not visited by Treasury Secretary in decades, which coincided with the solar eclipse. Mnuchin later dismissed the naivete of Kentuckians for believing a sophisticated NY billionaire would have any interest in the stellar event. Did he really think anyone stupid enough to believe that bullshit, with Trump himself risking blindness to view the partial eclipse in DC when Kentucky afforded the full eclipse on view? He can afford to pay the full cost of flights and should, now that he pinky swore not to do it again.

Scott Pruitt, a billionaire wannabe over at the EPA is not only private jetting, he’s having a $25,000 soundproof booth built at the agency to prevent eavesdropping on his phone calls, although the identity of supposed eavesdroppers is unclear. These administration officials, so unconcerned about the reaction of the little people who brought them to power that they plan to gouge for whatever they can, clearly display their arrogance through an astounding tone deafness. To hell with the optics.

 

A Short History of Taxation

When the colonies united under the Articles of Confederation the federal government did not have the power to tax. Congress soon discovered that finance by going hat in hand to the states was no way to fight a war, if the authority to compel them to pay didn’t come with it. For five years, Georgia and Florida paid nothing at all.

The first national income tax in peacetime was enacted in 1894, the product of William Jennings Bryan’s populist movement. That tax applied only to the richest 85,000 Americans, the top 0.1%. The robber barons led a legal battle that eventually led to a Supreme Court decision overturning  the income tax, declaring it unconstitutional. But the 16th Amendment to the Constitution in 1913 legalized a national income tax which was initially levied only on the very rich. Rates increased during the wars, rationalized as the wealthy’s patriotic duty. During WWI, the top bracket paid 77%. During the next world war, the rate jumped to 94%.

The top earners were obviously upset, not feeling all that patriotic when it came to their lifestyles. So by 1942, they had succeeded in shifting the burden to the rest of the population so that two thirds of the population was paying income tax. The wealthy then successfully convinced the federal government in campaigns waged over 30 years to cut taxes, generally under Republicans. Although the tax structure remained progressive with the top bracket paying a 50% rate by 1981, by the end of the tax slashing festivities, the richest 0.01% had their income tax rate cut in half and the top 1% had their effective average rate pruned by one third. It should be remembered that the official rate in no way reflects actual taxes paid, given the mountains of loopholes that favor the wealthy over an average Joe or Jane.

The millionaires argue that there is no such thing as a fair share of the tax burden. They say they are no more interested in shifting the tax burden to other economic groups than in lifting it from themselves. They argue that taxes should be cut for everyone. Charles Koch has said, “Our goal is not to reallocate the burden of government; our goal is to roll back government….Morally, lowering taxes is simply defending property rights.” These libertarians have elevated their own self interest, tax avoidance, into a principled crusade about government itself. Moreover, they contend that the country benefits more if the wealthy spend more of their money on the public good, far more beneficial than government spending. I’m not sure if I’ve ever seen a road or bridge built by a wealthy citizen; that’s rightly to providence of our government.

 

Fast forward to the present

It’s no surprise that a high priority agenda of the Republican Congress is to cut taxes on the wealthy, which they claim will get the “job creators” creating jobs. That logic is difficult to square with record corporate profits in recent years, used primarily to reward stockholders and buy their own stocks, because the return in dividends is higher than the return on “job creation”. Many economists agree that wages do not usually benefit from corporate tax relief. But an alternative economic stimulus argument is that money saved on taxes will drive the consumer economy which will in term stimulate increased production. Unfortunately with the bulk of the tax breaks going to the wealthy who tend to invest rather than spend, the amount going to the rest of us isn’t enough of an economic stimulus.

The other reason for GOP enthusiasm is that they have been bought and paid for by the Kochtopus network through campaign and party contributions supplemented by political advertising from the network of PACs and superPacs, social welfare groups,  and nonprofit trusts that are used to circumnavigate limitations on campaign funding of political candidates. Some legislators and many on their staffs are products of conservative institutes and business leagues. The network funded the Tea Party through the illusion of a grassroots movement in opposition to Obamacare that was primarily a collection of Koch funded PO box organizations. Mitch McConnell and Paul Ryan, the leadership of the Senate and the House and Marco Rubio are just a few easily recognizable names. They own ‘em and they mean to run ‘em.

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The essence of the bill so far

The delayed the bill this week to work out a few last minute kinks. But what we know so far is that over 80% of the changes are aimed at the top 1%. The inheritance tax, for instance, is strictly their baby. Estates taxed at 40% are levied after couples are worth over $11million or singles worth $5.49 million, the whipped cream on the economic milkshake. A whole 5428 people will benefit from changes to the so-called “death tax”, that’s got to be the top less than 0.01%. While the person impact is small, the dollar amounts are huge. When all the other tax cuts are considered, one third of the benefits accrue to the top 0.1% of taxpayers. Trump has called the inheritance tax a “tremendous burden” on the family farmer. Tax relief is said to help families trying to retain their family farms. Imagine how many family farms are worth over $11 million; it’s less than 1 in 1000. The trucking company owners who could pass their businesses onto their children that the president claimed would benefit from elimination of the estate tax number less than 100. Mnuchin has also said, “Only morons pay estate tax,” what with the myriad opportunities to create untaxed trusts. Who says 45 doesn’t care about the very few among us.

