Archive | January, 2012

A few interesting news links and a movie review!

22 Jan

Well, the snow is melting, the power is coming back on in the Puget Sound region and the sky was blue yesterday afternoon. The snow was really pretty for a day. then it was really wet and sloppy for a few days. Now it’s gone.

Here is a news report from OilPrice.com: Study Finds that Childhood Leukemia Rates Double Near Nuclear Power Stations

hmmm… that doesn’t sound good. I think the jury is in on nuclear power. TEPCO buried the Fukushima nuclear reactors and the industry, but the fallout from the experiment with “cheap” nuclear power will be with us for a long time. Frontline just came out with program – Nuclear Aftershocks. Haven’t seen it yet, but Frontline usually does a good job, so plan to watch that one.Courtesy UK Tar Sands - Wiki Commons

Oilprice.com is a good reference site for all things energy. Particularly good for keeping track of … oil prices! I haven’t spent a lot of time on the site, but it seems pretty technically sound, non-partisan. If/when I will draw from oilprice.com I am sure I will be cherry picking for the information and stories that have a progressive edge.

Obama to Grant Banks Robosigning Immunity in Showdown With Breakaway AGs from OpEdNews.

U.S. AG Eric Holder, DoJ Head Lanny Breuer Linked To Banks Accused Of Foreclosure Fraud – another one from OpEdNews. I think posting one of these requires the posting of the other for context. The revolving door between industry, government, and the nexus of goals is more clear when you see the two stories together.

Finally – a movie review.

Margin Call

My review: wow, see it.

Austerity Politics or Real Utopias?

11 Jan

We need transcendent, transformative politics in this country and the world, but the mainstream paradigm remains a struggle between established power bases – one, a social democrat model as epitomized in Scandinavian models and the other, a Thatcher/Reagan model of social darwinism wearing a mantle of trickle down, supply-side economics. There is no question that I prefer the social democrat model, but I think neither model is particularly well-suited to the challenges that the planet is cranking up to deal with a species that is out of control. Wiki commons - Eusebius - needs a new roof

Greece’s experiment with austerity politics in a time of economic stagnation proves once again that pulling more money out of a economic system that has a crashing demand side will cause the economic system to slip to a lower state. It doesn’t seem to matter if all of the most photogenic politicians that money can buy are spouting platitudes about “growing the economy” by reducing debt, austerity politics just don’t turn stagnating economies around. You do austerity politics in good economic times, you do keynsian economics in economic downturns if you want somewhat stable economies. You also need a stable and consistent tax policy that generates the revenue needed for public services. You don’t flatten taxes in boom times because you will need the accumulated revenue when the boom times go… well… boom!

Boom and bust. Bubble economies. These cycles should not be a big surprise to anyone who has studied economic cycles.

Transformative politics? Does that mean democrats? uhh… no… I don’t think those folks misunderstand who is footing the bill for their elections. Do you think Goldman Sachs money is showing up in the Obama re-election till because they think Obama’s ideas are great? Well, maybe. GS has done pretty well since Obama became president.

No, I am thinking about really transformative economics and politics.

Real utopias. I like the sound of that .

Envisioning Real Utopias from West Coast Poverty Center on Vimeo.

Wage the Dog, Part III

7 Jan

The brightest moment in the Jan 3rd meeting with Senator Fraser, Representative Hunt and Representative Reykdal came when Chris Reykdal took the opportuWiki Commons public domainnity to talk about the impasse that exists with generating revenue for the State.

Reykdal had campaigned for election to the legislature on tax fairness and he appears to be willing to make efforts on that question. Chris described the revenue proposal that he and freshman Senator David Frockt will be putting on the table.

Reykdal and Frockt’s proposal will eliminate the State business and occupation tax (B&0). This element of the proposal is expected to be attractive to the republicans. According to Reykdal, republicans really hate the B&O tax. I will take him at his word on that, but I haven’t been able to identify any tax that our current generation of republicans don’t hate. I guess there is some reason to believe that republicans prefer regressive taxes like sales tax that are paid disproportionately by middle and low income citizens.

