April 2011 archive

Why We Must Raise Taxes on the Rich

Robert Reich

Monday, April 4, 2011

The vast majority of Americans can’t afford to pay more. Despite an economy that’s twice as large as it was thirty years ago, the bottom 90 percent are still stuck in the mud. If they’re employed they’re earning on average only about $280 more a year than thirty years ago, adjusted for inflation. That’s less than a 1 percent gain over more than a third of a century.

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Yet even as their share of the nation’s total income has withered, the tax burden on the middle has grown. Today’s working and middle-class taxpayers are shelling out a bigger chunk of income in payroll taxes, sales taxes, and property taxes than thirty years ago.

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The top 1 percent’s share of national income has doubled over the past three decades (from 10 percent in 1981 to well over 20 percent now). The richest one-tenth of 1 percent’s share has tripled.

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Yet, remarkably, taxes on the top have plummeted. From the 1940s until 1980, the top tax income tax rate on the highest earners in America was at least 70 percent. In the 1950s, it was 91 percent. Now it’s 35 percent. Even if you include deductions and credits, the rich are now paying a far lower share of their incomes in taxes than at any time since World War II.

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If the rich were taxed at the same rates they were half a century ago, they’d be paying in over $350 billion more this year alone, which translates into trillions over the next decade. That’s enough to accomplish everything the nation needs while also reducing future deficits.

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Yes, the rich will find ways to avoid paying more taxes courtesy of clever accountants and tax attorneys. But this has always been the case regardless of where the tax rate is set. That’s why the government should aim high.

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And yes, some of the super rich will move their money to the Cayman Islands and other tax shelters. But paying taxes is a central obligation of citizenship, and those who take their money abroad in an effort to avoid paying American taxes should lose their American citizenship.

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(T)he reason we have a Democrat in the White House – indeed, the reason we have a Democratic Party at all – is to try to rebalance the economy exactly this way.

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This shouldn’t be difficult. Most Americans are on the receiving end. By now they know trickle-down economics is a lie. And they sense the dice are loaded in favor of the multi-millionaires and billionaires, and their corporations, now paying a relative pittance in taxes.

“Punting the Pundits” is an Open Thread. It is a selection of editorials and opinions from around the news medium and the internet blogs. The intent is to provide a forum for your reactions and opinions, not just to the opinions presented, but to what ever you find important.

Thanks to ek hornbeck, click on the link and you can access all the past “Punting the Pundits”

Paiul Krugman: The Truth, Still Inconvenient

So the joke begins like this: An economist, a lawyer and a professor of marketing walk into a room. What’s the punch line? They were three of the five “expert witnesses” Republicans called for last week’s Congressional hearing on climate science.

But the joke actually ended up being on the Republicans, when one of the two actual scientists they invited to testify went off script.

Prof. Richard Muller of Berkeley, a physicist who has gotten into the climate skeptic game, has been leading the Berkeley Earth Surface Temperature project, an effort partially financed by none other than the Koch foundation. And climate deniers – who claim that researchers at NASA and other groups analyzing climate trends have massaged and distorted the data – had been hoping that the Berkeley project would conclude that global warming is a myth.

New York Times Editorial: An Epidemic of Rape for Haiti’s Displaced

Life after Haiti’s earthquake has been especially difficult and dangerous for displaced women and girls. In addition to the ongoing crises of homelessness and cholera, a chronic emergency of sexual violence prevails in the settlements where hundreds of thousands still live, well over a year after the disaster.

Groups of Haitian women have been struggling to defend themselves, banding together to prevent assaults and now taking their case to a wider world. At a hearing March 25 in Washington before the Inter-American Commission on Human Rights, a grass-roots group, Kofaviv, joined other human-rights advocates in pressing for an end to what they called a rape epidemic. The police, they said, rarely patrol inside unlighted camps or investigate attacks. Victims live in constant fear and shame while attackers go unpunished.

E.J. Dionne, Jr.: The end of progressive government?

So far, our nation’s budget debate has been a desultory affair focused on whether a small slice of the federal government’s outlays should be cut by $33 billion or $61 billion, or whatever.

But Americans are about to learn how much is at stake in our larger budget fight, how radical the new conservatives in Washington are, and the extent to which some politicians would transfer even more resources from the have-nots and have-a-littles to the have-a-lots.

