Tag Archives: GOP

About That Shortage Of Workers…

Bars and restaurants are reopening–something for which we are all grateful–but according to media reports, having trouble finding workers. Republicans are jumping on those reports, arguing that employers just can’t compete with unemployment insurance checks. It’s the standard GOP argument that helping people breeds “dependence,” — that workers would rather collect benefits than go back to work.

A 2020 study by Yale economists found that–convenient as that argument may be–it’s wrong. Unemployment benefits don’t create a disincentive for job seekers.

Recent reports suggest that the pandemic has cost America’s economy 2.5 million restaurant jobs and closed more than 100,000 eateries. Now, just as the nation begins to return to whatever “normal” looks like, the restaurants that made it through 2020 can’t find staffers.

A recent Brookings report  looked at Census survey data from early April. It found that 37% of small businesses in the hospitality and food sectors were affected by worker availability, compared to 16% for all small businesses.

So–if those Yale researchers are right, and the dearth of restaurant workers isn’t attributable to sloth enabled by unemployment compensation–what is causing the problem?

One likely factor is the unusual timing. When everyone is trying to hire at the same time, it is harder to find workers. Add to that the fact that easing of the pandemic does not equate to defeat of the pandemic. Many workers–especially those who will face the public as servers, hosts and the like–remain fearful, and not without reason.

But a substantial and overlooked reason for the problem is Trump’s immigration policy. 

Restaurants (and for that matter, farmers) have long been dependent upon immigrant labor, and Trump’s policies (if hatred of Black and brown people can be dignified by the label “policy”) sharply curtailed the supply of those workers. Of course, pointing out that consequence is incompatible with Republican’s anti-immigration orthodoxy.

An ugly truth further complicating the situation is the fact that food establishments don’t depend exclusively on legal immigrants. A study from last year pointed out the significant extent to which restaurants rely on undocumented workers–and how they exploit those workers’ fears of deportation to underpay them.

Undocumented immigrants as a whole pay billions in taxes and a higher effective tax rate average than the top 1 percent of taxpayers (8 percent versus 5.4 percent).

And, as they often work in the back of house — as line cooks, bussers, dishwashers, and janitors — they’re largely invisible to the dining public. In reality, they’re the backbone of the industry. And yet, many are unable to obtain health insurance even though they perform backbreaking work day after day. Most didn’t receive a $1,200 stimulus check from the government, and they often fear getting tested for COVID-19 or obtaining care for fear of deportation.

The next time a GOP flack attributes the scarcity of workers to “dependency” caused by government largesse (a dependency that somehow doesn’t affect the wealthy and corporate beneficiaries of sizable subsidies), you might connect the dots for him.

You might also ask GOP opponents of immigration if they are willing to pay higher prices for fruits and vegetables, and more for that hamburger, if farmers and restaurant owners have to pay something close to a living wage to attract workers in a tighter (and Whiter) labor market. (For the record, I would be willing to pay more if I could rely on the assumption that the people picking produce and waiting on my table–whatever their ethnicity– were being paid a fair wage. )

Bottom line: anti-immigrant rhetoric grounded in barely veiled bigotry may generate votes, but rational, comprehensible and humane immigration policies are more likely to reopen your favorite watering hole….

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Alternate Realities

If we needed a reminder that today’s Republicans and Democrats occupy very different realities, Pew recently provided it.

The Pew Research Center fielded one of its periodic surveys, asking Americans to identify the issues facing the country that they considered most pressing. A majority of Democrats identified gun violence, health care affordability, the coronavirus outbreak and racism as very big problems facing the country today. Each of those issues was identified by two-thirds or more of Democrats and Democratic leaners.

But far fewer Republicans saw these issues as major problems.  The closest they came was the four-in-ten Republicans who did identify health care affordability; approximately two-in-ten rated the coronavirus and gun violence as big problems.

The extent to which climate change and economic inequality are viewed as very big problems is similarly split along partisan lines. About six-in-ten Democrats say each of these are very big problems, while just 21% of Republicans say economic inequality is a very big problem and even fewer (14%) say this about climate change.

