Postal Workers And The Public Want A Postal Banking Public Option

Contract talks between the American Postal Workers Union (APWU) and the U.S. Postal Service for a new contract start Thursday. Along with asking for fair wages and benefits, the APWU wants improvements in customer services, including postal banking.

“There are two competing visions of the future of the Postal Service,” said APWU President Mark Dimondstein. “Postal management’s policy has been to severely degrade service, dismantle the postal network, and engage in piecemeal privatization. … Management has shortened hours at neighborhood post offices, closed mail processing centers, lowered delivery standards, and slowed mail delivery.”

Instead of trying to “save money” by cutting service with layoffs and closings that cause more customers to turn away, which costs revenue, the Postal Service should add services such as postal banking. This would also help millions of people who currently are left wide open to predatory services like payday lending.

Postal Banking: A Public Option For Banking

Until 1967, the Postal Service (then called the Post Office) operated postal banking through the United States Postal Savings System. Reviving postal banking would be like offering a “public option” for financial services. It would let people have accounts they could use to cash checks, get small loans, pay bills and even get prepaid debit cards. These services would enable lower-income Americans to avoid the exploitative “payday lenders” and check-cashing “services” that eat up working people’s earnings.

The Postal Service would use existing bank infrastructure as the backbone for these services, particularly the debit card service. In “A public option for banking,” Mike Konczal explains how the Treasury Department is already doing this with their Direct Express debit card program for disability and pension payments.

The program allows unbanked recipients of Social Security, federal disability and a few pension-related federal programs to receive their benefits on a debit card. The program emerged from congressional efforts in the 1990s to move from paper checks to direct deposits for these benefits. Congress tasked Treasury to make sure there were low-cost accounts available to the unbanked so they could access deposits.

… By 2007, the department initiated a competitive bidding process for the cards, and Comerica won the account by offering the low-fee schedule the cards now have.

The Treasury Department is already offering this service. There is no reason the Postal Service could not do the same thing with postal banking.

Millions Would Benefit

A lot of people would benefit if the Postal Service offered postal banking. The term for people with no bank accounts is “unbanked.’ According to the 2013 FDIC National Survey of Unbanked and Underbanked Households, “7.7 percent (1 in 13) of households in the United States were unbanked in 2013. This proportion represented nearly 9.6 million households.” On top of that, “20.0 percent of U.S. households (24.8 million) were underbanked in 2013, meaning that they had a bank account but also used alternative financial services (AFS) outside of the banking system.”

In “The Post Office Should Just Become a Bank, David Dayen explains how this idea could free these millions from the grips of “check-cashing stores, pawn shops, payday lenders, and other unscrupulous financial services providers who gouged their customers to the tune of $89 billion in interest and fees in 2012,” and help the Postal Service at the same time. With small fees for services, including small, low-interest loans, the Postal Service would be helping Americans and increasing its funding.

Post offices could deliver the same services at a 90 percent discount, saving the average underserved household over $2,000 a year and still providing the USPS with $8.9 billion in new annual profits, significantly improving its troubled balance sheet. The report calls simple financial services “the single best new opportunity for the posts to earn additional revenue.”

These millions are not being served now by the financial industry, as Dayen explains,

Banks don’t want these customers; if they did, they would actually make a play for their business. Large banks have closed branches in the very low-income communities with the largest percentages of unbanked Americans. In fact, banks find it more profitable to fund payday lenders that charge junk fees and outrageous interest—currently the subject of a Justice Department investigation—than actually take market share away from them.

Instead of partnering with predatory lenders, banks could partner with the USPS on a public option, not beholden to shareholder demands, which would treat customers more fairly.

If ever there was an idea whose time has come (again) it is the idea of a public option for postal banking. It would help millions of people, would boost the revenue of the Postal Service and would demonstrate that our government actually can be on the side of regular people. (Note that a government service in a democracy should be providing a government service, not trying to “operate like a business” and “make money” off of citizens.)


Also see “A “Grand Alliance” To Save Our Public Postal Service.”

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This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF. Sign up here for the CAF daily summary and/or for the Progress Breakfast.