Monday Business Edition is an Open Thread

1 Japan business confidence dives after quake: BoJ

AFP

Mon Apr 4, 1:20 am ET

This is your morning Open Thread. Pour your favorite beverage and review the past and comment on the future.

Find the past “On This Day in History” here.

April 4 is the 94th day of the year (95th in leap years) in the Gregorian calendar. There are 271 days remaining until the end of the year.

On this day in 1949,the NATO pact signed

The United States and 11 other nations establish the North Atlantic Treaty Organization (NATO), a mutual defense pact aimed at containing possible Soviet aggression against Western Europe. NATO stood as the main U.S.-led military alliance against the Soviet Union throughout the duration of the Cold War.

Relations between the United States and the Soviet Union began to deteriorate rapidly in 1948. There were heated disagreements over the postwar status of Germany, with the Americans insisting on German recovery and eventual rearmament and the Soviets steadfastly opposing such actions. In June 1948, the Soviets blocked all ground travel to the American occupation zone in West Berlin, and only a massive U.S. airlift of food and other necessities sustained the population of the zone until the Soviets relented and lifted the blockade in May 1949. In January 1949, President Harry S. Truman warned in his State of the Union Address that the forces of democracy and communism were locked in a dangerous struggle, and he called for a defensive alliance of nations in the North Atlantic-U.S military in Korea.NATO was the result. In April 1949, representatives from Belgium, Canada, Denmark, France, Great Britain, Iceland, Italy, Luxembourg, the Netherlands, Norway, and Portugal joined the United States in signing the NATO agreement. The signatories agreed, “An armed attack against one or more of them… shall be considered an attack against them all.” President Truman welcomed the organization as “a shield against aggression.”

UN staff flee Abidjan amid warnings of ‘bloodbath’

Troops loyal to Ivory Coast’s recognised President-elect prepare for ‘final push’

By Daniel Howden, Africa Correspondent Monday, 4 April 2011

The United Nations has started to evacuate its staff from Abidjan ahead of a bloody final battle for Ivory Coast’s commercial capital that is expected to start today.

Laurent Gbagbo, who has refused international appeals to stand down after losing an election last year, has ordered his supporters into the streets to form a “human shield” around him while the forces of Alassane Ouattara, the President-elect, have been massing on the outskirts of the city.

“We are in the last kilometre of a marathon, the last step, which is always the toughest,” UN spokesman Hamadun Touré told The Independent by telephone from Abidjan.

The CBS News program, “60 Minutes” aired a Mortgage paperwork mess: the next housing shock? segment on foreclosure fraud which, as most economists agree, is the biggest threat to the US economy. Scott Pelley looks for the answer and a at the possible solutions to the question of “who owns your mortgage”:

It’s bizarre but, it turns out, Wall Street cut corners when it created those mortgage-backed investments that triggered the financial collapse. Now that banks want to evict people, they’re unwinding these exotic investments to find, that often, the legal documents behind the mortgages aren’t there. Caught in a jam of their own making, some companies appear to be resorting to forgery and phony paperwork to throw people – down on their luck – out of their homes.

Sheila Bair, Chairperson of the FDIC, says she will call for a clean-up super fund

   Banks so poorly handled documentation on millions of mortgages that many today cannot prove that they own the homes they want to foreclose on. The resulting rash of lawsuits from people seeking to save their homes has one of the government’s top banking regulators worried that the torrent of litigation will delay the real estate market’s recovery.

   Federal Deposit Insurance Corporation Chair Sheila Bair tells Scott Pelley banks should be forced to contribute billions to a clean-up fund that will help stressed homeowners stay in their homes and stave off lawsuits – there are 30,000 already – that threaten the economic rebound […]

   Like last year, banks are expected to foreclose on a million mortgages this year, a scenario that could generate more lawsuits over mismanaged paperwork. “I think that this litigation could easily get out of control,” says Bair. “…We’re already feeling like we’re falling behind it,” She thinks a large clean-up pool funded by the banks that would pay homeowners to accept a bank’s ownership claim without a lawsuit is necessary. “I would assume it would be billions [that the fund would need],” Bair tells Pelley.

