Monday, October 19, 2015

Sun. Oct. 18


AROUND NEW HAMPSHIRE
 
 
 
 
 
1.  This and That
 
 
For historical committee, inertia reigns
 
Capital Beat,   by Allie Morris,   concordmonitor.com,   October 18, 2015
 

The 7-foot plywood pillars didn’t look quite right planted in the grass before the taller State House archway. And, when the posts were too close to the Liberty Bell and a sundial, the lawn st

But when the posts were put between the archway and the lamppost, lawmakers decided it looked just right.

The joint legislative historical committee had the replicas constructed (at a cost not to exceed $100) to help them figure out where to place the real things – a pair of historic granite pillars that during the 1800s marked the entrance to the State House grounds.

It was more than a year ago, when lawmakers settled on a spot to put the posts after a demonstration with the plywood lookalikes. Since then, a lot has changed, but not the location of the pillars, which are still planted a few miles away outside the state archives building off Fruit Street.

What has changed is the committee’s membership, which shifted after the 2014 election, and the chair position, which passed from the Senate to the House.


Some committee members are concerned the granite posts, dinged by snow plows last winter, are too unsightly to relocate to the State House.

“They are in pretty bad condition,” said Rep. David Welch, a Kingston Republican who chairs the historic committee, and was not a member during discussions about the posts location. “I don’t really know where they would go in the condition they are in.”

It means the Lafayette posts, named for the Marquis de Lafayette who is credited with calling New Hampshire the granite state, are in limbo.

Sen. David Watters, a Dover Democrat, chaired the committee last session and led the effort to move the posts.

“Having seen the damage that’s been caused to them, it’s a good idea to preserve them by bringing them down to the State House,” he said. “We were on a path to do this, and had some potential for private funding to cover costs involved. With the new membership of the committee, there’s an unwillingness.”

The disagreement over the posts illustrates a challenge of leaving historic preservation to a legislative committee, whose members, and tastes, can change every election cycle.

Granite posts aside, the issue arose more recently during the committee’s debate over what to do with the state’s 87 civil war battle flags. Over the last few years, the committee spent an estimated $3,000 choosing and hiring a specialist to develop a flag conservation plan.

But just last week, the committee voted to put that plan on hold and instead consider taking annual photos of the flags to determine whether, and at what rate, they are deteriorating.

It’s frustrating to some outside observers, like David Nelson, a veteran who for the last decade has been advocating for battle flag preservation.

“I am disappointed that this is the outcome, that this project has been indefinitely postponed because of the personal whim of someone elected to the legislature for two years,” said Nelson, who founded an organization in 2007 dedicated to historic flag preservation in New Hampshire.


He wants lawmakers to listen to the experts who often weigh in on the preservation projects. “It’s a shame a few people are making a major decision for basically the entire population of the state.”

While the state’s Department of Cultural Resources is in charge of most historic preservation in New Hampshire, the joint legislative historical committee oversees the State House complex, and the artifacts within. The State House walls display more than 200 portraits of historical figures, ranging from Mary Baker Eddy to past speakers of the House. The Hall of Flags has artifacts from several conflicts, including the Civil War and both world wars. Plaques adorn several walls and hallways.

The committee is made up of eight lawmakers, including the Senate president and House speaker. It gets $10,000 annually, and has the power to purchase and restore historical items, among other things.

Not all initiatives are derailed by turnover. For the past several years, the committee has worked with a conservator to restore portraits that hang in the State House. That effort is ongoing.

Watters says changes in membership can be good, providing new voices, and new eyes to look at problems.

But the collection may be better off overseen by a non-legislative group, say some.

“People are coming and going all the time. They really have no sense of the historical perspective because they can’t view it, because No. 1 they aren’t here long enough,” said Sen. Lou D’Allesandro, a Manchester Democrat on the historic committee. “There should be something outside that is put together that preserves the history of the building, the history of the portraits and the history of the state.”

But good luck getting lawmakers to vote in favor of giving up a say.

In the meantime, the granite posts are standing guard at the state archives. It’s a troubling thought for Watters.

“I’m worried that I’ll get a call that a snow plow cracked it right in half,” he said. “That’s the kind of thing that keeps me up at night worrying. We have this historic treasure and we neglect it.”

Punting

Lawmakers again punted on a decision over how to close a $10.6 million shortfall in the state retiree healthcare plan. They will meet Tuesday to vote on a plan. Then the committee will likely approve a plan to raise copays, deductibles and premium contributions for state retirees under the age of 65. To touch the over 65 group they need legislation, and that will likely come up for discussion Tuesday.

Rep. Lynn Ober, a Hudson Republican, is working on a bill, and on Friday, D’Allesandro indicated he would support it.