How To End Unemployment

Alongside Friday’s good employment data, there is a brouhaha on the Internets over claims that the government’s employment numbers are a “big lie.” Jim Clifton, Chairman and CEO of the Gallup polling company penned “The Big Lie: 5.6% Unemployment,” claiming that “the media” is “cheer-leading” and the White House is “scor[ing] political points” over phony numbers that the government makes up to make things look better than they are.

In fact, the “top line” unemployment number – now 5.7 percent, representing 9 million people, does not factor in people who have given up looking, 6.8 million part-time workers who want to work full-time, 2.2 million “marginally attached” people, people who are grossly underpaid, etc. But everyone knows that, and the government reports that. The “official” number has a specific definition, the “U-6 “alternative measure of labor under-utilization” reports the more accurate 13.5 percent number. So somewhere between 15 and 20 million Americans count as un- or underemployed. But even that doesn’t count those who have given up. It’s still bad out there, but the government’s figures are not being manipulated.

Intentionally High Unemployment

I want to suggest that this high un- and underemployment is intentional. Here is why. Two things that the government could easily do right now would pretty much get rid of unemployment. But our government is blocked from doing those things by extremely wealthy people, who benefit from the low wages, and a desperate and “cowering” reserve army of unemployed status quo.

First, balancing the trade deficit would by itself bring back more than 5 million jobs. This is based only on the 3.1 million lost to the China trade deficit, 1 million lost to NAFTA and 900,000 lost to the Japan trade deficit. We also have trade deficits with Germany, South Korea, and others.

A way to visualize this is to imagine the effect on our economy of $500 billion of new orders coming in to businesses that make and do things inside the U.S. Then another $500 billion next year and every year after that. Our annual trade deficit is $500 billion. Fixing that means $500 billion of new business here, now,  and continuing every year from now on. What you are visualizing is the damage this trade regime has done to us since Wall Street and the right’s “free trade” ideology took over.

Second, we have deferred maintaining our infrastructure since the Reagan era started the cycle of tax cuts and spending cutbacks. To bring the country’s infrastructure up to standards (never mind modernizing) we would need to spend $360 billion each year for 10 years, according to the American Society of Civil Engineers’ Infrastructure Report Card. If you conservatively estimate that each $1 billion spent on infrastructure creates 30,000 jobs, $350 billion translates to 350×30,000 = 10.5 million jobs.

So that’s conservatively 15.5 million jobs if we just go back to doing what the country did before the Reagan era. (This gives you a hint at the damage Reagan’s “trickle down” economics, and “free trade” market ideology have done. Look around. The extreme inequality that resulted tells you why it was done.)

Balance trade and fix up our aging infrastructure means at least 15.5 million jobs. (Think about what that would mean for wages, too.)

But That’s Just Catch-Up

But those things are just playing catch-up. It comes close to giving jobs to the unemployed, part-time for economic reasons and “marginally attached” workers. It doesn’t even start to dig into the people who have given up and left the labor market.

We got here by cutting taxes for the rich, gutting government, deferring maintenance, a and letting a few billionaires harvest our public wealth through privatization, etc. We’ll get out of it by fixing the trade deficit, repairing our infrastructure, undoing policy mistakes that have continued since the Reagan era, and ending “trickle down” tax cuts.

How do we take this a step further? The following things would employ tons of people and bring a long-term economic return far above any “cost.”

First, retrofit buildings and homes to be energy-efficient. Start with the basics: plug leaks and drafts, paint roofs white. These simple things could employ tons of people who we call “low skilled.” Take it a step further, and install energy-efficient windows, insulation, modern heating and cooling systems, solar on the roofs, etc. — all made in America, of course — and we will employ millions more. The energy payoff would be enormous, and we would go into the future with a much more efficient economy.

Next, engage in 21st century infrastructure projects like high-speed rail across the country and into Canada and Mexico — just like China is already doing. (See: “New Silk Road.“) We’ll create jobs, and end up with a massively more efficient, competitive economy. Then, modernize our power grid and install wind turbines across the plains states. Again, we end up with a massively more efficient, competitive economy. Requiring American-made supplies boosts the return to our economy.

