Monday, November 21, 2011

Eliminating Capital Gains Tax - Bad for America, Great for the 1%

One of the common threads that Republicans keep hammering on is the need to "reduce taxes" to improve the economy. One of their efforts is the "flat tax" where everyone pays the same tax rate, and among other things, reduce or eliminate the capital gains tax.
HORSLEY: Perry's plan would also cut corporate tax rates to 20 percent, and eliminate the tax on dividends and capital gains. By doing away with those investment taxes, Perry would give a big windfall to the wealthiest Americans.

Just what sort of windfall are we talking about? This article tells us: The top 0.1% of the nation earn half of the capital gains.
The top 0.1%-- about 315,000 individuals out of 315 million-- are making about half of all capital gains on the sale of shares or property after 1 year; and these capital gains make up 60% of the income made by the Forbes 400.

Capital gains are currently taxed at 15%, down from the 28% it was under Reagan - and he had raised it to that level. Various conservatives try to make the case that this low tax rate is beneficial for the economy:
So what does this mean for this debate? It means that when you tax millionaires, you reduce the biggest wells of disposable income we have. This means cars will not be bought, houses will not be built, planes will go unproduced, and charities will suffer. It means fewer jobs in our economy as the engines of purchasing power get burdened by higher taxes. We need to promote wealth and high incomes by making it easier to achieve that lofty goal rather than making it something at which to sneer.

Which is a somewhat different argument from their previous one, where the wealthy would be investing in other businesses. Now the argument is that they'll "buy stuff with the money." That this has apparently not happened with previous reductions, in either case, is an indicator that they want "the wealthy to be wealthier," and that the wealthy don't want to pay for the society they live in.

There is a huge difference between the small investor who may be making a few thousand dollars in capital gains from sale of stocks and the very wealthy who are making millions turning over stocks and hedge fund investments. The original purpose of capital gains was to encourage long-term investing. You bought your stocks, you held onto them. The current policy encourages rapid turnover, and investment in risky investments promising high return and quick turnarounds. It does not increase "value" or economic growth and investment. At a time when the nation faces deficits and decaying infrastructure, it's time to change that, and make the very wealthy start paying their share.

Thursday, November 17, 2011

Open Thread - Republican Follies Edition

Rick Perry challenged Nancy Pelosi to debate the part-time Congress plan.
In a letter to Pelosi obtained by The Hill, the Texas governor wrote: I am in Washington Monday and would love to engage you in a public debate about my Overhaul Washington plan versus the congressional status quo.
Nancy Pelosi responded via Twitter:
Re: Gov. Perry--Monday I’ll be in Portland. Later visiting labs in CA. That's 2. I can’t remember the 3rd thing.
After his debate performance, even Texans are starting to realize something about him.
But White knows this: Texans everywhere are seeing a side of Perry they’ve never seen, a side unscripted. He says Perry has long run from accountability, whether in the form of debates, editorial board meetings or regular press conferences.
And now we know why: Perry has never really known the answers, he just memorized what polls and advisers told him the answers were.
Herman Cain is having his share of problems, after his disastrous "Libya" moment in an interview. First, he canceled an editorial board meeting with New Hampshire's most read newspaper.
A scheduled meeting with the New Hampshire Union Leader‘s editorial board was canceled about an hour before it was to begin. There was disagreement over whether the meeting would be videotaped. The Union Leader typically allows filming of its meetings with presidential candidates; Cain’s campaign refused to allow it.
The newspaper is an influential voice among New Hampshire conservatives.

But that's not his only recent gaffe:
“What about Cuba?” he asked. “One of my principles is: Go to the source closest to the problem. You will find the solution… I want to get from Cuban leaders a solution what we should do.”
Oh, and he apparently doesn't know languages:
Cain also stepped in it a bit (as Gov. Rick Perry might say) when he said while enjoying a cafecito and croquette at the Cafe Versailles, “How do you say delicious in Cuban?”
With her campaign hopes fading, Michele Bachmann violates Reagan's rule about Republicans, and goes after Newt:

Fannie [Mae] and Freddie, as you know, have been the epicenter of the financial meltdown in this country, and whether former Speaker Gingrich made $300,000 or whether he made $2 million, the point is he took money to also influence senior Republicans to be favorable toward Fannie and Freddie,
Meanwhile, Mitt Romney is facing some problems regarding transparency in his campaign, and his time as governor:
Just before Mitt Romney left the Massachusetts governor’s office and first ran for president, 11 of his top aides purchased their state-issued computer hard drives, and the Romney administration’s e-mails were all wiped from a server, according to interviews and records obtained by the Globe.
The Globe story went on to detail how nearly a dozen aides paid some $65 each to purchase their work computer hard drives -- proved by cancelled checks, provided to the Globe -- and that new servers were installed for the incoming Democratic administration of Deval Patrick in 2006. The result? There are no electronic records of any Romney administration emails, although boxes of paper documents do exist in state storage facilities. 


Wednesday, November 16, 2011

Rick Perry Wants an (Unconstitutional) Part-Time Congress

Rick Perry, after his brain freeze in a recent debate when it came to which government departments he would abolish if he were President. In an effort to salvage his campaign, he's started announcing his plans to "reform" government, starting with the legislative branch. What's his plan? A part-time Congress.
The U.S. does not need a full-time Congress that is more focused on increasing its perks instead of reducing spending. America needs a part-time, Citizen Congress – populated with those who choose to serve not for profit, or for the promise of a high-paying lobbyist job, but for the good of their communities, states, and the nation. Even with a 50 percent pay-cut, Congressional members would still make a significantly higher income than the average American.11 By changing the way Congress operates, and moving towards a part-time legislature, Congressman will have the freedom to live in their communities, engage their constituents, and truly speak for the people they represent. Rules preventing members of Congress from holding private sector jobs must also be repealed. – When lawmakers hold the same types of jobs as their constituents, they will gain a much greater understanding of how congressional laws impact the real world.

Reaction has been swift, with Matt Yglesias calling it dangerously unsound. The Daily Mail calls it a populist attempt to regain his standing. It's one of those "sounds good" to the Republican base proposals, but doesn't stand up to the reality of Congress. It even doesn't stand up to a fact check, as Matt Glassman points out:
I haven’t checked if his statements about inflation are true (I have no reason to doubt them technically), but if they are true then almost all the real increase in congressional salaries took place in the 19th century.* According to the inflation figures Perry used, real prices fell by almost 50% between 1815 and 1907, while Members’ salaries went from $1500 to $7500. There’s the entirety of the 10-fold increase he cites.

and
Members make approximately 1.7% more in real dollars than they did 100 years ago. So if the salaries of the legislative branch ran wild because something changed in Washington, that something took place in the 19th century, not the 20th.

So the "make far more than ever before" is a fabrication, when checked against a constant dollar scenario. Yglesias points out some other problems:
You can see this along a number of dimensions. One is that if members of Congress need to work second jobs, their business relationships will involve conflicts of interest. A second is that to the extent that earning extra income takes up more of members of Congress’ time, they’ll become more dependent on lobbyists and special interest groups for information and assistance with their projects.

It's an astoundingly bad idea from any number of standpoints. Beyond the fact that people expect that their congressional representatives will work full-time at it, the idea that they will "work at a job" when not in session is ridiculous. Even in states which have "part time" legislatures, it often turns into a full-time job for the legislators and their staffs to do the job properly. What the proposal does is to ensure that only the very wealthy can take the time to become members of Congress.

But even beyond it being impractical, there's another facet. It's unconstitutional. A quick read of the United States Constitution, Article 1 says so.

Section 5 - Membership, Rules, Journals, Adjournment
Each House shall be the Judge of the Elections, Returns and Qualifications of its own Members, and a Majority of each shall constitute a Quorum to do Business; but a smaller number may adjourn from day to day, and may be authorized to compel the Attendance of absent Members, in such Manner, and under such Penalties as each House may provide.
Each House may determine the Rules of its Proceedings, punish its Members for disorderly Behavior, and, with the Concurrence of two-thirds, expel a Member.
Each House shall keep a Journal of its Proceedings, and from time to time publish the same, excepting such Parts as may in their Judgment require Secrecy; and the Yeas and Nays of the Members of either House on any question shall, at the Desire of one fifth of those Present, be entered on the Journal.
Neither House, during the Session of Congress, shall, without the Consent of the other, adjourn for more than three days, nor to any other Place than that in which the two Houses shall be sitting.
Amendment 27 - Limiting Changes to Congressional Pay. Ratified 5/7/1992. History
No law, varying the compensation for the services of the Senators and Representatives, shall take effect, until an election of Representatives shall have intervened.
In other words, he can't do it. Only Congress can do so, and only Congress can change its pay. So what he's doing is simply posturing, and it's meaningless. He can't do it, and he can't force Congress to do it. Only Congress could make those sorts of changes to itself, and not even the Republicans would go along with that. Which is something that any serious candidate who studied government would know. Saying this just shows that Rick Perry is not a serious candidate, but that he even is being considered a contender just shows how far the Republican Party has fallen.

