The Congress returned December 1 for two weeks. What are they doing with all this time?
The House is setting its collective hair on fire over the President’s Executive Order on Immigration. There are hearings in at least two committees to hammer away against the Obama “Kingship.” There is a bill in the works to repeal all the President’s deferred prosecution, including for Dreamers. On Thursday the House voted to pass this legislation, known as the Yoho bill, by a vote of 219 to 197, an almost totally party line vote.
They may have reached a deal on appropriations that has them passing and omnibus appropriations bill to fund the government for a whole fiscal year.
Apparently the Republican Leadership may want to get this out of the way. The Homeland Security appropriations will run only until March in order to give the anti-immigrant bunch an opportunity to take another shot at the Administration. No government shutdown.
In case you were wondering, the term “lame duck” does not refer to the session but to the people conducting the session – elected officials whose terms are about to expire and who are not going to be back. Apparently the term originated in the 18th century as an allusion to stockbrokers who were unable to pay their debts.
After playing around with this for the better part of a year, the “extenders” apparently will pass in some form making a bunch of loopholes available for another year. House and Senate lists differ on which to include but they should close these differences quickly. This follows an attempt to pass a “compromise” that included not only an expanded list of “extenders,” but tried to make a number of them permanent. Progressive tax groups made their displeasure known and the President threatened a veto.
So it looks like they have settled on a short term fix. The Democrats in the Senate had apparently agreed to the now ignored “compromise.” If this is the Democrat’s strategy, be prepared for hard times ahead.
Police Body Cameras
The police officer who choked to death an unarmed black man on Staten Island was exonerated by a grand jury. The coroner had called it a homicide.
The President did take a stronger personal role in the matter of blacks and the cops by calling for cameras on police flack vests.
The problem is that the persistent poverty, discrimination, unemployment, poor health, bad schools, and hopelessness in people of color communities will not be solved by cameras on cops. It needs something like a domestic Marshall Plan and the politicians who have been in the ascendency are more interested in feeding cash to the corporations and the wealthy than they are in dealing with the quality of domestic society.
The U.S. economy added 321,000 jobs in November and there is evidence of regional improvements in consumer spending. The unemployment rate held at 5.8 percent. It remains to be seen whether or not the Democrats will be emboldened to resist another round of Congressional efforts to cut taxes, reduce critical spending, fight immigrants, and perpetuate inequality – the long list of discredited austerity programs that the Republican majority is sure to try to enact.
A committee appointed by Texas Governor Rick Perry has recommended that Texas join in the Medicaid Expansion. It looks like the state of Wyoming is coming to its senses, too, and is trying to figure out how to participate in expansion. Rumors abound that deals also are in the works in Montana and Idaho.
Pretty soon we will look at the map of non-expansion states and see the modern manifestation of a racist, slave-owning South.
The mad scramble to contain Ebola may finally be showing some hopeful signs. There now are empty treatment beds in Liberia, which was hardest hit. Efforts to prevent its spread into Europe and the U.S. also appear to be holding. Sierra Leone has now become the new hot-bed of Ebola infection.
The appropriations bill now working its way through the U.S. Congress includes $5.3 billion to fight the Ebola epidemic.
Health Care Cost Slows
One of the big causes of the push for austerity economics has been the inexorable cost push in the health care sector of the economy. Austerity freaks should be cheering and dancing. In 2013 spending on health care grew at the lowest rate since 1960, the lowest on record.
You can read all about it in Health Affairs: http://content.healthaffairs.org/content/early/2014/11/25/hlthaff.2014.1107.full.pdf+html.
Tax Reform – the Myth
One of the things that the pundits suggest as a potential point of agreement between Obama and the coming Republican Congress is something they call “tax reform.” Here are two myths to watch out for:
Revenue Neutral. Even though it is patently obvious that the great give-away of tax loopholes to the rich and corporations has caused an enormous drain from the national treasury, the mantra is that reform should be “revenue neutral.” That means that every cut that they make for the corporations needs to be balanced by some increase somewhere else.
In order to make it easier to do this, the House Republicans have tried to maximize the cuts being provided in the “extender” package they are pushing in the lame duck session. The more they permanently reduce taxes for the corporations on the extender bill, the less it costs them when they try to produce “revenue neutral” tax reform that cuts the rates for the corporations. Cut a bunch of rates now, without paying for them, and we will not have to account for them in the score for tax reform next year.
The other thing that they are proposing to use to find a “revenue neutral” plan is a little thing called “dynamic scoring.” This is a purely ideological theory that says tax cuts actually produce tax revenue. Yep – cut those taxes and the economy will grow and more money will roll in and everything will be rosy. The trouble is that it doesn’t work and the experts at the Congressional Budget Office have refused to use it.
But next year the voodoo economics gang will be in charge and they are preparing to rattle a few beads over the national economy and, presto, we can cut the hell out of corporate taxes. Deficit hawks should be shuddering.
The U.S. Has the Highest Corporate Tax Rate in the World. This little myth is a media favorite. It says that, because the law sets a 35 percent top corporate tax rate, we have the highest corporate taxes. The problem here is that corporations simply do not pay this rate.
Here are some key findings from a study done by Citizens for Tax Justice:
- “As a group, the 288 corporations examined paid an effective federal income tax rate of just 19.4 percent over the five-year period — far less than the statutory 35 percent tax rate.
- Twenty-six of the corporations, including Boeing, General Electric, Priceline.com and Verizon, paid no federal income tax at all over the five-year period. A third of the corporations (93) paid an effective tax rate of less than ten percent over that period.
- Of those corporations in our sample with significant offshore profits, two thirds paid higher corporate tax rates to foreign governments where they operate than they paid in the U.S. on their U.S. profits.
- These findings refute the prevailing view inside the Washington, D.C. Beltway that America’s corporate income tax is more burdensome than the corporate income taxes levied by other countries, and that this purported (but false) excess burden somehow makes the U.S. “uncompetitive.”
In addition to having to get a new Attorney General confirmed by the Senate, Obama now has to get a new Defense Secretary. Every time the President needs something out of the Senate he is made more vulnerable to the extortionists. Obama apparently will nominate former Deputy Secretary of Defense Ashton Carter to Defense. John McCain likes him, so maybe everything will be O.K.
The Congress is supposed to end its lame duck session next week and re-convene with its shiny new majorities on January 6.