What about building out national, high-speed, fiber internet? Imagine the innovation that would result.

There is so much we could do to first bring about full employment, and then move our economy into the 21st century. But we are held back by this weird Reagan/Wall Street/conservative ideology that tells us not to believe that We the People deserve a government that spends to make our lives better. That spending boosts us up now, makes our lives better, and more than pays for itself later. But we are kept from dreaming and doing because that return on our investment would go to us, instead of into the pockets of a few billionaires.

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This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF. Sign up here for the CAF daily summary and/or for the Progress Breakfast.

Give Americans A $2000 Check From “Deferred” Corporate Taxes

U.S. multinational corporations are hoarding an estimated $2 trillion “offshore” to take advantage of a loophole in our tax laws. At our 35 percent top federal corporate tax rate, that represents up to $700 billion in taxes owed but “deferred” because they are “offshore.” This is not imaginary or future money; it is taxes owed on $2 trillion of profits these companies have already made. Who should get this money?

A loophole in the corporate tax code allows companies to “defer” paying taxes on profits made outside of the U.S. until they “repatriate” it – bring the money back to the U.S.. Because of this loophole corporations are holding an estimated $2 trillion of profits “offshore.” Companies are increasingly moving jobs, production and profit centers out of the country to take advantage of this scheme – or are engaging in schemes to make it look like they are. (The amount is increasing 11.8 percent a year and the rate of increase is increasing as well.)

That $700 billion is serious money. Washington lobbyists are working with Congress to come up with various corporate tax “reform” schemes designed to let the corporations off the hook for much of this tax bill – and to lower their future tax bills as well.

The most popular “centrist” idea is to let the corporations just keep much or most of the tax money they owe, if only they would just let us use some of it to maintain our country’s infrastructure. Going along with this would reward these companies for engaging in schemes to “offshore” jobs, production and profit centers, thereby moving (or making it appear that they moved) these profits out of the country – and certainly would encourage doing even more of this from now on.

Send A $2,000 Check To Every Adult – AND Fix Our Infrastructure

Instead of letting these companies off the hook for this tax bill, here is an alternative idea: Let’s collect the taxes that are due on these profits that have already been made, send every adult in the U.S. a check for $2,000, and use what’s left over to fix up our infrastructure.

This is real money, and a lot of it. Instead of making a “deal” on deferment and letting the corporations just keep this money they owe us, let’s fix this loophole and give most of this tax money to the 242 million U.S. residents over 18 as a $2,000 check. What’s left over (and there might be a lot – as much as $215 billion) can be used to fix our infrastructure and other priorities like research and development, fighting Ebola and other diseases, forgiving student debt – you name it.

This is about who gets the money. Do we give the tax money that is already owed to We the People, or do we let the giant corporations just keep it? By making this about a $2,000 check directly to every adult, it becomes personal. It becomes an issue of real money in people’s pockets, not some distant sum that “government” uses for their own good but that people never really feel or touch. Sending people a $2,000 check turns this battle over this money into a personal fight, not just some nebulous, distant, complicated government policy issue.

Who Should Get The Money?

By the way, when we talk about “corporate” money and corporate tax cuts, this is what – more accurately “who” – we are really talking about:

The top 1 percent own 50.9 percent of all stocks, bonds, and mutual fund assets. The top 10 percent own 90.3 percent. The bottom half of all of us own 0.5 percent – one half of one percent. That was 2007 – the top few have only increased their ownership percentages since.

This is about who gets the money. There is up to $700 billion in taxes due and someone is going to get that money. By making this about a $2,000 check to each adult American vs. billions to the owners of the giant corporations, we’re making the “who gets the money” argument personal instead of abstract.

Effect On Economy

What happens to our economy if every adult gets a $2000 check? How much hiring happens in local stores, etc?

What happens to our economy with up to $215 billion going into infrastructure work, with the related hiring and purchases of supplies?

What happens to our economy if companies lose the incentive to move jobs, production and profit centers offshore to take advantage of this loophole?

