Tag: taxes

Last month John Oliver, host of HBO’s “Last Week Tonight,” focused his laser with on the boondoggle of tax payer funded sports stadiums. The practice goes on even though it is a losing proposition for the cities that just lines the pockets of the extremely wealthy franchise owners. In states and cities that are going broke, where the infrastructure is falling apart, schools failing and far right elected officials cut taxes and spending, the one thing that will get money is a sports stadium. In St. Louis, Missouri the court recently rules that the city doesn’t need to ask the taxpayers for permission to build a new NFL stadium:

St. Louis can use city tax dollars to build a new NFL stadium for the Rams without a public vote on the matter, Circuit Court Judge Thomas Frawley ruled on Monday. Critics say the decision calls into question the city’s spending priorities one year after the killing of an unarmed black teenager ignited long-simmering racial tensions and exposed extreme poverty, corruption, and racial bias throughout the county.

A 2002 ordinance requires a city vote before spending public money on a new sports facility. Frawley declared the ordinance invalid, saying portions were “too vague to be enforced.”

Meanwhile, in the state that Charles Pierce calls the Koch Industries subsidiary formerly known as the state of Wisconsin, staunch fiscal conservative and Tea Party Governor signed legislation to give the New York City bases hedge fund owners of the Milwaukee Bucks basketball team millions of tax dollars to build a new arena. David Dayen at Salon fills us in on Gov. Walker’s fiscal hypocrisy:

Herb Kohl, the former Democratic senator, sold the Milwaukee Bucks to two New York-based hedge fund managers, Marc Lasry and Wesley Edens, in 2014; and they immediately demanded a new arena, lest they abandon Milwaukee. Lasry and Edens are worth around $2 billion each, but under the purchasing agreement they would only put up $150 million for the arena, with Kohl kicking in another $100 million. The rest would come from city, county and state taxpayers.

The usual discredited arguments propped up this deal. Wisconsin lawmakers promised great economic benefits from a new downtown arena. Walker said repeatedly it would be cheaper to keep the Bucks in Wisconsin than to lose them to some other city. This ignores the fact that the alternate universe where Wisconsinites don’t have a Bucks game to attend in April is not necessarily to sit in their homes and contemplate the darkness of existence. They’d maybe go out to dinner, with the economic activity simply substituted.

Numerous (pdf) studies (pdf) have shown (pdf) no economic benefits (pdf) to building a new stadium; it’s just something rich people say to get someone else to pay for the construction. Seattle is not a deserted wasteland because they lost the SuperSonics in 2008. They’re doing okay.

None of this mattered to politicians who could tell sports fans they “saved the Bucks,” however, and the legislature, with Walker’s prodding, agreed to cover $250 million of the $500 million needed to build the stadium. Walker’s budget literally cuts $250 million for the state university system, precisely the public share of the arena. They’re paying for it partially through borrowing, which adds interest. And if you tally up other subsidies like property tax abatements and sales tax exemptions, the 20-year cost could be as much as $500 million. That’s effectively the entire cost of the arena itself, and taxpayers will have no ownership stake in the property.

The host of MSNBC’s “All In,” Chris Hayes discussed the deal with David Boaz, Executive Vice President of the Cato Institute and Kavitha Davidson, sports columnist at Bloomberg View.

What Charlie said:

Contrary to what I predicted, so far at least, Scott Walker has proven to be something of a lemon as a national candidate. He is even more charisma-challenged than I thought he was, and he can’t get out of his own way on most major policy issues.  Beating up English teachers and bum-rushing grannies out of the state capitol will only get you so far. And this gift to a couple of hedge-fund buckaroos is making nobody except those two guys happy. This is how Ben Carson ends up in second place in Iowa.

Cities spend massive amounts of public money on privately-owned stadiums. Cities issue tax-exempt municipal bonds that – wait, don’t fall asleep!

About now there are hundreds of thousands of people hunched over their computers, sitting with tax preparers, searching through files and boxes of receipts, standing on a line or hanging on hold waiting to ask a question which may not have answer or, at least, one they will like. It’s Tax Day in America.

