Relevant and even prescient commentary on news, politics and the economy.

Whats In the News . . .

Quite a few things going on requiring some type of commentary. Trump can certainly get people going in different directions away from him. It is important to recognize these issues without losing sight of what Trump has done in stealing an election. Just a few things I have noticed in the news.

DACA

“But today, that shadow has been cast over some of our best and brightest young people once again. To target these young people is wrong – because they have done nothing wrong. It is self-defeating – because they want to start new businesses, staff our labs, serve in our military, and otherwise contribute to the country we love. And it is cruel. What if our kid’s science teacher, or our friendly neighbor turns out to be a Dreamer? Where are we supposed to send her? To a country she doesn’t know or remember, with a language she may not even speak?

Let’s be clear: the action taken today isn’t required legally. It’s a political decision, and a moral question. Whatever concerns or complaints Americans may have about immigration in general, we shouldn’t threaten the future of this group of young people who are here through no fault of their own, who pose no threat, who are not taking away anything from the rest of us. They are that pitcher on our kid’s softball team, that first responder who helps out his community after a disaster, that cadet in ROTC who wants nothing more than to wear the uniform of the country that gave him a chance. Kicking them out won’t lower the unemployment rate, or lighten anyone’s taxes, or raise anybody’s wages.” former President Barack Obama.

Some at Angry Bear fear immigrants and minorities citing commentary and statistics to support their beliefs of a threat to the nation, its economy, and citizenry. While there is a relatively small minority of immigrants who may pose such a threat, the majority of immigrants like many of our forefathers have done over the years assimilated into society.

Pack Your Bags

President Trump’s “Department of Homeland Security urges DACA recipients to use the time remaining on their work authorizations to prepare for and arrange their departure from the United States – including proactively seeking travel documentation – or to apply for other immigration benefits for which they may be eligible,”

“As I’ve said before, we (President Trump) will resolve the DACA issue with heart and compassion – but through the lawful democratic process,”

Such heart and compassion shown to a bunch of young adults and children. Maybe Trump will change his mind before some leave. I would not bet on it. If they did leave early, I am sure they would not be allowed back into the states resulting from Trump’s heart and compassion. Corpocracy at its finest . . .

Growing list of Departures

Javier Palomarez , the president and CEO of the United States Hispanic Chamber of Commerce announced his departure from Trump’s National Diversity Council.

“As a nation of immigrants, we have a moral responsibility to support and defend ‘Dreamers,’ who arrived to this country — at the average age of six — through no fault of their own,”

His departure comes after Trump rescinded DACA.

Javier joins a group of others who have left Trump’s committees due to the administration’s stance on DACA, Charlottesville comments, Paris Accords withdrawal, increased Uber charges, etc. Daniel Kammen climate Science Envoy for the State Department, the entire Arts and Humanities Panel, Elon Musk business and manufacturing advisory, Bob Igor business and manufacturing advisory, Travis Kalanick business and manufacturing advisory, Kenneth Frazier business and manufacturing advisory, Kevin Plank business and manufacturing advisory, Brian Krzanich business and manufacturing advisory advisory, Richard Trumka business and manufacturing advisory, Inge Thulin business and manufacturing advisory, Scott Paul business business and manufacturing advisory, and Denise Morrison on the business and manufacturing advisory committees also.

Gotta be getting pretty lonesome there in the WH.

Wiretapping

“The U.S. Justice Department said it had no evidence to support the unsubstantiated claim made in March by President Donald Trump that his predecessor, Barack Obama, had ordered a wiretap of Trump Tower during the 2016 presidential campaign.

There has never been any evidence to support Trump’s assertion on Twitter that “Obama had my ‘wires tapped’ in Trump Tower just before the victory,” despite continued insistence from some conservative websites and commentators.

But in a court filing late on Friday, the Justice Department added itself to the list of entities debunking the allegation.”

Easy enough, President Trump lied and the DOJ under Jeffrey Beauregard Sessions quietly confirmed it.

Wardrobes

Melania versus Michelle cost of clothes. As the article says, “See how they measure up.”

Other Things

Not much being said about Mueller investigating the Russian Connection and Trump. People are getting out-of-town in Florida and other places due to category 5 hurricane Irma. North Korea has not blown anything up yet and Trump can not use them as a distraction or an excuse to blow them up.

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Laugh at Sessions and Suddenly You Are in Federal Court?

Fairooz was detained after audibly laughing after Sen. Richard Shelby told senators at Sessions’ confirmation hearing that the then-Alabama senator had a record of “treating all Americans equally under the law.”

That is laughable as Sessions is flying under the radar having learned you can not be so overt about racism and prejudice.

