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Manchin late with recent tax payments, according to records
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https://www.allsides.com/news/2023-07-06-1223/taxes-manchin-late-recent-tax-payments-according-records
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Taxes
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https://www.washingtonexaminer.com/news/senate/manchin-late-tax-payments
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JOE MANCHIN
Manchin late with recent tax payments, according to records
by Samantha-Jo Roth, Congressional Reporter
July 06, 2023 02:13 PM
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Sen. Joe Manchin (D-WV) has been late making payments on taxes he owed on real estate and personal property in recent years, according to a recent report.
Manchin paid off $700 he owed to Marion County, West Virginia, last week in back taxes over the past three years, NBC News reported on Wednesday. In 2020, Manchin paid $630 in back tax payments to the same county for payments he owed from 2016, 2017, and 2018. The payments, which went back as far as 2009, at times included interest or fines.
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"Like most West Virginians, Senator Manchin has always paid every tax bill he's received in full, and any lapse in payment has been quickly rectified as soon as he has been made aware,” a Manchin spokesperson told the Washington Examiner.
The payments, at times, were made within days of their due dates, while others were made months and, in some cases, years later.
“Joe Manchin voted to raise West Virginians’ taxes with the Inflation Reduction Act but can’t be bothered to pay his own,” Tate Mitchell, a spokesman for the National Republican Senatorial Committee, said in a statement provided to the Washington Examiner. “Manchin’s hypocrisy knows no limits.”
Manchin, a centrist Democrat in ruby-red West Virginia, is facing a tough reelection in 2024. Gov. Jim Justice (R-WV) and Rep. Alex Mooney (R-WV) have already announced they intend to challenge Manchin in 2024. The West Virginia senator has not yet announced whether he will seek reelection.
Manchin isn’t the only candidate dealing with some unsettled debts. For years, Justice has been dealing with allegations his family business hadn’t paid its debts, which included fines for environmental violations at coal plants. According to court documents, a bank filed paperwork to garnish his salary as governor to finish paying a personal guarantee of a business loan.
In 2020, a ProPublica report found Justice’s companies were involved in over 600 lawsuits in more than two dozen states after workers, vendors, and government agencies said they weren’t paid. A month after Justice decided to get into the race, the Department of Justice announced it was suing 13 coal companies owned and operated by the governor’s son, alleging his companies committed more than 100 violations harmful to the environment.
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Manchin isn’t the only Senate Democrat who has struggled to make tax payments on time.
Sen. Sherrod Brown (D-OH) and his wife Connie Schultz have also been late making tax bill payments on their Cleveland home at least seven times since 2013. Brown also faces a tough reelection as Republicans are looking to target his seat in the 2024 election.
Joe Manchin News 2024 Elections West Virginia Senate Senate Democrats
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Maine budget-writing committee makes bipartisan compromise on budget that provides tax relief
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https://www.allsides.com/news/2023-06-30-1138/taxes-maine-budget-writing-committee-makes-bipartisan-compromise-budget
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Taxes
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https://www.foxnews.com/politics/maine-budget-writing-committee-bipartisan-compromise-budget-provides-tax-relief
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MAINE
Maine budget-writing committee makes bipartisan compromise on budget that provides tax relief
ME proposal includes startup costs for a paid family leave program
Associated Press
Published June 29, 2023 7:47am EDT
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The Maine Legislature's budget-writing committee has reached a bipartisan compromise on the remaining $800 million to $900 million in spending in the upcoming budget, providing startup funding for paid family leave, investing more in child care and providing tax cuts for retirees.
The Appropriations and Financial Affairs Committee began voting after midnight and didn't wrap up until nearly 4 a.m. Wednesday. The panel adopted the plan on an 11-1 vote.
It's unclear when the full Legislature will take up the spending proposal, which follows approval of a nearly $10 billion essential services budget along party lines in March to prevent a state government shutdown. It's possible the Maine Senate won't reconvene until next week, after the Fourth of July holiday.
MAINE HOUSE VOTES TO ENACT BILL THAT EXPANDS ACCESS TO ABORTIONS
The proposal includes startup costs for a paid family leave program that both chambers support, along with additional spending for child care workers and to boost a child care affordability program. It also includes more money for emergency medical services and a cost-of-living adjustment for state government retirees.
Maine's State Capitol is shown in Augusta, Maine. The Maine Legislature's Appropriations and Financial Affairs Committee reached a bipartisan compromise for the state's upcoming budget on June 28, 2023. (eyecrave productions via Getty Images)
The proposal includes some tax relief sought by Republicans, increasing the annual income tax pension deduction to $30,000 last tax year to $35,000 for all retired Maine residents this tax year, and more in coming years. It also establishes a Maine Dependent Tax Credit that provide a $300 exemption starting in 2025.
MAINE DEMOCRATIC GOV. JANET MILLS SIGNS LAW PARTIALLY DECRIMINALIZING PROSTITUTION
"These investments make clear what Maine values — our people and families," Sen. Peggy Rotundo, D-Lewiston, one of the committee co-chairs, said in a statement Wednesday.
Some had expected bigger tax cuts.
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Jacob Posik, communications director for the conservative Maine Policy Institute, said Republicans went from posturing for $200 million to $400 million in tax cuts to winning a paltry $48 million in tax relief for retirees.
"Republicans are selling the farm and signing off on this big spending bill for such a small concession. You’re looking at a state government that’s never been more flush with cash than it is right now," he said.
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Biden to unveil $600 million in additional climate spending
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https://www.allsides.com/news/2023-06-19-0722/climate-change-biden-unveil-600-million-additional-climate-spending
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https://www.foxbusiness.com/politics/biden-unveil-600-million-additional-climate-spending
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JOE BIDEN Published June 19, 2023 8:13am EDT
Biden to unveil $600 million in additional climate spending
President Biden pledged another $1B to the UN climate fund in April
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Forbes Media chairman Steve Forbes and Americans for Tax Reform President Grover Norquist weigh in on alleged 'elitist' actions by Democratic lawmakers on 'The Evening Edit.'
President Biden will announce plans to spend an additional $600 million on efforts to address climate change on Monday.
Biden will hold an event Monday in Palo Alto, California, touting his administration's efforts to bolster defenses against rising sea levels and associated weather catastrophes.
The funding includes $575 million to reinforce coastal infrastructure and $67 million to protect California's power grid from weather events.
"The funding will support innovative coastal resilience and adaptation solutions, such as building natural infrastructure, planning and preparing for community-led relocation, and protecting public access to coastal natural resources, that protect communities and ecosystems from sea level rise, tidal flooding, hurricanes, storm surge, among other severe climate impacts," the Biden administration said in a public statement.
MASSIVE OIL PROJECT SPARKED CIVIL WAR WITHIN BIDEN ADMINISTRATION, LAWMAKERS SAY
President Biden will announce $600 million in additional climate change spending during an event in Palo Alto, California, on Monday. (Evan Vucci / AP Newsroom)
Biden has maintained climate change as a top priority throughout his administration. Monday's move comes just months after the U.S. pledged another $1 billion donation to the United Nations' Green Climate Fund.
AOC, TOP DEMOCRATS ISSUE STINGING REBUKE OF BIDEN OVER FAILED CLIMATE PROMISES
Biden's Monday climate event comes just before a series of 2024 campaign fundraising events the president also has scheduled in California. Biden will meet with tech billionaires and climate donors across the state this week in his largest fundraising push since announcing his 2024 re-election campaign.
President Biden has devoted billions toward fighting the effects of climate change since taking office in 2021. (Brendan Smialowski/AFP via / Getty Images)
Biden opened up his climate crusade on his first day in office, signing an executive order that caused the U.S. to rejoin the Paris climate accord that former President Donald Trump had withdrawn from.
Critics have blasted many of Biden's climate policies, however, arguing regulations could threaten millions of jobs and destabilize the economy.
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More recently, the administration's efforts have caused exasperation among the public after officials were found to have explored crackdowns on gas stoves.
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Taxing the Rich Will Have No Meaningful Effect on Our Sky-High National Debt
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https://www.allsides.com/news/2023-05-25-1220/taxes-taxing-rich-will-have-no-meaningful-effect-our-sky-high-national-debt
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https://reason.com/2023/05/25/taxing-the-rich-will-have-no-meaningful-effect-on-our-sky-high-national-debt/
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TAXES
Taxing the Rich Will Have No Meaningful Effect on Our Sky-High National Debt
The U.S. tax system is extremely progressive, even compared to European countries—whose governments rely on taxing the middle class.
VERONIQUE DE RUGY | 5.25.2023 12:01 AM
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| 903
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IRS worked overtime to probe Twitter Files journalist Matt Taibbi
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https://www.allsides.com/news/2023-05-24-1149/taxes-irs-worked-overtime-probe-twitter-files-journalist-matt-taibbi
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https://www.washingtontimes.com/news/2023/may/24/irs-worked-overtime-probe-twitter-files-journalist/
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Report: IRS Removes Entire Team Probing Hunter Biden
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https://www.allsides.com/news/2023-05-16-1002/taxes-report-irs-removes-entire-team-probing-hunter-biden
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https://www.newsmax.com/newsfront/hunter-biden-irs-team/2023/05/16/id/1119965/
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IRS plans to hire gun-carrying special agents in all 50 states
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https://www.allsides.com/news/2023-04-28-0706/taxes-irs-plans-hire-gun-carrying-special-agents-all-50-states
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https://www.foxbusiness.com/politics/irs-plans-hire-gun-carrying-special-agents-all-50-states
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IRS Published April 27, 2023 4:52pm EDT
IRS plans to hire gun-carrying special agents in all 50 states
Special agents with the IRS' Criminal Investigation division are the only IRS agents permitted by law to carry firearms as part of their duties
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By Eric Revell FOXBusiness
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IRS whistleblower is playing it by the book: Grover Norquist
Americans for Tax Reform President Grover Norquist reacts to revelations in the Hunter Biden investigation and President Biden's tax-and-spending spree.
The Internal Revenue Service (IRS) is looking to hire special agents who carry guns and make arrests with jobs available in all 50 states, according to a posting on the agency’s website.
The law enforcement branch of the IRS, known as the Criminal Investigation (CI) division, is hiring for the role at locations throughout the U.S. IRS special agents within the CI division are the only IRS employees who are authorized by law to carry and use firearms. IRS-CI investigates financial crimes, money laundering, tax-related identity theft and terrorist financing efforts.
Under the posting’s "major duties" section, the IRS says that special agents "[c]arry a firearm; must be prepared to protect him/herself or others from physical attacks at any time and without warning and use firearms in life-threatening situations; must be willing to use force up to and including the use of deadly force."
Additionally, IRS-CI special agents must be "willing and able to participate in arrests, execution of search warrants, and other dangerous assignments." The posting adds that special agents need to maintain "a level of fitness necessary to effectively respond to life-threatening situations on the job."
IRS UNVEILS SPENDING PLAN FOR $80B FUNDING BOOST
The IRS is hiring special agents who carry firearms and make arrests for the agency's Criminal Investigation division. (Rafael Henrique/SOPA Images/LightRocket via Getty Images / Getty Images)
Jobseekers must meet a number of other requirements, including having U.S. citizenship and being between the age of 21 at the time of completing the training academy and 37 at the time of appointment.
Would-be special agents with the IRS’ Criminal Investigation division must be able to pass pre-employment medical and tax exams, in addition to passing a drug test and being legally allowed to possess firearms.
5 THINGS TO KNOW ABOUT YOUR 2023 TAXES
The IRS is hiring special agents for its Criminal Investigation division at locations in all 50 states. (Timothy Fadek/Bloomberg via Getty Images / Getty Images)
The IRS’ job posting for the role on USAJobs opened in mid-February and will remain open through the end of the year. The posting lists 360 vacancies in 249 locations around the country — at least one of which is in each state.
IRS special agents in the CI division can expect a salary between $52,921 and $94,228 annually.
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The IRS faced criticism last year when a similar posting went live amid debate in Congress over Democrats’ Inflation Reduction Act, which included $80 billion in increased funding for the IRS over a decade — much of which was intended to help the agency crack down on tax evasion.
Similar language related to the use of force and carrying firearms is listed on other federal law enforcement job postings that involve field work and potentially dangerous situations.
FOX Business’ Jessica Chasmar contributed to this report.
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Biden's 'Buy American' Electric Vehicle Tax Credits Go Into Effect
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https://www.allsides.com/news/2023-04-19-1250/economy-and-jobs-bidens-buy-american-electric-vehicle-tax-credits-go-effect
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https://reason.com/2023/04/18/bidens-buy-american-electric-vehicle-tax-credits-go-into-effect/
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ELECTRIC CARS
Biden's 'Buy American' Electric Vehicle Tax Credits Go Into Effect
The credits may be well-intentioned, but they will distort the market and lead to a windfall for U.S. companies.
JOE LANCASTER | 4.18.2023 4:15 PM
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(Adam Schultz/ZUMA Press/Newscom)
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Biden Releases His 2022 Tax Returns
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https://www.allsides.com/news/2023-04-19-0938/joe-biden-biden-releases-his-2022-tax-returns
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https://dailycaller.com/2023/04/19/president-joe-biden-jill-2022-tax-returns-income-white-house/
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Auditors Asked the IRS To Figure Out Why So Many Taxpayers Make Mistakes. The IRS Said 'No.'
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https://www.allsides.com/news/2023-04-14-1320/taxes-auditors-asked-irs-figure-out-why-so-many-taxpayers-make-mistakes-irs
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Taxes
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https://reason.com/2023/04/14/auditors-asked-the-irs-to-figure-out-why-so-many-taxpayers-make-mistakes-the-irs-said-no/
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IRS
Auditors Asked the IRS To Figure Out Why So Many Taxpayers Make Mistakes. The IRS Said 'No.'
Maybe taxpayers would make fewer mistakes if the federal tax code weren't so hopelessly complex.
ERIC BOEHM | 4.14.2023 11:15 AM
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| 909
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Biden admin moves to limit EV tax credit eligibility in potential blow to climate agenda
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https://www.allsides.com/news/2023-03-31-0929/sustainability-biden-admin-moves-limit-ev-tax-credit-eligibility-potential-blow
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Taxes
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https://www.foxnews.com/politics/biden-admin-moves-limit-ev-tax-credit-eligibility-potential-blow-climate-agenda
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JOE BIDEN
Biden admin moves to limit EV tax credit eligibility in potential blow to climate agenda
A Biden administration official said they were unsure how many EVs are eligible for tax credits under rules announced Friday
By Thomas Catenacci Fox News
Published March 31, 2023 9:14am EDT
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Biden pushing for more electric vehicle use
U.S. Oil & Gas Association President Tim Stewart says Americans are not ready to fully switch to electric cars and that oil and gas are here to stay.
The Biden administration proposed a series of highly anticipated rules, providing some clarity on how it will implement Inflation Reduction Act (IRA) provisions that restrict which electric vehicles (EV) are eligible for tax credits.
The rules, issued by the Treasury Department on Friday morning, outline the sourcing requirements for critical minerals and battery components automakers must use in EV batteries to ensure eligibility for the full $7,500 credit. The IRA — which President Biden signed into law in August — was crafted by lead sponsor Sen. Joe Manchin, D-W.Va., to bolster domestic EV battery supply chains and reduce reliance on hostile nations like China.
"The Inflation Reduction Act is a once-in-a-generation piece of legislation that is lowering costs for American consumers, building a strong U.S. industrial base, and bolstering supply chains," said Treasury Secretary Janet Yellen. "Today, Treasury is taking an important step that will help consumers save up to $7,500 on a new clean vehicle and hundreds of dollars per year on gas, while creating American manufacturing jobs and strengthening our energy and national security."
However, because the U.S. supply chain currently sources an outsized share of its critical minerals and EV battery components from China and other foreign nations, the rules Friday could greatly restrict which EVs will ultimately be eligible for the tax credits. The Biden administration has set lofty goals as part of its climate agenda to ensure 50% of new car sales are electric by 2030.
CCP-BACKED TECH COMPANIES ARE POISED TO CASH IN ON BIDEN'S CLIMATE BILL, NATIONAL SECURITY EXPERTS WARN
President Biden has aggressively pushed electric vehicles since taking office and has set the goal of ensuring 50% of new car sales are electric by 2030. (Nic Antaya/Getty Images)
A Biden administration told reporters during a call ahead of the announcement Friday that they were unsure how many vehicles would actually be eligible for the tax credit under its proposed rules.
And though the rules provide clarity for how the administration plans to implement the IRA's tax provisions, the Treasury Department declined to outline how it will implement one of the key requirements for EV batteries. The IRA bars EVs assembled with any battery components or critical minerals sourced from a "foreign entity of concern" beginning in 2024 and 2025, respectively.
BIDEN ADMIN QUIETLY ADDS WORKAROUND, MAKING PRICEY SPORTS CARS ELIGIBLE FOR EV TAX CREDITS
Because China falls into that classification, the bill would disqualify EVs with Chinese-sourced components and minerals from being eligible for the credit. China currently boasts 78% of the world’s cell manufacturing capacity for EV batteries, according to a Brookings Institution analysis released in July. An Administration official said details on its implementation of that provision would come at a later date.