The legislation would require those who turn 65 after June 30, 2016, to continue paying a partial premium, which would equate to roughly $50 a month, Ober said. Currently the 9,000 retirees over age 65 do not pay into the state plan, which is supplemental to Medicare coverage. But the bill would make the plan flexible, allowing the over 65 group to use that money toward a different plan in another state if they so choose.

The legislation would also create a new subcommittee of the fiscal committee that would deal specifically with changes to the state retiree health plan, and be able to hold public hearings. Finally, the bill would pull an additional $1.9 million from the health plan surplus to help plug the deficit.

Lawmakers have until the Tuesday meeting to wheel and deal, so it’s not clear whether the bill will be presented in the same form. Some lawmakers on Friday said they want assurances from Gov. Maggie Hassan that she would support proposed legislation. If the bill does get support, it means the joint legislative fiscal committee won’t raise prescription co-pays Tuesday for the over-65 age group.

It’s not clear how the plan will be received among retirees. Rich Gulla, president of the state’s largest union of employees, said Friday he hopes lawmakers used the extra time looking for other revenue sources to fill the hole.

“I am urging them not to take it out on the backs of retired employees,” he said.

Mark your calendar

On Wednesdays, Mean Girls wear pink and the House meets for session. But that could soon change – the latter bit of course.

Speaker Shawn Jasper is polling members, asking what they think about changing the session day from Wednesday to Thursday. The Senate meets on Thursday, which would be part of the rationale for making a switch. That way, representatives wouldn’t have to leave session to testify in Senate committees. Jasper is just testing the waters, said spokesman Jim Rivers.

Tech savvy

And soon, we can welcome the New Hampshire House into the 21st century – when it comes to technology, that is. The House is working on updating its website, and making it friendly for smart phones and tablets.

What to watch

The Governor’s Commission on Alcohol and Drug Abuse Prevention, Treatment and Recovery will meet Friday to start figuring out how to spend its money. The budget doubled the money in a fund controlled by the commission to roughly $6.7 million over the two-year budget cycle.
arted to look cluttered.
 
 
2.  And More
 
 
Bracing for candidates swarming State House
 
State House Dome,   by Garry Rayno,   unionleader.com,   October 17, 2015
 
THE PRESIDENTIAL parade through the State House to Secretary of State Bill Gardner's office begins in two and a half weeks when the New Hampshire presidential primary sign-up period opens.

Between Nov. 4 and 20, Gardner's office will host the national and local media, political activists, campaign workers, hangers-on and a host of candidates who come in to plunk down $1,000 and sign their names on the dotted line to enter the first-in-the-nation presidential primary.

Most will have only those 15 minutes of fame, but one of the upwards of 50 candidates will become the most powerful leader in the world.

The candidates have to file their declaration of candidacy and that could eventually pose a problem for two of the major candidates, one from each party.

The issues of Bernie Sanders running in the Democratic primary has been out in the blogosphere for some time and will be again when he files in New Hampshire.

The document asks the candidate to swear he or she is “a registered member of the (fill in the blank) party.”

Sanders has always run as an independent, although he was endorsed by the Democratic Party and its leaders when he ran for the U.S. Senate in 2006, filed as an independent. He caucuses with Democrats in Washington but is not a member of the party.

Sanders has time to rectify any problem that might arise before he files and could simply have Senate Democratic Leader Harry Reid declare he is a member of the Democratic Party, but Reid's endorsement may not sit well in New Hampshire after he trashed the state and its presidential primary last week.

Reid did not say he wanted to change New Hampshire's place on the presidential selection calendar as Republican National Committee Chairman Reince Priebus implied when Reid talked about doing away with “the sacred cows” and moving to a regional primary system.

The other candidate with a potential problem is Texas Sen. Ted Cruz. The Republican was born to United States citizens but in Canada.

The declaration form quotes from the U.S. Constitution listing the requirements to be President. “No person except a natural born citizen, or a citizen of the United States, at the time of the adoption of this Constitution, shall be eligible to the office of President.”

Former GOP presidential candidate and Sen. John McCain was born on a Naval Base in the Panama Canal Zone, but a military base has traditionally been thought of as a U.S. controlled territory, and 1964 GOP presidential candidate Barry Goldwater was born in 1909 in Arizona when it was a territory and not a state.

But Cruz was born in Calgary, Canada, where his father was working for an oil company, although he grew up in Texas.

Gardner said the quote from the Constitution is included on the declaration form after a man filed for the 2008 presidential primary who was an Egyptian citizen.

“After he filed, in less than an hour I got a call from someone telling me he had proof he was not a U.S. citizen,” Gardner said Friday.

Gardner called the candidate and asked him if he was an U.S. citizen and the man said no, he was an Egyptian citizen, and did not know he had to be an American citizen to run for President.