But wait, there’s more. There’s also that other $1.3 trillion – the “after tax” part that is offshore, too. If we do something about this deferment scam companies would lose the incentive to move jobs, production and profit centers out of the country to make it look like their profits are made elsewhere, and would “bring that money back.” The money would either be invested in the corporation or distributed to shareholders. This would be a big stimulus to the economy either way.

The Numbers

There’s as much as $2 trillion (maybe more) sitting offshore representing up to $700 billion in taxes owed at the top tax rate of 35 percent. (Taxes already paid to other countries are subtracted from what is owed here. This is why the tax bill is “up to” $700 billion. State taxes are also due on these profits, this article concerns itself with the federal share.)

According to the Census Bureau’s QuickFacts there were 316,128,839 Americans in 2013, 23.3 percent of them under 18, leaving 242,470,819 adults.

Sending a $2,000 check to 242.5 million adults costs about $485 billion. Up to $700 billion owed minus $485 billion leaves up to $215 billion for infrastructure and other priorities.

Summary

It’s a great way to accomplish several things that are good for the country:

1) Get cash to people right now. Helicoptered in, $700 billion would make a very big difference that people would feel now and the economy would feel for a while.

2) A $2,000 check shows people how corporate tax breaks are seriously costing them.

3) This puts pressure on “corporate tax reform” deals that reward the corporations by letting them keep any of it.

5) The best part is these companies already owe the money. This is about who gets the money that is owed to We the People. It makes the “We the People” part personal.

The awareness “making this personal” would bring to the issue would lend public support to other efforts to get companies to pay their taxes.

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This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF. Sign up here for the CAF daily summary and/or for the Progress Breakfast.

Republicans On Supreme Court Enable Ohio Voter Suppression

The Republican majority on the US Supreme Court by the usual 5-4 today overturned a lower court and blocked a week of early voting in Ohio.

A US Supreme Court just made it much harder for many people to vote — even impossible for some.

Ohio is one of the states that provides plenty of voting machines in affluent, mostly-white precincts while providing few in poorer, minority districts. The result is long, long, long, long lines at the polls in these district, discouraging or making it impossible for people to vote.

I’d call this one of the most blatant uses of raw power for partisan purposes since Bush v Gore, when the Court ruled 5-4 that counting the votes in Florida would “threaten irreparable harm to petitioner Bush, and to the country, by casting a cloud upon what he claims to be the legitimacy of his election.”

Other blatant abuses include letting corporations put money into elections, letting billionaires put as much as they want into elections and getting rid of the Voting Rights Act.

Corporate Courts — A Big Red Flag On “Trade” Agreements

Think about everything you understood about our system of government here in the United States. We’re  governed under a document that starts with the words, “We the People.” Right? When We the People agree that something should done to make our lives better, it’s supposed to get done. Right?

You didn’t know it, but that whole system thing changed several years ago. Our government, in our name, signed a document that placed corporate profits above our own democracy. The “investor-state dispute settlements” chapter in NAFTA (and similar agreements) places corporate rights on above the rights of people and their governments.

As a result of “NAFTA-style” investor protections that are part of so-called “trade” agreements,  giant corporations can and do sue governments for trying to pass laws that protect their citizens from harmful chemicals, ban harmful products, and protect the rights of working people, among  other things. Corporations even sue governments for passing laws that might cause the investors in the corporations to make a bit less money — like raising the minimum wage.

But wait, there’s more.

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Why Is SEC Sitting On Corporate Transparency Rules?

Are We the People the boss of the corporations, or are the corporations the boss of We the People? The Securities and Exchange Commission (SEC) needs to be reminded which way that question is supposed to be answered.

The SEC is the agency set up by We the People to “protect investors, maintain fair, orderly, and efficient markets, and facilitate capital formation.” The SEC states that “all investors, whether large institutions or private individuals, should have access to certain basic facts about an investment prior to buying it, and so long as they hold it. … Only through the steady flow of timely, comprehensive, and accurate information can people make sound investment decisions.”

One would think those basic corporate facts and timely, comprehensive, and accurate information needed by investors would include access to a company’s tax returns. One would think they would include information about where the executives of the company are spending millions and millions of the company’s dollars. And one would think they would include disclosure of the ratio of CEO “pay ratio” of compensation to worker compensation, as required by the 2010 Dodd-Frank law.