So, the first part of this tax proposal that Reykdal referred to as The Hope Act is total elimination of the B&O tax. The second part of The Hope Act would reduce State sales tax from 6.5% to a flat 5%. Elimination of the B&O tax may or may not be regressive. I am a low income small business owner who pays the B&O tax each year. Last year I was pleasantly surprised to find that a tax credit for small business owners was in effect that reduced my annual payment by a significant amount. I have checked with other business owners whose scale of business is much larger than mine and have been told that they did not notice any significant reduction in 2010 B&O tax. So, the elimination of the B&O tax may be fairly regressive if that tax has been made somewhat progressive by an enduring tax credit scheme for low income small businesses, but I think the jury is out on that one. I think there is no question that the B&O tax raises a lot of revenue for the State, so elimination of that tax structure raises the question about how that lost revenue will be replaced.

Courtesy Wiki Commons public domainSales tax revenue is clearly regressive, so a reduction of the sale tax rate (State part only, local add-ons will still be in effect) is clearly progressive. But like the elimination of B&O taxes, the sales tax reduction is a loss of revenue for the State and that translates into cuts in services. Reykdal and Frockt could probably pass these tax cut elements with 100% support from the Norquist Tax Patriots, but we would probably have to reduce education funding in the State to be K-4 proposition from the current K-12 model. Most folks who get through the fourth grade with the standard set of skills should be able to operate a deep-fryer or a touch screen cash register and will be able to stock shelves at a big box store, so this model works for a State economy based on 32 flavors of fast food and lowest prices, guaranteed, but there are many of us who think that there is a problem with the consumer utopian society, so there may be need to replace some of the lost revenue.

Revenue generation: this is where Reykdal/Frockt’s proposal gets interesting. This proposal seeks to increase State revenue by expanding the 5% State sales tax (we should assume that all local add-ons will follow suit) fromEconomic Opportunity Institute goods to goods and services.

So, the bill from your attorney, doctor, tax preparer, and more would start arriving with a sales tax bite. There is a large number of small business owners (I look in the mirror and see one) who will now need to start collecting and turning over sales tax if the Reykdal/Frockt proposal becomes law. Reykdal stated that the expansion of sales to everything, would not include sales tax on food. Ok. Sales tax on food is a really regressive source of revenue. It’s a good thing to keep the sales tax off of food. That’s progressive.

Wiki Commons - courtesy curimedia

A small, but relevant detail about the sales tax on “everything.” It’s not quite everything – airplane sales are exempt and would continue to be exempt. We had a short discussion of the sales tax exemption that exists and will continue to exist if you are selling airplanes. Planes are a movable feast and buyers might insist on taking delivery of their planes in flight over the Cayman Islands to avoid paying a sales tax, so Reykdal says the only way to generate State tax revenue if you have a company that builds and sells airplanes in your State is through a State income tax. Hmm… There will continue to be some tax loopholes so large you can fly an airplane through them.

I am not sure how progressive the expansion of sales tax to services is because I experiencing a bit of resistance to a new tax requirement for my small business operation. Like a lot of small business owners, I am wondering if I am really going to be able to add this tax without losing some business or if I am going to need to absorb some portion of the sales tax as a business cost that would not be that different from the B&O tax. My initial calculation on the sales tax v. B&O tax suggests that my small business will be collecting and paying about three times as much money the Dept of Revenue with sales tax than I paid with B&O tax (and that’s before I factor in the surprise small business tax credit that unexpectedly left a few dollars in the till last year). I think it’s fair to say that businesses and business owners who have not been collecting sales tax are going to be lukewarm at best about the expansion of sales tax to services. I think we should look to the Economic Opportunity Institute for analysis of Reykdal/Frockt’s proposal. The historical analysis of expansion of sales tax to services is going to suggest that this tax is regressive, but less so than a simple tax rate jump (Gov Gregoire’s and others are ready to go that way to raise revenue).

