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Dear Group, The dues we pay for our membership in society, the money that city, county, state, and national governments gather, those dues fund goods and services from which we all benefit. We can (and do) argue about exactly what that funding should be used for and whether it is being spent wisely. We wince when we pay our property taxes and sales taxes, we grumble as we file our income tax, but without these dues most of the physical and societal structures on which we all depend to one degree or another would not exist (or might exist only for use by the monied few, e.g. toll roads). Roads, railroad rights-of-way, airports, air traffic control, shipping ports, fire protection, education, the public health system, sewers, sewerage treatment, drinkable water, the judicial system, the police all function to one degree or another on the dues we pay to cities, counties, states and the federal government. No wealthy person anywhere in the world (and certainly no wealthy person in this country) made their money without benefitting from these dues. The idea of a pure “self-made man” (or woman) is a libertarian myth. Underpinning every “self-made” wealthy person is a myriad of publicly funded structures, plus the judicial system and law enforcement on which their success depends. The richest among us have benefitted the most. It is only fitting they pay back a much higher portion of their monetary winnings as the dues that hold together the fabric of society upon which we are all dependent. (Elizabeth Warren makes this point better than I in a 2 minute 2011 youtube video you should watch.) The Republican/Libertarians, including our very own McMorris Rodgers, tried to sell us on the idea an even greater reduction in the dues the wealthy pay to live in the society would benefit everyone. The bill was called the Tax Cuts and Jobs Act. Among its many provisions was a reduction of the top income tax bracket from 39.6% to 37% for tax year 2018. The Republicans crowed about the Tax Cuts and Jobs Act, how it was going to be “money in your pocket,” Did you notice as the November elections approached “money in your pocket” dropped out of McMorris Rodgers’ rhetoric? Did her messaging prowess help her keep her supposed position of power as Chair of the House Republican Caucus? No. Her message fell flat. She and her cohort abandoned talking up their signature achievement. Instead it was properly framed as a tax giveaway to the wealthy. McMorris Rodgers does not clearly say she advocates for “trickle down economics” but her rhetoric is clear: give the titans of industry, the movers and shakers (like her “positive disruptor,” Mr. Trump) more money and they will expand the economy and we’ll all be better off. OK. There are more jobs now in our wobbly, overstimulated economy, but the wealthy have become wealthier and the gap between them and the average worker continues to grow, fueled by a massive increase in national debt. Have the Republican/Libertarians overreached in their effort to make toxic the very word “tax”? Perhaps. We all need to pay our dues, but “To whom much is given much is expected.” We the People have given much to the wealthy and too little of it trickles down. Alexandria Ocasio-Cortez (D-NY), the progressive dancing firebrand newly elected to Congress from the Bronx is openly advocating a 70-80% tax on very high incomes. Is this nuts? Well, consider: “…it’s a policy nobody has ever implemented, aside from … the United States, for 35 years after World War II — including the most successful period of economic growth in our history.” [the bold is mine.] I urge you to read the opinion piece in the New York Times by Paul Krugman, recipient of the Nobel Prize in Economics (2008), from January 5, 2019 from which I took that quote. Ocasio-Cortez is no dummy. The top income tax bracket topped 90% for several years between 1940 and 1965. Of course, the wealthy did not like 90% then any more than they like 37% now. With a widening income gap, growing national debt, and crumbling infrastructure it is time to change the narrative around taxation. Taxes are the dues we pay to be citizens. Keep to the high ground, Jerry P.S. “Trickle down” economics descended from what’s been dubbed the “Horse and Sparrow Theory” of the late 1800s: “If you feed the horse enough oats, some will pass through to the road for the sparrows.” Providing the rich and corporations with more money in order to better the average person is an economic theory worthy of the vehicle in which the half-digested oats reach the sparrows. P.P.S. A much less emphasized part of the Tax Cuts and Jobs Act doubled the inheritance tax exemption to 11.18 million dollars, enabling the wealthy to pass on untaxed more than twice the previous amount without even bothering to engage in the fiscal shenanigans the Trump family engaged in. The bogus Republican messaging about the “death tax” and bankrupting “family farms” was nowhere to be heard. That messaging, pushed by “think tanks” had served its purpose…in the glee of the Republican Congress the doubling passed with no fanfare. No doubt there was quiet celebration among some of the uber-wealthy. |
The Waif and the Grocery Tax
Dear Group,
A thin young woman standing on a corner in a middle class residential neighborhood on the north side of Spokane looked down at something on a clipboard, looked up, glanced both ways, squinted at street signs. It was two days before the 2018 General Election. She had to be a canvasser, but one I didn’t recognize. My fellow canvassers and I were a committed volunteer army knocking doors for Lisa Brown out of the Shadle Library on a Sunday afternoon. She was something else, one of very few young, lone canvassers I had seen in all the weeks leading up to the election.