But so far the SEC is not asking corporations to provide investors and the public with this information. Don’t shareholders — and We the People — deserve to know what these companies are really doing and how much they are really making?

What Are These Companies Really Earning?

Companies tell their investors that they are making tons of money. But to get out of paying taxes the same companies tell the IRS something entirely different. Don’t investors have a right to know what the companies they invest in are telling the tax office?

Last month Catherine Rampell wrote in the Washington Post, in “Shareholders, public deserve tax transparency,” that:

“[There is an] array of eye-glazingly complicated tax avoidance strategies adopted by America’s biggest companies … The basic rationale behind tax transparency is that shareholders (and creditors and the general public) deserve to know what publicly traded companies are doing, particularly if complicated tax acrobatics are distorting their operational and investment decisions.”

She points out that we started out requiring this.

This is not a new idea. In fact, when the modern federal corporate income tax was introduced in 1909, it came with a requirement to disclose the returns. Such transparency mandates were fought over bitterly for the next couple of decades, and U.S. returns have been confidential since 1935.

What About Company “Donations”?

If a company’s executives are literally giving the company’s money away to politicians, “charities” (maybe run by a relative), “think tanks” (that employ relatives, etc.) or other worthy recipients,  shouldn’t investors be provided with information about who is getting the company’s money, and how much they are getting? (Milton Friedman notably claimed that such donations are “theft” from the company.)

(Note: If a company gives money to a politician, and is not simply “giving the money away” for nothing — with absolutely no expectation of getting anything in return — that would be bribery,  under the law.)

Last week in The Nation Zoë Carpenter wrote about this in, “SEC Faces Renewed Pressure to Consider a Corporate Disclosure Rule”:

The campaign to lift the veil on secret corporate campaign donations hit a milestone on Thursday. More than 1 million comments have been submitted to the US Securities and Exchange Commission calling for a requirement that corporations disclose political spending to their shareholders—ten times more than for any other rule-making petition to the SEC, according to the Corporate Reform Coalition.

“Investors want to know how their money is being spent,” Tim Smith, director of shareholder engagement at the firm Walden Asset Management, said at a press conference outside the SEC in Washington. A sign over his right shoulder read, “Your money is being invested in secret. Why is the SEC doing nothing?”

Why Is SEC Sitting On These Rules?

So why is the SEC just sitting on these proposals to disclose basic information to shareholders? In the case of the CEO pay ratio, this is even required by a law passed almost 5 years ago.

Could it be that the people working at the SEC really do know who is the boss now? (“Boss” as in the writer of the big paycheck and future employer.) Maybe, and maybe not. Who’s to say?

In early 2013 the Project On Government Oversight (POGO) released it report, “Dangerous Liaisons: Revolving Door at SEC Creates Risk of Regulatory Capture”:

A revolving door blurs the lines between one of the nation’s most important regulatory agencies and the interests it regulates. Former employees of the Securities and Exchange Commission (SEC) routinely help corporations try to influence SEC rulemaking, counter the agency’s investigations of suspected wrongdoing, soften the blow of SEC enforcement actions, block shareholder proposals, and win exemptions from federal law. POGO’s report examines many manifestations of the revolving door, analyzes how the revolving door can influence the SEC, and explores how to mitigate the most harmful effects.

At the time of the report’s release Bloomberg reported,

From 2001 to 2010, POGO says, more than 400 SEC alumni filed about 2,000 disclosure forms (which POGO obtained using the Freedom of Information Act) saying they planned to represent an employer before the SEC. That may vastly understate the problem because, as POGO points out, former SEC employees must file such statements for only two years after departing.

The SEC has exempted some senior employees (even sometimes blacking out their names on SEC documents) from a one-year cooling-off period during which they are barred from representing clients before the agency, POGO found.

Soon after the report was released: April, 2013, Ex-SEC chief Schapiro takes revolving door back to private sector,

With her seat barely cold at the chairmanship of the Securities and Exchange Commission, Schapiro will become a managing director at a financial consulting and lobbying firm that has hired a slew of former financial regulators over the last several years and that represents for many a nexus of the cozy relations between banks and their regulators.

