Trump’s State of the Disunion Message Tonight

I’ve tried to begin various versions of this post, but have ground to a halt each time.  Why speculate on what he will say?  We never know what he really means.  He often doesn’t know what he really means but those gut instincts of his have served him well.  He remains afloat by playing upon the fears, the hunger for simplicity and the resentments of many Americans, like a music phenom plays a Strativarius.   Meanwhile he will talk about wanting to unify the country when he has done the exact opposite this past year.  I imagine even his supporters don’t see him as a unifier.  They just want to see him bully their imagined enemies in government.

In broad terms, whatever he says, the big news is how he and his minions in Congress and Trump TV (a.k.a.  Fox “News”, with a couple exceptions) are steadily creating the alternative reality to challenge what is likely to come out of the Mueller investigation, a combination of charges and actions worthy of impeachment.  When that time comes, the Trumpeteers want a well established narrative that undermines the credibility of Mueller and the FBI itself, so Trump can challenge the charges, maybe even plead the 5th Amendment. The latest attack comes from what is called the “Nunes” memo, which you can google and judge for yourself.  So bogus if you know the history.

Meanwhile, Trump continues to be nice to his Russian buddy Vlad by cancelling plans yesterday for additional sanctions on Russia for interfering with our elections, sanctions that were passed in Congress by near unanimous majorities last summer.  The White House has dragged its collective feet for months and finally, last night 10 minutes before the deadline, they cancelled them saying they didn’t seem necessary now.

Not necessary?   Trump appointed CIA Director Mike Pompeo said earlier that day he expects Russia to try to interfere in our 2018 elections.  And then that night, the White House says no need for more sanctions?  It makes no sense but at this point lying has worked so well, who cares about contradictions, even when obvious. And so far Congress has barely raised a peep, as if they are all mesmerized.

I won’t watch the speech, but tomorrow I will be  curious to know if Trump brings up his plan for immigration reform.  Both the right and the left hate it, which says to me:  Hey, there might be a decent deal to be made.  If Trump actually could pull off a deal on immigration I might have to say something nice.  But my guess is he won’t even try.  He just wants to put the Dems in a position where they will have to refuse the deal.  He doesn’t have the courage to make his base angry.

Oh, by the way, tied to some DACA deal is the necessity to add another budget extension (our 5th I think since October) in nine days.

Our fly by night budget system suits our fly by night president.   It is only fitting that after Trump’s speech Jimmy Kimmel will host Stormy Daniels, called a porn star paramour of Trump who was allegedly paid off to keep silent prior to the election.  In the pre-Trump era that would be BIG NEWS – the president and the porn star…..

Now it is just another side show in Trump’s 23 ring circus.  Given all the geological layers of recently uncovered sleazy behavior by men in power, consensual sex, even while his wife was pregnant and a big payoff for silence was made, seems pretty tepid stuff.

Welcome to Trumptopia.

 

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SMATTERINGS 10/26/13: The Nub of Some Ongoing Issues

Our main stream television media must believe we can’t handle thinking about more than one issue at a time.  All the world was the congressional budget/debt ceiling battle for three weeks or so.  Before that, all the world was Syria and their chemical weapons.  Before that, I can’t recall.   Like most Americans, I have a short memory, even shorter than most as a member of the social security set.

English: Depiction of the House vote on H.R. 3...

English: Depiction of the House vote on H.R. 3590 (the Patient Protection and Affordable Care Act) on March 21, 2010, by congressional district. Click the map for a much larger image and details (Photo credit: Wikipedia)

Now all the world is the faltering Obamacare web site.   Of course, this is the world the Republicans want us to dwell in, while the Democrats wish to constantly refresh our memories about how obstructionist the Republicans were in regard to the extension of the budget and raising of the debt ceiling.

Meanwhile the Republican Civil War is steadily simmering en route to a boil, with many of that party angry at Ted Cruz and his Tea Party set for making Republicans look imbecilic to a majority of the rest of us with their non-plan to stop Obamacare.    Had that not been the case, they could have been focusing attention on the clownish internet roll out for weeks.

Oh, well, they are making up for lost time by holding congressional hearings to accentuate the disaster to the public mind, the “train wreck” that they “knew” to be Obamacare even before it was passed.   Well, of course, they didn’t know, and they still don’t know, nor does anyone know how this will play out overall.   ( I know, many individuals already have personal stories, seemingly more negative than positive, but the whole thing has barely begun to be rolled out.)