Mind you, Desiree Fairooz did say something after Congressional Security start to remove her from the room. “Support civil rights, stop Sessions” and yelled “Why am I being taken out of here? This man is evil.”

Nonviolent civil disobedience is little more than a misdemeanor. For Sessions you go to Federal Court, then they ask her to plea bargain?

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Tax Cuts for the 1% Coming Out of Your 401K

If you have been in a 401K like I have over the decades, you know this has been helpful in reducing tax on your income. If you do not know this, you do now. The GOP is making eyes on your 401k contributions with the intent of removing the upfront deduction which lowers your taxable income. The GOP would like to go to a Roth type of 401k. Either way, I would be ok.

The problem I have with this idea is it is being presented as a way to help holders of a 401K today. It is not. The entire exercise here is provide enough offsetting revenue to provide a major tax cut for those making >$500,000 annually which number ~1.5 million households of the 154 million tax paying households. Why would the GOP want to do this? A tax cut would have to be passed through Reconciliation as Dems would filibuster to block it and that would require a super-majority vote (which was not the intent of the founders[that is a different story]). Reconciliation also requires no deficits be created at 10 years otherwise the act sunsets the same as the 2001/2003 tax breaks did in 2014(?).

I do not know who Prof. James Choi is; but, I do know who Andrew Biggs is as he would make appearances here to challenge Bruce Webb and Dale Coberly on Social Security. Those discussions were a great way to learn about Social Security. The points Bruce had made in support of Social Security can be found at Social Security Defender or by doing a search at Angry Bear. Andrew Biggs felt the need to privatize Social Security claiming it was bankrupt.

Both Andrew and (I assume) the Professor are in favor of the transition to Roth Accounts, taxing income before 401ks, and also in funding tax cuts for those making > $500,000. The rest of this article can be found here; The GOP is looking for ways to pay for tax cuts. Your 401(k) may bear the cost.

“Some others say removing the up-front payroll deduction on 401(k)s would not have a big effect on participation. Many savers in the plans don’t understand the differences in the tax consequences between the 401(k) and Roth-based accounts, according to one study.

James Choi, a professor of finance at the Yale School of Management who has done research on the subject:

‘The evidence suggests that there will be relatively little impact on 401(k) participation and contribution rates if we switched to a Roth-only system, in large part,’ Choi said, ‘people don’t understand how 401(k) taxation works.’

He cited one survey in which only 49 percent knew that making before-tax 401(k) contributions decreases taxable income in the year of the contribution. Only 46 percent responded that making Roth 401(k) contributions does not affect taxable income in the year of the contribution, Choi said.

One possible advantage of paying the tax up front is that you meet the obligation based on your current tax rate instead of owing based on a future rate that could be higher by the time you retire.

Andrew Biggs, a resident scholar at the American Enterprise Institute, a Washington-based think tank favoring free markets, said the biggest issue for 401(k)s is signing people up.

‘Some people may like paying upfront with the tax-free withdrawals, while others might like the tax savings today,” Biggs said. “But this isn’t as big a deal as something like automatically enrolling people in 401(k)s. That’s a major effect, while the tax treatment is more around the margins.’”

I would say an issue with 401ks is a lack of company contributions and a lack of company contributions without regard for employee contributions. It should also be a defined benefit plan and not a defined contribution plan with matching employer contribution. One other thing to consider if you have a stream of income to sustain yourself at 70-1/2 years of age. Consider rolling your 401K into a Roth to preserve the equity you gained from compounding; otherwise, you will lose much of it over the years in taxes.

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GAO Report finds Rural Postal Service Remains Essential

From time to time, Mark Jamison or myself would feature articles from the Save the Post Office blog as authored by Steve Hutkins, a literature professor who teaches “place studies” at the Gallatin School of New York University. Mark Jamison a retired Postmaster for a small town in North Carolina would often write there also. This particular post was featured in October of 2016. Where FedeEx, UPS, DHL or other services do not go, the US Postman still does play an important role in rural communities.

West Plains Daily Quill: A top watchdog study completed at the request of U.S. Senators Claire McCaskill of Missouri and Heidi Heitkamp of North Dakota, found that the Postal Service remains essential to rural communities, regardless of whether those communities have access to rural broadband services.

Senator Clair McCaskill had this to say:

“This study shows what we already know to be true—that the Postal Service remains essential to Missouri’s rural communities, regardless of their access to other technologies,” said McCaskill, a former Missouri State Auditor and senior member of the Senate Homeland Security and Governmental Affairs Committee, which has jurisdiction over the Postal Service.

“There’s simply no substitute for the vital service our post offices provide— even as we continue to make important advances in rural broadband—and we’ve got to preserve and improve that service for the folks who rely on it most.”