The Treasury Department announcement Friday, though, did explain that, to meet the broader critical mineral requirement, 40% of critical minerals contained in an EV's battery must have been extracted or processed in the U.S. or country the U.S. has a free trade agreement with, beginning in 2023. The share of critical minerals then increases 10% in each subsequent year until 2027, when 80% of minerals must be sourced under the conditions.
President Biden speaks about electric vehicles during a visit to the Detroit Auto Show in Detroit on Sept. 14, 2022. (AP Photo/Evan Vucci)
The announcement listed Australia, Bahrain, Canada, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Israel, Jordan, Korea, Mexico, Morocco, Nicaragua, Oman, Panama, Peru, Singapore and Japan as the eligible nations.
While automakers have yet to weigh in on the proposed rule, the rule may create uncertainty since it appears to open the door for companies to extract critical minerals in the listed nations, but process those minerals in an unlisted nation. A Biden administration official told reporters that the rule was intended to incentivize companies to only extract and process minerals in listed nations.
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"It will ensure we can work with our allies and partners to reduce our reliance on China and bolster our national security," a White House official told reporters earlier in the call.
And to meet the battery component requirement, the Treasury Department stated in its rules that, beginning in 2023, at least 50% of an EV's battery components must be manufactured or assembled in North America. That percentage increases in subsequent years until it reaches 90% in 2028.
EVs that meet both the critical mineral and battery component requirements are eligible for the full $7,500 credit. Vehicles that meet just one of the requirements are eligible for a $3,750 credit.
In addition, all EVs must also have undergone final assembly in North America; cost less than $55,000, or $80,000 for larger vehicles; and be purchased by an individual with an annual income of less than $150,000 or a family with an annual income of less than $300,000.
Thomas Catenacci is a politics writer for Fox News Digital.
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'Twitter Files' journalist received IRS agent visit at home the same day he testified in Congress
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https://www.allsides.com/news/2023-03-28-0936/taxes-twitter-files-journalist-received-irs-agent-visit-home-same-day-he
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Taxes
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https://www.washingtonexaminer.com/news/twitter-files-journalist-received-irs-agent-same-day-testified-congress
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HOUSE JUDICIARY COMMITTEE
'Twitter Files' journalist received IRS agent visit at home the same day he testified in Congress
by Gabe Kaminsky, Investigative Reporter
March 28, 2023 11:59 AM
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The IRS made an unexpected visit to the home of Matt Taibbi on the same day that he testified before Congress, the "Twitter Files" journalist has disclosed to House Judiciary Committee Chairman Jim Jordan (R-OH).
Along with fellow Twitter Files author Michael Shellenberger, Taibbi testified on March 9 before the Select Subcommittee on the Weaponization of the Federal Government, citing internal Twitter communications he obtained showing the social media giant's coordination with the government on content moderation. That same day, the IRS visited Taibbi's residence in New Jersey and left a note instructing him to call the agency, Jordan revealed on Monday in a letter to the IRS that was reviewed by the Washington Examiner.
WATCH LIVE: HEARING ON THE 'WEAPONIZATION' OF FEDERAL GOVERNMENT: THE 'TWITTER FILES'
"The Committee recently learned that during this hearing, an Internal Revenue Service (IRS) agent visited, unannounced and unprompted, the home of one of the hearing witnesses, Matthew Taibbi, an independent journalist who has reported extensively on government abuse," Jordan wrote to Treasury Department Secretary Janet Yellen and IRS Commissioner Daniel Werfel.
"In light of the hostile reaction to Mr. Taibbi’s reporting among left-wing activists, and the IRS’s history as a tool of government abuse, the IRS’s action could be interpreted as an attempt to intimidate a witness before Congress," the letter continued. "We expect your full cooperation with our inquiry."
Taibbi's March 9 testimony before the Judiciary Committee sparked fiery debate among Republicans and Democrats on the First Amendment and the proper role of Twitter in moderating content. Del. Stacey Plaskett (D-VI) and Rep. Sylvia Garcia (D-TX) notably tried to get Taibbi to divulge his sources in connection to the Twitter Files, sets of records that Twitter CEO Elon Musk has provided Taibbi and others in relation to the platform's operations under former CEO Jack Dorsey.
The IRS agent's note left at Taibbi's residence told him to call the agency four days later, according to Jordan. The journalist was informed that his 2021 and 2018 tax returns were rejected because of purported identity theft concerns.
Taibbi has now provided the Judiciary Committee with a copy of his 2018 tax filing, which shows that it was accepted. The IRS never notified him of any issues with the filing four-and-a-half years prior, according to Taibbi. The 2021 tax filing was rejected due to a "monetary" problem, and the journalist alleged that the IRS owes him a "considerable" amount of money.
The visit comes after it was revealed on March 7 that the Federal Trade Commission has launched a sweeping investigation into Twitter under Musk. The regulator is seeking internal communications showing the names of all journalists who Musk has provided records to as part of the Twitter Files, according to a weaponization subcommittee report.
The FTC's inquiry relates to Twitter's privacy and data practices, according to the New York Times. Under Chairwoman Lina Khan, the FTC has been criticized by Republicans for purportedly overreaching into the private sector.
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In his Monday letter, Jordan asked the IRS for all records related to its visit to Taibbi's home. The Republican also wants communications between the IRS, Treasury Department, and any executive branch relating to Taibbi.
The IRS did not return a request for comment.
House Judiciary Committee Jim Jordan Twitter IRS News
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| 911
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Cornel West Owes More Than Half a Million in Unpaid Taxes
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https://www.allsides.com/news/2023-08-03-1048/2024-presidential-election-cornel-west-owes-more-half-million-unpaid-taxes
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https://www.thedailybeast.com/cornel-west-owes-more-than-half-a-million-in-unpaid-taxes?ref=home%3Fref%3Dhome
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ELECTIONS
Cornel West Owes More Than Half a Million in Unpaid Taxes
DECLINE OF THE WEST
The presidential candidate has made raising taxes on the rich a fixture of his campaign. He's shorted the IRS more than the median salary in six of the last 20 years.
William Bredderman
Senior Researcher
Updated Aug. 24, 2023 3:31PM EDT
Published Aug. 03, 2023 4:35AM EDT
EXCLUSIVE
Photo Illustration by Elizabeth Brockway/The Daily Beast/Getty
Veteran Ivy League professor and bestselling author Dr. Cornel West has long advocated for taxing the rich to provide more services to America’s lower classes. But the academic-turned-Green Party presidential candidate isn’t living up to those standards in his own life—as public records from New Jersey and California show, West owes the IRS hundreds of thousands of dollars in back taxes.
West’s lament of the concentration of wealth among the nation’s elite and his support for fiscal policies that would funnel funds down the social scale have been an enduring theme of his decades-long career as a public intellectual—from his initial appearances on the national scene in the 1990s, to his support of both of Sen. Bernie Sanders’ failed presidential bids, to his current sally along the 2024 campaign trail.
"Taxation without representation is now reflected in policies that allow the wealthy to be coddled and under-taxed while the perennially poor, working poor, and 'new poor' are ignored and rendered invisible,” West and co-author (and alleged sex pest) Tavis Smiley wrote in their 2012 book, The Rich and the Rest of Us. “Economic justice in America has been overshadowed by greed, because unequal taxation benefits the rich at the expense of everyone else.”
In a recent interview with Semafor, West maintained that “we’ve got to have taxes that are higher, much higher”—while he told New York Post that first son Hunter Biden’s now-lapsed plea deal to misdemeanor tax charges amounted to “a little tap on the wrist,” especially compared to the penalties the spawn of less powerful families face.
But materials filed in Mercer County, New Jersey, where West owns a home in the upper-crust college town of Princeton, and in Los Angeles—the location of his personal attorney’s office—reveal a second, secret motif to his hugely lucrative professional life: a failure to pay his own taxes.
These documents show a total of $543,778.78 in outstanding federal tax liens against the professor, activist, and writer.
After repeated emails, calls and text messages from The Daily Beast to the West campaign, to interim campaign manager Jill Stein, and to West himself, the professor sent a one-line response from his personal Gmail account.
“My brother I have asked my accountant to respond to these charges some of which are not true,” West wrote from his iPhone.
However, correspondence from the accountant was not forthcoming, and West did not respond to The Daily Beast’s subsequent requests that he provide documentation that contradicts the public records from New Jersey and California.
These records show that, for all his tirades against the wealthy, in almost every one of the years recorded West owed more in unpaid taxes than the median American household earned. This includes $85,477.02 he shorted the Internal Revenue Service in 2017, $136,916.26 in 2016, $82,396.14 in 2015, $98,818.25 in 2014, $62,367.69, and $77,803.42 way back in 2005. The IRS has not filed a release for any of these liens, meaning they remain open, or have only been repaid inside the last 30 days.
It is possible West has entered a payment plan with the IRS and paid some of the outstanding balance on these liens. But neither the candidate nor his campaign made any claim to this effect to The Daily Beast.
The county-level filings also expose West as a perennial tax delinquent for almost his entire tenure in the public eye. On top of the sums listed above, he piled up $724,397.26 in liens in a six-year period ending in 2004—a balance he finally paid down in 2010. He also welshed on a $34,069.93 tax debt in 2008, which he finally made good on four years later.
Additionally, documents the IRS submitted in California reveal that West racked up $46,904.57 and $112,449.79 in tax debt in 2011 and 2012, respectively. The materials from the Los Angeles County Clerk’s office also show West finally resolved these liens on June 14 of this year, a little more than a week after he joined the presidential fray.
New Jersey court records further indicate the Harvard- and Princeton-educated son of a Defense Department contractor is a deadbeat in more ways than one. A $49,500 child support judgment against him from 2003 remains open to this day.
William Bredderman
Senior Researcher
@WillBredderman
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Hunter Biden expected to plead guilty in criminal tax case
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https://www.allsides.com/news/2023-07-26-0634/justice-hunter-biden-expected-plead-guilty-criminal-tax-case
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https://www.nbcnews.com/politics/justice-department/hunter-biden-expected-plead-guilty-criminal-tax-case-rcna96232
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JUSTICE DEPARTMENT
Hunter Biden pleads not guilty after plea deal is derailed
The judge raised concerns over two separate agreements the president's son reached with prosecutors, but the agreement could ultimately be accepted.
Judge refuses to accept Hunter Biden’s plea deal
03:29
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July 26, 2023, 11:00 AM CEST / Updated July 26, 2023, 8:58 PM CEST
By Phil McCausland and Tom Winter
WILMINGTON, Del. — Hunter Biden pleaded not guilty to federal tax charges Wednesday after a plea deal he struck with the government unraveled when the judge raised questions about the terms of the agreement.
The surprise development came at a hearing in federal court here at which Biden had been expected to plead guilty to two charges of failure to pay taxes under a deal he struck with the government last month. Far from signing off on a done deal, he pleaded "not guilty" to those charges instead until the two sides can meet and address the questions posed by U.S. District Judge Maryellen Noreika.
At times, Noreika appeared almost upset that she believed she was being asked to act as a "rubber stamp" for the deal. The parties will reconvene later to hammer out the terms and provide Noreika more information, which could be within the next six weeks.
"Without me saying I'll agree to the plea agreement, how do you plead?" Noreika asked Biden.
"Not guilty, your honor," he responded.
Biden is expected to reverse his plea if a new agreement or the new information eventually satisfies Noreika.
Noreika, who was appointed by President Donald Trump, pressed both sides about the terms of the agreement struck with U.S. Attorney David Weiss of Delaware, another Trump appointee, whom President Joe Biden kept on to oversee the case. She expressed clear concern about how two separate deals, one regarding the unpaid taxes and the other about a gun possession charge, potentially intersected, as well as her purview over them.
Noreika quizzed the lawyers about whether the gun charge would be diverted until Biden fulfilled certain terms. The agreement would have her act as an arbiter if he violated the deal over 24 months. She said that she did not believe that the judiciary would normally oversee such an agreement and that it was the responsibility of the executive branch to bring charges.
Biden's lawyer, Chris Clark, said that because of tremendous political "Sturm and Drang" surrounding the case, that element of the agreement would help ensure it "wouldn't become more politicized" if the government targeted Biden again in the future.
While Noreika said she understood his argument, she said she worried that there was no case law to necessarily support the terms of the agreement.
What happens next after Hunter Biden's plea deal falls apart?
JULY 26, 202303:00
Noreika also said she worried that the agreement on the tax charges did not give her the authority to reject or modify the deal and that the gun charge agreement could shield Biden against further prosecution over his financial and tax issues.
Though Noreika said it was possible all of those terms could be adopted, she wanted both sides to give her more information about their reasoning for her to study further.
There were numerous points of disagreement and requests for clarification throughout the hearing, which had been expected to take a little over an hour but lasted well over three hours.
At one point, Noreika asked whether the investigation was ongoing, to which Weiss responded that it was but said he could not share any further details.
Noreika also raised a hypothetical, asking whether Biden could face charges of failing to register as a foreign agent and whether the agreement blocks his prosecution on such a charge. The defense said it believed the agreement would prohibit him from being charged, and the prosecution then disagreed.
Clark was overheard telling a prosecutor, "Then we'll rip it up," most likely in a reference to the plea deal, as they discussed the disagreement during a brief break before he eventually relented.
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In outlining the charges, Weiss’ office said in an earlier statement that “Hunter Biden received taxable income in excess of $1,500,000 annually in calendar years 2017 and 2018. Despite owing in excess of $100,000 in federal income taxes each year, he did not pay the income tax due for either year.”
The original deal included provisions that prosecutors would recommend probation for the tax violations, while a separate felony gun charge would be dropped if Biden met certain conditions laid out in court. It appears that now, the terms of his sentencing will be decided later.
Biden faced a separate gun charge, for illegally owning a Colt Cobra .38 Special handgun. He had conceivably reached a pretrial agreement about the issue that would delay the charges for 24 months, assuming he did not violate certain terms during that period — which included being added to the National Instant Criminal Background Check System, no use of controlled substances or alcohol and no violations of local, state or federal laws. If he followed the agreement, the charge would be dropped,
But there was some confusion about the gun charge, prompting the judge to pause Wednesday's proceedings so a resolution could be reached.
The affair has consumed the U.S. political world, particularly Republicans. They have argued Biden has received preferential treatment because of his father, saying he should have been charged for some of his other business dealings. Trump, members of his family and his political allies have weighed in regularly with numerous allegations about his actions. While the deal brought an end to a sweeping five-year investigation that involved federal prosecutors, FBI agents and IRS officials, it is unlikely to hinder the deluge of political commentary.
White House press secretary Karine Jean-Pierre addressed the latest regarding the case at the start of her daily briefing Wednesday. Beyond a short statement, she referred all questions to the Justice Department and Biden's legal team.
"Hunter Biden is a private citizen, and this was a personal matter for him," she said. "As we have said, the president, the first lady, they love their son, and they support him as he continues to rebuild his life. This case was handled independently, as all of you know, by the Justice Department under the leadership of a prosecutor appointed by the former president, President Trump."
Hugh Hewitt, a conservative commentator, argued in The Washington Post on Tuesday that “Hunter Biden’s doozy of a plea deal over tax and gun charges is ripe for rejection” by Noreika, as it did not involve jail time. His argument runs parallel with that of many Republicans who criticized the deal as a slap on the wrist. The fallout is likely to please many on the right.
Republicans have questioned the investigation and threatened to impeach Attorney General Merrick Garland over how the Justice Department has handled the case. Their ire has grown steadily since two IRS whistleblowers involved in the investigation testified before Congress that there was meddling to benefit the president’s son.
“At every stage, decisions were made that benefited the subject of this investigation,” said Greg Shapley, one of the whistleblowers.
In response, Weiss offered Monday to testify publicly before Congress in a letter sent to House Judiciary Committee Chairman Jim Jordan, R-Ohio. He has disputed Jordan’s claims, writing to him late last month that he was granted “ultimate authority” in terms of “where, when and whether to file charges.”
“The Department believes it is strongly in the public interest for the American people and for Congress to hear directly from U.S. Attorney Weiss on these assertions and questions about his authority at a public hearing,” Assistant Attorney General Carlos Felipe Uriarte wrote in the letter, obtained by NBC News, which offered a handful of potential dates.
The FBI also shared a memo with Republican oversight leaders in the House and the Senate that included unverified claims about Biden’s time on the board of a Ukrainian energy company while his father was vice president. The allegations, which remain uncorroborated, were part of a Justice Department review that Trump’s then-attorney general, William Barr, launched in 2020. The probe was closed later that year.
Phil McCausland
Phil McCausland is an NBC News reporter.
Tom Winter
Tom Winter is a New York-based correspondent covering crime, courts, terrorism and financial fraud on the East Coast for the NBC News Investigative Unit.
Chloe Atkins, Rebecca Kaplan and Benjamin Deeter contributed.