“Hi! You must be knocking on doors, too. Who or what are you canvassing for?”
“The grocery tax,” she said, a little uncertainly. I’ll never forget the ensuing conversation. She had just turned eighteen. She was happy to have a job, no matter it was part time gig employment with no benefits, a job that would abruptly end in two days. She smiled a little at the thought of a hundred and five dollars for a six hour shift working an inexpensive smartphone and a clipboard, knocking on doors. She would save the money for a deposit to rent an apartment. She said she’d been living on the streets since age thirteen when her mother kicked her out of the house., Since then her mother has kept for herself the money she receives from social security for her daughter’s support.
She offered that she’d “been into drugs,” but with her boyfriend’s help she’d escaped that scene. She would sleep that night in the park or “under a bridge,” as she often did. Where we stood it was fifty degrees and dropping quickly as the sun began to set. I shivered for her in my many layers of clothing.
I asked her about the “grocery tax initiative” for which she was canvassing, Initiative 1634. We were several sentences into our discussion before I understood her assigned task was to convince people to vote “yes” to “protect Washington families from taxes on our food,” as the door-hanger she finally offered me explained. She had a script in the app on her tiny smartphone. One of her talking points was that Initiative 1634 (aka the “Yes! to Affordable Groceries” Initiative) would prevent government from taxing the groceries of “hard working families and people on fixed incomes”…and keep government from giving the money to those un-deserving “welfare people.” I did not inquire just who she thought those “welfare people” might be.
She clearly had a job to do, a script to get across. She seemed to genuinely believe there were evil forces in government anxious to impose taxes on food. There wasn’t a glimmer of understanding when I mentioned to her any politician offering to tax real food would be committing political suicide, that this initiative was only to pre-emptively protect the sugary drink industry from taxes on their fattening, diabetes-abetting products, that protecting wholesome food from predacious taxation was just clever framing. It had escaped her notice that the fine print (on the door-hanger, required by Washington State law) identified four of the top five contributors to 1634 as “The Coca-Cola Company; PepsiCo, Inc.; Keurig Dr Pepper and Red Bull North America.”
Every dime of the 22 million dollars raised by the Initiative Committee “Yes! to Affordable Groceries” the organization that hatched and promoted Initiative 1634, came from businesses, 20 million of it from three of those sugary drink producers, all with out-of-state headquarters, Not a dime came from a consumer or taxpayer group. Apparently, 20 million dollars is chump change for the sugary drink companies to spend to induce voters to preempt a tax that, if enacted, might put a dent in their lavish profits. There were only ten contributors to “Yes! to Affordable Groceries” initiative committee. The last three were “in kind” donations of less than $300. The very last one, $198, came from the “WASHINGTON STATE REPUBLICAN PARTY NON-EXEMPT.”
Where were all these millions spent? The WA State Public Disclosure Commission tells us. Click the link and browse. Media companies are smiling all the way to the bank.
How much was spent by the opposition? The Public Disclosure Commission tells us: a total of $28,693, spent by the Healthy Kids Coalition. Contributors included the American Cancer Society, the American Heart Association, and the Childhood Obesity Prevention Coalition. Apparently, the sugary drink industry’s money and clever framing was so overwhelming resistance seemed a waste of scarce funds.
What was gained by the citizens of Washington by the passage of Initiative 1634? Gee. We’ll get to buy sugary drinks without the terrible threat of taxation! (Sorry, I cannot resist sarcasm.)
The sugary drink industry spent 20 million in advertising–and even with that got just 55% of the vote. I imagine they feel it was worth every cent to pull the wool over the eyes of just enough voters to buy insurance against the risk of profit loss…
And the guileless young, homeless woman canvassing sincerely for Initiative 1634, canvassing in the hope of protecting people from a non-existent threat of a grocery tax, canvassing in the cold for $105/day, working for a boss she said was based in Wyoming, not realizing she was really working to shield soft drink companies from a sin tax? She saved her $105 share of the $20 million the soft drink companies spent. She planned to save up the money…and sleep that night outdoors.
Keep to the high ground,
Jerry
P.S. The politics of initiatives are peculiar. I’m still trying to figure out how the promotors of Initiative 1634 got to use Minivan, the smartphone app developed by and for Democrats. I’m not sure how that happened or who to ask.