“After that we put the exact wording from the U.S. Constitution on the form,” Gardner said.

Gardner noted his office does not investigate when candidates file for office, but if someone presents documentation that the would-be candidate does not qualify, then the issue goes to the Ballot Law Commission.

In both instances, if Gardner accepts the forms from Sanders and Cruz as expected, challenges are likely to follow.

The Ballot Law Commission will have to decide, but will essentially be on its own because the U.S. Supreme Court has never been asked to decide what constitutes “natural born citizen” or if someone can run in a party primary without being a member of the party. The party issue is usually left for states to decide.

While both candidates are likely to be on the presidential primary ballot in February, they may have to spend some time before the Ballot Law Commission. And that's not something either candidate is going to want to do or to spend precious resources to address the question.

All ready to go

The presidential filing period may be two weeks away but several people have already scheduled times with the Secretary of State's Office.

The day after the filing opening on Nov. 4, both Florida Sen. Mario Rubio and former Hewlett-Packard CEO Carly Fiorina will file, and Cruz is scheduled for Nov. 12.

With the number of major candidates set to run in New Hampshire, there are bound to be some back-to-back days that will try the patience of State House workers.

Opening day is usually reserved for folks seeking a little attention for their cause and ideas.

Executive Council 3

With District 3 Executive Councilor Chris Sununu announcing he will run for governor, Salem Democrat Beth Roth announced she will seek the District 3 seat.

Roth is a former two-term Salem selectman and a business attorney with her own practice.

“I am announcing early in order to do the most thorough job I can talking to voters and learning about the needs of the entire district, which spans from the Seacoast to Pelham,” Roth said. “I'm ready to take on the challenge of a regional campaign, and plan to devote the energy and time to earning the votes of people in this district who deserve to be heard.”

Roth said she is troubled by the influence of national politics on state policy decisions, such as the recent Council vote to defund the Planned Parenthood contract.

Prior to her election as selectman, Roth served on Salem's planning board, and is now on the Salem Historical Society board. She is married, with three children and eight grandchildren.

Two Republican state senators are exploring running for the seat, Nancy Stiles from Hampton and Russell Prescott from Kingston.

Campaign chair

GOP presidential candidate and former Virginia Gov. Jim Gilmore named State Sen. Sam Cataldo, R-Farmington, as his New Hampshire State Chairman of Gilmore for America.

“I am honored to have Sen. Cataldo leading our efforts to build a grassroots campaign in New Hampshire,” Gilmore said.

Senate Democrats

The Senate Democratic Political Action Committee holds a fundraiser Wednesday as the political season is clearly in full swing, even if the next general election is more than a year away.

The Democrat event is at O Steak & Seafoods between 5 and 7 p.m.

The Sununu touch

One of the viral Youtube videos of the last election was Chris Sununu's introduction of then-U.S. Senate candidate Scott Brown in Portsmouth.

His brother, former U.S. Sen. John E Sununu, could have one of his own if anyone was taping his introduction of Ohio Gov. John Kasich Tuesday at a town hall meeting in Bow.

Sununu, who served with Kasich on the House Budget Committee and is chairman of his New Hampshire campaign, was touting Kasich's accomplishments in Congress, including the last balanced budget.

Sununu noted when Kasich became governor of Ohio the state was in dire fiscal shape, but after he took over as governor, “he turned a $6 billion surplus into a $2 billion deficit.”

Catching himself, Sununu noted the forgiving people of New Hampshire are used to him fumbling his words, but Kasich was probably not going to be so kind.
 
 
 
 
 
3.  Presentation and Vote on the County Jail Project
 
 
County jail plans move along
Delegation is expected to vote on bond proposal on Nov. 2
 