Everyone hates the IRS but it’s not their fault, as John Oliver explained on his HBO show “Last Week Tonight.” Blame congress for the recent budget and staff cuts have made it increasingly difficult for the department to do its very important job.

Think of our government as a body. The IRS is the anus. It’s nobody’s favorite part, but you need that thing working properly or everything goes to shit real quick. [..]

The fact is, blaming the IRS because you hate paying your taxes is a bit like slapping your check-out clerk because the price of eggs has gone up

Humor and History on Tax Day

Joel Fox, Fox and Hounds

“April is the month when the green returns to the lawn, the trees, – and the Internal Revenue Service.” So observed Evan Esar, a collector of humorous sayings who understood that humor is the ultimate therapy. All of us need this therapy now that tax time is here.

Fortunately, a rich vein of humor and wry observations exist about taxes to help us through this time.

When tax day comes, most citizens pay what they owe … or what they think they owe. Discovering what you owe can be a challenge. Even one of the century’s greatest geniuses, Albert Einstein said, “The hardest thing in the world to understand is the income tax.”

Humorist Will Rogers put it this way: “The income tax has made more liars out of the American people than golf has. Even when you make a tax form out on the level, you don’t know when it’s through if you are a crook or a martyr.”

So, grin and bear it, “You never miss your anus till it’s gone.”

A two year budget deal was reached yesterday with congressional leaders announcing the deal that would to replace $63 billion in sequester cuts, a very small part of the $180 billion in cuts that will occur over the next two years. The deal will restore defense cuts by funding from a tax on airline travel and cuts to federal pensions. The budget does not include extension of unemployment funds to the millions of workers who are about to lose their benefits the end of December. There will be no changes to Medicare or Social Security but none of the tax loop holes were closed.

As Ezra Klein puts it:

Whether this deal can be a model for future deals is an open question. The core principle of this deal is that Democrats didn’t have to touch entitlements and Republicans didn’t have to touch taxes. But a lot of the policies that made that possible got used up in this deal. It’s not clear that another deal like this would work in 2016.

DSWright at FDL News Desk notes:

The Republicans got everything they wanted. They get more cuts while none of their friends in the defense industry get hurt – actually they even got to do some damage to the federal pension system. All that while avoiding another shutdown that killed their poll numbers before the 2014 elections. Christmas came early for the GOP.

The Democratic Party, on the other hand, sold out its own base to help Republicans maintain power. Why? Who knows? The only thing that is clear is this is an awful deal for majority of Americans.

Once again, the majority of Americans get screwed by their elected representatives.  

At a recent hearing before the Senate Permanent Subcommittee on Investigations, Apple CEO Tim Cooke testified how the company managed to evade paying billions in taxes using tax loopholes particularly and overseas subsidiaries, like Apple’s subsidiary in Ireland.

Apple’s massive cash hoard, and the danger of soaring corporate profits

by Steve Gentile, Up with Steve Kornacki

The major flaw of our recovery has not been the pace, although certainly it could have been much faster. Instead, the major flaw is distribution. The economy is growing, but corporations and the richest Americans are capturing the lion’s share of the proceeds from that growth. You’ve likely heard a lot about the one percent-in the first year of the recovery, they captured 93% of the income gains – but the story of America’s corporations is even more troubling.

We’ve seen systemic inequality in our country growing for decades, even before the latest financial crisis. Between 1979 and 2007, income for the top 1% grew by nearly 300%, while it grew by just 18% for the bottom quintile of earners. [..]

Apple argues that its off-shore profits should only be subject to off-shore taxes. As if those off-shore profits had nothing to do with America. Of course, they do. Apple may sell products across the world, but the company is based in America for a reason. Apple enjoys, indeed exploits, countless legal and economic benefits by operating in America, benefits Apple wouldn’t enjoy anywhere else: basic legal protections, a judiciary that safeguards and enforces the rule of law, an intellectual property regime that affords generous-in fact, overly broad-protections for new ideas and innovations, a world-class system of higher education, a (somewhat) open immigration policy, reliable security, an advanced infrastructure for business development, and countless other benefits  from operating in a functional, developed society with a genuine social contract.

