And Now, Celebrating the Plutocracy

Andy Borowitz said it best: Greed alone is destructive but greed combined with idiocy is catastrophic.

Which brings me to this recent report in the Indianapolis Business Journal.

A House panel on Thursday approved Republican-written legislation that would gut much of the Dodd-Frank law enacted by Democrats and signed by Obama in the wake of the financial crisis and the Great Recession. The party-line vote in the Republican-led House Financial Services Committee was 34-26.

House Republicans based their desire to repeal Dodd-Frank on the “costs of compliance.”

Evidently, they aren’t worried about the economic or human costs of the rampant financial misbehaviors that Dodd-Frank was enacted to control.

President Donald Trump has denounced Dodd-Frank with his usual “eloquence” (cough, cough), promising that his administration would “do a big number” on it. (I think that’s what’s called “thug speak”…)

Vox has also reported on a number of GOP efforts to once-again deregulate Wall Street; it details a bill that “would do more to deregulate the banking industry than any single piece of legislation in a generation.”

Because that worked out so well….

Republicans on the House Finance Committee have hammered away at a mammoth 593-page bill called the Financial Choice Act that the bulk of the GOP caucus is expected to get behind. The committee already moved the bill to the “markup” phase on Wednesday.

“I think this has a very good chance of passing. There are a lot of Democrats who are going to be supporting this,” Sen. Jim Inhofe (R-OK) said in an interview. “Even Democrats have bankers in their districts.”

Of course, Inhofe seems overly optimistic. Congressional Democrats are expected to march in lockstep against the banking bill, which would make it difficult for Republicans to get the 60 votes they’d need to get the Choice Act through the Senate.

Financial experts have called the measure radical.  It eliminates most of the banking oversight passed during the Obama administration, but it goes much further, “rolling back oversight in a way that could dramatically exacerbate the likelihood of another financial crisis, according to experts in financial regulation.”

The Choice Act would also gut the Consumer Finance Protection Bureau, the brainchild of Sen. Elizabeth Warren (D-MA). As Mike Konczal wrote for Vox, the CFPB has won millions from big corporations by suing those who use “deceptive practices” for their customers. Hensarling’s bill wouldn’t get rid of CFPB entirely, but advocates say it would effectively render the agency powerless by letting Congress control its funding, allowing the White House to fire the agency’s director at will, and, perhaps most importantly, stripping it of a broad range of rulemaking authority.

There’s much, much more. The bill would split the Federal Reserve in half and prevent it from coordinating financial regulations and monetary policy; that, according to banking experts, would make bubbles more likely — and more dangerous to the economy.

Borowitz is right. Greed and idiocy are a lethal combination.

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About That Fox and That Henhouse…

And the hits keep coming…

Major media outlets are reporting on the Administration’s most recent assault on science and the environment. According to the New York Times, 

The Environmental Protection Agency has dismissed at least five members of a major scientific review board, the latest signal of what critics call a campaign by the Trump administration to shrink the agency’s regulatory reach by reducing the role of academic research.

A spokesman for the E.P.A. administrator, Scott Pruitt, said he would consider replacing the academic scientists with representatives from industries whose pollution the agency is supposed to regulate, as part of the wide net it plans to cast. “The administrator believes we should have people on this board who understand the impact of regulations on the regulated community,” said the spokesman, J. P. Freire.

The dismissals on Friday came about six weeks after the House passed a bill aimed at changing the composition of another E.P.A. scientific review board to include more representation from the corporate world.

The Washington Post reports that the Interior Department is overhauling the more than 200 advisory panels that inform how their agencies assess the science underpinning departmental policies, “the first step in a broader effort by Republicans to change the way the federal government evaluates the scientific basis for its regulations.”

Gee–maybe Jeff Sessions can emulate Scott Pruitt, and allow offenders to rewrite criminal law and incarceration practices–after all, who knows more about crime and punishment than those most immediately affected?

Trump has previously instructed Pruitt to shave 40 percent of the agency’s science budget and to eliminate or severely roll back the most important Obama-era regulations on climate change and clean water protection. Last week, when I was checking some clean water information, I found that the EPA had removed a significant amount of data on climate change from its websites.