by Bob Martin,   thecitizen.villagesoup.com,   October 17, 2015
 
LACONIA — The Belknap County Delegation will hear a presentation on proposed jail improvements and community corrections center on Oct. 27. Commissioner David DeVoy said the delegation will vote on a bond proposal for the project on Nov. 2.
In order for the bond to pass, two-thirds of the 18-member delegation must vote in favor, DeVoy said.
Earlier last month, county commissioners unanimously agreed to move forward with a plan for a new community corrections facility and renovations to the existing jail, which would cost about $8.3 million.
During the Sept. 3 meeting, representatives of SMP Architects and consultants Kevin Warwick and Ross Cunningham made a presentation to the commissioners, which showed the plan for an 18,100-square-foot facility with 64 beds.
The proposal set a price of $7,171,925, with a contingency amount of $700,000 for the community corrections facility. Other costs in the final total were $491,000 for upgrades of the existing jail and $668,300 for other improvements like fencing, paving and roof repairs. Also included is $650,183 for security and programs, as well as $29,000 for electricity and natural gas.
The focus of the commissioners has been to create a community corrections center that will reduce recidivism and prepare inmates for getting back into the working world once they have completed their sentence.
They modeled the proposed facility after Sullivan County, where Cunningham was once superintendent. In Sullivan County, programs and classes designed to help inmates in the transition to life beyond jail have led the recidivism rate to drop greatly – from 88 percent to about 18 percent.
Programming would include classes throughout the day that would focus on drug and mental health treatment.
The 64 beds includes 30 treatment spots for 20 men and 10 women, plus 34 work-release beds for 24 men and 10 women.
Improvements to the jail have been a subject of controversy over the years, most notably in 2013 when Ricci Greene Associates estimated it would cost $42.6 million to build a new jail. This was universally found to be unacceptable. Since then, there have been various jail planning committees and two sets of commissioners working to come up with a solution.
Warwick and Cunningham came up with a proposal for a facility of 27,000 square feet in two stories. SMP Architects worked with them and various key stakeholders in Belknap County to decrease the scope significantly to about 18,100 square feet and only one floor.
DeVoy said the bond hearing on Oct. 27 will be similar to the Sept. 3 meeting, except that it will be directed at the delegation rather than the commissioners. He said members of SMP Architects, as well as Warwick and Cunningham, will be present to answer questions.
“We’ve got to do this in front of the delegation and we’ll be working with everybody, hopefully getting those 12 votes,” said DeVoy.
DeVoy has spoken with several members of the delegation and plans to talk to others before the Oct. 27 meeting. He has been trying to gather their thoughts on the terms of the bond, with the option being either 20 or 25 years. He said another issue they will have to decide is the number of years there will be interest. The bond will be for roughly $8 million.
At the upcoming Oct. 21 commission meeting, DeVoy said he will speak to his fellow commissioners about which bond they will bring forward to the delegation. He said the options are having two years’ interest, or another that is just a straight bond with interest and principle.
“I’d like to give the delegation a plan A and a plan B and make a recommendation of which one I’d like to see, but then let them debate it,” said DeVoy.
DeVoy said he is leaning toward a 25-year bond. He will leave it up to the delegation to decide on the interest aspect.
The Oct. 27 meeting will begin at 7 p.m. and the Nov. 2 meeting is at 6 p.m., both at the Belknap County Complex. For a schedule of meetings, log onto Belknapcounty.org.
 
 
 
 
4.  3rd Quarter Congressional Fundraising
 
 
Innis edges Guinta in third quarter fundraising
WMUR.com details campaign finance reporting by New Hampshire’s congressional candidates
 
by John DiStaso,   wmur.com,   October 18, 2015
 
MANCHESTER, N.H. —U.S. Rep. Frank Guinta and businessman-educator Dan Innis, a potential Republican primary challenger in 2016, raised similar amounts of money for their campaigns in the third quarter of the year, with Innis edging Guinta by about $1,800.
Guinta’s third quarter report shows that his campaign committee now has $350,255 on hand -- $4,745 short of the $355,000 he owes what he calls the “Guinta Family Fund” under the terms of a conciliation agreement he signed with the Federal Election Commission earlier this year.
The FEC staff found that Guinta committed campaign finance law violations by accepting contributions from his parents totaling $355,000 during his 2010 campaign, far in excess of the federal limit on individual contributions.
Guinta maintained that although the money came via checks signed by his parents, it was actually part of a “family pot” account to which he contributed more than he received.
But in signing the agreement, Guinta agreed to pay a $15,000 fine – which he has already paid. He also agreed to return the $355,000. He was given a year by the FEC to return the money to the "family" account.
Several top Republicans, including U.S. Sen. Kelly Ayotte, called on Guinta to resign, but he has refused and has said he intends to seek re-election. He filed a statement of candidacy in March, about two months before the campaign finance controversy became public.
Innis, who lost to Guinta in the 2014 Republican 1st District U.S. House primary, filed in July to run again for the seat. He told WMUR.com on Friday that he intends to make a formal announcement in about two weeks.
Innis’ third quarter report shows that his committee has $109,423 on hand. He lists debts totaling $189,559.
Innis owes $63,657 to the online consulting firm WEDU; $34,255 to strategic consultant Christopher Stewart; and $5,146 to the Devine, Millimet and Branch law firm. Innis also loaned his own campaign committee $86,500 between June 2014, and January 2015.
During the third quarter, Innis raised $111,374, all from individuals and none from political action committees.
Guinta raised $109,532, with $53,682 from individuals and $55,850 from political action committees.
Guinta’s committee spent $66,351 during the quarter, while Innis’ committee spent $3,122.
Guinta, since being elected in November 2014 has raised a total of $561,187 and refunded $11,050 in contributions. His committee’s total disbursements since November 2014 are $308,692.
Two Democrats, former U.S. Rep. Carol Shea-Porter and businessman Shawn O’Connor, have also announced their candidacies for the 1st District seat.
Shea-Porter’s third quarter report shows that she raised $85,849 during the quarter and a total of $99,895 since losing to Guinta in the 2014 general election.
Her total for the quarter includes $81,249 from individuals and $4,600 from political action committees. She lists disbursements of $48,699 during the quarter, and no debts.
Shea-Porter reported having $39,422 on hand as of Sept. 30.
O’Connor’s campaign had by far the most money of any 1st District candidate on hand entering the fourth quarter, $820,439.
He loaned his campaign $500,000 of his own money in March and an additional $500,000 in June. His third quarter reports lists debt of $1,043,929.
O’Connor’s campaign raised $17,720 in contributions during the third quarter and $156,880 since filing a statement of candidacy in February.
He took no money from political action committees in the third quarter and $3,000 from PACs since becoming a candidate.
O’Connor reports spending $162,373 during the third quarter, and $400,244 since becoming a candidate.
In the 2nd District, as WMUR.com reported earlier this month, Democratic U.S. Rep. Ann Kuster raised $376,978 in the third quarter, bringing her total for the 2016 cycle to $1.17 million.
Kuster during the quarter raised $220,405 from individuals and $155,300 from political action committees. Since her reelection in November 2014, Kuster’s committee raised $742,272 from individuals and $406,881 from PACs.
Kuster’s campaign committee entered the fourth quarter with $979,154 in cash on hand.
No Republican has yet filed to challenge Kuster, who has announced that she will seek re-election in 2016.
 