The Federal Debt Ceiling and Budget Extension Battle

After much struggle and gnashing of teeth, the government reopened what was closed and will remain “open” at least until January 15, when the appropriated money runs out.   Also, the debt ceiling either will need to be raised again Feb 7 or government default on federal debt payments will once again be in the offing.

In short, the political arm twisting accomplished little more than postpone the match for a few months so both sides can enjoy the holidays and rest up.    Well, there are two things that may be seen as accomplishments down the line.  One is the formation of a Senate/House committee to try to actually come up with joint budget recommendations by Dec 13.

Given the inability of the two parties to come to terms on budget issues for a few years now (except for the sequester which they forced upon themselves through inaction), it is hard to get too excited about the prospects, but the upcoming second point might help.

Point Two is what seems a clarification of the political hazards of using the threat of a government shutdown and/or a default on federal debt as bargaining chips in future negotiations.  According to most polls the Republican “brand” took a big hit through all of this because they are blamed more for causing it.  (Don’t you just love how everything has been turned into a brand these days, including each of us.)

While the Tea Party types say they will continue to use such tactics, the rest of the Republican party doesn’t look like it will fall in line next time out.

The Republican Civil War

Recently I heard that Liz Cheney called John McCain a “liberal” which among the right is like “sinner”  was used in the early days of Puritan America.   A little Googling of the issue will reveal that Republicans are deeply divided between those who think of Ted Cruz as a hero and those, like Representative Peter King of New York, who called him a “fraud.”   Of course, party leadership tries to paint this as healthy debate within the party, but when one side in a debate refuses to compromise, there is no room for resolution.  Hence, a civil war.

I never tire of pointing out the irony of the Tea Party folks always proudly defending the constitution as if it were dropped from the heavens on a tablet.  It is a remarkable piece of work but it came about through torturous compromises, the most profound being the toleration of slavery in the new republic.   “Compromise” was not a dirty word to the founders, but a necessity to establish a stable central government.

How the Republican split will play out by January is sheer guess work, but if the rift doesn’t heal (and i do not think it will), Republican moderates and Democrats may actually work together on some sort of fiscal compromise that lasts longer than a few weeks.

Obamacare

As indicated above, one reason many Republicans are angry at Ted Cruz and his posse is that in pushing for changes in Obamacare that weren’t going to happen and in turn making the party resemble the keystone cops of early film days while trying to somehow look sensible, attention was paid to their intra-party squabbles and not to the initial roll out of the Obamacare website, which turned out to be the Democrats’ own version of the Keystone cops.

Here is my take on Obamacare.   It has barely begun to be rolled out and it is not going away, so let’s just wait and see how it plays out.   When Republicans argue that it is a disaster and a majority of Americans agree, keep in mind that the right has called it a disaster from the beginning, even when it was little more than an elaborate idea.  Since most Americans, including me, know little about it, if they feel it is a disaster it is because the Republican message has been more effective than that of the Democrats.   A part of that success is because negative advertising is more effective than positive, which is why campaigns are largely made up of the former.

In man-in-the-street interviews, when asked if they prefer Obamacare to the Affordable Care Act, most people state the latter, while oblivious to the fact they are the same thing.  In terms of brands, Obamacare doesn’t look good right now.  But it is not going away anytime soon, so let’s see what happens between now and the mid-term elections in 2014.

If Obamacare really is the train wreck portrayed by the Republicans, they should come to dominate both houses of Congress, that is if they haven’t torn apart the party by then.

Corporate Tax Reform: A Little Bit More if You Can Stand It

Ways and Means Committee, US Legislative Branch

Ways and Means Committee, US Legislative Branch (Photo credit: Wikipedia)

After writing my previous post I watched UPw/Steve Kornacki onMSNBC Sunday and he had his own response to the Apple hearing.  Perhaps that last post was already more than you want to know about reforming corporate taxes, but those who find the topic interesting should find Kornacki’s panel discussion worthwhile to watch here.  Scroll down the clips shown toward the left to find it.

For those who don’t want to bother, here are a few points made that add to or enhance what I wrote.   As it turns out, Matthew Yglesias, who I mentioned in my post, was on this panel and he made the case again for changing the focus away from additional corporate taxes and on to individuals, such as corporate executives and shareholders.  For one thing, individuals cannot so easily pretend to be “based” in Ireland.