Of course, anyone who cares about the environment–or scientific integrity–expected much of this;  Pruitt is a climate-change denier. Like most of Trump’s cabinet, he appears to have been chosen in order to dismantle the agency he heads. Betsy DeVos is an enemy of public education, Jeff Sessions has already moved to erode enforcement of civil rights laws.. the list goes on.

The administration has also announced plans to fill federal court vacancies with judges likely to do their bidding.

The only people who will benefit from the policies of this Administration are the rich and the large corporations chafing under “inconvenient” regulations–like the rules against dumping toxic materials  into nearby rivers and polluting the drinking water.

Public administration scholars have long been concerned with the problem of “capture”–the process by which regulatory agencies get “cozy” with representatives of the industries they regulate. Some of that is inevitable; especially when you are dealing with complex issues that are salient only to the industry being regulated, it’s understandable that the regulators and those subject to regulation will develop a relationship. That relationship doesn’t necessarily undermine the regulatory process, and it is important to listen to the voices of those being regulated–the voices of those with the most intimate knowledge of the effect of rules being promulgated.

Listening, however, is one thing. Letting the industry write the rules–or rewrite the science justifying the rules–is something else entirely.

In the Trump Administration, the fox apparently lives in the henhouse.

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The Evidence Keeps Accumulating…

Periodically, I use this blog to indulge a rant about Americans’ lack of civic literacy. (Regular readers are probably getting tired of my preoccupation with civic education–or more accurately, the lack thereof.) Be warned– I’m going to beat that dead horse again today.

A column written by Colbert King from the Washington Post has highlighted still another research project confirming Americans’ low levels of civic knowledge. 

King introduced the topic by noting what we might call “constitutional challenges” in Donald Trump’s Presidential campaign.

He proposed a religious test on immigration, promised to “open up” U.S. libel laws and revoked press credentials of critical reporters. He called for killing family members of terrorists, said he would do “a hell of a lot worse than waterboarding” terrorism suspects and suggested that a U.S.-born federal judge of Mexican heritage couldn’t be neutral because of his ethnicity. He whipped up animosity against Muslims and immigrants from Mexico, branding the latter as “rapists.”

When protesters interrupted his rallies, he cheered violence against them. He told a political opponent that if he won, he would “get a special prosecutor to look into your situation,” adding “you’d be in jail.” He threatened not to respect election results if he didn’t win and, in Idi Amin fashion, made the claims of a strongman: “I alone can fix it.” He publicly expressed admiration for authoritarian Russian President Vladimir Putin.

Cherished notions of religious freedom, a free press, an independent judiciary and the rights of minorities took a beating from him. The prospect of mob violence in his defense and imprisoning of political opponents found favor.

An electorate with even a basic understanding of the U.S. Constitution would have found these assaults on foundational American principles reprehensible. And in fairness, civically- educated Americans did recoil.

The problem is, we don’t have enough civically-educated Americans.

How did a pluralistic nation that propounds democratic values and practices come to this?

“This” not being the authoritarian in the White House who dismisses basic constitutional principles as if they were annoying gnats, but “this” — an electorate that looks past the disrespect shown toward democratic ideals.

That haunting question has occupied the minds of Richard D. Kahlenberg and Clifford Janey, two education scholars and writers who began to take a hard look at this fundamental domestic challenge long before November’s results came in.

Kahlenberg and Janey addressed the scope of the problem in a joint Century Foundation report released in November, “Putting Democracy Back into Public Education.” The report was also discussed in an article in the Atlantic, “Is Trump’s Victory the Jump-Start Civics Education Needed?”

Janey and Kahlenberg argue that our “schools are failing at what the nation’s founders saw as education’s most basic purpose: preparing young people to be reflective citizens who would value liberty and democracy and resist the appeals of demagogues.”

They said today’s schools turn themselves inside out trying to prepare “college-and-career ready” students who can contend with economic globalization and economic competition and find a niche with private skills in the marketplace.

As for preparing them for American democracy? Raising civics literacy levels? Cultivating knowledge of democratic practices and beliefs with rigorous courses in history, literature and how democratic means have been used to improve the country? Not so much or maybe not at all, they suggest.

This has to change. And in Indiana, at least, a number of us are committed to changing it.

