Saturday, January 13, 2018

Trump Policies Not Helping Rural America

On Monday, Trump went to American Farm Bureau Federation’s annual convention in Nashville to tout his tax law and preview a new strategy to help rural America but his administration is working on legislation and policies that are the exact opposite of what most farmers and ranchers say the need. Threats to terminate NAFTA and other trade agreements that have expanded agriculture exports to the advantage of American farmers and ranchers aren’t helping rural economies.

Just look at the tax law he signed as one example. According to analyses of the tax law by economists at the Department of Agriculture it could actually lower future farm output and effectively raise taxes on the lowest-earning farm households, while delivering large gains for the richest farmers.

Siraj G. Bawa and James M. Williamson, of the Agriculture Department’s Economic Research Service, developed a model which of the tax laws effects on farm households which projects that 70 to 80 percent of the law’s benefits will flow to the top 1 percent by income.

In a session hosted by the Agriculture and Applied Economics Association Mr. Bawa said the law actually shrinks tax refunds for the lowest-earning 20 percent of farm households. The reason stems from a combination of changes in the bill, including its elimination of a tax break for domestic production.

While many farmers have cheered Trump initiatives like rescinding tighter regulations on water pollution and weakening worker safety standards his immigration enforcement policies are causing those farmers problems finding enough migrant workers to pick produce.

Canada among other nations is beginning to export goods that have long been a staple of United States exports, such as lobster.

Agriculture industry lobbyists say Trump is hearing from them about maintaining trade agreements that support the rural American economy but they aren’t sure he’s actually being persuaded as they’ve seen no action on their concerns.

A good number of the folks who read this newspaper are involved in agriculture directly or indirectly. Just because they don’t own or work on a ranch or farm doesn’t mean their business or job isn’t dependent on the agriculture industry. Back in 1985 plenty of folks in New Orleans found out they were dependent on the oil industry even though they owned restaurants, clothing stores and lumber yards.

I doubt any readers are in the top 1% who will enjoy the benefits of Trump’s tax law, they’re much more likely to be among the bottom 20% who will see a tax hike. Even those who stand to benefit from the tax law will be hurt if access to foreign markets is reduced due to Trump’s protectionist agenda.

Trump’s rhetoric during the 2016 election campaign was often tuned to rural voters whose overwhelming support helped him win the electoral college victory which put him in the White House. If things don’t work out on the farm they might want to look into a job building Trump’s wall. Of course, once it’s built they’ll be out of a job again.

Published in the Seguin Gazette, January 12, 2017

Saturday, January 6, 2018

No Taxation Without Representation Redux

The slogan "No Taxation Without Representation" summarized a primary grievance of the American colonists during the 1750s and 1760s and was one of the major causes of the 1776 revolution. The lack of representation was more obvious 242 years ago but it is nevertheless true today. Modern Americans suffer the same plight due to extreme partisan gerrymandering.

When voters aren’t able to choose their representation fairly it’s the same as not being represented at all so they are taxed without representation. In addition many of their other concerns are left unmet or even opposed unjustly.

Texas is a prime example of gerrymandering, our state has 36 congressional districts. In the 2016 election the vote split for president was approximately 55% to 45% so you’d expect that Republicans would hold about 20 seats and Democrats 16 but our state is gerrymandered such that Republicans hold 25 seats and Democrats 11. Numerous other states suffer similar unsupportable distribution of seats for the same reason.

Elected officials drawing the district maps use sophisticated analysis to create districts that favor one party or another. Packing refers to drawing districts in such a way as to maximize the number of disfavored voters in the fewest possible districts. Cracking refers to a technique that splits disfavored groups of voters into districts with majorities of the favored party’s voters so that they’re unable to amass a majority in any district therefore blocking them from selecting a representative of their choice. Both techniques are outlawed by the Voting Rights Act (VRA) and a number of states and smaller jurisdictions including Texas were once required to get approval from the Justice Department before finalizing redistricting due to prior bad behavior. Unfortunately the Supreme Court overturned Section IV of the VRA which covered pre-clearance in 2013 and parties in power in many states let fly with bad behavior that had previously not been permitted.

Last summer a three-judge panel of a federal district court ruled 2-1 that the drawing of two Texas congressional districts, the 27th and 35th, violated both the Constitution and the Voting Rights Act. The panel issued a similar ruling on maps for the Texas state House of Representatives. In early September the Supreme Court in a 5-4 ruling issued a stay of the order which means that this year we’ll again use the unconstitutional maps for our elections.

The Supreme Court currently has three gerrymandering cases from Wisconsin, North Carolina and Maryland before it. In the case of Maryland it’s the Democrats playing dirty. We can expect decisions in these cases by the end of the current term this summer.