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Long-awaited $18 billion property tax-cut deal heads to Gov. Greg Abbott
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https://www.allsides.com/news/2023-07-14-1415/taxes-long-awaited-18-billion-property-tax-cut-deal-heads-gov-greg-abbott
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https://www.texastribune.org/2023/07/13/texas-legislature-property-tax-cuts/
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TEXAS LEGISLATURE 2023
Long-awaited $18 billion property tax-cut deal heads to Gov. Greg Abbott
House Democrats attempted to insert benefits for renters and more money for public education into the tax-cuts package in a series of floor amendments but were unsuccessful.
BY KAREN BROOKS HARPER
JULY 13, 2023
UPDATED: 8 PM CENTRAL
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A landmark $18 billion tax cut for property owners in the state is headed to Gov. Greg Abbott’s desk late Thursday, ending a monthslong stalemate among the state’s top Republicans with a deal that drew near-unanimous support from legislators.
Both chambers adjourned sine die Thursday evening, ending the second special session Abbott had called this summer to hammer out an agreement on property tax relief.
“We knew … the most contentious issue that we faced was how to return these dollars to the taxpayers,” House Speaker Dade Phelan told House members after they approved the bills Thursday evening. “Congratulations to you, but more importantly, congratulations to the taxpayers of Texas. They are the big winners.”
During floor debate Thursday, Democrats attempted to insert benefits for renters, teacher pay raises and more money for public education into the tax-cuts package in a series of floor amendments but were unsuccessful.
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A cheer went up on the chamber floors upon the passage of the three bills that make up the package: Senate Bill 2, which details the proposed property tax cuts; Senate Bill 3, a franchise tax relief bill; and House Joint Resolution 2, a constitutional amendment required to authorize the tax cuts.
“We now have a record-setting plan that will affect every family, every individual, every business, every operation in this state pretty much, for the next several decades,” said Houston Republican Sen. Paul Bettencourt, an architect of the package. “Every Texan deserves it because it’s their money.”
The package puts $12.6 billion of the state’s historic budget surplus toward making cuts to school taxes for all property owners, dropping property taxes an average of more than 40% for some 5.7 million Texas homeowners, and offering brand-new tax savings for smaller businesses and other commercial and non-homesteaded properties. The voters would need to approve the package in November for the cuts to take effect this year.
At a time when the state has some of the nation’s highest property taxes and lawmakers face massive political pressure to ease the financial suffering of their constituents, Abbott said he will sign the legislation — a cornerstone of his 2022 reelection campaign and that of most state lawmakers for several cycles now.
“The Texas House and Senate fulfilled our promise with an agreement that delivers a comprehensive, long-lasting solution to increasingly burdensome property tax bills,” Abbott said in a statement after the bills passed. “I thank my partners in the Texas Legislature for coming together to honor the best interests of hardworking Texans who want to own their property—not rent it from the government.”
The package’s marquee item is a $5.3 billion expansion of the state’s homestead exemption from $40,000 to $100,000. Bettencourt said the new exemption combined with the school tax cuts would save homesteaders — Texans who live in a residence they own — an average of $1,300 a year in property taxes.
It also offers additional cuts for seniors and property owners with disabilities, averaging about $170 more per year, Bettencourt said.
The most novel part of the plan, an idea introduced publicly for the first time on Monday, is a first-ever temporary 20% cap on appraisal increases for properties valued at $5 million or lower that aren’t considered homesteads. Those would include second homes, vacation properties, rental houses, or commercial retail or business properties.
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Leaders have referred to that part of the bill as a “circuit breaker” program, but it’s somewhat of a misnomer. Unlike programs in other parts of the country with the same name, the Texas proposal does not calculate property taxes based on a person’s income or ability to pay, nor does it specifically seek to benefit lower-income taxpayers.
School funding and other issues
Including more than $5 billion approved four years ago, the legislation also allocates nearly $12.6 billion to reduce the school property tax rate by 10.7 cents per $100 valuation for all homeowners and business properties.
Those billions are being sent to school districts so they can cut their taxes for all property owners and shift a portion of their maintenance and operations costs to the state.
But the package would give no new funding to schools, a sticking point with critics who note that, compared to other states’ spending, Texas is ranked near the bottom in per-student funding for education.
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$4 billion in new public education funding has been tied up since the regular legislative session amid an ongoing political battle over school vouchers. In response to the calls for more money for schools and raises for teachers, senators proposed a one-time teacher pay bonus late last month as part of their tax-cut legislation. But that proposal ultimately didn’t end up in the final compromise, with House members saying teacher pay should be considered in separate legislation.
The idea was intended to pacify an increasingly angry and impatient public school community — who have been expecting a pay raise since last year’s campaign season — until lawmakers can agree on an education package in another special session expected for later this year.
The passage of the tax-cuts package this week without any nod to new school funding — which depends mostly on property taxes in many districts — triggered criticism from public education advocates inside and outside the Capitol dome, who said there’s more than enough money in the state surplus to bump up the district’s funding.
While the plan won applause from a variety of advocacy groups and organizations across the political spectrum, few agreed it was a perfect plan.
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“There is no bill that is perfect, but this one is pretty damn good,” state Rep. Richard Raymond, D-Laredo, said Wednesday.
And while businesses applauded the overall lowering of taxes, some taxpayer groups and conservative economists said the resulting share of the tax burden would be even larger now for businesses.
The plan shifts the school-tax burden by about three percentage points toward businesses, raising the share of the school property taxes paid by businesses from 52% to 55%, while homeowners’ share drops from 48% to 44.8%, said Jennifer Rabb, president of the business-backed Texas Taxpayers and Research Association.
“At the same time, everybody’s getting a tax cut so I’m not here to look a gift horse in the mouth,” Rabb told the House Ways and Means committee Wednesday. “But I do think it’s important for you to understand that this shift is occurring. Texas businesses already pay a high property tax or rather tax burden overall relative to other states.”
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Targeted tax relief for the state’s 3.7 million renter households has been left out of proposals that have passed both chambers.
House Democrats last week unveiled their own tax-cut package, sponsored by Dallas state Rep. John Bryant, that would’ve given tenants a cash refund equaling up to 10% of the rent they paid the previous year. It also would have made the homestead exemption $200,000, doubling the exemption in the current bill, included a teacher pay raise and added more school funding. Their proposal did not make it into the final package.
Bryant tried to replace SB 2 on the floor with his plan on Thursday, but the plan’s authors said it would jeopardize the deal the House made with the Senate. Bryant said that while the owners of “skyscrapers and refineries and oil wells and other big business” would be bringing home thousands in tax cuts, homeowners wouldn’t see enough of a cut on a monthly basis to make any real impact — and renters would see none at all.
“I urge you to join me in doing something meaningful,” Bryant told his colleagues.
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The effort failed on a 51-79 vote.
Republicans and some tax policy experts argue that renters, who include about 3.8 million households in the state, will benefit from lower school taxes because landlords who benefit from the tax cuts won’t pass as much in property taxes onto their tenants — thus resulting in smaller rent increases.
But skeptics of that idea say demand for the state’s red-hot rental market and a dearth of supply to meet that demand, not property taxes, have driven rent increases in recent years — a problem that a tax cut will not remedy.
Disclosure: Texas Taxpayers and Research Association has been a financial supporter of The Texas Tribune, a nonprofit, nonpartisan news organization that is funded in part by donations from members, foundations and corporate sponsors. Financial supporters play no role in the Tribune's journalism. Find a complete list of them here.
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Join us for conversations that matter with newly announced speakers at the 2023 Texas Tribune Festival, in downtown Austin from Sept. 21-23.
Correction, July 13, 2023 at 8:59 p.m.: A previous version of this article misspelled the name of the president of the Texas Taxpayers and Research Association. She is Jennifer Rabb, not Jennifer Raab.
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| 914
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States have been on a tax-cutting spree, but revenues are now weakening
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https://www.allsides.com/news/2023-07-03-0832/taxes-states-have-been-tax-cutting-spree-revenues-are-now-weakening
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https://www.cnn.com/2023/07/03/politics/state-tax-cuts-revenue/index.html
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President Biden touts economic achievements in Chicago
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CNN
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Fueled by surging revenues, states have been slashing taxes for individuals and businesses for the past three years.
But the party is expected to come to an end in the coming fiscal year, which started on Saturday in 46 states. Revenue is projected to decline by 0.7% in fiscal 2024, based on forecasts used in governors’ budgets, after an estimated 0.3% dip this fiscal year, according to a recently released National Association of State Budget Officers survey.
This reversal comes after double-digit percentage increases for the prior two fiscal years. It reflects the impact of slower economic growth, a weaker stock market and a slew of recent tax cuts.
Reducing taxes
Some 25 states have cut individual income tax rates since 2021, according to the right-leaning Tax Foundation. This includes 22 states that reduced their top marginal rates.
“Most states are viewing tax reform and relief as a chance to, first and foremost, return some of their excess revenue to taxpayers, but to also do that in a way that is simultaneously improving the structure of their tax cuts and make it more conducive to long-term economic growth,” said Katherine Loughead, senior policy analyst at the foundation.
States are also seeking to make themselves more attractive to business investment, as well as to remote and traditional workers, she continued.
In 2023 alone, at least eight states approved rate reductions, according to the Tax Foundation. Arkansas, for instance, is trimming its top individual income tax rate to 4.7%, retroactive to January 1, after reducing it from 5.5% to 4.9% last year.
Likewise, Montana lawmakers approved deepening cuts enacted in 2021. Starting in 2024, the top marginal income tax rate will be 5.9%, instead of 6.5% as originally planned. It was 6.9% in 2021.
In addition, previously scheduled or triggered income tax rate reductions took effect this year in Arizona, Idaho, Iowa, Missouri and North Carolina, as well as for interest and dividend income in New Hampshire, according to the Tax Foundation.
Aside from individual income tax cuts, states have also lowered the levies on purchases and for businesses over the past three years. Two states cut sales tax rates, while 13 reduced corporate income tax rates and others made additional tax changes that benefited companies.
In 2023, Nebraska and Utah adopted corporate income tax rate reductions. The former will phase down its top rate to 3.99% in 2027, accelerating an earlier law’s timetable. If fully implemented as planned, Nebraska will slash its top marginal corporate income tax rate nearly in half over six years, according to the Tax Foundation.
Utah also further reduced its corporate income tax rate to 4.65%, retroactive to January 1. A law passed last year had cut it to 4.85% for 2022, down from 4.95%.
Weakening revenues
The tax cuts, along with stock market declines and the shaky economy, have taken their toll on states’ revenues, however.
State tax revenue fell in 37 states, after adjusting for inflation, between July 2022 and May 2023, according to Lucy Dadayan, principal research associate at the nonpartisan Tax Policy Center. Some 19 states saw declines before taking inflation into account.
Revenue dropped nearly 12% over the period on an inflation-adjusted basis. All major sources of revenue – personal income, sales and corporate income taxes – declined, though the extent varies widely by state and source. Individual income taxes were the weakest, plummeting more than 22%.
States are in trouble, though there won’t be an immediate crisis, she said. Much depends on factors that remain unknown, such as whether the nation will fall into a recession or whether states will face natural disasters.
The robust revenue of recent years was “artificially boosted” by federal Covid-19 pandemic relief funds and the strong stock market in 2021, she said.
“We knew this is temporary,” Dadayan said. “It would have been better if the states wouldn’t jump and do tax cuts and be more cautious.”
Still, revenues in fiscal 2023 are coming in stronger than initially expected. The current estimates are outperforming earlier forecasts by 6.5%, according to the National Association of State Budget Officers. Most states have also built up big reserves in their rainy day funds in recent years.
Whether states will continue cutting taxes in the coming fiscal year will depend on what happens with revenues.
“A lot of states have done what they can already,” Loughead said. “They will continue to look at how revenues come in and how the rates measure up. If they still are experiencing strong surpluses, I do think they might tweak those rates down even more.”
| 915
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Hunter Biden will plead guilty to three federal charges in plea deal, court filing shows – live updates
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https://www.allsides.com/news/2023-06-20-0647/justice-hunter-biden-will-plead-guilty-three-federal-charges-plea-deal-court
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https://www.theguardian.com/us-news/live/2023/jun/20/hunter-biden-will-plead-guilty-to-three-federal-charges-court-filing-shows-live-updates
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20 Jun 2023
22.00 CEST
Summary
That wraps up today’s US politics blog! Here’s what happened today:
The White House has announced that Joe Biden, Jill Biden, Kamala Harris and Doug Emhoff will “participate in a political event with reproductive rights groups” this Friday, 23 June, nearly a year after the overturning of Roe V Wade.
The first Republic primary debate will take place on 23 August in Milwaukee, where the Republican National Convention will take place in 2024, reported Politico. Fox News will be hosting the first debate.
House speaker Kevin McCarthy says DoJ should turn over the records from its investigation into Hunter Biden to the Republican-controlled House oversight committee, which has its own investigation going into the president’s son.
McCarthy has called Hunter Biden’s plea agreement with DoJ a “sweetheart deal”, adding that the latest filings should ramp up investigations into Joe Biden given the latest charges.
Donald Trump responded via his social media platform to the news about Hunter Biden, with characteristically blunt populist-speak: “Wow! The corrupt Biden DOJ just cleared up hundreds of years of criminal liability by giving Hunter Biden a mere ‘traffic ticket.’ Our system is BROKEN!”
A White House spokesperson said in a statement: “The President and First Lady love their son and support him as he continues to rebuild his life. We will have no further comment.”
Hunter Biden will plead guilty to federal crimes as part of a plea agreement with the US Department of Justice (DoJ) to resolve tax and federal firearm crimes.
Judge Aileen Cannon, overseeing Donald Trump’s federal criminal case over his keeping classified documents at Mar-a-Lago after leaving office, has set a trial date of August 14 this year.
Here is our full report on Hunter Biden:
Hunter Biden to plead guilty to misdemeanor tax charges
Read more
Thank you for reading! Come back tomorrow for more updates.
Updated at 22.15 CEST
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After Brinkmanship Over Debt, House GOP Tees Up Potentially $1 Trillion In Tax Cuts
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https://www.allsides.com/news/2023-06-14-0628/banking-and-finance-after-brinkmanship-over-debt-house-gop-tees-potentially-1
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https://www.huffpost.com/entry/republicans-tax-cuts_n_64891353e4b06725aee308d2
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LOADING
Less than two weeks after the end of the debt limit fight that Republicans said they started because they worried about government red ink, House Republicans moved a step closer to possibly adding as much as a trillion dollars more in debt through tax cuts.
The tax-writing House Ways and Means Committee late Tuesday approved a trio of bills that would extend or expand parts of the Trump tax cuts from 2017 and take back green energy tax cuts included in last year’s Inflation Reduction Act.
While the nonpartisan Joint Committee on Taxation estimated the bills together would cost only around $20 billion through 2033, an anti-budget deficit group says the price tag would be closer to $1 trillion if the tax cuts were made permanent, as happened with almost all of the George W. Bush-era tax cuts.
“We estimate that the plan would cost over $1.1 trillion ($950 billion without interest) through 2033 if these temporary tax cuts and extensions were made permanent,” the Committee for a Responsible Federal Budget said Friday.
The bills are unlikely to make it through the Senate and serve more as markers for future tax fights. But coming so soon after the debt limit standoff, they leave Republicans open to charges of budget deficit hypocrisy.
“We estimate that the plan would cost over $1.1 trillion ($950 billion without interest) through 2033 if these temporary tax cuts and extensions were made permanent.”
- The Committee for a Responsible Federal Budget
Asked about the disconnect between threatening default in the debt limit fight, which ended June 3 with President Joe Biden signing a bill suspending the limit until 2025, and potentially adding massively to the debt, House Speaker Kevin McCarthy told reporters Monday the problem was spending, not revenues.
“I look at it from the perspective of that if Washington is not taking your money, it’s much more efficient used by you,” he said.
Rep. Jason Smith (R-Mo.), the chairman of the Ways and Means Committee, said Republicans had been vindicated about the 2017 Tax Cuts and Jobs Act tax bill by the pace of economic growth and revenues since then.
“Let’s set the record straight: TCJA delivered exactly what was promised ― tax cuts for families, more jobs and a growing economy,” he said.
“I look at it from the perspective of that if Washington is not taking your money, it’s much more efficient used by you.”
- House Speaker Kevin McCarthy (R-Calif.)
Democrats at the markup focused on the shift in priorities among Republicans and its speed.
“Ten days ago, to the floor of the House of Representatives, they threatened the full faith and credit of the United States because of the debt that they helped add to the problem” through the 2017 tax bill, said Rep. Rich Neal (D-Mass.), the top Democrat on the panel.
“So they get to set the fire with the tax cut that borrowed money, and then, with the debt ceiling, call the fire department? Because that’s the real issue here today that’s in dispute.”
“Republicans are back to the single issue that makes their party: tax cuts for the rich,” said Rep. Bill Pascrell (D-N.J.).
Pascrell said he had asked his staff to name some of the worst movie sequels in history, for reference.