Friday, November 4, 2011

Mississippi Is Turning Women Into Criminals

There's an amendment being voted on next week to the constitution for the state of Mississippi which is called the "Personhood Amendment." It's fairly simple in its language:
Initiative 26 would define personhood as "every human being from the moment of fertilization, cloning or the functional equivalent thereof."

This amendment has been pushed by a group called "Personhood USA," in attempt to overturn Roe v Wade. It's based on a statement made during arguments:
Justice Potter Stewart said, "If it were established that an unborn fetus is a person, you would have an impossible case here."

Which is why this measure is being pushed. By defining a "person" as an egg from the moment of fertilization, it makes it their case that it is a legal person. There are multiple problems with this definition, not just from an ethical standpoint, but from a legal and biological standpoint.

Human fertilization is a complex process in itself. A series of things have to happen in sequence, and with the right timing, for the egg and sperm to merge. Even after that point - when Mississippi wants to define it as a person - it has to travel down the fallopian tubes, and implant in the uterus. For this to happen, a series of things have to go right. Which more often than not, it doesn't.
John Opitz, a professor of pediatrics, human genetics, and obstetrics and gynecology at the University of Utah, testified before the President's Council on Bioethics that between 60 and 80 percent of all naturally conceived embryos are simply flushed out in women's normal menstrual flows unnoticed. This is not miscarriage we're talking about. The women and their husbands or partners never even know that conception has taken place; the embryos disappear from their wombs in their menstrual flows. In fact, according to Opitz, embryologists estimate that the rate of natural loss for embryos that have developed for seven days or more is 60 percent. The total rate of natural loss of human embryos increases to at least 80 percent if one counts from the moment of conception.

Even, if implantation does occur, and development starts, it doesn't mean that things will go smoothly.
According to the American Academy of Pediatrics, a majority of pregnancies never go past the first few weeks, and even after a clinical diagnosis of pregnancy (using ultrasound), there's still about a 25 percent chance of miscarriage.

Given the odds, and the number of things that have to go right, it's often more astonishing that women carry to term than that they don't. But, that highlights the problem with the Personhood Amendment: Every one of those embryos which didn't implant, or those that miscarried, is a "person" whose life has been lost. Even more, this would ban many forms of birth control.
Unfortunately for proponents, the Personhood movement spokesman Walter Hoye stated the opposite on NPR’s Diane Rehm Show. As the Florida Independent reports, when asked if there were any restrictions on birth control in the amendment, Hoye answered “no…well, yes,” adding, “any birth control that ends the life of a human being will be impacted by this measure,” including the pill:
HOYE: Any birth control that ends the life of a human being will be impacted by this measure.
REHM: So that would then include the IUD [intra-uterine device]. What about the birth control pill?
HOYE: If that falls into the same category, yes.
REHM: So you’re saying that the birth control pill could be considered as taking the life of a human being?
HOYE: I’m saying that once the egg and the oocyte come together and you have that single-celled embryo, at that point you have human life, you’ve got a human being and we’re taking the life of a human being with some forms of birth control and if birth control falls into that category, yes I am.

In short, many of the most commonly used forms of birth control become illegal because they prevent implantation. The result of this amendment is not "stopping abortion," although it's been promoted this way by many on the right. Instead, because they ignore biology, the actual result of it is to make women "killers," because they failed to save a person - even though she may never have known that conception had taken place, or was trying not to become pregnant.

If this passes, and I sincerely hope it doesn't, it will mark a new low in women's rights. It's not just an assault on reproductive choice, it makes them criminals. For that alone, it should never be allowed.

 
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