Even if the Supreme Court rules against the states which have gerrymandered districts the ruling won’t have any effect until 2020 and by then many voters will have gone nearly a decade without fair representation. Worse yet, unless the court invokes a portion of Section 2 of the VRA known as bail in, which would require offending jurisdictions to once again submit redistricting for pre-clearance, we’ll just go through the same decade long legal stand-off all over again after the 2020 census invokes redistricting in 2021.

There is a solution to all this, Texas could follow Austin’s lead and create a citizens redistricting commission which would be tasked with creating fair district maps without regard to partisanship. Common Cause Texas proposed such a bill last session and it was filed by Representative Victoria Neave but the Redistricting Committee chair failed to even call a meeting the committee so neither it nor any other proposal even got a hearing. Hopefully the Texas legislature does better in 2019.

Saturday, December 30, 2017

Collateral Damage Comes to Texas

One week ago today a six year old boy was shot to death in Schertz. This wasn’t a gang shooting or even a domestic violence incident. The little boy was at home because school had let out early on the last day before Christmas break. He was in his home with family behind a locked door. Kameron Prescott died as a result of gunfire from law enforcement officers.

My heart goes out to the parents and family of the little boy. I can’t imagine how distraught I would have been if that had happened to my daughter but I tear up just contemplating such a horror.

According to news reports Bexar County Sheriff deputies had been chasing the suspect for some time and say she threatened them repeatedly with what she claimed was a gun. When deputies cornered her attempting to get into Kameron Prescott’s home they report she held up what appeared to be a gun and all four deputies fired. At least one bullet missed the suspect, went through the wall of the home hitting the boy in the abdomen and he died shortly afterward. No gun has been found days later.

I grew up understanding that peace officers are supposed to protect lives so I can’t help but wonder if our society hasn’t crossed a line that ought not be crossed if peace officers are willing to shoot at a suspect without due regard for the people behind that suspect. Bexar County Sheriff Javier Salazar says that he believes his deputies followed proper procedure; if so perhaps procedure needs to be reviewed if the rules of engagement allow firing on a suspect when people are behind them.

What sort of training are local police and sheriff’s deputies getting that all four would fire without considering that the house probably had people in it and perhaps shooting wasn’t a good idea? Has our society’s willingness to accept the deaths of innocent civilians referred to as “collateral damage” in Afghanistan, Iraq and Yemen led us to accept similar disregard for innocents here at home?

If we don’t ask questions like this now we may end up with the same kind of unaccountable and out of control policing as the infamous Los Angeles Police Department’s Rampart Division. This may indeed have been an unavoidable tragedy but not asking questions and demanding a thorough investigation and expecting full transparency in the results of that investigation sends a message that the community will accept whatever law enforcement dishes out.

If we simply accept the death if this innocent child and move on; we’re telling our sheriffs and police chiefs that they don’t have to work hard to do better and be better. I think we should all be asking our local police chiefs and sheriffs to review their use of force policies with an eye toward avoiding a senseless tragedy like the death of Kameron Prescott. I’ll be asking my city councilman and mayor to demand that the police chief review the department’s training and use of force policies in light of this tragedy and I hope you will too.

Published in the Seguin Gazette - December 29, 2017

Saturday, December 23, 2017

Wealth, Political Influence, Tax Breaks

Over the course of my adult life I’ve worked for two companies both of which have been small family owned businesses. The first one grew to about 50 people over the years and the family became comfortably wealthy which they deserved for their hard work, sacrifices and skills. The second is newer and is still growing and I have no doubt the owners will also achieve a comfortable level of wealth. I have never begrudged them their success and have worked hard to help them achieve it as they have also allowed me to share in that success via a good salary and nice bonuses.

The Republican tax plan, which will likely have passed and been signed into law by the time you read this, the entrepreneurs I’ve worked for over the years may benefit a little but 70% of middle and working class families won’t. The bulk of the benefits go to the wealthiest 10% of Americans, the latest in Republican largesse will go to those with massive real estate holdings like Donald Trump and Sen. Bob Corker who suddenly changed his no vote to a yes vote about the same time as the 20% tax break was added to the bill.

Presidents often tout their economic successes by quoting increases in the Dow Jones Industrial Average which now stands at nearly 25,000. The tax plan includes a huge break on corporate taxes especially for international profits that are brought back to the US which are guaranteed to increase stock values which some analysts expect will cause the Dow to hit 27,000. That’s great if you own stocks but nearly half of Americans don’t, in fact over 80% of stock value is owned by the same 10% of Americans who will benefit the most from the Republican tax plan. How nice for them.

Now here’s the problem, the big reason those massive tax benefits go to the ultra-wealthy is that they use a small fraction of their wealth to influence the rules that affect their wealth. Through campaign donations directly to candidates and political action committees (PAC’s) some of which obscure where the money came from, and an army of lobbyists the wealthiest among us pursue further economic advantage over the rest of us.