Finally, the capper on the Reykdal/Frockt tax fairness proposal is implementation of a 1% State income tax. Reykdal stated that the Washington State Constitution limits State income tax to 1%. I haven’t fact-checked that assertion, but I am going to trust Chris on that one. The State has repeatedly rejected State income tax out of ignorance about the woefully regressive nature of our State revenue structure. We are the most regressive State in the Nation! We are number 1!

In addition to ignorance and a deep abiding faith and love for the most regressive tax structure in the nation, the opponents of State income tax have always been able to reach into their (deep) pockets and outspend the proponents of a progressive State income tax and I don’t think there is any reason to think that these leopards will change their spots in 2012, so I think the State income tax is going to be a sticking point even though it is a crucial part of the Reykdal/Frockt proposal.

Reykdal projects that this tax package will raise revenue and have instant tax fairness. I think he is correct. I am ready to get behind this bill. Bring the fight. Eyman has been wagging the State’s dog for long enough. It’s time for the legislature to take back responsibility for the budget and revenue generation.

Well done, Chris.

Wag the Dog, Part II

6 Jan

Senator Fraser, Representative Hunt and Representative Reykdal all spoke on January 3rd about the “big achievement” of the recent Special Session that was able to cut 480 million dollars to reduce the budget deficit, about 25% of the amount that it is assumed will need to be cut. There was some sense of dread about the next step – the process of cutting another 1.5 billion from the State budget – that is going to be front and center in the Regular Session that starts on January 8th. And there should be some dread about that.Courtesy Gov WA

This group of legislators does seem to have gotten and absorbed the message that this next round of cuts will contribute to the death of some folks in the most needy, most disabled segments of the State population and they appeared to be rightfully horrified about moving from legislative death of a thousand cuts to an actual headcount of citizens who will need to be buried in the coming biennium as a result of legislative action.

Senator Fraser spoke to the citizens who assembled (I counted about 40 persons, but folks were coming and going, so it might have been as many as 60 folks over the two hour meet-up) and stated that the next session is going to be about choosing between funding education or health and welfare services. That may be true, but I would sure like to see Ms. Fraser (a wonderful person btw) absorb George Lakoff’s Don’t Think of Elephants message and focus on the battle for revenue generation or the progressive agenda that can be moved forward (Washington Investment Trust anyone?) independent of the budget brawl.

That’s what we should be talking about: the budget brawl. Make no mistake, Eyman and his lackeys in the legislature are brawlers who are focused on the long game. They are not wringing their hands when they fail on an agenda, they are back to writing initiatives and planning the next round of their fight to drown state government like a baby in the bathtub.

I encourage you to click on the link above and read the Norquist quotes if you want to understand the sensitivity of the Norquist/Eyman troops that we face. Senator Fraser, keep your eye on the prize, the goals, values, and the opportunities that exist each and every moment in our personal and private lives. You will feel better, you will govern better if you will stop thinking about the other side’s agenda and start thinking and talking our progressive agenda. Everything develops from that. Try not thinking of elephants. Let’s think/talk about the Washington Investment Trust. Let’s talk about the constitutional requirement to adequately fund education, let’s talk about the personal, moral commitment to create a society where a poor, disabled person can rely on the community, on State government to provide subsistence levels of support. Keep your eye on the prize.

We are sending up a team of folks who are thinking “don’t strike out.” Come on. This is not rocket science. We understand that the struggle is difficult, but the folks who represent progressive public policy have to show up and show a little grit.

Representative Hunt took a couple of minutes to describe the three budgets that actually exist in State government. There is an operational budget – the budget for services, salaries for State employees, etc. There is a capital budget – the budget for buildings, schools, etc. – that can raise revenue from bonds. And there is the transportation budget that is funded from gas taxes primarily. The struggle is over the operational budget. This may be self-evident to state policy wonks, legislators and citizen activists, but is less well-understood by the citizenry, so I guess it makes sense for Mr. Hunt to go over that and to have it repeated.