 
 
5.  Ah, That Free-Stater Mentality
 
 
 
by William Tucker,   miscellanyblue.com,   October 17, 2015
 
Caleb Quinn Dyer is a 19-year-old candidate for the New Hampshire House of Representatives from Hudson running as an independent. Yesterday, he submitted an “Ask me anything” post on Reddit. A brief (reformatted) excerpt follows.
cqdyer: Hello my name is Caleb Q. Dyer and I’m running for the NH HoR from Hillsborough country district 37! AMA.
cqdyer: I’m a 19 year old running as a non-partisan candidate for the NH House of Representatives. I self identify as a liberty oriented candidate but I’m unwilling to take on any party label. I’ll answer just about any question but please keep it classy.
idgaf271: Why are you running? You’ve presented nothing here so far. So I guess I am supposed to look at your posting history.
cqdyer: Yup I enjoy living in a good secular part of NH where I’m easily able to own my guns and knives without anyone telling me I can’t have them or need a fucking permit license or any of that bull shit. Because here we live how we want and the assholes who don’t like it can fucking die. Hence: Live Free or Die!
idgaf271: Would you say this accurately reflects the agenda of your campaign: isolationist, selfish, armed with deadly weapons, and threatening others who disagree?
cqdyer: There is nothing belligerent or threatening about the first post. Perhaps you may disagree with me over the part that reads “Here we live how we want and the assholes who don’t like it can go fucking die.” When I write this I mean “go die” more in the sense that they can just go deal with it and be dead to me. Otherwise I truly do think that the lack of licensure for firearms and knives in NH is an excellent policy to further both in the interests of individual liberty and personal safety and security. I don’t see how this is inherently isolationist. As long as other people don’t try to forcefully deny my ability to own these things I won’t have a problem…
zdw2082: If you haven’t already, it might be wise to pack up and go home my friend. This clearly has not reflected well on your character. For your states sake, I hope its occupants see this.
 
 
 
 
AND NATIONALLY
 
 
 
 
 
6.  The Right's Dodd-Frank Myth
 
 
 
by Invictus,   ritholtz.com,   October 14, 2015
 
AEI’s Peter Wallison recently described why America is in the midst of a “slow economic recovery,” which we have been, but not for the reason Mr. Wallison cites.
According to Mr. Wallison, “Dodd Frank has burdened small banks – and the businesses that rely on them – much more than large businesses that have access to capital markets.” The point Mr. Wallison drives home: “While larger firms have access to credit in the capital markets, millions of small firms, limited to borrowing from beleaguered community banks, are not getting the credit they need to grow and create jobs.”
Sadly, though completely unsurprisingly, Mr. Wallison’s claims do not withstand even a modicum of scrutiny. Barry took Mr. Wallison to task  here: Don’t Blame Dodd-Frank for the Slow Recovery.
Below are Commercial and Industrial (C&I) Loans for both small (blue, right hand scale) and large (red, left hand scale) domestically chartered commercial banks. If there’s a meaningful difference to be seen in the recent pace of lending between the two, it’s lost on me. But the fact that both series are at all-time highs is not.