Are We the People the boss of the corporations, or are the corporations the boss of We the People? Who’s to say? Not the SEC, apparently.

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This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF. Sign up here for the CAF daily summary and/or for the Progress Breakfast.

Six Corporate Tax Myths In One Letter to Editor

How MANY mistruths can you count in a letter in today’s San Jose Mercury News?

Lower corporate taxes would boost economy

When the government wants to raise taxes, the counter argument is always that people and corporations will work harder if they can keep their earnings. It is either that, or pass the costs to the consumers. Either way, high taxes are a no-win situation for everybody. Now that we have the highest taxes of any industrialized nation, corporations are “voting with their feet” and using legal tax-inversion strategies to stay competitive. The administration that pushed for high taxes is crying foul and saying this is not patriotic. Now they don’t like the consequences of their greedy tax policies. Drop the corporate tax rate to 15 percent and watch the economy soar.

  1. Myth: People will work harder if they can keep their earnings. Actually, wouldn’t people work harder to make up for the money that goes to taxes?
  2. Myth: Corporations pass the “cost” of taxes onto consumers. Actually corporations can’t pass taxes to consumers. (And taxes are not a “cost.”) Summary: taxes are on profits and prices are already as high as the company can charge. If corporations could just increase prices to cover taxes then the profits would go up, which raises the taxes, so they wold have to increase prices again, which would increase profits, which raises taxes, so they have to increase prices again, etc.
  3. Myth: Taxes are no-win. Actually they pay for the reads, schools, courts, police, military and the rest of the things that enable corporations to prosper.
  4. Myth: We have the highest taxes. Actually we don’t. Corporations are shifting profits out of the country to avoid ever paying taxes. The solution is to make them pay their taxes, not lower tax rates to let them get away with this.
  5. Myth: The administration raised taxes on corporations. Actually the administration didn’t raise corporate taxes. Corporate taxes have been lowered from 46% to 35% since the 80’s.
  6. Myth: If the corporate tax rate was lowered to 15% the economy would soar. Actually there is no relationship between lower tax rates and higher economic growth. In fact, there is a correlation between lower rates and lower growth, possibly because lower taxes cause government to cut back on the things that help the economy prosper, like education, investing in infrastructure, basic research, etc.

The letter-writer probably actually believes the stuff he wrote. Many people do. This shows the effect of decades of corporate/conservative propaganda on the public. Unfortunately these beliefs are leading to policies that are killing our economy and our democracy.

Now It’s Burger King Renouncing US Citizenship – Let’s Eat Somewhere Else

Burger King is the latest company announcing plans to renounce its U.S. citizenship in order to dodge taxes. It plans to buy Tim Hortons and then pretend Tim Hortons bought them so they can claim to be Canadian. (Tim Hortons renounced its own U.S. citizenship in 2009 and moved their headquarters from Ohio to Canada.)

The announcement is prompting calls like this petition you can sign by the Campaign for America’s Future that calls on Burger King’s CEO to keep the restaurant chain American or “I will dine elsewhere.”

Burger King Didn’t Build That By Themselves

Why is Burger King prosperous? Why do people feel safe eating food served at Burger King? Why do people recognize a Burger King when they see one? Why does something called “Burger King” with outlets across the country (and the world) even exist?

  • Consumers believe Burger King’s beef and other offerings are safe to eat because they know our taxpayer-funded government inspectors and regulations make sure of it.
  • Taxpayer-funded government courts and agencies make sure that other fast-food outlets can’t call themselves “Burger King” to trick people into eating there instead.
  • Taxpayer-funded agencies and courts also make sure that other restaurants can’t call their burger a “Whopper.”
  • Burger King’s customers use taxpayer-funded roads when they drive to a local Burger King outlet.
  • Burger King’s workers and managers were educated in taxpayer-funded schools.
  • The money Burger King collects is created and regulated by the taxpayer-funded government, and it is deposited in banks that are regulated by the government to be safe and trustworthy. (And protected by taxpayer-provided police.)
  • Burger King’s ultra-low-wage employees are paid so little that they receive food stamps, Medicaid, earned income tax credits and other taxpayer-funded government safety-net services.
  • The government enables Burger King to be something called a corporation at all. Corporations are entirely government-created entities with special rights, privileges and protections that are granted by the government.