“Somehow, the other side’s tax scam’s 2.0 is worse than ‘Police Academy 4.’ I’ve come to that conclusion,” he said.
The package consists of three bills. The biggest one would extend tax breaks for research and development and business equipment depreciation, and also repeal the Superfund tax on companies that pay for environmental cleanups. It would pay for those changes by repealing clean electricity and electric vehicle tax breaks, raising revenues overall by $156.9 billion through 2033.
Another bill would extend a tax break for publicly-traded companies to small businesses with stock known as “S corporations” and make it easier to write off new equipment costs. It would cost about $81 billion. A third bill would add a $2,000 income tax deduction for singles and a $4,000 one for couples that jointly file their taxes, limited by income, and make the deduction available through the end of 2025. It was scored by the JCT at about $96.4 billion.
“Republicans are back to the single issue that makes their party: tax cuts for the rich.”
- Rep. Bill Pascrell (D-N.J.)
Republicans see the extensions as necessary because in 2017, to be able to lower both companies and individuals’ taxes, GOP lawmakers had to agree to make many provisions temporary. The nonpartisan Congressional Budget Office said extending the individual income tax cuts past 2025 and through 2033 would cost about $2.8 trillion just by themselves.
“While the Ways and Means Committee should be commended for identifying offsets, their reliance on arbitrary expirations to hold down the bill’s costs today suggests further costs in the future,” the CRFB said when the legislation was unveiled.
The group noted it had issued a similar warning about President Joe Biden’s original infrastructure proposal.
“As we explained before with regards to the Build Back Better legislation, ‘Arbitrary expirations don’t make policies cheaper, they just make them shorter.’”
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Oklahoma Approves First Religious Charter School in the U.S.
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https://www.allsides.com/news/2023-06-05-1539/education-oklahoma-approves-first-religious-charter-school-us
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https://www.nytimes.com/2023/06/05/us/oklahoma-first-religious-charter-school-in-the-us.html
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Oklahoma Approves First Religious Charter School in the U.S.
The school will offer online, Roman Catholic instruction funded by taxpayers. Its approval is certain to tee off a legal battle over the separation of church and state.
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The Cathedral of Our Lady of Perpetual Help in Oklahoma City, the seat of the Archdiocese of Oklahoma City.
Credit...
Nathan J. Fish/The Oklahoman, via Usa Today Network
By Sarah Mervosh
Published June 5, 2023
Updated June 7, 2023
Oklahoma approved what would be the nation’s first religious charter school on Monday, handing a victory to Christian conservatives but opening the door to a constitutional battle over whether taxpayer dollars can directly fund religious schools.
The online school, St. Isidore of Seville Catholic Virtual School, is to be run by the Roman Catholic Archdiocese of Oklahoma City and the Diocese of Tulsa, with religious teachings embedded in the curriculum.
But as a charter school — a type of public school that is independently managed — it would be funded by taxpayer dollars.
After a nearly three-hour meeting, and despite concerns raised by its legal counsel, the Oklahoma Statewide Virtual Charter School Board approved the school in a 3-to-2 vote, including a yes vote from a member who was appointed on Friday. The relatively obscure board is made up of appointees by Gov. Kevin Stitt, a Republican who supports religious charter schools, and leaders of the Republican-controlled State Legislature.
The decision sets the stage for a high-profile legal fight over the barrier between church and state in education, at a time when other aspects of public education are being challenged. Seizing on debates over parents’ rights, Republican lawmakers, including in Oklahoma, have increasingly pushed for alternatives to public schools, such as vouchers and tax credits, which offer subsidies to parents to help pay for private tuition, often at religious schools.
While some government money already goes to religious schools — for example, Hasidic schools in New York City receive public money through various programs while also charging tuition — St. Isidore would be fully paid for by the government.
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Admissions and Race: In the latest challenge to the role race may play in admissions, a legal activist group asked the Supreme Court to hear a case on how students are selected at one of the nation’s top high schools.
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Within minutes of the vote, Americans United for Separation of Church and State announced that it was preparing legal action to fight the decision.
“It’s hard to think of a clearer violation of the religious freedom of Oklahoma taxpayers and public-school families,” said Rachel Laser, the group’s president and chief executive. “This is a sea change for American democracy.”
Brett Farley, the executive director of the Catholic Conference of Oklahoma, which represents the Catholic Church on policy issues in Oklahoma and was behind the proposal, said he welcomed a legal challenge, pointing to recent rulings by the U.S. Supreme Court that have signaled support for directing taxpayer money to religious schools.
“We believe we are in the right,” he said, adding, “This is a victory for parents, for school choice and for religious liberty.”
In key Supreme Court rulings in 2020 and 2022, the court ruled that religious schools could not be excluded from state programs that allow parents to send their children to private schools using government-financed scholarship or tuition programs. Chief Justice John G. Roberts Jr. wrote that while states were not required to support religious education, if a state chose to subsidize any private schools, it could not discriminate against religious ones.
Supporters in Oklahoma applied similar arguments to St. Isidore, contending that excluding religious schools from charter funding was a violation of the First Amendment’s protection of religious freedom.
“Not only may a charter school in Oklahoma be religious, but indeed it would be unlawful to prohibit the operation of such a school,” the school’s application stated.
The move was opposed by a range of groups, including pastors and religious leaders in Oklahoma, advocates for public schools and members of the charter school movement.
“The Archdiocese of Oklahoma City is trying to make charter schools into something they are not,” said Nina Rees, the chief executive of the National Alliance for Public Charter Schools.
Since they arose in the 1990s, charter schools have been public schools funded with taxpayer money. They are meant to offer innovation and flexibility; students can enroll from any school zone, for example. In 2020, about 8 percent of public schools in the United States were charter schools.
A key legal question is whether charter schools are “state actors,” representing the government, or “private actors,” more akin to government contractors. That question is central to another case, out of North Carolina, which the Supreme Court is weighing whether to take up.
In Oklahoma, the state board had been under intense political pressure. During Monday’s meeting, the chairman of the board, Robert Franklin, had been outwardly wary. “This is uncharted territory,” he said, before voting against approving the school.
Top state Republicans had disagreed over whether a religious charter school was allowable.
After the vote, Governor Stitt hailed the board’s “courage” and declared, “This is a win for religious liberty and education freedom.”
But the newly elected Republican attorney general, Gentner Drummond, had opposed the charter school. “It’s extremely disappointing that board members violated their oath in order to fund religious schools with our tax dollars,” he said on Monday.
Oklahoma has about two dozen charter schools, with many charter students getting their education online. St. Isidore, considered the patron saint of the internet, would not open sooner than the fall of 2024, offering online classes to about 500 students in kindergarten through 12th grade.
Sarah Mervosh is a national reporter covering education. She previously covered the coronavirus pandemic and breaking news. More about Sarah Mervosh
A version of this article appears in print on June 6, 2023, Section A, Page 17 of the New York edition with the headline: Charter School Based on Faith Is Approved In Oklahoma. Order Reprints | Today’s Paper | Subscribe
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| 918
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TurboTax customers to receive checks for $141M settlement
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https://www.allsides.com/news/2023-05-05-1539/taxes-turbotax-customers-receive-checks-141m-settlement
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https://apnews.com/article/turbotax-inuit-settlement-checks-mail-0c01cf25aa34693163886d135f7a6560?utm_source=homepage&utm_medium=TopNews&utm_campaign=position_07
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This is a display of TurboTax on display in a Costco Warehouse in Pittsburgh on Thursday, Jan. 26, 2023. In a settlement agreement last year, TurboTax’s owner Intuit Inc. was ordered to pay $141 million to low-income consumers who were deceived into paying TurboTax to file their federal returns — despite being eligible for free, federally-supported tax services. (AP Photo/Gene J. Puskar)
WASHINGTON (AP) — Millions of Americans who qualified for free tax services — but were instead deceived into paying TurboTax for their returns — will soon get settlement checks in the mail.
In a settlement last year, TurboTax’s owner Intuit Inc. was ordered to pay $141 million to some 4.4 million people across the country. Those impacted were low-income consumers eligible for free, federally-supported tax services — but paid TurboTax to file their federal returns across the 2016, 2017 and 2018 tax years due to “predatory and deceptive marketing,” New York Attorney General Letitia James said.
All 50 states and the District of Columbia signed the May 2022 settlement, which was led by James.
Consumers eligible for restitution payments do not need to file a claim, the New York Attorney’s General Office said Thursday. They will be notified by an email from Rust Consulting, the settlement fund administrator, and receive a check automatically.
Checks will be mailed starting next week, and continue through the month of May. The amount paid to each eligible consumer ranges from $29 to $85 — depending on the number of tax years they qualify for.
“TurboTax’s predatory and deceptive marketing cheated millions of low-income Americans who were trying to fulfill their legal duties to file their taxes,” James said in a Thursday statement. “Today we are righting that wrong and putting money back into the pockets of hardworking taxpayers who should have never paid to file their taxes.”
At the time of the May 2022 settlement, James said her investigation into Intuit was sparked by a 2019 ProPublica report that found the company was using deceptive tactics to steer low-income tax filers away from the free, federal services they qualified for — and toward its own commercial products instead.
Under the terms of last year’s settlement, Intuit Inc. agreed to suspend TurboTax’s “free, free, free” ad campaign. According to documents obtained by ProPublica, Intuit executives were aware of the impact of advertising free services that were actually not free for everyone.
“The website lists Free, Free, Free and the customers are assuming their return will be free,” an internal company PowerPoint presentation said, per ProPublica. “Customers are getting upset.”
When contacted by The Associated Press on Friday, Inuit pointed to the company’s May 2022 statement following the settlement agreement.
“Intuit is pleased to have reached a resolution with the state attorneys general that will ensure the company can return our focus to providing vital services to American taxpayers today and in the future,” Kerry McLean, Intuit’s executive vice president and general counsel, said at the time.
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Texas House passes $12 billion property tax relief package, setting up fight over appraisal cap with Senate
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https://www.allsides.com/news/2023-04-13-1400/taxes-texas-house-passes-12-billion-property-tax-relief-package-setting-fight
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https://www.texastribune.org/2023/04/13/texas-house-property-taxes-appraisal-cap/
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TEXAS LEGISLATURE 2023
Texas House passes $12 billion property tax relief package, setting up fight over appraisal cap with Senate
House Speaker Dade Phelan has said tightening the appraisal cap is the best way to cut property taxes, but Senate tax-cut proponents, housing experts and business groups predict the move would have dire consequences.
BY JOSHUA FECHTER
APRIL 13, 2023
UPDATED: 2 PM CENTRAL
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An East Austin neighborhood in 2017.
Credit:
Shelby Knowles for The Texas Tribune
Editor's note: Have you seen your rent increase over the years at the same home? We want to hear from you through the form at the end of this story.
A $12 billion proposal aimed at giving property tax relief to Texas homeowners and businesses cleared a major hurdle Friday in the Texas House, setting up a showdown with the Senate over their warring tax-cut packages.
House Bill 2 — backed by House Speaker Dade Phelan and carried by state Rep. Morgan Meyer, both Republicans — passed the full House by a 139-5 vote after gaining initial approval from the chamber the previous day.
The bill proposes pumping $12 billion into Texas school districts so that they, in turn, can lower their property taxes on home and business owners. For the owner of a $350,000 home, the package would result in more than $1,000 in savings over two years, according to Phelan’s office.
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Cutting the state’s high property tax burden has been a top priority for Texas Republicans this legislative session. HB 2 is a key part of the House’s $17 billion proposed package for how the Legislature should go about doing it.
But HB 2 contains a provision that has drawn substantial criticism from housing experts, business groups and even some tax-cut proponents like Lt. Gov. Dan Patrick who predict dire consequences if it goes into effect.
The controversial idea is to tighten the state’s “appraisal cap” on how much a home’s taxable value can rise each year. The House proposal would lower the cap from 10% to 5% — and expand the benefit to owners of business properties like grocery stores, restaurants and apartment complexes.
Phelan and Meyer argue lowering the cap is meant to ease property owners’ concerns over eye-popping property appraisal increases in recent years — a symptom of rapid economic growth and the state’s red-hot pandemic-era housing market, which is cooling.
“We want to have the caps so that there's predictability and stability for our property owners,” Meyer said Thursday on the House floor.
If the idea were to clear both chambers, the question of whether to tighten the cap would go before voters at the November ballot box.
But tightening the appraisal cap would lead to major inequities among property owners and drive up housing costs, experts warn. Those were the effects in California in the decades following a landmark vote in the late 1970s that capped how much homes could be taxed.
House Republican leaders on Thursday were dismissive of those concerns.
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"You cannot compare California's tax structure to the state of Texas' tax structure," Phelan told reporters after the initial vote Thursday. "It is apples and bowling balls."
Republican leaders in the House and Senate have publicly clashed over the appraisal-cap proposal. In a press conference ahead of the House vote Thursday, Patrick said the idea is dead on arrival in the Senate, arguing it wouldn’t benefit seniors whose appraisals are already capped.
“We can negotiate on just about everything, but I do not negotiate on bad math,” Patrick said.
Phelan remained defiant.
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“That … should send a message,” Phelan said after Thursday's vote.
Under the House’s proposal, owners of homes and businesses would get bigger tax breaks the longer they’ve held to their properties — and, as a consequence, more of the burden of paying property taxes would shift to new owners of homes and businesses. Already, the benefits of the state’s 10% cap flow to wealthier households, according to the Texas comptroller’s office.
Critics also warn that halving the cap would drive up housing prices. Homeowners would be encouraged to hold on to their homes for a longer period in order to keep the tax benefit, resulting in fewer homes available for sale and higher home prices.
What’s more, critics say, cutting the appraisal cap wouldn’t meaningfully bring tax bills down because cities, counties and school districts could just raise their tax rates to make up for any lost revenue.
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The Texas Senate has a different proposal. Senators want to raise the state’s homestead exemption — the amount of a home’s value that can’t be taxed by school districts — from $40,000 to $70,000; give an additional $20,000 bump to seniors; and give tax credits to businesses. Those ideas are part of the Senate’s $16.5 billion property tax package, which passed the chamber last month but haven’t gotten a hearing in the House.
Some House Democrats on Thursday also took a failed run at HB 2, trying to give homeowners more relief.
State Rep. Trey Martinez Fischer, a San Antonio Democrat who heads the House Democratic Caucus, tried to tack on a boost in the homestead exemption that mirrors the Senate’s proposed increase. He also proposed cutting the appraisal cap to 7.5% — instead of 10% — for home and business owners. Another amendment of his would have scrapped the idea of tightening the appraisal cap altogether and instead boosted the homestead exemption to $100,000.
“Homestead exemptions do much better for working families, middle-class families,” Martinez Fischer said, adding that lawmakers don’t need to pick between a bump in the homestead exemption or a tighter appraisal cap. “We can do both.”
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The idea died by a 77-65 vote.
House leaders have maintained that the benefits of the idea get washed out in times of rapidly rising property values. But Phelan signaled Thursday he was still open to raising the homestead exemption. A similar proposal cleared the House two years ago.
"We can have that discussion," Phelan said. "We're not shutting it down in the Texas House. But let's look at all taxpayers. Let's look at renters, let's look at people who own timber, let's look at people who own farmland, let's look at everybody who pays taxes."
Both chambers have agreed on devoting $5.3 billion to continue paying for tax cuts approved in the past. Like the House, the Senate also wants to pump additional funds into school tax cuts, but it would allocate $5.38 billion for that purpose instead of the House’s proposed $12 billion.
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The House also killed an amendment by state Rep. Chris Turner, a Grand Prairie Democrat, to lower the appraisal cap from 10% to 5% but keep the benefit just for homeowners.
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Disclosure: The Texas comptroller of public accounts has been a financial supporter of The Texas Tribune, a nonprofit, nonpartisan news organization that is funded in part by donations from members, foundations and corporate sponsors. Financial supporters play no role in the Tribune’s journalism. Find a complete list of them here.
We can’t wait to welcome you Sept. 21-23 to the 2023 Texas Tribune Festival, our multiday celebration of big, bold ideas about politics, public policy and the day’s news — all taking place just steps away from the Texas Capitol. When tickets go on sale in May, Tribune members will save big. Donate to join or renew today.
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Biden falsely credits tax that took effect in 2023 for deficit reduction in 2021 and 2022
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https://www.allsides.com/news/2023-03-24-0818/facts-and-fact-checking-biden-falsely-credits-tax-took-effect-2023-deficit
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https://www.cnn.com/2023/03/16/politics/fact-check-biden-deficit-minimum-tax/index.html
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President Joe Biden discusses his plan to lower prescription drug costs, at the University of Nevada in Las Vegas, Nevada, March 15, 2023.
Leah Millis/Reuters
Washington
CNN
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President Joe Biden falsely said on Wednesday that his new corporate minimum tax is the reason the federal budget deficit declined in 2021 and 2022. In reality, that tax didn’t even come into effect until the beginning of 2023.