http://www.ritholtz.com/blog/wp-content/uploads/2015/10/small-large-candi-loans.png

Beyond that, as fate would have it, the National Federation of Independent Business (NFIB) released its Small Business Economic Trends (SBET) report yesterday. As it relates to credit conditions, the SBET said this (my bold):
Two percent of owners reported that all their borrowing needs were not satisfied, a record low. Thirty percent reported all credit needs met, and 57 percent, a record high, explicitly said they did not want a loan.
Of course, Mr. Wallison could not have known a week or so ago what NFIB members were going to say in the most recent report. All he could have (and by all means should have) known when he published was what they said last month, which was this (my bold):
“Three percent of owners reported that all their borrowing needs were not satisfied, historically low. Thirty-three percent reported all credit needs met, and 49 percent explicitly said they did not want a loan. For most of the recovery, record numbers of firms have been on the “credit sidelines”, seeing no good reason to borrow.Only 1 percent reported that financing was their top business problem compared to 20 percent citing taxes. In the Great Recession, no more than 5 percent cited credit availability and interest rates as their top problem compared to as high as 37 percent in the Volcker era. Thirty-three percent of all owners reported borrowing on a regular basis, up 3 points. The average rate paid on short maturity loans rose 20 basis points to 5.4 percent. The net percent of owners expecting credit conditions to ease in the coming months was a negative 7 percent, down 2 points.”
The facts of the matter – supported by both the Federal Reserve’s H.8 and the NFIB – put the lie to Mr. Wallison’s claims.
Federal Reserve economists Bhutta and Ringo debunked his claim that the housing bubble of decade ago was caused by the Community Reinvestment Act of almost four decades ago (“…the current best evidence suggests that the CRA was not a significant contributor to the financial crisis.”)
AEI is no longer even trying to be a thoughtful, respectable thinktank with independent analysis and intelligent commentary. Instead, it has morphed into a showcase of discredited ideas, disproven myths, and empty-headed rhetoric.
AEI stands as a stark warning to other (so-called) think tanks what not to do: Don’t become some billionaire’s ideological bitch.
 
 
 
7.  If They Paid Their Share
 
 
What Could Raising Taxes on the 1% Do? Surprising Amounts
 
by Patricia Cohen,   nytimes.com,   October 16, 2015
 
When it comes to paying taxes, most Americans think the wealthy do not pay their fair share.
 There is a sharp divide, however, between Republicans and Democrats when it comes to taxing the rich, who provide most of the cash for political campaigns.
All the Republican tax proposals, in fact, cut taxes for the wealthiest Americans. Democrats, on the other hand, are prepared to raise taxes at the top, though they have not been very specific about how they would do so.
“Right now, the wealthy pay too little,” Hillary Rodham Clinton said at this week’s Democratic debate in Las Vegas, “and the middle class pays too much.”
But what could a tax-the-rich plan actually achieve? As it turns out, quite a lot, experts say. Given the gains that have flowed to those at the tip of the income pyramid in recent decades, several economists have been making the case that the government could raise large amounts of revenue exclusively from this small group, while still allowing them to take home a majority of their income.
It is “absurd” to argue that most wealth at the top is already highly taxed or that there isn’t much more revenue to be had by raising taxes on the 1 percent, says the economist Joseph E. Stiglitz, winner of the Nobel in economic science, who has written extensively about inequality. “The only upside of the concentration of the wealth at the top is that they have more money to pay in taxes,” he said.
The top 1 percent on average already pay roughly a third of their incomes to the federal government, according to a Treasury Department analysisthat takes into account the entire menu of taxes — including income tax, payroll taxes that fund Medicare and Social Security, estate and gift taxes, excise and custom duties as well as investors’ share of corporate taxes. The tax bite on the top 0.1 percent is a bit higher. Most of those taxpayers insist they are already paying more than enough.
By comparison, the band of taxpayers right below them, in the 95th to 99thpercentile, pay on average about $1 out of every $4. Those in the bottom half pay less than $1 out of every $10.
[To see the chart detailing this, click on the following link:
 