Corporate tax rates would be lowered to 25%, setting aside that multiple loopholes reduce the effective rate to considerably less than the present 40%. Trump is fixated on a 20% rate which is comparable to other developed economies but legislators seem to be settling somewhere above that. What is shocking, when considered against the backdrop of Trump’s bemoaning corporations who stash their profits overseas to avoid taxes, is that the bill proposes to leave profits earned overseas completely untaxed. Is this so that money will come flooding back to US financial institutions, because it sounds more like a tax windfall that keeps on giving enough to spur earning more profits overseas.

Hedge fund managers and private equity executives will be happy with the retention of the “carried interest” exemption which is taxed at the capital gains rate, lower than the rate for income. Mnuchin has also proposed a lower rate for “pass through” small businesses and partnerships that now pay personal income tax rates instead of corporate tax rate. The posh always-ingenious-at-avoiding-taxes could move to exploit this as a giant loophole as wealthy individuals reclassify themselves as small businesses.

Paul Ryan, in a recent interview on CBS Sunday Morning, said that businesses will also be able to write off investments they make in their businesses. This corporate honeypot is designed, says Ryan, to help their employees because “most studies show that corporate taxes are taken out of wages”, which most economists would take issue with, or at least the ones who haven’t drunk the “conservative koolaid”.

On the other hand, US corporations are pretty healthy. They are making record profits and yet, haven’t been doing due diligence as “job creators”. Buoyed by big increases in productivity in recent years, corporations have taken most of those fat profits to buy their own stocks, with a higher rate of return than adding more workers to the pay roll. They didn’t waste any of it on higher wages or expanded benefits for their workforce either. In fact over 80% of jobs created in the US in the last five years have been small businesses, including self-employed consultants and those run out of homes.  

As for regular people, the standard deduction, the most commonly used method of filing taxes, will be doubled, but that may be at the cost of deductions like charitable giving, and retirement savings. Most taxpayers will be remain unaffected, since only a minority of us use the expanded form to take supplemental deductions. But one proposal, to eliminate the deduction for state taxes, seemed aimed at high tax blue northeastern states, like New York, New Jersey and Connecticut. Chuck Schumer has already put the kibosh on that.   

Rumors about the legislation are that there will be three or perhaps four brackets with 0, 10, 25 and 35% rates.  The Republican lawmakers have floated a fourth higher tax bracket for the richest as well as an increase in the child tax credit. The income levels that define the brackets have supposedly not yet been set. Ryan hinted that some people in the current lower bracket would go to zero, but others would move up a bracket.

Bearing in mind the lack of specifics, analysis by the Tax Policy Center projected an average tax bill for all income groups would decline by $1600 or 2.1% in 2018. The largest decrease would go to those with incomes above $730,000, with an after tax income rise of an average 8.5% or $129,000. For incomes averaging $66,690, the after tax income would increase by 1.2% or $660.  A $2.6 trillion is projected to be cut from business taxes. Individual income tax revenue would increase by $470 billion, largely as a result of changes in personal deductions and exemptions as well as an increase in the bottom tax rate to 12% from 10%. The bottom 99% would see their taxes drop 0.4-1.7%, but the top 1% will have a 500 to 1000% rise in their tax savings. By 2027 tax cuts will shrink for every group except the top 1% and one quarter of taxpayers, many in the upper middle class, could pay more than they would without the new plan. People with incomes $150,000 to $215,000 will receive an average $1140 cut in 2018, but by 2027, they would pay $820 more than if nothing changed.

The tax plan would cost $2.4 trillion over 10 years. The single largest cost would be the reduction in the corporate tax rate and repealing the corporate alternative minimum tax which would total $2 trillion. Individual tax rates of 12, 25 and 35% would lower revenues by $1.2 trillion, while the repeal of state and local tax deduction would generate $1.3 trillion and repeal of personal exemptions $1.6 trillion in federal income over 10 years. But the amount in the Republican plan pales in comparison to what Trump intended.

It would appear that Republicans are willing to betray their allegiance to erasing the federal deficit, obscured in a haze of projected economic growth. Erasing the national debt apparently is more sacrosanct when a party is out of power. The rate of economic growth hasn’t exceeded 2% in a couple of decades, and almost no economists outside of conservative think-tanks believes that a sustained 3-5% growth rate is possible. They point to the Bush 43 tax cuts as proof, but overlook the two subsequent tax increases during his administration. Long term, the Bush tax cuts probably didn’t pay for themselves, although it’s hard to determine since federal expenditures mushroomed with the two Middle Eastern wars.

There is no way to predict whether the tax cuts will pay for themselves long term. Citing economic growth after the Reagan tax cuts is specious; the global economy has been radically transformed in the two decades since. One complicating factor is the imprecision of economic cycles. Although it doesn’t feel like it, the US is currently on a run of steady growth, but for every upturn, there is a future downturn just around the corner, sometimes deeper than the upturn was high. And just to complicate things, there is the unknown future health of the global economy.

Of course, 10 year economic projections are good statistical devices, but hardly politically applicable. 10 years is two and one half presidential administrations and the transfer of power can wreak havoc on government policy. Just look at where we are now. The Divider in Chief is either righting wrongs or committing them.