As Elizabeth Warren famously put it, “There is nobody in this country who got rich on his own.” In the same way, there is no company in this country that got rich on its own. Corporations like Apple are hampering the economy and corroding our political system by hoarding hundreds of billions of dollars in cash. They owe the American people back payments.

On her May 25 MSNBC show, Melissa Harris-Perry exams corporate money tactics and tax codes with guests Lawrence J. Korb, Senior Fellow at the Center for American Progress; Stephen Lerner, organizer of the Wall Street Accountability campaign; Pulitzer Prize-winning investigative journalist David Cay Johnston, author of The Fine Print: How Big Companies Use “Plain English” To Rob You Blind; and Yves Smith, the founder and creator of the blog Naked Capitalism.

Economist Richard Wolff discusses how austerity is making economic problems worse and the cure for these economic woes.

As Washington lawmakers pushes new austerity measures, economist Richard Wolff calls for a radical restructuring of the U.S. economic and financial systems. We talk about the $85 billion budget cuts as part of the sequester, banks too big to fail, Congress’ failure to learn the lessons of the 2008 economic collapse, and his new book, “Democracy at Work: A Cure for Capitalism.” Wolff also gives Fox News host Bill O’Reilly a lesson in economics 101.

   AMY GOODMAN: Professor Wolff, before we end, I want to turn back to the crisis in Cyprus and relate it to what’s happening here. Bill O’Reilly of Fox News warned his audience last week that Cyprus and other European countries are facing economic hardships because they’re so-called “nanny states.”

       BILL O’REILLY: Greece, Italy, Spain, Portugal, Ireland, now Cyprus, all broke. And other European nations are close. Why? Because they’re nanny states, and there are not enough workers to support all the entitlements these progressive paradises are handing out.

   AMY GOODMAN: That’s Bill O’Reilly of Fox News. Richard?

   RICHARD WOLFF: You know, he gets away with saying things which no undergraduate in the United States with a responsible economic professor could ever get away with. If you want to refer to things as nanny states, then the place you go in Europe is not the southern tier-Portugal, Spain and Italy; the place you go are Germany and Scandinavia, because they provide more social services to their people than anybody else. And guess what: Not only are they not in trouble economically, they are the winners of the current situation. The unemployment rate in Germany is now below 5 percent. Ours is pushing between 7 and 8 percent. So, please, get your facts right, Mr. O’Reilly.

   The nanny state, you call it, the program of countries like Germany and Scandinavia, who tax their people heavily, by all means, but who provide them with social services that would be the envy of the United States-a national health program that takes care of you, whether you’re employed or not, and gives you proper healthcare. In France, for example, the law says when you go to work, you get five weeks’ paid vacation. That’s not an option; that’s the law. You get support when you’re a new parent for your child care and so forth. They provide services. And they are successful in Germany and Scandinavia, much more than we are in the United States and much more than those countries in the south.

   So they’re not broken, the south, because they’re nanny states, since the nanny states, par excellence, are doing better than everyone. The actual truth of Mr. O’Reilly is the opposite of what he says. The more you do nanny state, the better off you are during a crisis and to minimize the cost of the crisis. That’s what the European economic situation actually teaches. He’s just making it up as he goes along to conform to an ideological position that is harder and harder for folks like him to sustain, so he has to reach further and further into fantasy.

H/t Heather at Crooks and Liars

Capitalism efficient? We can do so much better

by Richard Wolff, The Guardian

For all its vaunted efficiency, capitalism has foisted wasteful inequality and environmental ruin on us. There is an alternative

What’s efficiency got to do with capitalism? The short answer is little or nothing. Economic and social collapses in Detroit, Cleveland and many other US cities did not happen because production was inefficient there. Efficiency problems did not cause the longer-term economic declines troubling the US and western Europe.

