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Stamp out starving writers, buy their books!

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Taxes (Don’t try this without an attorney.)

Google logoOn the Google corporate website, under the heading Our philosophy there’s a subheading that says You can make money without doing evil. Well, that’s good to know. In fact, Google has set up a philanthropic organization at www.google.org to do good.

On the google.org website, under the heading Philanthropy @ Google, it says, “Google approaches philanthropy in a variety of ways. In 2010, charitable giving at Google exceeded $145 million in funding to non-profits and academic institutions, and more than $184 million in total giving when including Google Grants, Google.org technology projects and product support for non-profits.”

That’s impressive. And it suggests that Google is interested in being a good corporate citizen, doing good instead of evil while making money.

On the other hand, we heard from National Public Radio that eight years ago Google transferred all of its non-U.S. intellectual rights to a Shamesubsidiary in Ireland. Intellectual property rights are the meat and bones of Google’s business. And if those rights were in the U.S., all profits due to those rights would be taxed at the usual corporate tax rate of 35 percent. But Google’s tax rate in Ireland is only 12.5 percent.

But wait, there’s more! Google’s Irish subsidiary pays royalties to a second Irish subsidiary that has its tax residency in Bermuda where the corporate tax rate is zero.

Wait, wait, there’s still more! Ordinarily, the first Irish subsidiary would have to pay taxes to shift money from Ireland to Bermuda, so to get around that little problem, Google sends the royalties from the first Irish subsidiary to a Ducth subsidiary that passes them on to the second Irish subsidiary that has designated no-tax Bermuda as its residency.

When it comes to arranging things to lower your taxes,  U.S. Supreme Court Justice Learned Hand has said this —  Everybody does so, rich or poor, and do right, for nobody owes any public duty to pay more taxes than the law demands. Taxes are enforced exactions, not voluntary contributions. 

Maybe the tax code needs to be rethought and rewritten.


We especially enjoyed the Twitter wit who reported that the United States Geological Survey rated the earthquake in Washington, DC,  as a magnitude 5.8, but Standard & Poor’s rating agency downgraded it to a 4.0.

Noted Economist with Wicked Felt-tipped Pen

The noted political economist is Robert Reich,  a professor of Public Policy at the University of California, Berkeley. In this video, he connects the dots about the structure of the US economy, and does it in a mere two minutes and fifteen seconds.  Reich is also a fast hand with the felt-tipped pen and may have an alternate career as a political cartoonist.  This video has been around a while and has been seen by well over a million people. But we have a weakness for the message. Check it out.

Left and Right on the Second Amendment

The writer Jack Slack – yes, that’s his real name — is politically liberal, so it’s no surprise that he favors gun control legislation, especially on handguns. But he does surprise some of his liberal friends when he says, with emphasis, “I support the Second Amendment as written.”   Here’s Jack  in his own words…

Gun - revolverAmendment II consists of only one sentence.  A well regulated militia, being necessary to the security of a free state, the right of the people to keep and bear arms, shall not be infringed.

The Second Amendment, by using “militia,” was only emphasizing why the people should have the right to bear arms, they had no reason to say that a militia must have guns, because a militia is an armed force. Why would they need permission bear arms?

I won’t quote all the Supreme Court rulings supporting the individual mandate of the Second Amendment, nor the framers interpretations right after the amendment was written. Suffice it to say, the Bill of Rights does not place a single limitation on the rights of the people, it only limits the power of government — that is why it is called “The Bill of Rights,” to distinguish it from the rest of the Constitution.  If the Second Amendment curtailed the right of the people by limiting arms to the militia, it would be a limitation on the rights of the people.

Finally, the word “militia” has no bearing on the meaning because in the English language the justifying clause does not limit the operative one. This can be seen more clearly if we use the exact syntax and punctuation with a less emotional subject.  Well educated teachers being necessary to the education of a free state, the right of the people to keep and bear books, shall not be infringed. (more…)

First, the Bad News…

First the bad news — the ultra conservative Tea Party faction has effectively manipulated the Republican majority in the House of Representative. Now for the really, really bad news — policies espoused by Republicans and Tea Party reactionaries are going to make matters worse, much worse.