The McCain-Feingold Act which provided some limits to the amount of money that could be spent by any one individual or corporation on a single politician wasn’t perfect but since the Supreme Court decisions overturning much of those limits, McCutcheon v. FEC and Citizens United v. FEC there has been a tidal wave of money flowing from the ultra-wealthy into campaign coffers of federal and state legislators. It is now ridiculously expensive to run a competitive campaign for any of those offices in nearly every district.

As I said earlier I don’t have a problem with people getting wealthy off of their own efforts, I do have a problem with people getting even wealthier by stacking the deck. It isn’t just tax breaks that enrich these folks either. They also push laws that prohibit competition such as the law in Texas that says no municipality can operate its own internet service provider. The wealthy also push for reductions in regulation that protect the health and safety of workers and consumers alike. One such example is the elimination of rules that coal companies had to abide by regarding polluting streams with runoff from mining waste which can dump high concentrations of toxic arsenic and mercury into drinking water sources.

We’ve returned to the era of the “Robber Barons”, are you comfortable with that?

Published in the Seguin Gazette - December 22, 2017

Friday, December 15, 2017

Tax Cuts and Republican Economic Mythology

Republican propaganda surrounding their partisan tax plan pushes the notion that when rich people have more money they’ll invest and create more jobs, going so far as to call the bill the Tax Cuts and Jobs Act. If you own or manage a business you know that’s just not true. Generally greater profits end up mostly if not completely in the hands of the company owners. Some few forward thinking folks will do some form of profit sharing so that their employees will get a little of the extra profit but that’s a small minority. No business creates jobs just because they have more profit, they only create more jobs if there is more demand.

Only demand for goods and services create jobs, if there is no one with both the desire for your product and the money to pay for it no business owner in their right mind adds to their payroll. So, if Republicans really wanted to create jobs using tax cuts they’d make sure that those cuts went to the folks most likely to spend those extra dollars which actually increase demand and create jobs which in turn generates more taxes. Instead 60% of the tax cuts will go to the top 10% of earners who rather than spending it will most likely invest it in the stock market which is nice for your 401k or Mutual Fund IRA if you’re among those fortunate enough to have one but it won’t put money in your pocket right now.

In case you think there is no proof, just look at Reagan and the first Bush, after Reagan’s tax cuts early in his term then when the economy didn’t take off he had to repeatedly raise taxes in order to avoid increasing the deficit. What’s worse is while his tax cuts largely benefitted the very wealthy his tax increases were felt mostly by the middle class.

This is all Economics 101 and either congressional Republicans know that and are willfully lying or they’re stupid. I’ll leave it to you to decide which is more likely.

Senator Chuck Grassley of Iowa pushed back when questioned about the merits of  eliminating the tax on estates valued at more than $5 million stating “I think not having the estate tax recognizes the people that are investing, as opposed to those that are just spending every darn penny they have, whether it’s on booze or women or movies.” I don’t know about you but I find that offensive coming from a guy who last worked a job like average Americans hold in 1959 when an assembly line job like he held paid well enough to buy a house, a car and raise a family.

Today that assembly line job barely pays enough for a family of four to cover rent, food and medical care. Even when both adults work full time most families just don’t earn enough to save millions of dollars as Grassley seems to think. Throw in a few recessions and a health crisis or two over the course of 30 years and a lot of us can’t manage to pay for our children’s college education without student loans.

As economist John Kenneth Galbraith pointed out long ago, "The modern conservative is engaged in one of man's oldest exercises in moral philosophy; that is, the search for a superior moral justification for selfishness."

It’s not too late to call Senators Cruz and Cornyn to let them know they’re tax plan is bad for most Americans and you’re not happy about it.

Published in the Seguin Gazette - December 15, 2017

Saturday, December 2, 2017

Wage Theft a Bigger Problem Than Armed Robbery

In the United States when we think of crimes most of us will immediately think of the perpetrator as someone of disreputable appearance, perhaps a gang member, someone from the wrong side of the tracks. We’ll picture a drug user or a biker, often someone of different ethnicity. We rarely think that someone like us, someone who owns or manages a business, someone who lives in our neighborhood or volunteers at our church.

Yet much of what we imagine is a fairy tale just like Little Red Riding Hood. On the whole Americans will suffer more than twice as much in financial losses from their employers than from armed robbers. According the crime statistics collected by the F.B.I. in 2012 American individuals and businesses combined suffered $414 million in losses. In that same year the US Department of Labor, various state departments of labor and their attorneys general as well as private attorneys reported recovering $933 million in back wages and other stolen compensation according to the Economic Policy Institute.