Sam Hunt also reminded us that WA State has been given a 10th Federal legislative district because of population growth. Our state government budget has been shrinking as our population has been rising. These two trends are out of synch. Population equals demand for State services and the budget is inexorably linked to the demand for state services. It doesn’t matter if you are thinking about public education, Department of Revenue, or folks behind the counter when you need a driver’s license, population equals demand for State services and that requires money. Instead we are looking at State government receiving a 40 year low in tax revenue as a percentage of GDP.

I am out of time and energy for this discussion this morning, but I want to come back and tell you about the budget proposal that Rep. Reykdal described to the group. It was the brightest moment in the discussion for me. I have saved it for last. I will be back to tell you about that very soon. It is time for the dog to wag the tail folks. I have had enough of the other approach. I hope we all have had enough of that. It is time to talk about what we have to do to maintain the kind of society that we value. Let’s talk about our values, our goals. Let’s commit to passing progressive legislation and establishing progressive public policy.

Wag the Dog, Part I

4 Jan

I attended a meeting with the Thurston County legislators on Jan 3rd. The three legislators are not firebrands, but as a group, representing a community, they (Reykdal, Hunt, Fraser) are probably about as liberal a group as any one community could send to Olympia to develop Washington State public policy, but there is the problem: they don’t seem to see how they can really develop public policy at the legislature. The meeting was organized and facilitated by Molly Gibbs, friend and organizer in the Move to Amend organization. Molly’s energy is a local treasure.

This is my second meeting with this legislative group. We (a bunch of leftist activists of various stripes) met with them (minus Reykdal for that meeting) in November 2011 to discuss the Special Session. It was clear in that meeting that Senator Karen Fraser and Representative Sam Hunt are really fine people, with all of the right intentions, but without any of the street-brawler tools or impulses that are required to enact public policy in Olympia today. I did what I could in the November meeting and again yesterday to move this group off of their “poor me, poor us” frame of reference and to motivate them to enact progressive public policy, but frankly, I don’t know if these folks can imagine throwing down the gauntlet and taking the fight to the other side.

There is an amazing amount of assumed futility, assumed defeat in the democratic party that assembles in the legislature. The road kill caucus is one thing, pseudo democrats that are as offensive in their true political views as road kill is in flattened flesh. But the more progressive democrats are roadkill of a different sort. They are reasonable, law-abiding folks who represent us by continuous compromise and surrender to an ideologically driven right wing political machine that has few discernible principles beyond an anti-tax, free market capitalism fused with the certainty of born-again economic revelation. Jesus in the Big Top. Church of Jesus Christ of the Latter Day Capitalists.courtesy igougo.com

Representative Sam Hunt opened with comments about how the current situation “feels like the middle of a hangover.” Sam (hair of the dog, bite him back please) said he came away from the Special Session with a feeling of how grim things are. He also mentioned that not one person (citizen) came to the special session and advocated for an “all cut” budget. All of the folks who turned out and got Sam’s ear were talking about the need to avoid an all cut budget. But Rep Hunt and the democrats are feeling completely handcuffed by I-1053 that requires a 2/3 majority vote to raise taxes. And early rulings on 1053 that were mentioned yesterday have determined that closing loopholes is raising taxes, so even closing tax loopholes to generate revenue is believed to be off the table by the democratic caucus.

Rep Hunt has not been sitting on his hands with regard to challenging I-1053. He has signed on to the Court challenge to that initiative and the challenge is currently in the Seattle Courts and moving toward a motion for summary judgment to find that tax policy/revenue generation is the purview of the Legislature and that 1053 is an unconstitutional encroachment on that legislative responsibility (if I understand the basis for the challenge adequately). That is fine, but the time frame on the court decision and the eventual path to the WA Supreme Court suggests that this question will be settled for the 2013 Legislative Session and for now, the Democrats appear to be playing true to form and are declining to event attempt to govern and legislate on the basis that I-1053 is flawed. You have to give these folks points for their reasonableness and their willingness to follow the rules. But keep in mind that the other side is not feeling so constrained.