Biden has repeatedly taken credit for reducing the deficit in 2021 and 2022 even though experts have said that the vast majority of this reduction occurred simply because emergency Covid-19 pandemic spending from 2020 expired as planned – and that Biden’s own initiatives made the deficits higher than they otherwise would be.
We’ve described Biden’s previous deficit boasts as misleading or missing key context. But he went further in his Wednesday speech in Las Vegas on lowering prescription drug costs, delivering a version of the story that is just not true.
Biden said: “And by the way, you know everybody said, well, how was I able to have these new programs and still cut the deficit $1.7 trillion the last two years? Well, it’s pretty – pretty straightforward. There were 550 companies of the Fortune 500 that made $40 billion that didn’t pay a penny in tax – zero, nothing – in taxes. So I said the – you know, outrageous. And we got votes for it. I said they ought to pay a minimum of 15%. Fifteen percent. That’s less than you all pay. And guess what? It allowed me to cut the deficit.”
Facts First: Biden’s “pretty straightforward” story about deficit reduction over the last two years is false. Though the 15% corporate minimum tax Biden signed into law in the August 2022 Inflation Reduction Act is expected to reduce deficits in 2023 and beyond, the tax only took effect on January 1, 2023, so it did not reduce the deficit in 2021 or 2022. Again, experts say the deficit fell in 2021 and 2022 primarily because of expiring pandemic spending, not Biden’s own policies, which had the net effect of worsening the deficit.
Maya MacGuineas, president of the Committee for a Responsible Federal Budget, a group that advocates deficit reduction, noted in a Thursday email that “corporations won’t start paying the minimum tax until this year.” She said the fact that Biden “continues to take credit for the deficit dropping between 2021 and 2022 – which happened entirely due to the expiration of temporary COVID measures – is cause for concern.”
Biden also got a key number wrong in this section of the Las Vegas speech. As he has correctly said on numerous previous occasions, it was 55 big companies, not 550 companies as he said this time, that didn’t pay any federal income tax in their previous fiscal year, according to an analysis published in 2021 by the Institute on Taxation and Economic Policy, a liberal think tank.
A White House spokesperson declined to comment for this article.
Future deficit reduction, not past deficit reduction
The 15% corporate minimum tax applies only to corporations with an average annual financial statement income of $1 billion or more – there are lots of nuances involved; you can read more details here – so it will not immediately hit all of the 55 companies on the Institute on Taxation and Economic Policy’s 2021 list.
It would be fair for Biden to invoke the minimum tax as an asset in battling the deficit this year and in the future. Matthew Gardner, a senior fellow at the institute, pointed out in a Thursday email that the government’s nonpartisan Joint Committee on Taxation has estimated that the tax will bring down the deficit by about $34.7 billion in the 2023 fiscal year (and a total of about $222.2 billion through the 2031 fiscal year). Gardner said that since the minimum tax is the biggest tax hike in the Inflation Reduction Act, “it makes sense that this is the first specific policy the President would point to in explaining the administration’s deficit reduction successes.”
Gardner also said, however, that “the first fiscal year in which we’ll see a direct revenue boost from the new minimum tax is fiscal 2023” and that the tax “shouldn’t have had any effect at all in fiscal year 2022.”
Reuven Avi-Yonah, a University of Michigan law professor and a corporate taxation expert who had advocated a minimum tax, said in an email that Biden probably meant that tax will significantly reduce the deficit going forward. “Of course it is true that no actual revenue will come in until 2023,” Avi-Yonah said, but the tax “does contribute to reducing the deficit over the ten year budget window” used by the federal government, which runs from the 2022 to 2031 fiscal years.
Nonetheless, the president explicitly said in a prepared speech, with emphasis, that the minimum tax was the reason he was able to cut the deficit by $1.7 trillion over the previous two years. That’s inaccurate.
“It would take a time machine for a policy implemented in 2023 to reduce deficits in 2021 and 2022,” said Brian Riedl, a senior fellow at the Manhattan Institute, a conservative think tank.
Why the deficit fell
The primary reason for the deficit falling by $1.7 trillion under Biden was that the deficit had skyrocketed to a record high of about $3.1 trillion in fiscal 2020 during the early stage of the pandemic under then-President Donald Trump. The increase happened largely because of temporary, bipartisan pandemic spending. After much of the temporary spending expired on schedule, the deficit plummeted to about $1.4 trillion in fiscal 2022 under Biden.
Biden can reasonably take credit for stimulating the US economic recovery, which pushed the deficit downward by boosting tax revenues in fiscal 2021 and fiscal 2022. But Biden’s list of policy initiatives – including a pandemic relief law, a bipartisan infrastructure law, a bipartisan law to spur semiconductor manufacturing, a boost to food stamp benefits and an extension of the Trump-era pandemic pause on federal student loan repayments – have, on the whole, made deficits higher, not lower, even when you factor in the deficit-reducing impact of Biden’s signature Inflation Reduction Act.
MacGuineas said Thursday that although Biden can rightly say that the Inflation Reduction Act will reduce deficits by $240 billion over a decade, that reduction offsets only a “small fraction” of the trillions in new borrowing Biden has approved to date. And Dan White, until recently senior director at Moody’s Analytics, an economic research firm whose analysis Biden has repeatedly touted in his speeches, said in an email last year: “The actions of the administration and Congress have undoubtedly resulted in higher deficits, not smaller ones.”
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Derek Chauvin, convicted of killing George Floyd, pleads guilty to tax evasion
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https://www.allsides.com/news/2023-03-17-1531/criminal-justice-derek-chauvin-convicted-killing-george-floyd-pleads-guilty-tax
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https://www.axios.com/2023/03/17/derek-chauvin-george-floyd-tax-evasion
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IRS nominee: No audit boost for households under $400,000
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https://www.allsides.com/news/2023-02-15-0901/taxes-irs-nominee-no-audit-boost-households-under-400000
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https://apnews.com/article/irs-nominee-tax-audit-promise-41b0d4242fcb69a180f313a689e34953
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Daniel Werfel testifies before the Senate Finance Committee during his confirmation hearing to be the Internal Revenue Service Commissioner, Wednesday, Feb. 15, 2023, on Capitol Hill in Washington. Werfel, President Joe Biden’s nominee to lead the Internal Revenue Service says he will commit to not increasing tax audits on businesses and households making less than $400,000 per year. (AP Photo/Mariam Zuhaib)
WASHINGTON (AP) — Republican and Democratic senators who have been arguing over how much money to give the IRS and how it should be spent found at least one point of unanimity Wednesday as they considered President Joe Biden’s nominee to lead the agency: Both sides wished Danny Werfel good luck with the worst job in Washington.
Werfel pledged before senators not to expand tax audits on businesses and households making less than $400,000 per year, a key point of concern to legislators, as he faced rounds of questions before the Senate Finance Committee on how he would spend the agency’s big new infusion of money. He drew praise for being willing to leave a private consulting job to take on the top job at the troubled agency.
Sen. Mark Warner, D-Va., called the job “one of the more thankless tasks” in Washington. Sen James Lankford, R-Okla., said Werfel was “walking right into fire.” Sen. Thom Tillis, R-N.C., told Werfel the IRS was never going to be one of the most admired agencies in Washington given its mission of collecting taxes. And Sen. Sheldon Whitehouse, D-R.I., offered Werfel best wishes in one of the “least popular jobs in town.”
A vote on Werfel’s nomination will be scheduled after the committee allows time for him to answer follow-up questions. But the bipartisan acknowledgment of the tough job ahead served as a reminder of just how beleaguered the national tax collector has become in recent decades and the work it will take to modernize the organization.
President Joe Biden nominated Werfel to steer the IRS as it receives nearly $80 billion over the next 10 years through the Inflation Reduction Act, which Congress passed in August. Taking note of the potential impact of the funding, Werfel said “Americans rightfully expect a more modern and high-performing IRS.”
Werfel, 51, said he would be “unyielding in following my true north to increase public trust” in the agency even as he works to modernize the agency’s technology, address its paperwork burden and audit high-income earners.
Werfel, who led Boston Consulting Group’s global public sector practice, would replace Charles Rettig, whose five-year term ended in November. An acting commissioner has been filling in.
Werfel will have to navigate controversy surrounding the new funding as critics distort how the new law would affect the IRS and taxes for the middle class. About $46 billion was allocated for enforcing tax laws and the rest to taxpayer services, operations support and updating business systems.
Republicans have suggested without evidence that the agency would use the new money to hire an army of tax agents with weapons.
Sen. Mike Crapo, R-Idaho, said Republican concerns center around potential misuse of government funding.
Taxpayers “are rightly concerned about the vitality of their taxpayer rights” he said.
Werfel pulled out a paper copy of the Taxpayers Bill of Rights and said he pledged to read the document every day if confirmed to the role.
”I’m ready to roll up my sleeves to help working families,” he said.
Senators on both sides of the aisle probed the IRS’ intent to audit more high-income earners — and Werfel’s commitment not to expand audits of households and businesses making less than $400,000 per year.
House Republicans began their tenure in the majority last month by passing a bill that would rescind new IRS funding. That legislation has not advanced in the Senate and is unlikely to reach Biden, who has promised a veto.
Caroline Bruckner, a tax professor at the American University Kogod School of Business, said that, if confirmed, Werfel would have to address the massive workforce challenges at the IRS wrought by attrition, an aging workforce and a generally poor reputation.
“The next generation of accountants don’t want to work for the IRS,” Bruckner said. She added, “To attract the best talent, particularly with Millennials and Gen-Z workers who will be the future of the workforce, transparency as a leader will go a long way.”
Bruckner referred to a Stanford University study that showed IRS data-driven algorithms chose Black taxpayers for audit at up to 4.7 times the rate of non-Black taxpayers. “The next generation of workers care about these things, and this is a leadership challenge,” she said.
Werfel said he would “absolutely” report to the Senate Finance committee within 60 days of his confirmation on the matter.
“The bottom line is what will build trust with the taxpayers,” Werfel said.
| 923
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Trump Organization fined $1.6 million for tax fraud
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https://www.allsides.com/news/2023-01-13-0905/donald-trump-trump-organization-fined-16-million-tax-fraud
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https://apnews.com/article/politics-legal-proceedings-new-york-city-donald-trump-manhattan-e2f1d01525dafb64be8738c8b4f32085
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Prosecuting and Defense attorneys wait during the sentencing of the Trump Organization at Manhattan Criminal Court on Friday, Jan. 13, 2023, in New York. (Adam Gray/DailyMail via AP, Pool)
NEW YORK (AP) — Donald Trump’s company was fined $1.6 million Friday for a scheme in which the former president’s top executives dodged personal income taxes on lavish job perks — a symbolic, hardly crippling blow for an enterprise boasting billions of dollars in assets.
A fine was the only penalty a judge could impose on the Trump Organization after its conviction last month for 17 tax crimes, including conspiracy and falsifying business records. The amount was the maximum allowed by law. Judge Juan Manuel Merchan gave the company 14 days to pay. A person convicted of the same crimes would’ve faced years in prison.
Trump himself was not on trial and denied any knowledge that a small group of executives were evading taxes on extras including rent-free apartments, luxury cars and private school tuition. Prosecutors said such items were part of what they dubbed the Trump Organization’s “deluxe executive compensation package.”
The company denied wrongdoing and said it would appeal.
“These politically motivated prosecutors will stop at nothing to get President Trump and continue the never ending witch-hunt which began the day he announced his presidency,” the company said in a statement after the fine was announced.
Neither the former president nor his children, who helped run the Trump Organization, were in the courtroom.
While the fines — less than the cost of a Trump Tower apartment — aren’t big enough to impact the company’s operations or future, the conviction is a black mark on the Republican’s reputation as a savvy businessman as he mounts a campaign to regain the White House.
Outside the courtroom, Manhattan District Attorney Alvin Bragg, a Democrat, said he wished the law had allowed for a more serious penalty.
“I want to be very clear: we don’t think that is enough,” he said. “Our laws in this state need to change in order to capture this type of decade-plus systemic and egregious fraud.”
Besides the company, only one executive was charged in the case: former Trump Organization Chief Financial Officer Allen Weisselberg, who pleaded guilty last summer to evading taxes on $1.7 million in compensation. He was sentenced Tuesday to five months in jail.
The criminal case involved financial practices and pay arrangements that the company halted when Trump was elected president in 2016.
Over his years as the company’s chief moneyman, Weisselberg received a rent-free apartment in a Trump-branded building in Manhattan with a view of the Hudson River. He and his wife drove Mercedes-Benz cars, leased by company. When his grandchildren went to an exclusive private school, Trump paid their tuition. A handful of other executives received similar perks.
When called to testify against the Trump Organization at trial, Weisselberg said that he didn’t pay taxes on that compensation, and that he and a company vice president conspired to hide the perks by having the company issue falsified W-2 forms.
Assistant District Attorney Joshua Steinglass told jurors Trump had a role, showing them a lease that the Republican signed himself for Weisselberg’s apartment.
“Mr. Trump is explicitly sanctioning tax fraud,” Steinglass argued.
Weisselberg also attempted to take responsibility on the witness stand, saying nobody in the Trump family knew what he was doing. He choked up as he told jurors, “It was my own personal greed that led to this.”
At the trial, Trump Organization lawyers repeated the mantra, “Weisselberg did it for Weisselberg.” In its statement Friday, the company took a different tone.
“Allen Weisselberg is a victim,” it said. “He was threatened, intimidated and terrorized. He was given a choice of pleading guilty and serving 90 days in prison or serving the rest of his life in jail -- all of this over a corporate car and standard employee benefits.”
A jury convicted the company of tax fraud on Dec. 6.
The Trump Organization was charged through two corporate entities: The Trump Corporation, which was fined $810,000; and Trump Payroll Corporation, which was fined $800,000.
Those fines “constitute a fraction of the revenue” generated by Trump’s real estate empire, Steinglass said in court. It could face more trouble outside of court from reputational damage, such as difficulty finding new deals and business partners.
“We all know that these corporations won’t go to jail, as Allen Weisselberg has,” Steinglass said. “The only way to deter such conduct is to make it as expensive as possible.”
The Trump Organization’s sentencing doesn’t end Trump’s battle with Bragg, who said the sentencing “closes this important chapter of our ongoing investigation into the former president and his businesses. We now move onto the next chapter.”
Bragg, in office for little more than a year, inherited the Trump Organization case and the investigation into the former president from his predecessor, Cyrus Vance Jr.
At the same time, New York Attorney General Letitia James is suing Trump and the Trump Organization, alleging they misled banks and others about the value of its many assets, including golf courses and skyscrapers — a practice she dubbed the “art of the steal.”
James, a Democrat, is asking a court to ban Trump and his three eldest children from running any New York-based company and is seeking to fine them at least $250 million. A judge has set an October trial date and appointed a monitor for the company while the case is pending.
Trump faces several other legal challenges as he ramps up his presidential campaign.
A special grand jury in Atlanta has investigated whether Trump and his allies committed any crimes while trying to overturn his 2020 election loss in Georgia.
Last month, the House Jan. 6 committee voted to make a criminal referral to the Justice Department for Trump’s role in sparking the violent insurrection at the U.S. Capitol. The FBI is also investigating Trump’s storage of classified documents.
Follow Michael Sisak on Twitter at twitter.com/mikesisak and send confidential tips by visiting https://www.ap.org/tips/
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How you can take advantage of tax breaks in the Inflation Reduction Act
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How you can take advantage of tax breaks in the Inflation Reduction Act
Make a home energy audit your resolution for 2023.
By Rebecca [email protected]@vox.com Jan 3, 2023, 6:30am EST
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Solar contractors lift solar panels onto the roof of a home in Hayward, California, on February 8. David Paul Morris/Bloomberg via Getty Images
Rebecca Leber is a senior reporter covering climate change for Vox. She was previously an environmental reporter at Mother Jones, Grist, and the New Republic. Rebecca also serves on the board of the Society of Environmental Journalists.
On January 1, Americans became eligible to save thousands of dollars when they buy electric cars, induction stoves, and modern appliances under the Inflation Reduction Act that Democrats passed last fall.
Most American homes still use fossil fuels, specifically natural gas, for heating, cooking, and hot water. To reach the Biden administration’s goal of slashing buildings’ climate footprint in half by 2032, many of those homes will need to be electrified. Swapping out the gas stove for induction and a natural gas furnace for an electric heat pump plugs the building more fully into the electric grid. Today, that grid might still be powered by some coal and gas, but years from now, it will run predominantly on clean energy like wind and solar. Electrifying homes now is key to reducing the US carbon pollution in the decades to come.
A major part of the new law’s $369 billion for climate initiatives is rebates and tax credits aimed at helping consumers switch from fossil fuels to electricity. While the IRA also includes big payouts for utilities and manufacturers to boost a cleaner economy domestically, the consumer incentives address a different set of problems — rising energy bills, and tackling the most stubborn sources of greenhouse gas pollution.
There’s money for rooftop solar; electric vehicles, clothes dryers, stoves, and ovens; heat pumps for heating, cooling, and hot water; electric panels and wiring. The law also includes programs that cover the costs of insulation and weatherization to cut a building’s energy usage.