Senator Heidi Heitkamp added to McCaskill’s comments:

“For North Dakotans in rural communities—whether they have access to high-speed internet or not —reliable mail service is a key ingredient to a successful business and staying connected,” said Heitkamp. “But too often, that high-quality service is not delivered—and that’s exactly what Senator McCaskill and I are working to improve. Today, we received the results of a Government Accountability Office study we requested which affirmed what folks in rural states have long known—that communities and businesses in rural areas depend on mail service regardless of their internet connection. By providing more clarity, we can make sure dependable mail service is prioritized in the rural communities where it is needed the most.”

The Government Accountability Office report examined the relationship between broadband access and use of the Postal Service in rural and urban communities. The report found that rural households without broadband access continue to rely on the Postal Service for more transaction and correspondence mail—and value this service for a variety of reasons, including fewer retail alternatives and a high level of trust in USPS services. The study also found that when rural households get broadband access, they do not reduce their use of the Postal Service. Read more. The GAO report Information on How Broadband Affects Postal Use and the Communications Options for Rural Residents is attached.

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Republicans and Labor

Interesting development last week, Missouri’s state Legislature decided a minimum wage of $10/hour is a hardship for business and too much for Labor. This comes after the MSC sided with St. Louis and Kansas City in setting a minimum wage of $10.10/hour. The Republican legislature decided differently and passed legislation to prevent local communities from establishing minimum wage above what the state mandates.

Thousands of workers in St. Louis will likely see smaller paychecks starting Monday, when a new Missouri law takes effect barring local government from enacting minimum wages different than the state minimum.

The law is drawing protests in St. Louis and in Kansas City, where a recent vote approving a higher minimum wage is essentially nullified without ever really taking effect.

The impact is direct in St. Louis, where the minimum wage had increased to $10 after the Missouri Supreme Court sided with the city in a two-year legal battle. Days after the Supreme Court ruling, Missouri’s Republican-led Legislature passed a statewide uniform minimum wage requirement. The state minimum wage is $7.70 per hour. Republican Gov. Eric Greitens declined to veto the bill, allowing it to become law.
An estimated 35,000 St. Louis workers saw pay raises after the court ruling, and the city’s plan had called for the minimum wage to increase to $11 per hour in 2018.

Republican State Sen. Dan Hegeman from rural northwest Missouri, said the higher minimum would force some employers to either cut jobs or move. Just like having healthcare insurance at Papa John’s would really impact the cost of pizza . . . 10 cents for a medium pizza.

‘You end up having fewer jobs and you do a disservice to the workers,’ Hegeman said. ‘In my heart of hearts, I really think it hurts people in the long run.'”

Missouri Republican Governor Eric Greitens refused to veto legislation limiting local minimum wage laws, is pushing RTW laws, and is looking to boost pay for some state employees who are “star” performers.

Some more original ideas from the Republican sector on how to improve the economy by riding on the back of the low-income citizens.

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Two Monuments

The Colfax Massacre occurred during Reconstruction when Republicans, many of whom were black, won the election. The White League and kukluxklan joined forces to take back the Parish Court House. 300 armed white militia faced black and white defenders of the court house. When James Hadnot was shot by his own men, the attackers started to shoot the black defenders who had surrendered. 48 were killed that day and the white militia turned its anger on the black residents.

Villifying Black Republicans. Colfax Riot, 48 Black Americans massacred after surrendering and another 100 residents killed by the white mob.

Sign erected by the Colfax Chamber of Commerce in 1951 commemorating the Colfax Riot. The exact count of Black Americans shot to death after surrendering is uncertain. It ranges anywhere from 80 to 300. Three White Americans die.

Heroes Fighting for White Supremacy

Honoring White Supremacists. The greatest travesty was the SCOTUS decision by the Waite court.

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Donald Trump’s White House

Newspaper Editorial Cartoonists are having a field day with Donald Trump’s comments condoning the Charlottesville’s supremacists rioting, killing one person, and injuring many more. Living his father’s legacy of racism and supporting ku klux klan. Trump 2015: “ My legacy has its roots in my father’s legacy.”

Trump’s staff is complaining Trump went rogue and David Duke kkk member is applauding. If Trump finds himself alone as more people abandon the White House, I doubt he will care and sink into another unintelligible bombastic rage.

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Woodie Guthrie, Racism, Trump, and Beach Haven

From an old sixties coffee house person, just a little history. In 1950, Woodie Guthrie signed a two year lease to reside in a Fred Trump’s Brooklyn development. Having wandered around the countryside for a number of years, he knew the North did not have any special claim to racial enlightenment. One event of a shooting at a bus terminal in Freeport, Long Island stuck in his mind. “Ferguson Brothers Killing” by Woody Guthrie.

