‘Job Creators’ and the Tax Bill

According to the Republicans pushing for its passage, the recent, massive overhaul of the tax code was a “middle-class” tax cut. Yes, they admitted that it bestowed largesse on the wealthy, and yes, they recognized that the benefits to corporate taxpayers dwarfed the pennies that the poor and middle-class will realize, but that, they assured us, was because the GOP is all about job creation. Give corporations tax “relief” (not that most of them had been paying at the going rate) and they would use those dollars to create jobs.

Right.

Opponents of the tax bill publicly doubted that corporate savings would be used to create jobs, or to raise pay levels. They predicted that the money would be used instead to buy back stock and “reward” management with bonuses. And they pointed out that the meager tax relief granted to the middle class will phase out, while the corporate cuts are permanent.

Once the bill passed–and the Koch Brothers had donated $500,000 to Paul Ryan (a contribution I’m sure was merely coincidental, despite coming a mere two weeks after the measure was approved)–there was an initial flurry of publicity suggesting that ordinary workers at several large companies had been given bonuses. (It later turned out that those payments went to far fewer workers than the original publicity had suggested.)

Now, it turns out that the cynics were right all along. I know–you’re shocked.

After President Trump signed the Republican tax cut into law, companies put out cheery announcements that they were giving workers bonuses because of their expected windfalls from the tax reductions. The president and Republican lawmakers quickly held up these news releases as vindication for their argument that cutting the top federal corporate tax rate to 21 percent, from 35 percent, would boost workers’ incomes even as it added $1.5 trillion to the debt that future generations would have to pay off.

Now corporate announcements and analyst reports confirm what honest observers always said — this claim is pure fantasy. As executives tell investors what they intend to do with their tax savings and their spending plans are tabulated into neat charts and graphs, the reports jibe with what most experts said would happen: Companies are rewarding their stockholders.

Businesses are buying back shares, which creates demand for the stocks, boosts share prices and benefits investors. Some of the cash is going to increase dividends. And a chunk will go to acquiring other businesses, creating larger corporations that face less competition.

It isn’t just liberal pundits making these claims. Morgan Stanley analysts have estimated that 43 percent of the savings realized by corporations will be used for buybacks and dividends and another 19 percent will fund mergers and acquisitions. They calculate that  17 percent will go into capital investments, and a mere 13 percent will be used for bonuses and raises. CNBC reports that stock buy-backs are at a record pace.  Axios  has reported that nine pharmaceutical companies have announced $50 billion in buybacks since the tax law was passed.

The open question is whether voters whose paychecks are marginally fatter under the new withholding tables will believe they were the beneficiaries of this “reform,” and whether that belief will influence their votes in November.

As Lincoln said, you can fool some of the people some of the time….

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Why Government Loses Public Trust–Indiana Version

Most of us would avoid patronizing a butcher shop where the butcher routinely put his thumb on the scale.  We would take our business elsewhere.

When our state government lies to us, however, most of us can’t simply move elsewhere. Worse, we may not even find out that we have been misled.

I don’t know how it is in other states, but here in Indiana, we are most likely to encounter biased information when the people running the state are religious zealots. Mike Pence was uninterested in the nitty-gritty of governing, but he was intensely focused on imposing his religious beliefs on Hoosiers–he saved his real enthusiasm for his anti-gay, anti-woman efforts.

I had a much better impression of current Governor Holcomb, who has seemed refreshingly free of the urge to sermonize and actually appears to be tending to the issues facing Indiana. But then I came across this report.

Indiana ranks as one of the worst states in the nation when it comes to its infant mortality rate. In his state of the state address earlier this month, Gov. Eric Holcomb (R) called attention to this crisis and announced the goal of improving the state’s status in the coming years. As part of that process, in November 2017 the Indiana State Department of Health (ISDH) launched a new mobile app for its existing statewide campaign aimed at improving Indiana’s infant mortality rate. The app, Liv, was developed with state funding and includes pregnancy and parenting guidance.