Not everyone will need to replace their furnace, car, or stove in 2023. But even if you aren’t planning to do so, or you don’t own your home, there are ways the IRA’s incentives can apply, and it’s important to start thinking about them early to take full advantage.
Home renovations are a big investment and difficult to time right. The worst case is to find yourself with a broken system and long wait times for a contractor, let alone one who’s up to date on the best available technology. That’s why if you’re going to make one goal for 2023, it should be to evaluate what you have and what you’ll need.
“Embrace the notion that electrification is what we all need to do eventually,” said Craig Aaker of Green Savers, an Oregon-based home performance contractor. There’s no point to upgrade a furnace, unless it’s switching to a heat pump, he added: “At this point, I certainly wouldn’t spend any money fixing a furnace if it goes out. Just take that money and turn it into an investment.”
The best place to start is an energy audit, which identifies where your home is inefficient, any problem areas like drafty windows, and any fixes that could make it cost less in energy bills and more comfortable. A professional one will run around $150 (though the Department of Energy has a guide for a DIY option). Not all of the suggestions are expensive upgrades, and probably fall under one of the categories of improvements eligible for tax breaks.
“The nice thing about the Inflation Reduction Act is it effectively creates an electric bank account for every household in America that they can access when the time is right for them,” said Ari Matusiak, CEO of the electrification advocacy group Rewiring America.
Just some of the tax credits available in 2023
There are two main buckets of incentives available — tax credits that can be redeemed when you file your taxes the following year, and rebates that lower the upfront cost of installation and machines.
Tax credits will last through 2032 without any cap on their cost, barring a dramatic reversal by a future Congress. Some funding for rebates is set aside for low and middle-income people, those earning between 80 and 150 percent of an area’s median income, and does have a cap on spending, so the law may run out of money before the 10 years are up.
Some rebates might not kick in until later in 2023, because states have to set up their own programs and guidance for who qualifies. For lower-income people earning less than 80 percent of an area’s income, the rebates will eventually cover most if not all of the costs of the technology and installations. Middle-income people, earning between 80 and 150 percent of an area’s income, would see a portion of the costs covered. The rebates will be an upfront discount, offered at sale.
More information on rebates is coming in 2023. For now, the tax credits are available, and can be a little complicated. Some are capped based on cost and income levels, or, like the 25C tax credits, apply to multiple categories.
If you want to dig into these tax breaks further, Rewiring America has a useful guide, and the White House has a dedicated website to unpacking the IRA. The other page to bookmark is the IRS guidance, which will be updated throughout the year.
Here is some of the technology you might want to think about upgrading or replacing, taking advantage of the tax credits available January 1 through the IRA:
Breaker box
The electrical panel, or breaker box, is the foundation for the electricity flowing into your home. The panel size matters if you’re planning on adding tons of new plug-in appliances, because older homes may have a much smaller capacity.
The tax credits cover 30 percent of the panel upgrade, capped at $600 resetting each year (this is uncapped if it pairs with a rooftop solar installation).
Rooftop solar
In the long run, rooftop solar can slash bills by hundreds of dollars each year, and come through as a backup electricity source in a storm when paired with battery storage. It’s also electricity that doesn’t contribute to the climate crisis.
The tax credit would cover 30 percent of the cost of installing rooftop solar. Rewiring America estimates that the average 6kW rooftop solar installation costs about $19,000, so the average tax credit would be around $4,700.
Heat pumps for heating, AC, and water heaters
Heat pumps are up to four times more efficient than the best gas furnaces, because they essentially redirect cold air from one area to another. The technology is relatively unfamiliar in the US compared to Europe, but is catching on.
There are a few different kinds of heat pumps, which are especially good to consider if you currently rely on gas for your clothes dryer, your AC, heating, or hot water.
The tax credit covers 30 percent of the cost of heat pumps for air and water, capped at $2,000 each year, but resets annually so it can be used for other projects.
Aaker, of Green Savers, explained that it’s worth considering what you have already for water heating, too. “If you have natural gas or a resistance electric water heater, which are the two most common types, you can save real money. The thing that we sell that has the highest payback is heat pump water heaters.”
Weatherization and insulation
By sealing doors and windows, and adding insulation, a home could be much more comfortable to live in and require less money to heat and cool. The first step to figuring out what a space needs is getting an energy audit done by a professional, who evaluates what kinds of insulation and sealing will be the most useful. The IRA offers a 30 percent tax credit back for an energy audit, and on upgrades for insulation, doors, and windows.
Residential battery system
Battery storage can help power appliances in the home, even if there is a major storm outage. The tax credit for this is uncapped, offering 30 percent back on battery storage. The average cost is $16,000, so the average credit delivers about $4,800.
Electric vehicles
There are two relevant tax credits for new and used EVs, each with different income limits and price caps. The way it works for new vehicles is if you earn under $150,000, $225,000 as the head of household, or $300,000 for joint filers, you could get up to $7,500 off. The cars have to cost less than a certain retail price to qualify: For vans and pickup trucks, that’s $80,000; for other cars, that’s $55,000. The IRS has an initial list of qualifying cars here, and answers common questions about the new credits.
For used vehicles, the income cap is $150,000 for joint filers, $112,500 for the head of household, and $75,000 for all other filers. The cars have to cost less than $25,000 to qualify.
In 2024, these credits will change into upfront discounts provided by dealers at the point of sale.
Additional rebates available later in 2023
There are going to be more rebates available for all the above categories, aimed at lower and moderate income levels, later in 2023. There are also added categories that will be eligible for rebates, including induction stoves, ovens, and clothes dryers.
Correction, January 3, 11:30 am ET: An earlier version of this story misstated the restrictions in place for new electric vehicle tax credits.
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Providence colleges will pay the city $200M in lieu of taxes
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https://insidehighered.com/news/quick-takes/2023/09/06/providence-colleges-will-pay-city-200m-lieu-taxes
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Four private colleges in Providence, R.I., have agreed to pay the city more than $200 million over the next two decades in lieu of taxes, The Boston Globe reported Tuesday.
The deal is comprised of two different agreements. According to the first, Brown University, Providence College, the Rhode Island School of Design and Johnson & Wales University will pay Providence $177 million over 20 years, with Brown paying the largest portion, $128.7 million.
The second agreement involves Brown alone paying the city $46 million over 10 years. However, in an announcement released by the university, that agreement stipulates that the city could give Brown a “contribution credit” toward its payment for investments that could bring in tax revenue for the city. The city may also lower Brown’s voluntary payment if the university begins bringing in tax revenue through new developments or building sales.
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The institutions will also offer community services that could include “snow and trash removal, support for public schools, scholarships and more,” the Globe reported.
Providence often seeks voluntary payments, known as PILOTs, or payments in lieu of taxes, from tax-exempt institutions like colleges and hospitals; in exchange, the city does not challenge the institutions’ tax-exempt status and does not request additional funds. In the previous iteration of this agreement, the colleges paid $94 million.
Providence also agreed to give Brown four city blocks that are already occupied by the university. Buildings purchased by the four private institutions will immediately become tax exempt, whereas in the past they were removed from the city’s tax rolls over multiple years.
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States And Retailers Take A Stand Against The ‘Tampon Tax’
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TurboTax Paying $141 Million to Taxpayers Who Could Have Filed for Free
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https://www.wsj.com/articles/turbotax-paying-141-million-to-taxpayers-who-could-have-filed-for-free-b3020046?mod=hp_lead_pos7
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By
Ashlea Ebeling
May 4, 2023 3:55 pm ET
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TurboTax owner Intuit will make payments ranging from $29 to $85 to about 4.4 million taxpayers. PHOTO: SHUTTERSTOCK
Millions of Americans who were charged for tax preparation that should have been free will receive settlement checks from TurboTax starting next week, New York’s attorney general said Thursday.
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Bernie Sanders calls for income over $1 billion to be taxed at 100%: ’People can make it on $999 million’
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Longtime wealth tax advocate Sen. Bernie Sanders has argued that all earnings above $1 billion in the U.S. should be confiscated by the government.
In an interview with HBO Max’s Who’s Talking to Chris Wallace, the Vermont senator was questioned about his long-standing view that billionaires should not exist.
“Are you basically saying that once you get to $999 million, the government should confiscate all the rest?” he was asked—to which Sanders responded: “Yeah.”
“You may disagree with me, but I think people can make it on $999 million,” Sanders added. “I think that they can survive just fine.”
Earlier this year, Sanders published It’s OK to Be Angry About Capitalism. During Friday’s show, he responded to questions on whether billionaires could actually boost the economy by creating employment.
“You can have a vibrant economy without [a handful of] people owning more wealth than the bottom half of American society,” he said, adding that if he had things his way those making “a whole lot of money” would have to “pay a whole lot of money.”
Sanders has long touted the idea of imposing much higher taxes on the wealthiest factions of U.S. society, proposing a wealth tax in 2019 when he was running to be the Democratic candidate for the 2020 presidential election.
The Vermont independent senator called for the richest 0.1% of American households—or those with a net worth of more than $32 million—to be liable for a new annual tax, with the tax rate increasing with net worth.
Under his proposal, a married couple with a net worth of $32 million would have paid a 1% wealth tax, while wealth over $10 billion would have been taxed at 8%.
“Under this plan, the wealth of billionaires would be cut in half over 15 years, which would substantially break up the concentration of wealth and power of this small privileged class,” Sanders argued during his campaign.
Sanders dropped out of the race for the Democratic nomination seven months before the election, admitting that the “path toward victory is virtually impossible” despite his campaign enjoying a strong start.
It was the second time Sanders had run to compete in the presidential election, running against Hillary Clinton in 2016.
Taxing the wealth of America’s über-rich has garnered support from many high-profile individuals in recent years, including Ray Dalio, Mark Cuban, and Disney heiress Abigail Disney.
The American public also appears to support the concept of hiking taxes on the elite, with 57% of Americans saying billionaires were taxed too little in the U.S. in a YouGov poll last year.
An earlier poll, conducted by Reuters and Ipsos in 2020, found that the majority of 4,441 Americans believed the very rich should “contribute an extra share of their total wealth each year to support public programs.”
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A 94-Year Old Grandmother Fights Back After Government Sold Her Home—And Kept The Profit
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Geraldine Tyler
In
1999, Geraldine Tyler, then a 70-year-old retired county worker, bought her own apartment—a modest one-bedroom condo in Minneapolis, Minnesota, near a park and public transit. She lived there for a decade, dutifully paying her real estate taxes, until worries about rising crime and an incident involving a neighbor led her to make a hasty move across town to a senior community in a safer neighborhood.
The move was good for her peace of mind but not for her pocketbook. She couldn't keep up with the bills for both places and by 2015 had accrued $2,311 in unpaid property taxes on the condo plus interest, costs, and penalties totaling nearly $13,000. Eventually, Hennepin County seized Tyler's condo and sold it for $40,000. But rather than keep the $15,000 it was owed and refund Geraldine the $25,000 sale surplus, the county kept the whole $40,000.
That’s perfectly legal in Minnesota–at least for now. When it comes to collecting property taxes and some other government debts, local governments in Minnesota take what's called absolute title, meaning that they can keep all proceeds from a sale, no matter how much the windfall exceeds the amount they’re owed.
Today, lawyers for Tyler will argue before the U.S. Supreme Court that this practice violates the U.S. constitution. The grandmother of four is now 94 and living in an assisted living facility, but if she wins, she would change a practice that has harmed thousands of other homeowners, many elderly, across the country.
In Minnesota alone, from 2014 to 2020, more than 4,300 properties were taken and sold. Of those, more than 1,200 were family homes—meaning they were not vacant or considered commercial. These families lost their homes for debts that averaged 8% of their properties’ value. Or, put another way, homeowners who had their homes seized lost 92% of the value of their home, or $207,000, above the tax debt that was owed—the average debt was just $17,000. That’s all according to the Pacific Legal Foundation, a nonprofit legal organization that has, as its mission, to defend Americans' liberties "when threatened by government overreach and abuse." It’s representing Tyler pro bono (for free).
PLF calls the Minnesota practice "an egregious violation of fundamental property rights." But the state isn’t alone. According to PLF, 12 states and the District of Columbia allow the government to seize your property over tax debts, code enforcement fines, or obligations to government agencies, then sell it and leave you with nothing. Nine other states allow for this kind of taking—which PLF calls "home equity theft"—in limited situations.
Hennepin County, in its response brief filed with the Supreme Court, suggests that homeowners who lose their properties do so voluntarily. The county claims that "Tyler chose not to pay property tax." And, the county suggested, Tyler could have sold her condominium or refinanced her mortgage, or signed up for a tax payment plan. But, they say, Tyler refused, instead, requiring "the State to serve as her real estate agent, sell the property on her behalf, and [if she wins her case] write a check for the difference between the tax debt and the fair market value." They further argue that Tyler wouldn’t have any equity in the property anyway–there were other liens on her property.
While it might be easy to blame tax delinquents for shirking their duties, these far-reaching state statutes can have devastating consequences for homeowners who fall behind on their taxes for non-blameworthy reasons. That includes many elderly property owners like Tyler who may leave their residences for medical or other reasons without fully understanding what could happen or for those who find themselves unable to make ends meet. Homeowners who experience cognitive decline, physical or mental illness that led them to financial difficulty—or are simply poor—are at risk under these schemes to lose far more than they owe.
This is why, in an amici curiae (meaning, literally, friends of the court) brief filed in support of Tyler, the American Association of Retired Persons (AARP), the AARP Foundation, and the The National Consumer Law Center (NCLC) urged the Court to consider the "human cost of such laws for the nation’s older homeowners in particular." Older homeowners of modest means are, they argue, most at risk of property tax foreclosure, often for reasons beyond their control. Many live on low fixed incomes and face steadily rising food, utilities, and medical expenses, have physical ailments, and are forced to navigate complex financial waters, like tax sales, without access to affordable professional financial advice, since that equity is their only sizable financial asset. And, unlike younger homeowners, many older homeowners no longer have the option of re-entering the workforce to try to recoup the loss or qualify for alternative financing. These challenges not only increase the likelihood that older homeowners might be sued for unpaid taxes, but also make it more difficult for them to defend themselves and resist foreclosure. Taking their home equity, the amici note, “is nothing short of catastrophic.”
Tyler’s own legal fight has been going on for years. In 2019, a St. Paul firm, Reinhardt Wendorf & Blanchield (which is still involved in the case) filed a putative class action lawsuit against Hennepin County with Tyler as the lead plaintiff. It was dismissed with a federal judge citing the very premise she now says is wrong—that forfeiture wipes out an owner's property interest. On appeal, the Eight Circuit affirmed the dismissal. But in January of this year, the Supreme Court agreed to hear Tyler's case.
It's important to understand that Tyler isn't claiming she paid the tax. She's arguing that the county should not have been allowed to fatten its coffers–beyond what she legitimately owed– at her expense. It's already been established, her lawyers note, that the government may lawfully seize property to collect a debt. But when it takes more than what it is owed, they claim, it violates both the Takings Clause and the Excessive Fines Clause. The Fifth Amendment to the Constitution prohibits the government from taking property–such as home equity–without just compensation. The Eighth Amendment bans excessive fines and fees—and the disconnect between the amount owed and the property value could be described as a punitive fine.
Hennepin County, in its response brief filed with the Supreme Court, suggests that homeowners who lose their properties do so voluntarily.
Under the Eighth Circuit's reasoning, Tyler's lawyers argue, even the smallest debt—underpaying by a few dollars—would entitle the government to the entire value of a debtor's property. This stance, they argued in their petition for certiorari to the Supreme Court, "flouts historical tradition, the fairness and justice embodied by the Just Compensation Clause, and principles established by this Court."
True, it’s a practice that's been going on in Minnesota for nearly 100 years. But, Tyler's lawyers argue, the basic concept that should protect Tyler dates back much further to 1215 and the Magna Carta, which limited how much property could be taken to satisfy a debt. And a bit more recently—in 1855—the Supreme Court itself found in Murray's Lessee v. Hoboken Land & Improvement Co., that while the government may seize property to collect a tax, it exceeds its legitimate authority to collect the debt when it takes more than what is owed.
It's a question that the Minnesota Supreme Court answered a few years later in 1866, writing in Baker v. Kelley, 11 Minn. 480, 488, 499 (1866), "If the Legislature by this section attempted to do more than confer on the State the power to take such further steps as were necessary in the collection of the delinquent taxes, or in the perfection of tax titles, then it overstepped the limits which the constitution has fixed to its authority."
But later on, courts ruled that laws passed by the legislature beginning in the 20th century intended to replace that logic, arguing, for example, that keeping the overage was a way to "compensate the government for lost revenues." Minnesota's tax forfeiture scheme, Tyler’s lawyers claim, goes beyond such compensation, taking all of a tax-delinquent property from its owner—which in many cases, including Tyler's, is substantially more than needed to satisfy the debt owed plus reasonable interest, penalties, and costs. In other words, it feels more like punishment.
