Category: Taxes
On Earmark Reform
Maybe not:
Eight months after Democrats vowed to shine light on the dark art of “earmarking” money for pet projects, many lawmakers say the new visibility has only intensified the competition for projects by letting each member see exactly how many everyone else is receiving…
The earmark frenzy hit fever pitch in recent days, even as the Senate passed new rules that allow more public scrutiny of them.
Far from causing embarrassment, the new transparency has raised the value of earmarks as a measure of members’ clout. Indeed, lawmakers have often competed to have their names attached to individual earmarks and rushed to put out press releases claiming credit for the money they bring home.
Community Broadband Act would overturn bans on municipal broadband
A bill introduced into the House of Representatives this week will attempt to spur broadband development in the US by overturning existing state bans on municipal broadband deployments. Titled the Community Broadband Act of 2007, the bill (PDF) is cosponsored by Rep. Rick Boucher (D-VA) and Rep. Fred Upton (R-MI).
Currently, laws in Arkansas, Florida, Missouri, Texas, and a handful of other states prevent cities and towns from installing and operating their own broadband networks. Most of those laws were enacted in the wake of heavy lobbying from the telecommunications industry, which doesn’t want to see competition coming from local governments.
Last year’s attempted rewrite of the Telecommunications Act contained a similar provision but never made it to the floor of the Senate for a vote. With the state of broadband in the US a hot topic of discussion lately, both on Capitol Hill and around the country, Reps. Boucher and Upton may be able to find allies in Congress a bit more easily this time around. The congressmen are hopeful that, should it be passed, the Act would lead to more—and better—broadband options for US citizens.
Wisconsin Congressional Earmarks: Spending our Children’s Money via a Bloated Defense Bill
Taxpayers for Common Sense posted a very useful and in some ways surprising look at $3,000,000,000 in Congressional Earmarks attached to a $459,600,000,000 defense appropriation bill (not the entire defense budget). This amount is $40,000,000,000 more than last year’s authorization (nice). Wisconsin congressional earmarks are lead by long time incumbent David Obey with $42,000,000, who also conveniently serves as Chair of the House Appropriations Committee. Obey’s earmark methods have been criticized recently: John Solomon & Jeffrey Birnbaum writing in the Washington Post:
Democrats had complained bitterly in recent years that Republicans routinely slipped multimillion-dollar pet projects into spending bills at the end of the legislative process, preventing any chance for serious public scrutiny. Now Democrats are poised to do the same.
“I don’t give a damn if people criticize me or not,” Obey said.
Obey’s spokeswoman, Kirstin Brost, said his intention is not to keep the projects secret. Rather, she said, so many requests for spending were made to the appropriations panel — more than 30,000 this year — that its staff has been unable to study them and decide their validity.
Here’s a list of all earmarks (.xls file) attached to this defense bill. Wisconsin delegation earmarks:
- David Obey 42,000,000 (Unique ID Column 837, 854, 874, 921, 947, 1053, 1093, 1165)
- Tammy Baldwin $7,500,000 (Unique Id Column 56, 740, 1334)
- Steve Kagen $5,000,000 (Unique ID 496, 561, 562)
- Ron Kind $4,000,000 (Unique Id 1033 and 1083)
- Tom Petri $4,000,000 (Unique Id 782)
- Gwen Moore $2,000,000 (Unique Id 575, 898, 978 and 1151)
- Paul Ryan $0.00
- Jim Sensenbrenner $0.00 (shocking)
HouseDefenseEarmarks.xls. Congress’s approval ratings (3%) are far below the President’s (24%), which isn’t saying much (Zogby Poll)
Much more on local earmarks, here [RSS Feed on earmarks]
Tax Code Sausage Making – for the Rentier Class
The corrosive effects of that trend were detailed in The Times yesterday by Alex Berenson, who examined the fallout of the Orwellian-named American Jobs Creation Act of 2004. Pitched by tax-axing lawmakers as a way to generate cash for new hiring, it allowed American companies to bring foreign-held profits back to the United States in 2005 at a discount of up to 85 percent off the normal tax rate. Some 100 companies repatriated about $300 billion, avoiding about $90 billion in taxes.
But instead of hiring more workers, many of the participating multinationals had mass layoffs, especially drug companies. Pfizer, the world’s largest drug company, repatriated $36 billion at the discounted rate, while laying off 8,000 employees in 2006 and announcing layoffs of 10,000 more. Eli Lilly and Schering-Plough also repatriated billions while laying off thousands. Technology companies did the same. Hewlett-Packard, for example, repatriated $14.5 billion in 2005 and laid off 14,500 workers. In some instances, the corporate tax savings were more than enough to cover the severance costs and other expenses of the layoffs.
Our good Senators, Russ Feingold and Herb Kohl supported this massive giveaway. Rentier
Earmarks, “Phonemarking”, Congressional Excesses and Wisconsin Representative David Obey
John Solomon & Jeffrey Birnbaum:
But the new majority is already skirting its own reforms.
Perhaps the biggest retreat from that pledge came this week, when House Appropriations Committee Chairman David R. Obey (D-Wis.) told fellow lawmakers that he intends to keep requests for earmarks out of pending spending bills, at least for now. Obey said the committee will deal with them at the end of the appropriations process in the closed-door meetings between House and Senate negotiators known as conference committees.
Democrats had complained bitterly in recent years that Republicans routinely slipped multimillion-dollar pet projects into spending bills at the end of the legislative process, preventing any chance for serious public scrutiny. Now Democrats are poised to do the same.
“I don’t give a damn if people criticize me or not,” Obey said.
Obey’s spokeswoman, Kirstin Brost, said his intention is not to keep the projects secret. Rather, she said, so many requests for spending were made to the appropriations panel — more than 30,000 this year — that its staff has been unable to study them and decide their validity.