It also provides users with contact information for health and service providers, along with basic descriptions of what the users can expect from those providers. But the app’s resource list excludes evidence-based family planning clinics and centers, such as Planned Parenthood and All-Options Pregnancy Resource Center (PRC), while including crisis pregnancy centers (CPCs): fake clinics that do not provide medically sound reproductive health care and actively lie to people seeking services.

Public health research shows that access to comprehensive family planning programs and services can help reduce infant mortality. Nonetheless, continuing the legacy of former Indiana Gov. Mike Pence (R), this app—and ISDH’s larger infant mortality initiative—promotes ideology over evidence.

Infant mortality is the result of a combination of factors, including poverty and lack of prenatal care. But research shows that comprehensive contraception and family planning help reduce infant mortality rates.

For example, as research from the Guttmacher Institute shows, access to contraception gives women the tools to space their births: “By allowing women to time and space the number of children they want, contraception prevents unintended, often high-risk pregnancies—too close together, too often, too early or too late in life—that can lead to maternal and child death and injury.” Additionally, addressing unintended pregnancies by increasing access to contraception and family planning services also contributes to increased prenatal care provision by establishing connections between patients and providers.

When policymakers allow ideology to trump evidence, and erect barriers to access for family planning services, you get the results we have been seeing in Indiana. In 2011, only 68 percent of infants in the state were born to women who had received prenatal care in their first trimester–and nearly half of all pregnancies in Indiana are unintended.   

Using taxpayer dollars to direct vulnerable women to crisis pregnancy centers, while omitting information about high-quality health services available through Planned Parenthood, is worse than irresponsible. Crisis pregnancy centers are purveyors of dogma, not medically-accurate information. They have no place on a state-run registry.

Women using the app don’t have to go to Planned Parenthood. But they are entitled to know that it is an option. For state government to omit a medically-appropriate service from a directory it has created and disseminated while including a “service” that offers dishonest “counseling” is unforgivable.

It certainly isn’t the way to cultivate public trust.

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Two Different Worlds…

Some of you reading this post may remember an old love song–I believe it was sung by Nat  King Cole–in which he rejected warnings by an unidentified “they,” to the effect that he and his love came from “two different worlds.” At the end of the song, he promises that their two different worlds will be one.

I’d say their chances were better than those of contemporary Republicans and Democrats.

Over the past few years, a steady stream of research has documented the growth of America’s partisan polarization. Today’s Republicans and Democrats would be more upset if their children married someone of the other party than if they married someone of another race or religion. Facebook and Twitter conversations are filled with expressions of incomprehension (WTF!) of positions taken by the other party.

Now, the Brookings Institution has come up with another indicator that Rs and Ds really do live in “two different worlds.” The researchers were exploring one of the thorniest issues raised by “school choice”–whether, as many of us worry– parents opting for privatized schools see education as a consumer good rather than a public good, thus privileging the inculcation of personal skills over democratic ones.

In holding schools more directly accountable to parents, school choice reforms reduce the influence of the democratic structures and processes that govern traditional public schools. For example, being more responsive to parents generally means being less responsive to school boards. This can have important implications if parents’ desires for their own children’s schools differ from the broader public’s desires for its education system. For instance, schools may look different under school choice reforms if—as is often argued—parents are preoccupied with getting their own children ahead, wanting schools to prepare their children for college and career success at the expense of serving more collective interests for social, political, civic, and economic health.

Questions about how parents’ and the public’s desires for schools differ are among the richest questions surrounding school choice reforms. They are also among the least explored empirically. We recently released a study looking at what parents and the public want from schools. Instead of finding the parents-public distinction we expected, we found a Democrat-Republican contrast we had not considered.

The results were very different from the researchers’ expectations. Parents and the broader public prioritized the same goals–a balance between the personal and the public.

Given these similarities, we wondered who—if anyone—is particularly drawn to “private success.” Did any subgroup of respondents want schools to prioritize students’ private interests over more collective, societal interests?