The data collected by the Economic Policy Institute doesn’t include dollar amounts from Alabama, Arizona, Delaware, Indiana, Louisiana, and Vermont from which such information was unavailable. While armed robberies are almost always reported wage theft often is not; either because the employee doesn’t know to whom to report the crime or they fear that they’ll lose the job that provides for their families, so the total is likely much higher.

Here are just a two examples starting with an upscale Manhattan restaurant, reached a settlement in March 2012 with New York State Attorney General Eric Schneiderman’s office over its illegal theft of wages from 25 employees. The restaurant paid employees less than the minimum wage, failed to compensate them for overtime work, and cheated them out of tips.

Two busboys were paid no wages at all for their work and had to subsist solely on their share of pooled tips. Then, once a manager began to oversee tip distribution, their meager earnings shrank further. After checking with waitresses, they realized the manager was illegally taking a share for himself. At this point, Jacal and Suarez got in touch with an advocacy group and subsequently the attorney general’s office.

After he was sued, restaurant owner retaliated against the two known whistleblowers — first cutting their hours and then firing them. The case settlement required the restaurant to pay restitution of $25,000 to each of the two busboys and $150,000 to the other 23 workers.

In 2012, the Oregon Bureau of Labor and Industries (BOLI) dealt with repeated wage theft offenses by contractor Affordable Safe and Professional Flagging, LLC. The company routinely paid less than the prevailing wage and failed to pay overtime to employees who conducted traffic control on public construction projects. The company was forced to pay a total of $107,010.24 in back wages and disqualified from holding further state contracts for 5 years. The firm was allowed to finish its work on the current contract, which led to yet more instances of stolen wages as employees’ paychecks bounced on several occasions and most received no pay for an entire month.  In 2013, the Oregon Bureau of Labor and Industries obtained another settlement of $113,000 in back wages for 36 employees.

The Oregon example is evidence that state and federal law don’t provide sufficient penalties to dissuade repeat wage theft offenses. Unlike armed robbery stealing from your employees doesn’t incur jail time, perhaps it should.

If you or someone you know has suffered wage theft contact the Texas Workforce Commission at 800-832-9243 to file a claim.

Published in the Seguin Gazette - December 1, 2017

Saturday, November 25, 2017

CHIP Funding Fail

The party claiming to represent “family values” also known as the Republican Party is once again showing its hypocrisy. Nearly two months ago the funding for the decades old Children’s Health Insurance Program (CHIP) expired and the funding bill Republicans in the House passed would simply take the $8 billion a year from Medicaid and more from other public health programs to pay for it. Senate Republicans knew that wasn’t going to fly and have even filed bill that continues funding without sticking it to the poor and other vulnerable Americans but there have been no hearings on the bill, nor have they scheduled a vote on it.

There’s no telling when Republican leaders will get around to pursuing a funding solution for CHIP but it looks like they’re going to hold the lives and health of 9 million poor children and pregnant women, more than 400,000 of them Texans, as hostage to get concessions like budget cuts from Democrats. In the interim, 11 states expect to run out of funds by the end of December and are preparing to send letters telling the parents of these children that if they get sick don’t expect them to receive medical care. How’s that for a Christmas present? Ebenezer Scrooge would be so proud.

The CHIP program only covers persons under age 19 and pregnant women who are either citizens or legal U.S. residents. If the family has only one child the total annual income must be less than $24,473 so we’re talking about folks on very low incomes.

CHIP covers primary health care, prescriptions, mental health, vision, physical and occupational therapies and dental care for children under 19. Additionally women receive CHIP coverage for prenatal and postpartum services.

Some states have enough funding to last a few more months but some don’t. Several states have already made emergency requests for funds to hold it over until February by which time they hope Congress gets around to deciding if the program will be retained.

The Senate and House are now very busy working toward providing massive tax cuts to billionaires while claiming they’re going to put more money in the pocket of working and middle class Americans. Of course, tax breaks for billionaires didn’t do anything to help working families under Reagan nor under George W. Bush. Republican leaders must think Americans are like Charlie Brown to their Lucy promising to hold the ball for him to kick this time.

One of the provisions getting a lot of attention will allow deductions for private jets. This is the same bill also takes away the deduction for school supplies that teachers purchase for their classrooms so it’s clear who Republicans really care about and it isn’t you and me.

CHIP has had bi-partisan support since its inception, yet this time around Republican leaders are so focused on the tax cuts they promised to their wealthy benefactors they just can’t find the energy to do the right thing. I guess we shouldn’t really be surprised at the heartless greed exhibited by congressional Republicans, after all they’re still trying to gut the Affordable Care Act, Medicare and Medicaid. Apparently they’re idea of right to life doesn’t include actual living people.

Published in the Seguin Gazette, November 25, 2017