But as, David Dayen points out, this “super fund” would not stop any claims in state courts on behalf of homeowners, federal regulators don’t have the authority to do that.

And the more banks resist it, the more liable they will become. In an important case this week, a judge in Alabama dismissed a foreclosure because the bank failed to comply with the pooling and servicing agreement for transferring mortgages to the trust. This would be a stunning ruling if applied broadly, though whether or not it will stand as precedent across other states remains to be seen; it’s far too early in the process to determine that. But we know that banks simply did not convey mortgages to trusts properly as a general rule. Foreclosure fraud can be seen as a coverup for that original sin. And if state courts are starting to make rulings based on that sin, banks will be stuck and unable to pursue foreclosures on tens of millions of loans.

The ruling in favor of the borrower endorses an argument we have made since last year on this blog, that the pooling and servicing agreement stipulated a specific set of transfers be undertaken to convey the borrower note (the IOU) to the securitization trust within a specified time frame. New York trust law was chosen to govern the trusts precisely because it is unforgiving; any act not specifically stipulated by the governing documents is deemed to be a “void act” and has no legal force. So if a the parties to a securitization failed to convey a note to the trust within the stipulated timetable, retroactive fixes don’t work. In this case, the note had been endorsed by the originator, Encore, but not by the later parties in the securitization chain as required in the pooling and servicing agreement.

Yves Smith at naked capitalism, has a problem with what Bair said:

One aspect that is distressing is that per her remarks in this clip, Sheila Bair does not appear to understand or worse, understands but is not willing to admit the seriousness of the chain of title issues. Often, the banks botched the transfer process in such a fundamental manner that retroactive fixes are not possible. This isn’t a matter of “if the banks spend enough time, they can prove the trust they are acting for owns the note” as Bair contends. It’s that in many cases the note didn’t get to the trust as stipulated, and the trust doesn’t have the ability under New York law, which governs virtually all of these trusts, to accept it now. A party earlier in the securitization chain is typically the owner, but no one wants that party to foreclose, since it would confirm the failure to handle the assignment of the note properly.

I’m not so sure that this Congress would be amenable to another multi-billion dollar bail out but this is a better proposal that the one that would strip homeowners of their right to due process.

(all emphasis is mine)

Regular Features-

• Late Night Karaoke by mishima
• Six In The Morning by mishima
• Gha! by RiaD

Featured Essays for April 2, 2011-

• My Little Town 20110331: Etta and Roy Chandler by Translator
• School House Rock: "I’m Just A Bill" by TheMomCat
• Obamabots by ek hornbeck
• Pique the Geek 20110403: How Nuclear Reactors Work. Part the Third by Translator

DocuDharma

The past two weeks we have been looking about current nuclear technology for power production.  Almost all of the plants currently in commercial production are the so called Generation II and Generation III plants, and the most advanced ones are sometimes called Generation III+.  This evening we shall examine nuclear technologies that are not yet used for commercial production.

These designs are called Generation IV plants, and may either be prototypes or merely designs that have not yet even had a prototype built, but appear to be feasible to come on line commercially by 2030 or so, give or take.  There is also a Generation V set of concepts, but they are much further out as far as construction of even a prototype in concerned, and we shall not consider them here.

Once again I’ll be hosting the Evening Edition while ek hornbeck sets up for tonight’s Women’s Final Four of the NCAA Championship Tournament.

NCAA Women’s Basketball Tournament 2011

The Aggies extract their revenge.  UConn cruises.

Tuesday’s Results

All too easy.

Notre Dame is just another Big East meeting, but they are the second best team in the Big East and it’s never an upset when a 2 seed beats a 1 seed.

What it looks like (and all the vapid emptyheaded announcers want, watch the bias or better yet turn off the sound) is that we’re going to have a Stanford/UConn rematch in the final.

Sadly I must agree since a large part of the Aggies’ motivation over Baylor was revenge, but you never know and that’s why you play the games.  Aggies would certainly be an easier matchup.

Current Matchups

Follow the 2011 NCAA Women’s Basketball Tournament on The Stars Hollow Gazette.

If you don’t like squeeky shoes you can look for alternate programming here-

• Zap2it TV Listings, Yahoo TV Listings

If you like a more traditional bracket try this NCAA one, they also have a TV schedule.