Around the country, as recent cases show, it’s not only local governments that have been profiting from homeowners’ misfortunes. Still, dispossessed homeowners have notched some victories, too.
In 2019, for example, a Massachusetts family lost its home to Tallage Lincoln, LLC, a private investment company that specializes in buying property tax debts. Brothers Neil and Mark Mucciaccio had lived in their childhood home with Mark's wife, his disabled stepdaughter, and two of his grandchildren, one of whom has juvenile diabetes. When medical bills made it difficult to make ends meet, they failed to pay their taxes and the tax liens were sold by the Town of Easton, where the house was located, to Tallage. The Mucciaccios owed $30,000 in taxes, interests, and costs—but under Massachusetts law, Tallage was entitled to all of the equity in the home worth $276,500. The Mucciaccios, represented by PLF, filed a suit against Tallage and Easton that challenged the state law; the suit was dismissed after Tallage agreed the family could pay the debt and reclaim title to the home.
In the District of Columbia, Benjamin Coleman, a 76-year-old veteran with severe dementia, lost his house, valued at $200,000, over a $133.88 tax bill. With the additional penalty, his tax bill hit $317.35 and was sold at a public auction to Embassy Tax Services, LLC. Embassy tacked on $4,999 for "court costs, attorney's fees, expenses incurred for personal service of process, expenses incurred for service of process by publication and fees for the title search." When Coleman's son realized what had happened, he tried to make payment arrangements and wrote letters to the court explaining that his father had been ill. When neither Coleman nor his son appeared in court proceedings, Embassy claimed full title to the property and evicted the retired Marine sergeant. Coleman's conservator, Robert Bunn, who was appointed by the court to oversee Coleman’s finances, took the matter to court, which rejected efforts by the District of Columbia to dismiss the case, finding that common law can create a property interest in the surplus created by a tax-foreclosure sale. In other words, the court disagreed with the District’s premise that “winner takes all,” finding that even when a homeowner lost property in a tax-related foreclosure or sale, the homeowner still had some rights to equity in the property.
The bottom line, however, is that state and local governments have financial incentives not to change their practices, unless they’re forced to.
In Michigan, a similar battle ended in a broader win for homeowners. In his 80s, Uri Rafaeli lost his property after underpaying by $8.41. With interest, penalties, and fees, he eventually owed $285.81. Oakland County seized his property and sold it at auction—pocketing a nearly $25,000 profit in the process. The court initially found that under the General Property Tax Act, Rafaeli lost his interest in the property, and as a result, didn't have any property interest in the proceeds–even though those proceeds far exceeded the debt. In 2020, however, the Michigan Supreme Court reversed the lower court, finding that "The remedy for a government taking is just compensation for the value of the property taken," and property owners are entitled to the value of those surplus proceeds as just compensation. The result was that the Michigan law was overturned.
The bottom line, however, is that state and local governments have financial incentives not to change their practices, unless they’re forced to. Many local governments depend on these proceeds to plug budget holes. According to PLF, Detroit has a budget line for the expected windfalls from home foreclosures, while in Minnesota, Maine, and Oregon, municipalities routinely seize properties and keep the surpluses for the government's benefit. Even when funds are usually returned, there can be incentives to carve out exceptions—in Ohio and California, the law permits confiscation of the entire value if there's a benefit to public use or economic revitalization.
In some states, there have historically been few restraints on what can be done with the proceeds. In Michigan, before the state Supreme Court ruled in homeowners’ favor, some local officials had auctioned properties to their families and related businesses at a discount. In Montana, before the practice was banned in 2019, local treasurers sold foreclosed homes for pennies on the dollar to preferred private investors–now, by law, properties in tax sales must be sold to the highest bidder. No such protections exist in states like Nebraska, Oregon, and Arizona.
Tyler's lawyers argue that these laws and how they can be enforced have created "a pressing national problem that has festered for decades in the lower courts." Her case, they say, is an excellent vehicle to address them on a national basis.
Oral arguments will be heard on April 26, 2023—it will be the last Supreme Court case heard this term. A decision is expected in June of 2023.
The case is Geraldine Tyler, Petitioner, v. Hennepin County, Minnesota, et al.
I focus on tax law including tax planning and tax controversy matters. My goal is to help taxpayers get compliant and stay out... Read More
I focus on tax law including tax planning and tax controversy matters. My goal is to help taxpayers get compliant and stay out
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The EU has approved the world's first carbon tax on imports
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https://www.allsides.com/news/2023-04-26-1033/taxes-eu-has-approved-worlds-first-carbon-tax-imports
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https://qz.com/the-eu-has-approved-the-worlds-first-carbon-tax-on-impo-1850376708
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After two years of negotiations, the EU’s 27 member states voted on Tuesday (April 25) to finalize a new law creating the world’s first carbon border tax. The tax, levied on imports, is a landmark piece of legislation, with the potential to transform the most polluting industries within the EU and beyond.
The carbon tax is part of a wider overhaul of the bloc’s carbon market that will require European industries to comply with strict emissions standards, making their products more expensive to produce. The tax is intended to ensure that the costlier, lower-carbon EU goods will not be undercut in price by those from countries with more lax rules on emissions.
Any companies importing such products into the EU will be required to buy certificates to cover their carbon emissions, based on the volume of goods they bring in and the emissions footprint of those goods. The tax will also prevent manufacturers, hoping to evade the EU emissions standards, from moving operations to another country, and then sending their goods into the EU, a process known as “carbon leakage” (pdf).
The carbon tax, to be phased in from 2026, will cover some of the most polluting industries: steel, aluminum, cement, fertilizer and electricity, as well as hydrogen. In the future, it could be expanded to include organic chemicals and polymers, including plastics.
The tax is expected to raise as much as €14 billion ($15.4 billion) a year for the EU. The ensuing reforms of the overall carbon market are projected to cut EU emissions by 62% by 2030, from 2005 levels.
“It is one of the only mechanisms we have to incentivize our trading partners to decarbonize their manufacturing industry,” Mohammed Chahim, the European Parliament’s lead negotiator on the law, said in a statement in December, during the contentious negotiations over the tax.
Products from China, which has long opposed the carbon border tax, make up about 10% of the goods affected, according to an analysis by Adelphi, a German think tank. Indian, UK, Korean, US and Turkish industries will also impacted.
China has argued that the tax violates international trade principles. In March, China filed a proposal with the World Trade Organization asking the EU to defend its legality and impacts on developing countries.
In an interview with the Financial Times, Faten Aggad, a senior adviser at the African Climate Foundation, warned that developing countries are likely to suffer the most from the carbon border tax, leading to a “deindustrialization” of African economies dependent on trade with the EU. The law does not set out clear commitments to provide funds for poorer countries to decarbonize in order to continue to access European markets.
Our free, fast, and fun briefing on the global economy, delivered every weekday morning.
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Worried the IRS is going to audit you? If you make less than $400K, here’s one reason you can relax
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https://www.allsides.com/news/2023-04-19-1639/taxes-worried-irs-going-audit-you-if-you-make-less-400k-here-s-one-reason-you
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https://www.marketwatch.com/story/worried-the-irs-is-going-to-audit-you-if-you-make-less-than-400k-heres-one-reason-you-can-relax-e2610f62?mod=home-page
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Ahead of the bill’s passage, Treasury Secretary Janet Yellen pledged that there would be no increase in the audit rate for households and small businesses with annual incomes below $400,000 “relative to historical levels.”
But Republican critics and other observers have asked what “historical levels” might actually mean.
Also read:
The numbers show that 0.4% of returns for taxpayers earning up to $25,000 were audited. That figure was 0.3% for returns between $200,000 and $500,000 and more than 9% for returns over $10 million, the IRS data show. Six years earlier, more than 13% of returns over $10 million were scrutinized, according to the IRS.
Another open question has been how the $400,000 income threshold will be determined. Months after the Inflation Reduction Act passed, IRS and Treasury officials still hadn’t finalized what counted as $400,000 in income, according to a January Treasury Department watchdog report.
The IRS description of total positive income as “the sum of all positive amounts shown for the various sources of income reported on an individual income tax return and, thus, excludes losses” represents, effectively, a tally of income before taxpayers subtract their losses.
Read on:
Also:
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Here’s how the IRS will spend its $80 billion funding boost
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https://www.allsides.com/news/2023-04-06-1227/taxes-here-s-how-irs-will-spend-its-80-billion-funding-boost
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https://thehill.com/business/3937781-heres-how-the-irs-will-spend-its-80-billion-funding-boost/
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| 933
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Credit Suisse whistleblowers say Swiss bank has been helping wealthy Americans dodge U.S. taxes for years
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https://www.allsides.com/news/2023-03-29-0854/banking-and-finance-credit-suisse-whistleblowers-say-swiss-bank-has-been
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https://www.cnbc.com/2023/03/29/credit-suisse-whistleblowers-say-bank-has-been-helping-americans-dodge-us-taxes.html
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Are Taxpayers on the Hook for Silicon Valley Bank Bailout?
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https://www.allsides.com/news/2023-03-14-1503/taxes-are-taxpayers-hook-silicon-valley-bank-bailout
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https://www.newsweek.com/are-taxpayers-hook-silicon-valley-bank-bailout-1787769
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Biden plans tax high-earners in bid to save Medicare
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https://www.allsides.com/news/2023-03-07-0526/taxes-biden-plans-tax-high-earners-bid-save-medicare
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https://www.reuters.com/world/us/biden-tax-high-earners-save-medicare-2023-03-07/
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U.S. President Joe Biden delivers remarks at the DNC 2023 Winter Meeting in Philadelphia, Pennsylvania, U.S., February 3, 2023. REUTERS/Elizabeth Frantz Acquire Licensing Rights
March 7 (Reuters) - U.S. President Joe Biden will seek to raise the Medicare tax on high earners and push for more drug price negotiations to help keep the federal health insurance program solvent through at least 2050 as part of his budget proposal this week, the White House said.
His idea quickly ran into opposition in Congress, where Senate Republican leader Mitch McConnell predicted that it would never pass the Republican-controlled House of Representatives.
The tax increase from 3.8% to 5% on earned and unearned income above $400,000 is part of a package of proposals aimed at extending the solvency of Medicare’s Hospital Insurance Trust Fund by at least 25 years, the White House said in a statement on Tuesday.
"Let’s ask the wealthiest to pay just a little bit more of their fair share, to strengthen Medicare for everyone over the long term," Biden wrote separately in a New York Times guest essaythat was published on Tuesday.
Biden has sought to link Republicans to the idea of cutting funding for the insurance program for seniors and the disabled as part of negotiations over increasing the United States' $31.4 trillion debt limit. Biden's Democrats control the Senate, but Republicans have a narrow majority in the House.
The Democratic president has pledged to offer his vision for funding Medicare and challenged Republicans to offer their own.
"Thank goodness the House is Republican," McConnell told reporters at a press conference.
"Massive tax increases, more spending. All of which the American people can thank the Republican House for will not see the light of day," he said.
The president is scheduled to unveil his budget on Thursday, including a speech in Philadelphia to highlight his plan.
Biden called the rate increase "modest," adding in the Times: "When Medicare was passed, the wealthiest 1% of Americans didn’t have more than five times the wealth of the bottom 50 percent combined, and it only makes sense that some adjustments be made to reflect that reality today."
His proposal also seeks to close loopholes that allow high earners to shield some of their income from the tax, the White House said.
The Inflation Reduction Act, passed by Democrats last year, authorizes Medicare to negotiate prices for high-cost drugs. The budget proposal would allow Medicare to negotiate prices for more drugs and to do so sooner after they launch, saving $200 billion over 10 years, the White House said.
Without any action, the most recent Medicare Trustees Report projected that the trust fund would be insolvent in 2028.
Some House Republicans have said Medicare along with Social Security, which delivers retirement and disability payments, should be part of any budget negotiations. While popular, the two programs account for about one-third of federal spending, according to the Congressional Budget Office, and are expected to grow as the U.S. population ages.
Reporting By Jarrett Renshaw; additional reporting by Richard Cowan and Katharine Jackson; Editing by Shri Navaratnam Chizu Nomiyama, Aurora Ellis
Our Standards: The Thomson Reuters Trust Principles.
Former President Donald Trump has urged fellow Republicans in Congress to shut down the government to thwart the federal prosecutions against him, although any funding lapse was unlikely to stop the cases from being pursued.
"Set decorator for 20 years. Single mom of 15-year-old twins," said the sign above a table of cupcakes, cookies and other baked goods for sale. "Struggling to pay bills, especially my mortgage."
U.S. House Speaker Kevin McCarthy's attempt to restart his stalled spending agenda failed on Thursday when Republicans for a third time blocked a procedural vote on defense spending, raising the risk of a government shutdown in just 10 days.
Americans broadly back striking workers in the auto industry and Hollywood, according to a two-day Reuters/Ipsos poll completed on Wednesday that found significant support among both Democrats and Republicans.
A bipartisan group of lawmakers in the U.S. House of Representatives late on Wednesday announced they had embraced a framework for legislation providing stopgap funds to avert government shutdowns starting on Oct. 1.
Nine Memphis-area deputies have been indicted in the killing of a Black man who died after he was beaten by guards and held prone on the ground in a county jail a year ago, the local sheriff said.
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Texas lawmaker files bill to give tax cuts to heterosexual families only
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https://www.allsides.com/news/2023-03-05-0849/taxes-texas-lawmaker-files-bill-give-tax-cuts-heterosexual-families-only
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https://www.chron.com/news/article/texas-bill-property-tax-cuts-heterosexual-families-17819304.php
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Biden to trigger tax fight Senate Democrats don’t want
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https://thehill.com/homenews/senate/3880256-biden-to-trigger-tax-fight-senate-democrats-dont-want/
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Biden’s Tax Rate Comparison for Billionaires and Schoolteachers
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https://www.allsides.com/news/2023-02-17-0454/facts-and-fact-checking-biden-s-tax-rate-comparison-billionaires-and
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https://www.factcheck.org/2023/02/bidens-tax-rate-comparison-for-billionaires-and-schoolteachers/
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President Joe Biden has said there are hundreds, if not a thousand, billionaires paying lower federal tax rates than schoolteachers, police officers, firefighters and nurses. What his audience may not know is that his comparison relies on including wealthy families’ gains on unsold stock as income.
Biden has made this comparison frequently in recent weeks.
The New York Stock Exchange during the opening bell on Aug. 23, 2016. Photo by Cindy Ord/Getty Images.
“But no billionaire should be paying a lower tax rate than a schoolteacher or a firefighter,” Biden said in his Feb. 7 State of the Union address, calling on Congress to “pass my proposal for the billionaire minimum tax.”
In the following two days, Biden repeated that sentiment, mistakenly saying it was “trillionaires” who “pay less for the percentage of their income than a schoolteacher does” in an interview with “PBS NewsHour.” (The wealthiest person in the U.S. in 2022 was Elon Musk, with an estimated net worth of $219 billion, with a “b,” according to Forbes’ ranking.) And on Feb. 9, Biden said the average percentage of income billionaires pay is “less than the police officers I met a little bit earlier.”
We’ve seen similar claims before. In 2015, Sen. Bernie Sanders compared the tax rates of hedge fund managers with firefighters, police officers, nurses and truck drivers.
We wrote then that those who make their money through investments rather than wages can pay lower effective federal tax rates than some in jobs like firefighters, police officers and nurses — if we include federal income taxes and Social Security and Medicare payroll taxes paid by both the employee and the employer. And depending on the circumstances.
When we ran the numbers in 2015, the 23.8% top tax rate on investments, including a 20% capital gains rate and the 3.8% surtax on investments for high-income earners, was lower than the effective rates for single people without children making the median pay in nearly all of the occupations Sanders cited. But the situation flipped once we added a dependent child or nonworking spouse.
That 20% is still the top long-term capital gains tax rate, while the top marginal income tax rate, on earnings over $578,125 for individuals, is substantially higher, at 37%.
Biden, though, isn’t talking about existing income and capital gains taxes alone, and his claim is worth explaining.
The White House Analysis
Biden’s statements refer to a White House economic analysis that included earnings on unsold stock as income. After factoring in this change in wealth, the analysis estimated the average federal individual income tax rate for the 400 wealthiest families was 8.2%, based on the years 2010 to 2018. (On Feb. 9 and 15, Biden incorrectly said 3%.)
That’s lower than the average effective federal income, plus payroll, tax rate for the top 60% of taxpayers, according to this chart from the Urban-Brookings Tax Policy Center. Those are taxpayers in 2023 with more than $59,700 in “expanded cash income,” a measure TPC uses that includes tax-exempt employee and employer contributions to health benefits and retirement accounts, and nontaxable Social Security benefits, among other items.
Looking strictly at federal income tax paid on adjusted gross income, the White House’s 8.2% is lower than the average effective tax rate for the top 50% of taxpayers, according to a summary of 2020 IRS data by the Tax Foundation. Those earning less than $42,184 in adjusted gross income, on average, paid a lower federal income tax rate.