Women4Change Indiana is currently launching an effort to increase civic education; I am heading up a subcommittee that will encourage the formation of book clubs around the state focused upon the history and philosophy of America’s constitution. We will also be enlisting volunteers who will advocate in their local school systems for inclusion of the “We the People” curriculum, which is now entirely voluntary. Research has demonstrated that We the People has a salutary, lasting influence on students who have gone through it.

Citizens will not–cannot–protect what they don’t understand.

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Taxes and the Common Good

I know “real Amuricans” sneer at the notion that we might learn from the experiences of other countries. Universal healthcare? A commie plot! Decent mass transit? People who can’t afford–or don’t want– cars shouldn’t be coddled! A comprehensive social safety net? You are a commie!

Every so often, however, a “real American” finds living in a country that actually offers these and other subversive services is pretty attractive. Vox recently published an essay by one such person, whose job and that of his wife requires that they split their time between Wisconsin and “high tax” Sweden.

My wife and I have been dividing our time between jobs in Sweden and Wisconsin for the past dozen years, and I’m here to tell you that taxes in Sweden are not that high. To my surprise, I found that there are lots of things to love about the Swedish tax system. Swedish taxes are easy to pay, rational, and efficient. Best of all, rather than take away opportunities, Swedish taxes expand them.

The writer goes on to list things he loves about Swedish taxes. No kidding.

It turns out the average Swede pays less than 27 percent of his or her income in direct taxes. As I’ve written elsewhere, my wife and I pay about 22 percent of our US income in taxes. Our Swedish income tax was 31 percent. So, yes, our income taxes in Sweden were higher than in the US, but we still paid less than one-third in tax.

And you get far more for your taxes than you do in the US. In Sweden, college is free and students get a housing stipend. A colleague’s daughter, Kerstin, just completed a five-year dental program. Her family paid nothing for her education.

In Sweden, tax forms are simple, and they come already filled out. The author points out that tax-preparation services cost American taxpayers more than $32 billion per year–not to mention hours of citizens’ time and effort.

And in Sweden, there are no property taxes.

When the conservative government, favoring lower taxes, came to power in Sweden in 2006 one of its first steps was abolish the property tax and replace it with a fixed fee. The real estate fee for services is 7,112 SEK per house ($825 at current exchange rates).

This is the same for everyone no matter what the assessed value of the dwelling. The fee is $12 a month for our co-op apartment in Stockholm. If we owned the same property in Madison, our taxes would be $18,000 a year.

There are sales taxes in Sweden, and they’re high, but even then the author finds mitigating factors:

Sales taxes are high in Sweden, but you don’t see them, and that makes them easier to pay. If something costs 100 kronor, you pay the 100 kronor! Only when you look at the receipt do you see that it costs 80 kronor and 20 kronor for VAT (value-added tax). Many things are taxed at lower rates — 12 percent to have dinner out or buy groceries, 6 percent (only half a percent higher than our sales tax in Madison) for books and tickets to cultural events and in-country travel. Health related items: zero percent.

It is true that sales taxes are regressive; poor people pay a higher proportion of their income in this tax. In the US, a 25 percent sales tax would have to be offset with some kind of subsidies for our many poor. But because Sweden has a narrower income distribution, its sales tax is less regressive than in the US.

A fascinating difference between the U.S. and Sweden is that, in Sweden, if the government wants to encourage an activity, they don’t do it through the tax code.

One of the reasons US income tax preparation is so awful is that we try to reward certain activities by providing a tax deduction. If you do some good deed (like putting in a solar panel) and if you can find the receipt and documentation…, then you can list a number on Form H, line 36, that will lower your taxes.

Does this feel good? Do you feel rewarded for your solar panel?  Or is it just another damn number on a tax form?

If the Swedish government wants you to do something, they give you the money. For example: Having children is good for the society and costs parents money. In the US, you get a deduction on your income tax for dependents. In Sweden, you get a check every month and you can use it to buy shoes. For one child you get $120 a month and up to $620 for four children. Every parent gets a check.

The most persuasive argument for Sweden’s approach (at least, from my perspective) is that the taxes generate income used to provide collective goods that make life better and less costly for citizens.