It’s easiest to make the point regarding the other side in terms of national policy, so I will go there. If rules are in effect and constrain the democrats until such time as a Court strikes them down, you have to compare that with the exuberant willingness of the national republican party to enact legislation that allows for the indefinite detention of US citizens who are suspected of being terrorists. (terrorist is poorly defined and may include folks who demand gluten-free bread at a local eatery, so it’s pretty broad.) It seems like there are some constraints on this kind of thing in the bill of rights, in common law going back to the Magna Carta that grant us the right of habeas corpus and due process, but the red staters are not feeling constrained by these old pieces of paper as the craft and pass legislation that creates their brave new world. It’s fine to know that legislation such as the Patriot Act and the more recent National Defense Act are constitutionally invalid, but that knowledge serves us poorly as these unconstitutional policies spring into effect. We will have a lively teach-in at a FEMA detention center on the constitutional flaws of indefinite detention if opportunity arises, but I have to wonder if that is the right venue for that discussion?

I came away from the meeting yesterday thinking that we are sending boy scouts to a street fight for public policy. I don’t think our folks are as prepared as they need to be to adequately represent us against the other side. We have some work to do to get our folks whipped into shape. If we cannot get our representatives energized for the fight, we need to ask them to step down and get out of the way.

Hope to get back to this tomorrow with Wag the Dog, Part II. It’s probably going to take me two or three days to give an adequate recap of the January 3rd meeting and to give my take on what needs to be done.

Will see if I can get back to that tomorrow morning. Regular session opens on January 9th.

Dumbest public moment of 2011?

1 Jan

I didn’t feel like putting together a “best of” list to review 2011. It was an unsettling year. The politics of stalemate made it pretty useless and 2012 is an election year, if I am not mistaken, so there is not much chance of legislative action and good public policy in this year (unless an unhappy electorate turns out to the streets in numbers we have not seen to date).

I continue to be bearish on the economy and public policy. Obama squandered the opportunity of a century to move the country in the right direction, and his financial rescue of Goldman Sachs instead of a jobs program would have to be high on the list of dumbest public decisions of the young century, but we are talking about dumbest public moment of 2011, so that one is out of the running in this context. courtesy Gage Skidmore, Wiki Commons

The Herman Cain campaign’s idea of “Women for Herman Cain” was pretty dumb, but it’s the campaign season, so I think that one gets a bye.

Mr. Average, well... better than average hair

Rick Perry had three spectacularly dumb moments, including… uh… let’s see…. oops. Can’t remember the details right now. I feel bad about having to mention that one. Watching the GOP campaign is like fishing with dynamite. Some good-looking fish end up floating belly up pretty fast. Small car, many clowns, it’s a tried and true formula for laughs.

Michelle Bachman has been a disappointment. Except for a certain deranged twinkle in her eye, she has not really produced. Michelle Bachman is simply no Sarah Palin. I also want to go on record that I think Sarah would make a dandy ambassador to Saudi Arabia. You can’t see Saudi Arabia from Alaska, but I am not sure that is very important.

oops… I digress.

From the Business and Technology sector, I have to give Go Daddy CEO Bob Parsons his due for his video and claims to have shot a “problem, rogue … bull elephant.” Discovery News says, well, it was a young female elephant. Just sayin… Great white hunter. Isn’t that one a little tired? I think we are supposed to go to Africa with vaccines and mosquito nets now, the safari days were last century. Bob didn’t get the memo.

My personal favorite though is Pepper Spray? “It’s a food product, essentially.”

Megyn Kelly proves head  is empty

atta girl. Pretty dumb moment. by the way, pepper spray? It’s not a food product. Have you tried it?

I guess it would have looked even worse if the police had sprayed non-violent protesters down with ketchup.

Mustard gas? Can we get Megyn’s take on that one? Sounds like a food product, right?