For instance, a new emergency spending bill for the Iraq war passed by the House this month had no specific earmarks, but it included a clause declaring that all the projects lawmakers had included in a previously vetoed bill were, in effect, included.
Likewise, the House Appropriations Committee report accompanying the Iraq supplemental spending bill vetoed by President Bush boldly declared: “This bill, as reported, contains no congressional earmarks, limited tax benefits, or limited tariff benefits.” But it set aside money for pet projects including $25 million for spinach, $60 million for salmon fisheries and $5 million for aquaculture.
“Absolutely nothing has changed,” said the Center for Defense Information’s Winslow T. Wheeler, a Senate appropriations and national security aide who worked for both Democrats and Republicans over three decades before stepping down in 2002. “The rhetoric has changed but not the behavior, and the behavior has gotten worse in the sense that while they are pretending to reform things, they are still groveling in the trough.”
A 2006 spending bill included $6.9M for Obey’s Northern Wisconsin District. Much more on earmarks, including those spread around Madison, here.
More from the Examiner here.
True Broadband: Vermont vs. Wisconsin
An hour or so ago the Vermont House and Senate both gave final approval to a bill designed to make Vermont the nation’s first e-state. As defined in Vermont, e-stateness means cellular and adequate broadband coverage – fixed and mobile – everywhere in the state by 2010. The initial definition of adequate fixed broadband is 3 megabits per second service in at least one direction; but the bill contains a mechanism for ratcheting that up as requirements escalate. It is estimated that this requirement may be as high as 20 megabits in both directions by 2013.
Although the bill passed the Vermont House with an overwhelming 132-2 vote more than a month ago, it was by no means assured of passage. Vermont’s citizen legislature is hoping to adjourn for the year sometime tonight. There was a danger that the Senate would not have the time it needed to consider all aspects of this very large bill. But they did!
Quite a contrast to Wisconsin’s process, where AT&T’s stagnant infrastructure (and more importantly, their lobbying prowess) carries the day. Gotta love our forward thinking politicians.
Big Political Donors are also Tax Shelter Players
Walter F. Roche Jr. and Michael A. Hiltzik:
What’s a politician to do upon discovery that a generous billionaire donor turns out to be a major tax dodger? It’s a dilemma already encountered by the Republican and Democratic parties in this season of unprecedented political fundraising.
At a time when newly powerful Democrats, including presidential hopeful Sen. Hillary Clinton of New York, are pressing for aggressive pursuit of unpaid tax bills to boost federal revenue, the party’s biggest financier and prominent Clinton backer is tied to one of the largest individual tax avoidance schemes on record.
And two Republican billionaires — Texas brothers who have poured a small fortune into supporting the presidential bids of two George Bushes and, more recently, Sen. John McCain (R-Ariz.) — were accused last year of exploiting offshore havens to escape taxes on nearly $200 million in gains.
Amid predictions that the 2008 presidential campaign will be the most expensive in history, with spending possibly topping $1 billion, pressure to raise huge sums of cash is a certainty. For candidates, the question is whether the headlong pursuit of deep pockets may also risk embarrassment over their donors’ financial baggage.
Sheila Krumholz, executive director of the Washington-based Center for Responsive Politics, said that candidates sometimes have to make their own “cost-benefit analysis.”
A few Suggestions for Governor Doyle Regarding the AT&T “Video Competition” Bill
AT&T’s lobbying efforts to change Wisconsin’s cable TV regulations has generated a refreshing amount of commentary. 5 years ago, during Governor Doyle’s first Gubernatorial campaign, I had a chance to briefly talk with him after a debate with Scott McCallum. I mentioned Wisconsin’s poor broadband infrastructure (we continue to stand still, which means we’re falling further behind) and how AT&T had failed to invest in fiber networks. Doyle mentioned that he was aware of this, but could not do anything about it in a first term…..
Fast forward to 2007. This map, via broadbandreports.com displays the communities that have Verizon’s fiber to the home available. Fiber networks provide much higher speeds and more citizen choice than our aging and long since paid for copper networks (we continue to pay and pay and pay for the old stuff).
Perhaps, Governor Doyle might put citizen’s interests first and sign the bill only if:
- Those who provide service via this bill must do so via symmetrical fiber to the home, and,
- Customers may purchase the symmetrical fiber to the home service for internet use only (ie, without phone or video service). Such “naked” internet service shall be available at speeds equal or greater to those offered via phone/video bundles.. Cost and terms shall not penalize naked internet buyers vis a vis bundled phone/video purchases
- Customers shall have complete access to all internet services. Vendors will not restrict any IP services.
What are the odds?
UPDATE: A friend emailed simply: “Lotsa luck”.
Interestingly, this type of an initiative would be quite a legacy for the Governor. The fiber will be connected to our homes for many, many years.
I.R.S. Audits Middle Class More Often, More Quickly
Middle-class Americans, listen up: the I.R.S. is much more likely to audit you this year. Those caught cheating can expect to pay about $4,100 more on average in income taxes.
Since 2000, authorities at the Internal Revenue Service have nearly tripled audits of tax returns filed by people making $25,000 to $100,000 as part of a broad change in audit strategy.
Audits of these middle-class taxpayers rose to nearly 436,000 last year, up from about 147,000 returns in 2000. For these 61 million individuals and married couples, who make up nearly half of all taxpayers, the odds of being audited rose from 1 in 377 to 1 in 140.
Kevin Brown, the I.R.S. deputy commissioner for services and enforcement, said the audits “were out of whack” in 2000, with far too little attention paid to the middle class and to the very highest income generators, those making $1 million or more. “We try to run a balanced audit program,” Mr. Brown said.