We ran a logistic regression model to examine which, if any, respondent background characteristics were associated with choosing “private success” as the most important goal. We included all of the usual respondent characteristics in the model: gender, race, ethnicity, educational attainment, age, political affiliation, and parent status. Only one was a significant predictor: Republican respondents were much more likely than Democratic respondents to want schools to prioritize “private success.”

It’s a shame there are no earlier studies that might serve as benchmarks, allowing us to see whether and how these and other attitudes prevalent in today’s GOP differ from those of previous Republicans.

In any event, the pressing question we face now is how to make those “two different worlds” into one–or at the very least, make them overlap.

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We Don’t Need No Stinkin’ Ethics

A few days ago, I got an email from an old friend, asking me whether I’d seen the article about Trump’s myriad conflicts of interest in the most recent Forbes. I hadn’t.

He very thoughtfully brought me a copy.

After I had read it, I sat for awhile thinking about how diminished our expectations of presidential behavior have become. If any other President in my lifetime had simply ignored long-settled legal and ethical constraints in pursuit of personal gain, bipartisan outrage would have already triggered impeachment proceedings. (We wouldn’t need Robert Muller.)

The article is titled “Trump’s Towering Tenant Conflicts,” and it begins with the Bank of China.

The largest American office of China’s largest bank sits on the 20th floor of Trump Tower, six levels below the desk where Donald Trump built an empire and wrested a presidency. It’s hard to get a glimpse inside. There do not appear to be any public photos of the office, the bank doesn’t welcome visitors, and a man guards the elevators downstairs–one of the perks of forking over an estimated $2 million a year for the space.

Trump Tower officially lists the tenant as the Industrial & Commercial Bank of China, but make no mistake who’s paying the rent: the Chinese government, which owns a majority of the company. And while the landlord is technically the Trump Organization, make no mistake who’s cashing those millions: the president of the United States, who has placed day-to-day management with his sons but retains 100% ownership. This lease expires in October 2019, according to a debt prospectus obtained by Forbes. So if you assume that the Trumps want to keep this lucrative tenant, then Eric Trump and Donald Trump Jr. could well be negotiating right now over how many millions the Chinese government will pay the sitting president. Unless he has already taken care of it: In September 2015 then-candidate Trump boasted to Forbes that he had “just renewed” the lease, around the time he was gearing up his campaign.

The meticulously sourced article is accompanied by lists of tenants at a number of Trump’s signature properties, the rents those tenants pay, and the conflicts of interest they represent.

The numbers are significant: $21 million here, $12 million there. The names even more so: At least 36 of Trump’s tenants have meaningful relationships with the federal government, from contractors to lobbying firms to regulatory targets.

Those “regulatory targets” are the most worrisome. Trump’s other “meaningful relationships” are simply corrupt, but these landlord-tenant relationships facilitate highly sophisticated bribery that undermines the federal regulatory process.

How, then, to consider the backroom discussions between federal officials and Walgreens Boots Alliance, one of the largest pharmacies in the world? Through its brand Duane Reade, it is the highest-paying tenant in Trump’s skyscraper at 40 Wall Street in New York, with $3.2 million in annual rent, according to a 2015 prospectus. In October 2015, Walgreens Boots Alliance announced a $9.4 billion merger with rival Rite Aid, requiring a sign-off from antimonopoly regulators. After the deal failed to secure approval under President Obama, it then fell to the Trump administration, which arrived in Washington during the first quarter of 2017. According to federal disclosures, that was the same quarter Walgreens Boots Alliance began directly lobbying the White House on “competition policy issues.” In September, despite objections by one of the two commissioners at the Federal Trade Commission, Trump’s tenant got the green light for a slimmed-down, $4.4 billion version of the deal. In January, Trump announced he would nominate the commissioner who supported the deal, Maureen Ohlhausen, to be a federal judge.

This was anything but an isolated case. Capital One, for example, pays an estimated $1 million for space in Trump’s Park Avenue condo building while it is being investigated by the Justice and Treasury departments for alleged money-laundering.

In December, Trump tenants UBS, Barclays and JPMorgan, plus Trump lender Deutsche Bank, got waiver extensions from the Department of Labor that allow them to avoid part of their punishment for illegally manipulating interest rates and foreign exchange rates.