P.P.S. I almost never give money to panhandlers on the street. This young woman was not panhandling. She was working, but I found her story so compelling I reached in my pocket to offer her some money in the hope might use it find a warm place to sleep. She politely waved it away…
CMR’s Tax Backfill Attempt
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Dear Group, As we approach the midterm elections McMorris Rodgers (and the Republican/Libertarians in general) are firing up the machinery for some serious backfilling. On September 28, while the entire nation (and quite a lot of the rest of the world) was glued to the spectacle of the Kavanaugh hearings, McMorris Rodgers and her ilk in the House of Representatives quietly passed a bill, H.R. 6760: Protecting Family and Small Business Tax Cuts Act of 2018. The Republican Policy Committee’s summary of the bill states: “H.R. 6760 would make permanent the tax provisions for individuals and pass-through entities in the Tax Cuts and Jobs Act that otherwise be [sic] sunset after 2025…” There is no mention this would add to the budget deficit and there is no discussion of an offset. (See the P.S. below.) With H.R. 6760 the Republicans are trying to establish plausible deniability for a grievous error of their own making with H.R. 1, the “Tax Cuts and Jobs Act,” in December 2017. They are trying hard to backfill a hole they dug for themselves. Let me explain. McMorris Rodgers and her Republican colleagues were really excited over their partisan success in ramming the “Tax Cuts and Jobs Act” through the U.S. Senate. To do so they used a legislative loophole to avoid needing to compromise with Democrats. Trump was delighted to sign it. McMorris Rodgers immediately began talking up her accomplishment at every opportunity with the words, “Money in your pocket.” The trouble is, the money that was supposed to appear in “your” pocket was only about 20% of more than a trillion dollars the Act is expected to add to the federal deficit in the next ten years. The other 80% went to to corporations and the already wealthy. Worse, the Republicans started talking to their base about how the deficit (which they just exploded) was going to require them to “tackle entitlements,” i.e. Medicare, Medicaid, and Social Security. This has not played well to a angry electorate—and it shouldn’t. There was another glaring flaw in the Act. Belatedly, the Republican leadership (including McMorris Rodgers) has realized their disingenuous “Money in your Pocket” sales job convinced almost no one outside their loyal base. Worse, they realized they were nakedly vulnerable on another point. In their haste to get the Tax Cuts and Jobs Act passed (while completely shutting out Democrats from the deliberations) they had to use the “budget reconciliation” loophole to avoid a filibuster in the Senate. Using budget reconciliation required they balance the numbers. They chose to do so by making the corporate tax cuts permanent while letting the individual “money in your pocket” provisions (for the common folk) expire in seven years. Their corporate donors wouldn’t stand for the “uncertainty” of having it the other way around. “Uncertainty,” after all, is bad for business… Here’s the twist: It turns out it’s pretty hard to convince Americans you’re being fair when you hand a huge permanent benefit to corporations and a temporary pittance to the common folk, the “money in your pocket” people. I recall Republican talk at the time suggesting this expiring benefit was really no problem, since they had backed Democrats into a corner where later they could be forced to vote to rescue the common folk before their meager tax benefit expired. That pissed me off at the time and still does. They were saying, “We’ve got the power. You have to dance to our tune. We don’t need to even consider your viewpoint as we blow up the deficit to pay off our donors. We can count on you weak, lily-livered Democrats to vote with us to save your vulnerable constituents from the law we crammed down your throats.” Now they are having second thoughts, so while we were all distracted by the Kavanaugh spectacle the House Republicans cynically passed H.R. 6760: Protecting Family and Small Business Tax Cuts Act of 2018 on a party line vote (all WA Republican representatives voted for it, all Democrats against). In so doing the Republicans are counting on the ignorance and distraction of the electorate. The bill has zero chance of passing the Senate before the close of this “115th Congress” at year’s end. It is not a “budget reconciliation” bill, so it would require sixty votes to avoid a filibuster. On top of that, if made law, it would further explode the deficit. (Remember when the Republicans preached “fiscal responsibility”??) I guarantee McMorris Rodgers will be singing to her base about her vote on this bill. You can bet she will blame Democrats for not joining her in voting for a bogus solution to the problem of her own making. She will trot out this doomed bill as a debating point, “I voted to make the tax cuts permanent for the workers of eastern Washington.” I can hear it now. She’s counting on voters to forget it was she who made it a problem in the first place. Don’t let her get away with it. Keep to the high ground, Jerry P.S. The text of H.R. 6760 specifically states in its full text in Sec. 301 (the very last lines of the Bill) “The budgetary effects of this Act shall not be entered on either PAYGO scorecard.” I read that as legalese stating the Republicans want to make sure that no one takes notice of the fact by passing this measure they are further exploding the deficit. How cynical is that? P.P.S. I find it a bit odd to note that at govtrack.us one is presented with a two summaries of this H.R. 6760, one from the Republican Policy Committee and one from the Congressional Research Service, a non-partisan division of the Library of Congress. Are the Republican/Libertarians so partisan they have to publish their own spin on this bill? Is the non-partisan CRS Summary somehow not good enough? |
What is Avista saying about the Tax Cuts and Jobs Act?