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Austerity Has Made Europe’s Depression Longer Than in ’30s

Europe’s economic depression has now lasted longer than the Great Depression of the 1930s. Meanwhile, America’s “Great Recession” also drags on thanks to cutbacks in government spending since the stimulus.

Europe’s leaders somehow were convinced that austerity – “deficit reduction” through cutbacks in government – would somehow lead them out of their economic doldrums. They believed that taking money out of the economy would help the economy. The result has been terrible. The Washington Post’s Wonkblog calls Europe’s austerity-lengthened depression “one of the biggest catastrophes in economic history.”

To top it off, Europe’s governments are learning that cutting back on spending not only worsens the economic picture, causing terrible unemployment, poverty and human misery, but the worsened economic picture means less revenue coming in, thereby increasing deficits instead of lowering deficits. In other words, austerity cutbacks to fight deficits have instead made deficits worse and hurt people.

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GOP Vows To Dismantle Or Shut Down Government If They Win Senate

A Politico story being promoted by the Drudge Report, “McConnell’s plan to shut down Obama,” makes it clear that if Republicans capture the Senate this fall they will, as the Drudge Report puts it, “play chicken” and shut down the government if President Obama vetoes their legislation to dismantle the government.

From the Politico interview, a threat,

“We’re going to pass spending bills, and they’re going to have a lot of restrictions on the activities of the bureaucracy,” McConnell said in an interview aboard his campaign bus traveling through Western Kentucky coal country. “That’s something he won’t like, but that will be done. I guarantee it.”

Who does McConnell say would be to blame if the President vetoes bills and Republicans then shut down the government rather than compromise? “McConnell said it would be up to the president to decide whether to veto spending bills that would keep the government open.” (In a related story this week, Islamic State in Iraq and Syria (ISIS) blamed the United States for making them behead an American journalist.)

Dismantle Or Shut Down

Republicans say that if they take the Senate they will pass legislation to dismantle the government. Jim Manley, former aide to Sen. Harry Reid explained in April at the WSJ, “It is very difficult to imagine that House Republicans’ takeaway from such an election would be to search again for moderation.”

Republicans can be expected to:

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Are American Corporations Really Less Competitive Because Of Taxes?

Corporate tax rates used to top out at 52.8 percent. Later rates were lowered to 48 percent and then 46 percent. Then in 1986 corporations complained that this (lowered) rate made them “uncompetitive” and demanded “corporate tax reform.” Because job creators. So the rate was lowered to 35 percent.

Now in 2014 corporations are complaining that this (lowered) rate makes them “uncompetitive” and are demanding “corporate tax reform.” Because job creators – or something. This time they threaten to – or do – renounce their U.S. citizenship, saying it is because of too-high tax rates.

So, here we are again. They want rates lowered even more. But are corporate tax rates really “uncompetitive?” And what does that even mean?

Tax Rates Are Plenty Competitive

At the New York Times’ Dealbook Andrew Ross Sorkin looks at this issue in “Tax Burden in U.S. Not as Heavy as It Looks, Report Says.” Sorkin looks at a paper, “‘Competitiveness’ Has Nothing To Do With it,” by Edward D. Kleinbard. Kleinbard is a professor at the University of Southern California and used to be chief of staff to the Congressional Joint Committee on Taxation. Sorkin quotes Kleinbard:

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Three Charts to Email to Your Right-Wing Brother-In-Law — Updated

Problem: Your right-wing brother-in-law is plugged into the FOX-Limbaugh lie machine, and keeps sending you emails about “Obama spending” and “Obama deficits” and how the “stimulus” just made things worse.

Solution: Here are three “reality-based” charts to send to him. These charts show what actually happened.

Spending

Bush_Obama_Spending_2014

Government spending increased dramatically under President Bush. It has not increased much under President Obama. This is just a fact.

Deficits

Bush_Obama_Deficit_2014

Note that this chart starts with Clinton’s last budget year for comparison.

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