Not having to pay for college gives the best and the brightest the opportunity to attend any school they choose — equalizing opportunity on merit, not parents’ wealth.

It’s not just college. Public amenities like parks and hiking trails, excellent and frequent public transportation, and–oh yes– universal health care.

Paradoxically it turns out the bloated, heavily lobbied, privatized US system spends more tax money ($4,437) per person than Sweden’s socialized health care ($3,184).

This is due to Swedish efficiency rather than poor service. I do get to choose my doctor, have high-quality care a short walk from my home, same-day appointments and short waits when I walk in unannounced.

Keep chanting “We’re number one! We’re number one.” Maybe we’ll convince someone besides ourselves..

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We’re Number One! NOT.

This is my week for borrowing. But when someone says something so much more eloquently than I could, it’s hard to resist.

This time, it is a former student.

I keep in touch with a number of my former students via Facebook. I enjoy seeing their wedding photos, pictures of their children as they grow, and following their career paths. Most of them are truly admirable human beings, and I take a sort of motherly pride in reading their social and political commentaries.

In the wake of the House healthcare vote, one of those former students, –now a government employee who is for that reason understandably reluctant to “go public” with his critique–posted the following diatribe.

The United States has more citizens in prison than any country in the world. Even more than China, which has four times as many people. Republican legislators chose to focus on eroding healthcare protections.

The United States has a public education system ranked lower than Russia. Republican legislators chose to focus on eroding healthcare protections.

The United States has average Internet speeds three times slower than Romania. Republican legislators chose to focus on eroding healthcare protections.

The United States has infant mortality rates nearly twice as high as Belarus. Republican legislators chose to focus on eroding healthcare protections.

The United States has 2.5 million citizens without access to improved drinking water. Republican legislators chose to focus on eroding healthcare protections.

The United States has a youth unemployment rate of 13.4%. Republican legislators chose to focus on eroding healthcare protections.

The United States has 50 million citizens living below the poverty line. Republican legislators chose to focus on eroding healthcare protections.

The United States has greater income inequality than Morocco, Jordan, Tanzania, Niger, Kyrgyzstan, East Timor, and 95 other countries. Republican legislators chose to focus on eroding healthcare protections.

The United States is responsible for nearly twice as much CO2 emissions as the entire European Union. Republican legislators chose to focus on eroding healthcare protections.

The United States has more railways than any country on Earth, by more than 100,000 kilometers, but has virtually no long-range public transportation system. Republican legislators chose to focus on eroding healthcare protections.

The United States spends more on national defense than every other nation on Earth COMBINED, yet seems to be in perpetual warfare and has a barely functioning veteran-support system. Republican legislators chose to focus on eroding healthcare protections.

Next Election Day, please don’t forget this. And don’t ever let them forget it.

I’ve said it before and I’ll say it again: I’d turn this country over to my students in a heartbeat.

Speaking of “turnover”…as a direct result of the health-care vote, the well-respected Cook Report downgraded the 2018 prospects of twenty Republican House members. As the Washington Post’s Plum Line reports

Today, House Republicans are waking up to a big set of brutal ratings changes from the Cook Political Report. In the wake of the vote, Cook has shifted 20 GOP-held seats toward Democrats. Yes, 20. ..Cook analyst David Wasserman writes.. that the GOP passage of a bill this unpopular “is consistent with past scenarios that have generated a midterm wave.”

Meanwhile, Nate Silver takes stock of the abysmal unpopularity of the bill and concludes that the vote for it could prove “a job-killer for GOP incumbents.” And Nate Cohn draws a comparison between yesterday’s vote and the 2010 vote for the Affordable Care Act that helped cost Democrats dozens of House seats and their majority. As Cohn notes, if that history is any guide, it’s possible that those Republicans who voted for the GOP bill could lose substantial support in the next election.

Finally, let me add my voice to those of Hoosier Democrats who are trying to convince Christina Hale to run against Susan Brooks in Indiana’s Fifth Congressional District. Hale would be a formidable candidate; as she displayed during her run for Lt. Governor and her prior tenure at the Indiana Statehouse, she has energy, intellect, eloquence and integrity–and she’s a strong voice for women and girls. I hereby volunteer for her campaign!

And if the Cook Report is right, 2018 will be a very good year….

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