Sidestepping for the moment the messy question of just which taxes would be increased, how much more revenue could be generated by asking the rich to pay a larger share of their income in taxes?
To get the most accurate picture possible, throw in all the scraps of income, from the most obvious (like wages, interest and dividends) to the least (like employer contributions to health plans, overseas earnings and growth in retirement accounts). According to that measure — used by the Tax Policy Center, a joint project of the Urban Institute and the Brookings Institution — the top 1 percent includes about 1.13 million households earning an average income of $2.1 million.
Raising their total tax burden to, say, 40 percent would generate about $157 billion in revenue the first year. Increasing it to 45 percent brings in a whopping $276 billion. Even taking account of state and local taxes, the average household in this group would still take home at least $1 million a year.
If the tax increase were limited to just the 115,000 households in the top 0.1 percent, with an average income of $9.4 million, a 40 percent tax rate would produce $55 billion in extra revenue in its first year.
That would more than cover, for example, the estimated $47 billion cost of eliminating undergraduate tuition at all the country’s four-year public colleges and universities, as Senator Bernie Sanders has proposed, or Mrs. Clinton’s cheaper plan for a debt-free college degree, with money left over to help fund universal prekindergarten.
A tax rate of 45 percent on this select group raises $109 billion, more than enough to pay for the first year of a new $2,500 child tax credit introduced by Senator Marco Rubio, Republican of Florida.
Move a rung down the ladder and expand the contribution of those in the 95th to 99th percentile — who earn on average $405,000. Raising their total tax rate to 30 percent from a quarter of their total yearly income would generate an additional $86 billion. That’s enough to cover the cost over eight years of repealing the so-called Cadillac Tax on high-cost health plans, which Senator Sanders and Mrs. Clinton have endorsed.
A 35 percent share produces $176 billion — roughly the amount that the Federal Highway Administration has estimated is needed each year to improve conditions significantly on major urban highways.
Alternatively, those tax increases could be used to help reduce government borrowing: Some combination of those raises could go a long way toward wiping out this year’s estimated federal deficit of $426 billion.
“Most economists today would agree that raising taxes modestly would bring in more revenue” without doing any serious damage to the economy, said Roberton Williams, a fellow at the Tax Policy Center. The big question is how much is too much, because at some point higher tax rates would discourage extra investment and work.
All the Republican candidates share the party’s traditional opposition to raising taxes on the wealthy, arguing that it would ruin the economy by sopping up money that would otherwise be used to create jobs. Lowering taxes, they say, will unleash a torrent of economic activity that will in the long run spur growth and revenue.
But most mainstream economists, including some on the conservative side of the divide, concede that even with optimistic projections about growth and spending cuts, the Republican plans would leave a whopping budget gap, requiring more borrowing, not less. Revamping the tax code along these lines would also decrease the share paid by those at the top.
The argument for raising tax rates on the rich tends to focus on the vastgains that this group has enjoyed in recent years compared with everyone else. The top 0.1 percent of American families – each with net assets greater than $20 million — own more than 20 percent of the all the household wealth in the country. In the 1970s, that same sliver of the population controlled 7 percent.
That shift is behind Senator Sanders’s repeated vow to compel Wall Streeters and others in the Rolex-and-Maserati set to pay more than they do  now.
“Let me tell you, Donald Trump and his billionaire friends under my policies are going to pay a hell of a lot more in taxes today — taxes in the future than they’re paying today,” he declared in Las Vegas.
Middle-income families make substantially less money than they did 15 years ago, once inflation is taken into account. The economist Thomas Piketty blames, among other things, “the spectacular lowering of top income tax rates” for the sharp rise in inequality.
The lower rate — generally a maximum of 23.8 percent — on capital gains, or profits from investments, is particularly problematic, Mr. Piketty argues. Estimates show that nearly 70 percent of capital gains benefits go to the top 1 percent. A recent study by Adam Looney at Brookings and Kevin B. Moore at the Federal Reserve found that “the reduction in the long-term capital gains rate is the primary reason” that the income tax system had become less effective in reducing wealth inequality.
Aided by a phalanx of lawyers and accountants, the rich have become adept at figuring out ways to shift earnings that would normally be taxed at the top 39.6 percent rate on ordinary income into capital gains, said the economist Gabriel Zucman of the University of California, Berkeley, who is researching the link between widening inequality and tactics — legal and illegal — used by the wealthy to sidestep taxes.
Shifting earnings from one tax category to another is part of the reason that even the top 0.1 percent pay on average no more than a quarter of their income in federal individual income taxes — despite that top tax bracket of 39.6 percent, according to a Treasury Department analysis.
“Why give a blank check to all of these guys?” Mr. Stiglitz, the liberal economist, asked. He pointed out that current tax law makes no distinction between, say, investing abroad, speculating in land or building a new factory. A better approach, he said, is to say: “We’ll give you generous deductions if you invest in America.”
Eliminating the preferential rates on capital and dividends would generate $1.34 trillion over the next 10 years, according to the nonpartisan Congressional Budget Office.
Other breaks that critics say subsidize wealth inequality include one that allows people to avoid capital gains taxes on inherited assets. Getting rid of that adjustment would generate $644 billion over a 10-year period, according to the Congressional Budget Office.
Ending the deferral on corporate profits kept overseas — a boon for the wealthy that Robert S. McIntyre, the director of Citizens for Tax Justice, calls “the biggest corporate loophole” — would generate $900 billion over 10 years. (Mr. Trump also supports shutting down that deferral.)
Although an overwhelming proportion of Americans complain that many wealthy people don’t pay their fair share in taxes, Democratic voters are more likely to be upset about it than Republicans. According to the Pew Research Center survey, nearly three out of every four Democrats said it bothers them “a lot” compared to 45 percent of Republicans.
Yet the problem that any president — Democrat or Republican — is going to face in altering the tax code is getting Congress to agree. Researchershave repeatedly found that a top priority of the wealthy is reducing their tax burden and that they largely prefer, unlike a majority of the general public, to cut spending rather than raise taxes.
Senator Ron Wyden, the top Democrat on the Finance Committee, said maneuvering any tax overhaul “through that gauntlet of special interests is a herculean task.”
 