Adding perspective, Ylan Mui of the Washington Post  pointed out that the government takes in far more money from individual taxes than corporate ones (about one trillion from the former to about 240 billion from the latter in 2012).

While Yglesias is a liberal, his idea is not the common liberal position which is to just charge corporations higher taxes, with the Congressional Progressive Caucus wanting taxes on all corporate profits made overseas the same as income earned here.

In contrast, the conservative position, as indicated in the previous post, is to reduce taxes on corporate earnings abroad to entice their return here as opposed to making a home in Ireland or wherever.

Steve Kornacki suggested President Obama’s position includes lowering taxes on foreign earned money in exchange for closing some corporate loopholes.  Obviously, there are various ways to mix and match reforms.  The question is whether any soup will pass a sufficiently collective Congressional taste test.

One problem is what “facts” can be agreed upon as a place to start?   The Right always emphasizes our official corporate tax rate (35% to 38% or so)  as being the highest in the world, even though the “effective rate” is more like 25% (or judged even less by many liberals).  While the Right always points to  that official rate, the Left and most journalists covering the topic emphasize the effective rate and that it varies greatly from company to company.  As Frank Clemente of Citizens for Tax Justice pointed out on the show, 30 of our largest companies paid no federal income tax between 2008 to 2010 (many of them profiting from a deal made as part of the stimulus plan).

As you can see, this is a tough topic to get a handle on let alone for Congress to do anything about.   Still, the House Ways and Means Committee recently came up with a 568 page report on various tax options, and the Apple story along with I. R. S. mismanagement of those tax exemption requests might help keep the embers of possible reform alive.

Having some roots in the usually barren ground of the House of Representatives might help.

Timothy Cook Goes to Congress: Slicing Up Apple

Image representing Apple as depicted in CrunchBase

Image via CrunchBase

Congressional grand standing has not been limited to President Obama’s “trifecta of trouble”  this past week.   Wednesday Tim Cook, the  CEO of Apple, was called on the Senate carpet to defend Apple’s  lodging billions of overseas profits abroad instead of bringing the money home to be taxed.  Most notably Apple has a shell company in Ireland where they hold some 30 billion in untaxed dollars.

In an indirect way this hearing brings up a key problem with our economy, an incredibly complex tax code which makes what Apple is doing a good business decision and not “pernicious” as John McCain (R.) said or cause “real harm” as Carl Levin (D.) suggested at that Senate hearing.

It is the sort of thing that makes Apple look bad, but the company is an “iconic U. S. firm” and pays possibly the highest amount of any corporate taxes in the U. S.   Also, what they are doing is not illegal.   In fact, as Matt Miller points out in an editorial, “Cook and his colleagues have a fiduciary duty to minimize Apple’s taxes under the law.”

The problem here is not Apple, but a tax code that does not incentivise corporations making profits overseas to bring those profits home as our corporate tax rate is the highest in the world (at least in theory; corporations have phalanxes of lawyers to reduce the “effective rate”).   The key underlying factor in all of this is:   ” The fate of companies and countries in a global age now diverge. The success of U.S.-based multinationals no longer assures the prosperity of American workers.”

How can that be changed?  The key is to “realign the interests of companies with those of the country.”  Miller, a political centrist who concentrates on ways in which the two parties might actually work together,  offers one suggestion about adjusting individual corporate tax rates in his editorial….

….while the more conservative Kyle Smith in Forbes likes Tim Cook’s notion of reducing the corporate rate for overseas earnings to around 10% to entice that money back home….

…..and on the liberal side of the spectrum Matthew Yglesias argues in Slate that we should stop taxing corporate profits because they are too slippery to get a handle on,  and just raise taxes on individual incomes instead.

What I find so interesting in these three articles is that right, center and left can all agree upon this much:  Apple (and other corporations) are not the culprit;  our byzantine tax code is.

Finding such agreement is great, but reforming the tax code, while so necessary, is a classic case of the devil being in the details.    Almost everyone agrees reform is needed, but nobody wants to lose what the present system gives them or allows them to keep.   Over decades reforming the tax code has meant  interest groups lobbying for more exceptions for themselves.  The number of pages in the tax code and regulations doubled from 26,300 in 1984 to 54,846 by 2003 to around 74,000 now.

Keep this in mind when listening to members of either party or political commentators talk about the necessity of reforming the tax code.  They make it sound like a panacea, but if anything useful to more than a few can actually be agreed upon by Congress, it won’t be agreed upon any time soon.