“The town that we ride through is not Rankin, Mississippi,
Nor Bilbo’s Jim Crow town of Washington, D. C.
But it’s greater New York, our most fair-minded city
In all this big land here and streets of the brave.

Who’ll tell these three boys that their Daddy is gone?
(He helped whip the Fascists and Nazis to death)
Who’ll tell these three sons that Jim Crow coffee
Has killed several thousand the same as their dad?”

Fred Trump used federal funding to build what became known as Beach Haven and what Woody would call “Bitch Havens” in time and after discovering the racism of Fred Trump. Fred methodically blocked black Americans from taking resident in his development. Woody responded with a song called “Old Man Trump.”

“I suppose
Old Man Trump knows
Just how much
Racial Hate
he stirred up
In the bloodpot of human hearts
When he drawed
That color line
Here at his
Eighteen hundred family project ….”

Fred Trump was arrested in 1927 for participating in a Ku Klux Klan rally in Queens. The Beach Haven apartment complex was built afterwards and it was was intended to give returning WW II veterans affordable housing. With his words to the public about the Charlottesville riots by white supremacists, Donald could have changed what his father left as a legacy for him. Instead, he purposely chose not to do to placate them. As David Duke said publically. . . . “remember who put you in office.”

Trump 2015: “ My legacy has its roots in my father’s legacy.”

In the age of Trump, we need another Woodie Gunthrie to remind us of our history. Then too, Trump would probably tie him up in court.

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The Democrat’s “Better Deal”

In a recent email exchange with Yves Smith at Naked Capitalism: “This is not going to work with voters. Tom Frank has been all over this topic, saying again and again, the Dems are refusing to give up on their losing strategy of focusing on the 10%, and are trying to cover for their abandonment of middle and working class people with identity politics.”

What Yves is commenting about is a recent post and the “ Better Deal” proposed by Schumer and Pelosi.

Schumer: “When you lose to somebody who has 40 percent popularity, you don’t blame other things — Comey, Russia — you blame yourself,” In speaking on the Dems new plan, he continues; “So what did we do wrong? People did not know what we stood for, just that we were against Trump, and people still believe that.”

Pelosi: In a separate interview, the House Minority Leader says the new focus “is not a course correction; but, it is a presentation correction.”

Yves Smith again; “Pelosi is upfront that all the Dems are doing is trying a new PR strategy.”

Sounds like Schumer recognized the issue; but as Yves and Pelosi said, it “is not a course correction; but, it is a presentation correction.” In other words, we are going to say the same “stuff,” but it will be said in a different way. That is not going to work for urban and rural dwellers alike who are worried about everyday life. .

Progressives and activists both believe the repackaging of a failed message in 2016 is going to miss the targeted middle and lower income constituents needed to win the 2018 elections. Paul Ryan and his caucus speak of specifics such as “proposals to revamp poverty programs, health care and taxes, and a hawkish national security stance” which plays well to rural constituents who are fed news from conservative sources. In contrast, the Democrat party’s establishment economics addressing the 10% again fails to talk about the everyday life of the rest of voters with a progressive message addressing quality of life improvements. Democrats have to rebut Repub ideology with sound proposals reinforcing and improving healthcare, jobs, education, retirement, long term care, etc. which are attacked in Ryan’s message.

In a recent Washington Post-ABC News poll, 37 percent of Americans said the Democrats currently stands for something, while 52 percent said it just stands against Trump. With Trump being one of the most unpopular Presidents early in his first term, Democrats miss the opportunity to define what they stand for specifically capitalizing on Trumps 36% rating with a strong countering economic message. Where is the loud rebuttal by Democrats to Trump’s attacks on progressive healthcare, student loan forgiveness, and minorities. Where is Democrat pushback to tax repeal for those making >$200,000 annually and tax cuts largely going to the 1% of the household taxpayers and large corporations?

Republicans talk in headlines; Democrats speak in fine print,” In his Brooklyn town hall meetings, Democrat Congressman Hakeem Jeffries heard the messages about “pocketbook issues, housing challenges, crime, public safety, failures of the public schools,” and little about the “existential threat to our democracy by Trump and the Russians or what is going on at 1600 Pennsylvania Avenue.” It is here the Democrat message fails with its sole concentration on Trump the person rather than attack on Trump administrative fubars, what the Republican economics means, and Republican policies. There is not enough of a loud outrage in the new Democrat party message. Instead of a new brew of political coffee to sip upon and savor like one would a Starbuck’s French pressed serving of Veranda, we are being served yesterday’s warmed over and weak political brew.

And in the end we will not turn 2018 into a resounding rebuttal of Republican policies and Trump.

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