The article cites numerous similar “coincidences” –at best, they raise the appearance of impropriety; more likely, they really do represent the sort of graft engaged in by a blowhard who has always believed the rules are for other people.

Whether these unprecedented conflicts violate the Emoluments Clause will eventually be decided by a court–two cases raising the issue are pending. Of course, those who drafted the Emoluments Clause language would never have anticipated that the new country they were establishing–their “Shining City on the Hill”– would elect someone as unfit for public office–or for that matter, as unfit for polite society–as Donald Trump.

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This Is Why We Can’t Have Rational Debates…

Of all of our arguments about politics and policy, efforts to level the playing field for women and minorities seem to evoke the most heat and the least light.

A reader recently shared with me a lengthy, rambling letter to the editor  that appeared in a publication called the Carmel Current. (Carmel, for non-Hoosiers–is a bedroom community north of Indianapolis). The female letter writer ripped into organizations like the National Organization for Women and that dreaded group of harridan warriors, the American Association of University Women, accusing them of “gender feminism” that promotes the “inequality of men.”

Among other accusations, the writer argued that calls to reduce the pay gap between men and women aren’t really calls for equity, but rather part of an effort by “gender feminists” to diminish and disadvantage men.

American women make their own choices. They are succeeding at tremendous rates, most especially compared to men. Extensive research has been done on this subject by Professor Christina Hoff Sommers, a self-declared freedom feminist who has multiple publications regarding the misguided policies of gender feminists. The bogus “wage gap” is not a real concern. However, the underachievement of the American male population is. Hoff Sommers quotes education writer Paul Whitmire and literacy expert William Brozo in her book, The War Against Boys, “The global economic race we read so much about—the marathon to produce the most educated workforce and therefore the most prosperous nation—really comes down to a calculation: Whichever nation solves these ‘boy troubles’ wins the race.”

I read a few articles by self-described “freedom feminist” Sommers years ago, when she certainly seemed less confrontational than she later became. I don’t know whether she genuinely went off the rails or decided that taking a fairly unique “libertarian feminist-against-feminism” position would raise her profile and earn her more attention, but I do know that her current diatribes are perfect examples of what is wrong with American argumentation generally.

These days, significant numbers of activists on both the left and right avoid honest discussion by creating straw men, whose arguments are much easier to triumphantly dismiss and disparage than the more considered points raised by real people.

The straw man argument is an age-old tactic in which a debater purports to address an opponent’s argument while actually attacking a position that the opponent didn’t take.

Sommers has created a “straw woman,” dubbed “gender feminist,” who is out to dominate men. The women she invents and then battles are man-haters, not really interested in equal treatment or equal pay for the same work, but in beating down the male of the species.

I’m sure if we looked hard enough, we might find some women like that, but most of us who consider ourselves feminists–and a lot who don’t use the label but believe they should be compensated fairly and not subjected to sexual harassment–are hardly the man-haters Sommer attacks. We have husbands and sons and male friends–and no interest in inverting the current distribution of privilege to diminish them. We want parity, not dominance.

Sommers is hardly the first to paint feminists as radically unfeminine and anti-male. When I was younger, feminists were the butt of jokes about women who didn’t shave their legs, or who couldn’t get a date. (The potency of those descriptions is why many women still shun the label.)

It is much easier to attack–and demolish–caricatures than to engage with the real positions of people with whom you disagree. So we see people on the right claiming that advocates of civil rights for LGBTQ folks want to persecute Christians, or that civil libertarians concerned about due process or critical of police brutality are “pro criminal.” We see people on the left dismissing every objection to a stronger social safety net, or for a different approach to taxation, as evidencing either a lack of human compassion or (in legislators)  corrupt obedience to their donors.

Arguments made by the straw man (or woman) of our imagination are, obviously, much easier to refute than the actual points being raised. But engaging in the tactic in order to avoid confronting the real-life–and invariably more complex– issues at hand is both cowardly and dishonest.

Deliberative democracy it isn’t.

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