By contrast, illegal immigration and the federal budget deficit are the top problems identified by Republicans. About seven-in-ten say both of these are very big problems for the country. Only about three-in-ten Democrats identify these issues as very big problems

It isn’t hard to see the influence of partisanship in these responses. Pew reports that Republicans today are 40 percentage points more likely than Democrats to say the deficit is a very big problem, a finding that–among other things– is in stark contrast to the numbers who said so during the Trump Administration, when there wasn’t a partisan split on that issue. Evidently, deficits incurred when Republican Presidents cut taxes on the wealthy aren’t as worrisome as deficits caused by Democratic Presidents spending on pandemic relief and infrastructure.

It is stating the obvious to say that government cannot solve a problem it fails to properly diagnose. We have evidently reached a point in our political lives where Americans refuse to see problems that are at all inconsistent with their political identities–so people who embrace so-called “Second Amendment” liberties don’t see the steady toll of mass shootings (not to mention the consistent loss of life attributable to suicide by gun) as a big problem.

What is truly difficult to understand is the survey’s finding that only 14% of Republicans identify climate change as a problem. This, in the face of dramatic increases in damaging weather events, out-of-control fires attributable to unusually severe droughts, rising sea levels and other evidence that is widely reported and just as widely attributed to climate change– and that increasingly affects the daily lives of ordinary Americans.

The fact that members of the GOP don’t consider income inequality a problem is more understandable, if equally unforgivable. After all, Republican policy preferences have caused that inequality.

It also isn’t surprising that Republicans named immigration as a “big problem.” For many of them, immigration these days equates to the entry of people of color, hastening the time when White Americans are no longer in the majority. Democrats who consider immigration a problem generally define the problem differently; for them, the problem is a dysfunctional system that takes far too long, is difficult to administer, and is unfair to categories of would-be immigrants.

The Pew survey illustrates what most observers already know: Republicans and Democrats no longer simply disagree about the policies needed to solve our problems. They occupy different realities, in which the identity and severity of the nation’s problems are starkly different.

No wonder our political system is gridlocked.

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There Once Was A Party…

One of the newsletters I receive is that of Heather Cox Richardson. Richardson is a history professor, and her obviously deep knowledge of U.S. history permits her to contextualize the news of the day in ways that most of us cannot.

A recent letter is a great example. It’s also profoundly sad–at least, to those of us who once belonged to a very different Republican Party.

Richardson begins by reminding us that the GOP’s roots “lie in the immediate aftermath of the passage of the Kansas-Nebraska Act in spring 1854.” That was when it became clear that southern slaveholders effectively controlled the federal government– and were using that control to protect and spread the institution of slavery.

At first, members of the new party knew only what they stood against: an economic system that concentrated wealth upward and made it impossible for ordinary men to prosper. But in 1859, their new spokesman, Illinois lawyer Abraham Lincoln, articulated a new vision of government. Rather than using government power solely to protect the property of wealthy slaveholders, Lincoln argued, the government should work to make it possible for all men to get equal access to resources, including education, so they could rise to economic security.

Most of us think of Lincoln as the President who fought the civil war and emancipated the slaves. Richardson focuses on what is considerably less well-known, his policy preferences–especially his belief that government should provide a national infrastructure.

Back then, both Lincoln and the Republican Party believed in an activist government.

Richardson points out that the early Republican Party introduced the first national taxes, including the  first income tax. They used government to give “ordinary men” access to resources. In 1862, the GOP passed the Homestead Act, a measure that gave away western lands to those willing to settle on it. The party established Land-Grant Colleges, established the Department of Agriculture, and provided for construction of a railroad across the continent. They joined with Democrats to build more than 600 dams in 20 western states.

FDR is usually–and appropriately–credited with enlarging the scope of government in order to deal with the Great Depression, but as Richardson reminds us, Republicans who followed accepted the premise that government should provide for the common good–and that it has a special obligation to fund and maintain the national infrastructure.