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Dear Group, I was going to take the day off today, but then I read my email from Avista…and I can’t resist a comment. (The full text of the email is copied below, just to show I’m not making this up.) McMorris Rodgers, as you know, has been beating her messaging drum about the Republican Tax Law in an effort to sell it to the voters. She is so committed to her canned message she even dragged out “money in your pocket” for her opening remarks to high school students at a town hall on School Safety on Maundy Thursday at Ferris. Is she tone deaf…or was she nervous the students would want to talk about guns? Did “money in your pocket” come out as a reversion to comfort zone? In any case, polls have suggested her hand-crafted message is not sitting particularly well with the general populace. That fact only seems to make her more anxious to repeat her same talking points. When she pulls the string that activates her talking points on the Republican Tax Law the sound bite that falls out always includes “money in your pocket.” Then comes the well-worn calculation about the extra $2000 or so some hypothetical “average” taxpayer with a family income of $70,000 is supposed to get next year. A favorite local example of a bonus (and the one she memorably touted to the students at Ferris) is the “up to” $1000 Home Depot said last January it would give its employees. Earlier in the day of the Ferris event McMorris Rodgers had spent a few minutes as a stand-in employee. (You can see a clip of how that went here on the Katie Tur Show on MSNBC.) Of course, a one-time bonus offered by a huge company to their employees (more than a year before the effect of the Tax Law is actually felt) is nothing more than a public relations thank you to the Republican Party, a thank you for the eighty percent of the tax law proceeds (and increase in the national debt) that accrues to these companies and their owners. That eighty percent McMorris Rodgers seems incapable of discussing. The Home Depot bonus McMorris Rodgers touted was particularly sour since one of the founders of Home Depot, Ken Langone (current net worth 3.3 billion according to Forbes, up from 2.7 billion in 2014), is one of the frequent fliers in the Koch donor group chronicled in Jane Mayer’s book “Dark Money.” (See References below). The Koch group was among the most insistent in pushing the Tax Bill. Self interest knows no bounds. So why did the Avista email catch my eye? Here’s the excerpt (bold is mine): You may have heard that the Commission recently made a decision on our filings that will change your electric and natural gas rates beginning May 1, 2018. We’re pleased that these new rates include passing benefits of the federal Tax Cuts and Jobs Act to our customers through rates. Based on average monthly usage, residential customers in Washington can expect the following bill changes:
• Electric: Bill increase of $1.87 or 2.2 percent, for a revised monthly bill of $88.45. • Natural gas: Bill decrease of $0.77 or 1.5, percent for a revised monthly bill of $52.03. I burst out laughing when I read that. The “benefits” of the “Tax Cuts and Jobs Act” they’re passing along results in a net $1.10 increase in the average monthly bill! Are they math challenged at Avista or are they saying the Tax Cuts and Jobs Act is a complete hoax? I know. I know. Mr. Christie, the author of the Avista email, only said the new rates “include” the “benefits” of the Tax Cuts and Jobs Act. Must be monstrous “benefits” to result in a net increase in your utility bill… Keep to the high ground, Jerry Full text of the email I received from Avista May 2, 2018 at 5AM: Dear Avista Customer, In May 2017, we told you about filings we made with the Washington Utilities and Transportation Commission to recover costs related to infrastructure, system maintenance, technology and power supply to serve our customers that would change the price you pay for energy. These requests were driven by the ongoing maintenance and improvements we make every year to the massive infrastructure of poles, dams, turbines, substations, pipes, and other equipment that provides you with safe and reliable power and natural gas. You may have heard that the Commission recently made a decision on our filings that will change your electric and natural gas rates beginning May 1, 2018. We’re pleased that these new rates include passing benefits of the federal Tax Cuts and Jobs Act to our customers through rates. Based on average monthly usage, residential customers in Washington can expect the following bill changes: • Electric: Bill increase of $1.87 or 2.2 percent, for a revised monthly bill of $88.45. • Natural gas: Bill decrease of $0.77 or 1.5, percent for a revised monthly bill of $52.03. It’s important to remember that the Commission sets the rate you pay for the energy you use. You can learn more about this and your energy prices here. Take control of your energy use Your monthly energy bill is influenced not only by the price of energy but also by the amount of energy you use. Avista offers a variety of ways for you to manage or reduce your usage and save on your bill. Learn more here. We know you want prices that are fair and reasonable, and so do we. Thank you, Kevin Christie, Vice President, External Affairs and Chief Customer Officer Avista Utilities |
In Her Own Words
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