Hand points to textHere are two ugly facts.  One: We are in a recessionary period caused by the near collapse of our financial system. Two: Financial recessions generally take a long while to resolve themselves  (think five or ten years)  and employment tends to improve even more slowly than the economy.  A lot of economists have pointed this out. Harvard economist Kenneth Rogoff, along with Carmen Reinhart, published a big thick book back in 2009, This Time Is Different, surveying eight centuries of financial crises. Century after century the story has been about the same, but each generation of fools thought their own financial recession was different.

Now Tea Party people and other reactionaries apparently don’t know this. Rogoff’s book is heavy with statistics, which may explain why no one in the Republican party seems to have read it. On the other hand, they may understand economics, but want to make sure that things stay bad enough to assure a Republican candidate wins the next election for President.

If you haven’t been driven mad by endless shouting about the deficit, you may recall that most of the new Republican House members swept into Congress with cries of, “Jobs! Jobs! Jobs!” But after taking their oath of office, those same new congressmen and congresswomen cried, “Cut the deficit!” They claimed “the people” had sent them to Washington “to put our fiscal house in order.” No poll ever found that “the people” believed cutting the deficit was more important and creating jobs. But Republicans got their way.scissors

Cutting the deficit does absolutely nothing for creating jobs now. On the contrary, cutting the deficit cuts jobs.

Our last-minute Budget Control Act of 2011 requires $917 billion in initial deficit reductions over 10 years, including $350 billion from the base defense budget.  The slicing is spread all around for a decade, but it starts right away. Fiscal 2012 begins in less than two months, which means that agencies of government from the Pentagon to the Environmental Protection Agency are now scrambling to find where they can cut.

Here’s a gruesomely relevant page from history. In 1937, as the United States began to emerge from the Great Depression, President Roosevelt’s advisors convinced him to cut spending and balance the budget. So the government cut workers from the Works Progress Administration, and Public Works Administration projects were brought to a halt. Republicans rejoiced that the nation was putting its fiscal house in order. Manufacturing collapsed 37 percent, and from 1937 to 1938 unemployment rocketed from 14 percent to 19 percent. Consumers cut back on their spending and in response production fell even further. (more…)

“Congress Continues Debate Over Whether Or Not Nation Should Be Economically Ruined” — The Onion

The US  Congress is going through one of those insane times when only headlines from the satirical online newspaper, The Onion,  can sum it up.  Their headline quoted above says it all.  To get the full flavor, click on The Onion.

It’s Happening Again

Money bagUnless you’re a banker, you probably haven’t noticed that some banks are getting another helping hand from tax payers. A couple of years ago we citizens gave loans to bankrupt banks so that they could look solvent. That was called the Troubled Asset Relief Program. (Troubled Asset sounds so much nicer than flat-broke or busted.)

Nowadays those same banks, having been to the brink of insolvency, won’t lend unless they’re very, very, very sure they’ll get it all back with interest. As a result, small business are justifiably complaining that banks aren’t lending money, even when it’s a safe bet they’ll get repaid. Small businesses create the bulk of our employment, so when they’re not getting the money they need, our economy moves at a crawl.

To fix this, Republican Sam Graves (he chairs the House Small Business Committee) came up with a plan to help banks make loans to small businesses. The Graves plan is simple: give money to banks at almost no cost to the banks.  But wait! That means  banks can take these new low-cost loans and use the money to pay off their Troubled Asset Relief Program debt!