Three years after he became president, Eisenhower backed the 1956 Federal-Aid Highway Act, saying, “Our unity as a nation is sustained by free communication of thought and by easy transportation of people and goods.” The law initially provided $25 billion for the construction of 41,000 miles of road; at the time, it was the largest public works project in U.S. history.

So what happened? Why are today’s Republicans not just disinterested in governing, they are positively allergic to the notion that government should provide for the common good by building and maintaining the country’s physical and social infrastructure.

In this moment, Republican lawmakers seem weirdly out of step with their party’s history as well as with the country. They are responding to the American Jobs Plan by defining infrastructure as roads and bridges alone, cutting from the definition even the broadband that they included when Trump was president. (Trump, remember, followed his huge 2017 tax cuts with the promise of a big infrastructure bill. As he said, “Infrastructure is the easiest of all…. People want it, Republicans and Democrats.”) Senate Minority Leader Mitch McConnell (R-KY) warns that Biden’s plan is a “Trojan horse” that will require “massive tax increases.”

Republicans under Lincoln provided the first justifications for investing in the nation, and for taxing citizens to fund those investments.

The government had a right to “demand” 99% of a man’s property for an urgent need, said House Ways and Means Committee Chair Justin Smith Morrill (R-VT). When the nation required it, he said, “the property of the people… belongs to the [g]overnment.”

I probably wouldn’t go as far as Morrill, but it’s hard to rationalize what passes for philosophy in today’s Republican Party with the party’s history–not just the devolution into White Supremacy, but the 180 degree shift from policies supportive of the common good to policies favoring the wealthy.

Remember that old TV ad that told us “this isn’t your father’s Oldsmobile”? This isn’t your father’s (or grandfather’s) GOP, either.

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It Isn’t Just Tax Rates

A new study has found that at least 55 of America’s largest companies paid zero taxes last year, despite making billions of dollars in profits. It’s infuriating.

As the New York Times reports, that 2017 tax bill eagerly passed by Republicans in Congress and signed with great fanfare by the former guy, reduced the corporate tax rate to 21 percent from 35 percent. On top of that gift,

dozens of Fortune 500 companies were able to further shrink their tax bill — sometimes to zero — thanks to a range of legal deductions and exemptions that have become staples of the tax code, according to the analysis…

Twenty-six of the companies listed, including FedEx, Duke Energy and Nike, were able to avoid paying any federal income tax for the last three years even though they reported a combined income of $77 billion. Many also received millions of dollars in tax rebates.

As Bernie Sanders has reportedly noted, if you paid 135 for a pair of Nike shoes, you paid more for them than Nike paid in taxes.

The Times article has a list of the most profitable companies that paid no taxes last year.

Publicly traded corporations have to file financial reports, and those reports include the amounts they’ve paid in federal income taxes. When challenged about their ability to avoid paying taxes, most respond that they “fully comply” with the laws. Which is undoubtedly true. (Okay, maybe not for those with accounts in offshore tax havens…Although that tactic is more common among filthy rich individuals than corporations…)

It’s relatively simply to “fully comply” with tax provisions (aka “loopholes”) that are  intended to encourage socially useful behaviors like investing in clean energy or modernizing aging equipment.

The $2.2 trillion CARES Act, passed last year to help businesses and families survive the economic devastation wrought by the pandemic, included a provision that temporarily allowed businesses to use losses in 2020 to offset profits earned in previous years, according to the institute.

Several of these deductions and credits are justifiable. Others, much less so.

I agree with Elizabeth Warren, who has been quoted as saying that giant corporations with billions of dollars of profit shouldn’t be able to pay $0 in federal taxes. According to the Times, today’s tax avoidance strategies include a mix of old standards and what the report calls “new innovations”. It’s hard to argue, for example, for the social benefit of allowing companies to save billions of dollars by characterizing the purchase of discounted stock options by their top executives as a loss, which they then deduct.