 
 
 
8.  Determining the Supreme Court's Makeup
 
 
The Biggest Thing at Stake in the 2016 Election
 
by David S. Cohen,   readersupportednews.com,   October 13, 2015
 
The next president will hold tremendous power over the Supreme Court's make-up, and therefore the rights of millions of Americans

When the Supreme Court's last term ended in June, liberals were celebrating, and conservatives were up in arms: Same-sex marriage had become the law of the land, Obamacare had been saved (yet again), housing discrimination claims could continue, Texas didn't have to offer a Confederate flag license plate, Arizona could have a rational non-partisan re-districting process, Abercrombie & Fitch couldn't refuse to hire a woman in a hijab, pregnant workers could bring claims against employers for failing to accommodate their pregnancies and Muslim inmates could grow beards while in prison.
For a historically conservative Supreme Court, this was a stunning turn of events. To be sure, the Court hadn't gone full-tilt liberal – it still upheld lethal injection and struck down environmental regulations attempting to protect against pollution. But in the most high-profile decisions, there was a decidedly leftward tilt for the Court.
Expect all that to come to a screeching halt this term, which starts this week; the coming months are likely to bring some pretty regressive decisions that are more in line with what we've come to expect from the Republican-controlled Roberts Court.
If there's any upside to this likely flood of conservative decisions, it's that it might be the kick in the pants voters need to turn out for the 2016 presidential election. Last term's social justice wins on the Court may have made people forget the significance of a Supreme Court justice's political affiliation, as well as that of the president appointing a particular justice. After all, if Anthony Kennedy, a Republican appointed by President Reagan, and John Roberts, a Republican appointed by President Bush II, could join various liberal decisions, the thinking goes, then maybe the political affiliation of Supreme Court justices doesn't matter – right? Not so much.
Currently, Republicans have a 5-4 majority on the Supreme Court. The five Republicans don't always vote together, as last term showed us, but they often do – together, they've built one of the most conservative judicial records in the Court's history.
Right now, four Supreme Court justices are at least 77 years old: Stephen Breyer (77) and Ruth Bader Ginsburg (82), who are both Democrats, and Anthony Kennedy (79) and Antonin Scalia (79), who are both Republicans. Without even considering these justices' individual medical histories, at those ages, it's hard to imagine all four of them remaining on the Court for another nine years. Which means that the next president, especially if she or he serves two terms, will almost certainly appoint at least one, and maybe even four, new justices to the Court.
If the next president is a Democrat – Hillary Clinton, or Bernie Sanders or (who knows!) Joe Biden – and she or he gets to replace Kennedy and Scalia, the replacements could radically shift the balance of power, especially if the president's appointments are particularly young. We would have a liberal block on the Court that we haven't seen in generations: a Supreme Court that protects minorities, expands abortion rights, guarantees privacy, is concerned about the environment, opens access to courts for the poor, ensures workers are treated fairly and more. In other words, a Democratic president will likely have the opportunity to shift the Court into being something that most of us under age 50 have only read about in history books.
But if the next president is a Republican – Marco Rubio, say, or (please no) Donald Trump – and that person has the opportunity to replace Breyer and Ginsburg, the Court's current Republican majority will become an almost unstoppable 7-2 juggernaut. If that Republican president also gets to replace Scalia and Kennedy, those justices will be replaced with younger, possibly more conservative versions of themselves – ensuring a decades-long continuation, or even expansion, of one of the most conservative Supreme Courts in history. The occasional liberal victory, like the ones we've seen recently, would become an endangered species, and possibly even extinct.
A rights-expanding, worker-friendly, environmentally minded, fair-access-concerned Supreme Court for the first time in generations? Or an even more extreme version of the uber-conservative Roberts Court? After the Supreme Court was awash in rainbows earlier this year, it may be easy to forget, but these are the unbelievably high stakes of next November's election.
 
FINALLY
 
 

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