Banker by Orozco

Banker by Orozco

The Boston Globe reported that a Boston bank “has applied for more than $4 million in funding from the new program to replace the $3.5 million it received through TARP. The bank said it expects the funds to cost just 1 percent a year under the new small business lending program, compared to the 5 percent it pays now (and 9 percent in 2014) under TARP.”  Now that’s banking! And that Boston bank is not alone in knowing a good thing when they see it. The Treasury Department said has received 847 applications, including 315 from banks still holding TARP money. Oh, mercy!

Whatever happened to “Jobs! Jobs! Jobs!”?

The US recovery from the recession has stalled and Congress seems not to have noticed. Maybe you noticed, because you’re one of the unemployed. If so, it’s doubtless cold comfort for you to know there are more than 13.9 million other men and women in the same dump.

Unemployed workers

Unemployed Workers

Almost half the unemployed have been looking for a job for more than six
months, and about a third have been looking for work for more than a year. And if you’ve been looking for more than a year, the chances are you’ll be among the last to be hired. That’s the way it goes in today’s cruel labor market. Because so many workers are idle, employers can pick an choose and they prefer workers whose skills haven’t gotten rusty.

Meanwhile, the Republican dominated House of Representatives is calling loudly for cuts in government spending and in taxes. This is the same Republican party that took over the House a few months ago, saying that “Jobs! Jobs! Jobs!” were their top priority. It’s strange that lawmakers who say they want to provide jobs should be crying to amputate the federal budget and slash taxes. In fact, it’s bizarre, because doing that will bring not jobs but more unemployment while at the same time reducing the ability of the government to provide for the unemployed.

Municipalities and states cannot perform the kind of deficit spending carried out by the federal government. As a consequence, the recession has compelled cities and states to lay off workers – clerks, firemen, policemen, engineers, school teachers, and so forth. To immediately slash federal spending means that the US would reduce the already reduced flow of money to the already impoverished states, and at the same time fire US government workers, adding even more to the number of unemployed. (more…)

Class Warfare

The little sourball of American politics, Ralph Nader, likes to say that there’s no basic difference between the Republican and Democratic parties, they just look different on the surface. He has it backwards, of course. The parties have superficial similarities, but the differences between Democrats and Republicans are profound and basic.

Last year you could see one of these differences playing out as Republicans waged guerilla warfare in Congress against the Democrats’ health plan. The skirmishes dragged on for months, the details were abundant and confusing. So it’s no surprise that a lot of spectators came away thinking that Republicans and Democrats were merely wrangling over how the government plan should work. But Republicans are against ANY government health plan, no matter how it’s constructed, no matter how it works.

Republicans have been waging class warfare for years, attacking social programs that benefit the poor and marginal in our society. They opposed Medicare from the day it started in 1966 and have tried to put it to death with “improvements” ever since. They have opposed Social Security from it’s beginning and have tried to “reform” it out of existence for the past 74 years. Despite these vampire kisses by conservatives, Social Security and Medicare remain vibrantly alive as the two most popular government programs we have.

But that doesn’t matter to Republican thinkers. In the ideal Technicolor world of conservatives, Social Security would be replaced by each free citizen prudently saving money and wisely investing the savings to insure years of comfortable retirement. And, of course, Medicare would be replaced by free citizens freely buying their own health insurance. Healthy Americans, typical Americans in their Golden Years (thick white hair but springy steps), could go scuba diving in the Caribbean or take a cruise to Greek islands.

Alas, in the real world, Social Security and Medicare were created because most people weren’t able to save for a cushioned retirement. For a great, great many, the years between leaving work and getting completely dead were years of poverty made worse by unpayable bills from relentless doctors and hospitals. The fortunate stayed out of debt by working until they dropped; the less fortunate moved into the back room of the family home, which was now headed by one of their children. The really bad off went to the poor house. (more…)

More Notes

Tim Carmody, in his excellent piece, "How Haiti Became Poor", notes that President Trump's racist policies and vulgar language have sullied the word "shithole" which used to be one of the all-time great swear words. He's right. It's another terrible power this careless President wields.