The Biden administration announced this week that it planned to increase the corporate tax rate to 28 percent, and establish a kind of minimum tax that would limit the number of zero-payers. The White House estimated that the revisions would raise $2 trillion over 15 years, which will be used to fund the president’s ambitious infrastructure plan.

Supporters say that in addition to yielding revenue, the rewrite would help make the tax code more equitable, requiring individuals and companies at the top of the income ladder to pay more. But Republicans have signaled that the tax increases in the Biden proposal — which Senator Mitch McConnell of Kentucky, the minority leader, called “massive” — will preclude bipartisan support.

Individual taxpayers have long had to contend with the Alternative Minimum Tax. That provision was created in the 1960s, with the goal of preventing high-income taxpayers from using various deductions and credits to avoid the individual income tax. There’s no reason why a similar mechanism shouldn’t apply to corporate giants using provisions of the tax code to avoid paying any taxes on massive profits.

Meanwhile, It would be illuminating if a Congressional committee were to examine the credits and deductions allowed by the current tax code, and eliminate those that no longer make much sense. (Some never did.)

If nothing else, it would be interesting to see how the Republican supporters of these provisions would defend them.

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An Intriguing Analysis

Paul Krugman recently had a column that–almost incidentally–amplified the findings I reported on yesterday from Democracy Corp’s focus groups.

He began by noting that Biden simply doesn’t arouse the same degree of animosity that Obama did. Krugman leaves it there, but the reason for the moderation of vituperation is pretty obvious: Biden’s a White guy. Yes, he’s a hated Democrat/Socialist/Leftie/Whatever, but at least he’s not Black.

Krugman focused on the lower level of animus and hostility aimed at Biden by Republicans, and speculated over what that “low energy” opposition might mean for the prospects of upcoming legislative proposals.

Just about every analyst I follow asserted, almost until the last moment, that $1.9 trillion was an opening bid for the rescue plan and that the eventual bill would be substantially smaller. Instead, Democrats — who, by standard media convention, are always supposed to be in “disarray” — held together and did virtually everything they had promised. How did that happen?

Much of the post-stimulus commentary emphasizes the lessons Democrats learned from the Obama years, when softening policies in an attempt to win bipartisan support achieved nothing but a weaker-than-needed economic recovery. But my sense is that this is only part of the story. There has also been a change on the other side of the aisle: namely, Republicans have lost their knack for demonizing progressive policies.

Krugman is careful to note that the decrease in demonization applies to policies (after all, lots of Republicans still believe that Democrats managed to steal a federal election at the same time they were sexually exploiting and then feasting on small children…) But as he notes, there’s been an absence of “bloodcurdling warnings about runaway inflation and currency debasement, not to mention death panels.”

True, every once in a while some G.O.P. legislator mumbles one of the usual catchphrases — “job-killing left-wing policies,” “budget-busting,” “socialism.” But there has been no concerted effort to get the message out. In fact, the partisan policy critique has been so muted that almost a third of the Republican rank and file believe that the party supports the plan, even though it didn’t receive a single Republican vote in Congress.

Krugman notes a number of possible explanations: the obvious hypocrisy of screaming about deficits under Obama and then incurring huge ones via tax cuts for the rich; the fact that none of their past, dire warnings of inflation under Obama–or their rosy predictions of a boom under Trump–materialized (although, as he points out ” inconvenient facts haven’t bothered them much in the past.”)

Or perhaps Republicans no longer know how to govern. They are trapped in a culture war of their own creation. As Krugman notes, while the Democrats were fashioning legislation and hammering out policy compromises, Republicans were screaming about Dr. Seuss and Mr. Potato Head.

In short, the prospects for a big spend-and-tax bill are quite good, because Democrats know what they want to achieve and are willing to put in the work to make it happen — while Republicans don’t and aren’t.

I have been extremely happy with what the Biden Administration has done–and failed to do–thus far. This is a highly competent operation. What is undoubtedly true, however, is that one reason the path has been smoother for Joe Biden is simply because his skin is white.

And that is an incredibly sad commentary on the current state of America.

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