Capitalist corporations decided to relocate production: first, away from such cities, and now, away from those regions. It has done so to serve the priorities of their major shareholders and boards of directors. Higher profits, business growth, and market share drive those decisions. As I say, efficiency has little or nothing to do with it.

Many goods and services once made in the US and western Europe for those markets are now produced elsewhere and transported back to them. That wastes resources spent on the costly relocation and consequent return transportation. The pollution (of air, sea and soil) associated with vast transportation networks – and the eventual cleaning up of that pollution – only enlarges that waste.

Like the tale of the three bears, the congressional budget battle has three budget proposals one from the House Republicans penned by Rep. Paul Ryan (R-WI), chair of the House Budget Committee; another from the Senate Democrats that was worked out by Sen. Patty Murray (D-WA), chair of the Senate Budget Committee; and a third called the “Back to Work” budget presented by the Congressional Progressive Caucus. Each one has is proponents and opponents and, like that bear tale, it has one that’s too hard, one that’s too soft and one that’s just right.

Paul Ryan’s budget, which is getting the most press, the most negative reaction and is “dead on arrival” so to speak, is a rehash of his last two budgets only worse. The proposal would slash Medicare, Medicaid and repeals Obamacare, which even Fox News host Chris Wallace acknowledges, isn’t happening. It proposes balancing the federal budget with the usual draconian cuts to all non-defense spending and reduction of the already smaller federal work force by another 10%. The Ryan proposal would slash $4.6 trillion over 10 years. The budget plan includes no cuts in Social Security. Pres. Obama has suggested changing an inflation measurement to cut more than $100 billion from the program, which makes no sense since Social Security does not contribute to the debt or the deficit.

The there is the Senate Budget proposal which the Republican leadership insisted the Democrats produce even though, constitutionally, all budget and spending bills must originate in the House. That budget  would seek $975 billion in spending reductions over the next 10 years as well as $975 billion in new tax revenue, which Sen. Murray said would be raised by “closing loopholes and cutting unfair spending in the tax code for those who need it the least.” It includes a $100 billion in spending on infrastructure repair and educational improvements and the creation of a public-private infrastructure bank.

Then there is that third budget proposal from the House Progressive Caucus that is just right balance of spending, revenue increases and spending cuts. The basic plan is the put Americans back to work, by as Ezra Klein explains fixing the jobs crisis:

It begins with a stimulus program that makes the American Recovery and Reinvestment Act look tepid: $2.1 trillion in stimulus and investment from 2013-2015, including a $425 billion infrastructure program, a $340 billion middle-class tax cut, a $450 billion public-works initiative, and $179 billion in state and local aid. [..]

Investment on this scale will add trillions to the deficit. But the House Progressives have an answer for that: Higher taxes. About $4.2 trillion in higher taxes over the next decade, to be exact. The revenues come from raising marginal tax rates on high-income individuals and corporations, but also from closing a raft of deductions as well as adding a financial transactions tax and a carbon tax. They also set up a slew of super-high tax rates for the very rich, including a top rate of 49 percent on incomes over $1 billion.

But to the House Progressives, these taxes aren’t just about reducing the deficit – though they do set debt-to-GDP on a declining path. They’re also about reducing inequality and cutting carbon emissions and slowing down the financial sector. They’re not just raising revenues, but trying to solve other problems. But they might create other problems, too. Adding this many taxes to the economy all at once is likely to slow economic growth.

As for the spending side, there’s more than $900 billion in defense cuts, as well as a public option that can bargain down prices alongside Medicare. But this budget isn’t about cutting spending. Indeed, the House Progressives add far more spending than they cut.

On Sunday’s Up w/ Chris Hayes, host Chris Hayes discussed the various budget proposals released by Republicans and Democrats in Congress this week with his guests Representative Kyrsten Sinema (D-AZ); Representative Jerrold Nadler (D-NY); Sam Seder, host of The Majority Report, co-host of Ring of Fire; and Heidi Moore, economics and finance editor for The Guardian newspaper.