To be sure, when looking only at income, the top-earning taxpayers, on average, pay higher tax rates than those in the income groups below them. The top 0.1% of earners, with more than $4.4 million in expanded cash income, pay an average rate of 25.1% in federal income and payroll taxes, according to the TPC chart. Those in the middle 20%, with income between $59,700 and $105,900, pay an average of 12.3%.
But the current tax system does not tax earnings on assets, such as stock, until that asset is sold, at which point they are subject to capital gains taxes. Until stocks and assets are sold, any earnings are referred to as “unrealized” gains.
So, do many billionaires pay lower tax rates than schoolteachers and the other occupations Biden mentions? “Yes, if you count the unrealized gains, which we don’t normally count” for federal income tax purposes, Steven M. Rosenthal, senior fellow at the Urban-Brookings Tax Policy Center, told us in an interview.
Biden’s meaning is likely not clear to many in his audiences.
Erica York, a senior economist and research manager at the Tax Foundation, told us in an email that Biden’s comparison is “problematic” because “it creates a new definition of income to use to measure the tax burden, but only applies that new measure of income to the top 400” families. She also said an analysis including unrealized gains should factor in “associated taxes, like corporate income taxes,” levied on the corporations in which these wealthy households own stock. That would increase the White House estimate “significantly.”
Rosenthal, though, disagreed that such indirect taxes should be included in the analysis.
The problem with the current tax system, the White House says, is that unrealized gains could go untaxed forever if wealthy people hold on to them and pass them on to heirs when they die. “If a wealthy investor never sells stock that has increased in value, those investment gains are wiped out for income tax purposes when those assets are passed on to their heirs under a provision known as stepped-up basis,” the analysis says.
Under stepped-up basis, the value of the asset is adjusted to the fair market value at the time of the inheritance. This wipes out any taxes on the unrealized gains that accumulated from the time the investor bought the asset and the time it was inherited.
“One specific issue that can arise with respect to billionaires is that wealthy households may purchase assets that appreciate (increase in value), and then borrow money against their assets to consume their wealth without paying tax,” York said. Then, when the family passes away, the assets can go to heirs and the “unrealized gains escape taxation,” she said, later referring to the strategy as “buy, borrow, die.”
In a May 2022 post, Rosenthal wrote of the untaxed-gains-at-death issue: “Government loses a massive amount of revenue, wealth inequality is perpetuated through generations, and investors are encouraged to retain (or ‘lock-in’) poorly balanced, and less productive, portfolios. More than fifty years ago, two leading tax experts described the failure to tax gains of property transferred at death as ‘the most serious defect in our federal tax system.’”
It’s a “challenge” to address this, as both Rosenthal and York put it. Biden’s solution: his “billionaire minimum tax.”
Biden’s Proposal
The president’s billionaire minimum tax is a 20% minimum that actually applies to those worth over $100 million, so it’s not just for billionaires. The White House estimates those with such net worth are 0.01% of American households.
Under the proposal, if these households are not paying 20% in federal income taxes, as calculated on both standard income and unrealized income combined, they would “owe a top-up payment to meet the 20 percent minimum,” a White House fact sheet explains.
They can spread out these top-up payments over several years, and those with “illiquid” assets, such as a personal business, would have the option of paying the tax later “with interest.”
“In effect, the Billionaire Minimum Income Tax payments are a prepayment of tax obligations these households will owe when they later realize their gains,” the fact sheet says. “This approach means that the very wealthiest Americans pay taxes as they go, just like everyone else, and eliminates the inefficient sheltering of income for decades or generations.”
Both Rosenthal and York said this idea comes with administrative headaches and potential legal barriers.
“The market value of taxable assets net of liabilities would have to be determined each year, and the high share of privately held businesses among the wealthy would aggravate the problem,” York said. “The IRS currently deals with similar issues for the estate tax, and that experience indicates an annual tax on unrealized gains would be plagued with avoidance and evasion strategies.”
Rosenthal wrote about similar concerns when Biden pushed the idea last year — “the super-rich own lots of assets, which would require lots of valuations,” he said. And on the legal side, he questioned whether the Supreme Court would find the tax constitutional. (Read more about the legal concerns here.)
There’s also the issue of those who don’t have cash on hand to pay taxes on unrealized gains — “say a business owner whose wealth was entirely tied up in an ongoing business,” York noted. The business owner can pay the minimum tax later, when they sell the business or die, but with an added “deferral charge,” an estimation of what would have been owed annually. That would result in some over- and some under-taxation, she said.
Both of these experts had other ideas on how to fix the underlying problem: taxing unrealized gains at death at income tax rates and keeping capital gains rates for profits or gifts of assets during life (Rosenthal) or creating a progressive consumption tax (York).
In July of last year, Democratic Reps. Steve Cohen and Don Beyer introduced Biden’s minimum tax in the form of legislation. It was referred to committee, and no other action was taken on it. Now, Republicans control the House.
But Biden is continuing to call for a new tax on the wealthy (not only “billionaires”), who he says pay less of a percentage of their “income” — including unrealized gains — than schoolteachers, firefighters and others.
“These billionaire taxes poll really well,” Rosenthal noted.
Update, March 16: In remarks in Las Vegas on March 15, Biden again incorrectly used the figure 3% for billionaires’ tax rate, instead of the 8% his economic advisers had calculated by incorporating unsold stock earnings. “You know what the average federal tax they pay is? T-H-R-E-E percent. Three,” Biden said.
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Categories FactCheck Posts
Issue Capital Gains Tax Income Taxes Taxes Wealth
People Joe Biden
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The Facts on Sen. Scott’s Claim That Biden Is a ‘Tax Cheat’
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https://www.allsides.com/news/2023-02-14-0711/facts-and-fact-checking-facts-sen-scott-s-claim-biden-tax-cheat
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https://www.factcheck.org/2023/02/the-facts-on-sen-scotts-claim-that-biden-is-a-tax-cheat/
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After President Joe Biden took a veiled swipe at him during the State of the Union address, Sen. Rick Scott released an ad labeling Biden a “tax cheat.” Biden was first scrutinized in 2019 for using what one nonpartisan expert described as an “aggressive” but not illegal tactic on his 2017 and 2018 tax returns to avoid paying a Medicare tax.
The White House is employing a new defense of that tax maneuver, one it says the IRS blessed, though some tax experts remain unconvinced.
Scott fired off his “tax cheat” allegation in an ad after Biden jabbed Republicans during the State of the Union, saying, “Instead of making the wealthy pay their fair share, some Republicans want Medicare and Social Security to sunset. I’m not saying it’s a majority.”
The line drew catcalls from some Republicans, including Rep. Marjorie Taylor Greene, who shouted “liar.” As we wrote, the president has exaggerated Republican support for a proposal from Scott that said: “All federal legislation sunsets in 5 years. If a law is worth keeping, Congress can pass it again.” Scott — who was chairman of the National Republican Senatorial Committee —has said his aim is to “fix” but not eliminate the programs.
In a tweet the day after the State of the Union, Scott claimed Biden lied about Republicans wanting to cut Social Security and Medicare — though Biden only said that “some Republicans” want to sunset the programs, which is what Scott proposed.
.@JoeBiden once again lies about Republicans trying to cut Social Security and Medicare.
Here is my ad running tomorrow to welcome Joe to FL – he is a tax cheat and needs to resign. pic.twitter.com/9AdblW008W
— Rick Scott (@ScottforFlorida) February 8, 2023
“Joe Biden just cut $280 billion from Medicare, and we know about his 80,000 new IRS agents,” Scott says in the ad. “But what you don’t know is that Joe Biden also cheated on his taxes and got away with it. Biden improperly used a loophole to dodge half a million dollars in taxes that should have gone to Medicare. And Now that Biden has ripped off Medicare for half a million dollars, he wants to close the loophole and raise your taxes. … Biden should resign.”
The claims about cutting $280 billion from Medicare and funding “80,000 new IRS agents” are misleading, as we have written repeatedly in previous posts. We’ll explain why later, but we wanted to first address the claim that Biden is a “tax cheat.”
Biden’s S Corporations
The issue of Biden’s taxes was first raised by the Wall Street Journal in July 2019 when Biden was running for president, shortly after Biden released federal and state tax returns for 2016, 2017 and 2018 on his campaign website.
At issue was the amount Joe and Jill Biden claimed as salary in two S corporations — CelticCapri Corp. and Giacoppa Corp. — for their book and speech income after Biden had left the vice presidency. People who set up S corporations still report their flow-through income on their personal tax returns and pay taxes on that income at their individual income tax rate. However, S-corporation owners can avoid paying an additional 3.8% Medicare tax on income designated as profits rather than salary, so long as they pay themselves “reasonable compensation.” The 3.8% Medicare tax is levied on high-income earners as part of the Affordable Care Act.
According to their 2017 and 2018 returns, of the roughly $13.3 million in combined revenue from the S corporations in those years, the Wall Street Journal says less than $800,000 was paid to the Bidens in salary, or less than 6%. As a result, they avoided paying a 3.8% Medicare tax on the vast majority of the S corporation income. They still paid pass-through individual income taxes on the profit and salary amounts.
Whether that amounts to “reasonable compensation” pushes into a bit of a gray area in tax law, Kyle Pomerleau, a senior fellow at the American Enterprise Institute, told us in a phone interview.
“I don’t think that there is any hard and fast rule,” Pomerleau said. “There’s a lot of leeway here,” and plenty of incentive for high-income earners to underestimate their wages relative to profit to lower their tax obligation.
Had all of the S corporation income been recorded as salary, or had the Bidens simply paid the taxes directly — instead of routing book and speech income through S corporations — the Wall Street Journal said they could have owed as much as $500,000 more in Medicare taxes for those years.
In the Wall Street Journal’s 2019 article, Steve Rosenthal, a senior fellow at the Tax Policy Center, called the Bidens’ tactic “pretty aggressive.”
Rosenthal told us he stands by that characterization.
“The Bidens apparently routed their book and speech income through S corporations,” Rosenthal said. “After doing so, they characterized much of this income as profits, and little as compensation. As a result, they avoided the 3.8 percent Medicare tax on their profits. Many view routing income for services through an S corporation as a ‘loophole.'”
“I, personally, would not route income through an S corporation to save on Medicare taxes, but is it proper? Maybe yes, maybe no,” Rosenthal said. “The question is whether the amount allocated to compensation was ‘reasonable,’ which is a pretty loose standard. Was it illegal? No, illegal requires more extreme conduct, like the Trump Organization’s knowing violations of the tax law, which resulted in its criminal conviction for helping top executives evade taxes, including Medicare taxes.” (In 2016, Rosenthal wrote about how Trump also may have taken advantage of the S corporation rules to avoid paying Medicare payroll tax on a substantial amount of his income — the same type of accusation facing Biden.)
“Labelling tax positions is hard, as there is a wide range of aggressiveness (from lawfully exploiting a loophole to criminal fraud),” said Rosenthal, who co-wrote a blog post in January about the ambiguous terms used to describe ways to avoid or evade taxes. “I would not describe Biden as a tax cheat or a tax dodge. Biden reported his position clearly on his tax returns, which he released to the public. So, Biden did not hide anything which, to me, is important.”
“I would call this more tax avoidance than tax evasion, which is what Scott implies,” Pomerleau of AEI told us.
Biden Tried to Close ‘Loophole’
However one may characterize the Bidens’ tactic, it is worth noting, as the Wall Street Journal did, that the Obama administration tried, unsuccessfully, to close this tax “loophole.”
The technique of setting up S corporations to avoid paying payroll taxes became known as the “Gingrich/Edwards” tax loophole, as it was employed by Newt Gingrich, a former speaker of the House and GOP presidential contender, and John Edwards before he became a senator and Democratic vice presidential nominee. President Barack Obama called for closing the so-called loophole in his 2015 budget, but it never passed in Congress.
The Biden administration, too, has tried to close it. The initial House-backed version of the Build Back Better plan included Biden’s call to close the so-called S corporation loophole for those with incomes higher than $400,000. But that never made it into the scaled-back legislation that finally passed. And so what might be technically legal might also be deemed by some hypocritical for Biden to use.
Robert Willens, a tax expert and adjunct professor at Columbia University’s Graduate School of Business, said in an email that what the Bidens did is “a common tactic used by shareholders of ‘S’ corporations to reduce their medicare and payroll tax liabilities. This is done by reporting an unreasonably low amount of compensation for their services rendered to the ‘S’ corporation.”
“The I.R.S. has had great success in challenging taxpayers who employed this strategy and, to my knowledge, has never lost a case in which it was asserted that the compensation was unreasonably low,” Willens told us. “Wouldn’t you think that a business that earned approximately $10 million, in which capital was not a material income-producing factor, and in which the personal services provided by the shareholders accounts for the corporation’s success, should compensate its shareholder/employees more generously than the President’s ‘S’ corporation did? What is reasonable compensation in a case like this one is a question of fact [for the IRS or perhaps a judge or jury to decide] but it seems to be substantially higher than … the amount reported as such by President Biden.
“I wouldn’t label him a ‘tax cheat,'” Willens said. “He was simply employing a commonly used strategy and may not have even been aware of the benefits he could obtain by understating his compensation. This is just a normal, commonly employed, tax planning technique. He may have thought, in good faith, that the compensation he reported was reasonable.”
Nevertheless, back in 2019, the Biden campaign defended the tax returns, telling the Wall Street Journal: “The salaries earned by the Bidens are reasonable and were determined in good faith, considering the nature of the entities and the services they performed.”
New White House Defense
Now, however, the Biden administration is making a different argument. A White House official told FactCheck.org that during an audit of the Bidens’ 2021 tax return, “the IRS did review the S corporation income, including whether the 3.8% Medicare tax should apply. And the IRS conclusively agreed it did not apply.” (The tax returns of all presidents are supposed to be audited by the IRS while they are in office, although that did not happen in Trump’s first two years.)
“The President and First Lady fully and accurately reported their 2017 and 2018 taxes and the IRS never challenged those tax years,” the White House official said.
“Notably, this has nothing to do with the ‘S corporation loophole,'” the White House official said. “During the recent audit of the President and First Lady’s 2021 taxes, the IRS agreed that the President and First Lady’s royalty income would never be subject to the 3.8% Medicare tax, whether earned inside or outside of an S corporation, because an older federal regulation controls. Under Treas. Reg. § 1.469-2T, because the royalty income stems from the licensing of their own creative works, it’s always … characterized as non-passive income derived in the ordinary course of a trade or business. That means it should never be subject to the 3.8% Medicare tax.”
The official said royalties made up “the lion’s share of income in 2017 and 2018 and it represents all S Corp income during the presidency.”
The ‘S corporation loophole’ has never applied to the Bidens, the official said, “since they’re licensing their own creative works.”
Rosenthal and Willens aren’t buying the argument.
Rosenthal said the White House’s argument might make sense in 2021, when “Biden presumably devoted all his attention to the Presidency.” Because of that, Rosenthal said, “Biden could reasonably argue that the distributions from his S corporation” in 2021 — about $62,000 — “were not subject to self-employment taxes.” In that year, he said, Biden could argue that he received royalties and other income from his S corporation “effectively as an investor, not as an author.”
“They can’t take that argument back to 2017 and 2018,” Rosenthal said.
In 2017 and 2018, after Biden left the vice presidency, he was essentially in the business of writing books and making speeches, Rosenthal said.
Willens also disputed the White House argument, saying that while it is sometimes the case that “royalties constitute portfolio income, rather than passive income,” that’s not the case with the Bidens as “the royalties are derived in the ordinary course of licensing such property. Royalties are presumed to be so derived if the person receiving such royalties ‘created the property.'”
The question, Rosenthal said, is why, when it was doing the 2021 audit, didn’t the IRS go back to 2017 and 2018 and require the Bidens to make an adjustment.
White House spokesman Andrew Bates said the IRS did consider the 2017 and 2018 filings, though it did not formally audit those returns.
“During the first routine audit of this administration, tax years 2017 and 2018 were discussed with the IRS, who examined the finances of the s-corporations going back to their inception in 2017,” Bates said. “They challenged nothing.”
Rosenthal would like to know why, and he said that if he were the chairman of the House Ways and Means Committee, he would seek IRS records related to discussions of the 2017 and 2018 returns and the S corporations to find out why the IRS didn’t think an upward adjustment was warranted.
But it is probably too late for the IRS to try to recoup any money. The IRS typically has three years to go after someone’s back taxes. Given that the Bidens amended their 2018 returns in July 2019, the three-year window would have closed last July.
“Yes, it’s too late for the I.R.S. to audit those tax returns since the statute of limitations has long passed,” Willens told us.
Medicare ‘Cuts’ and IRS Agents
As for the other claims in Scott’s ad, this isn’t the first time Scott has said the Inflation Reduction Act passed by Democrats would cut Medicare by $280 billion. But as we have written, that’s misleading. The law seeks to lower prescription drug costs by allowing Medicare to negotiate some prescription drug prices.
The Medicare provisions would reduce federal deficits by about $300 billion over 10 years. But as the Committee for a Responsible Federal Budget explains, “While these policies do reduce the cost of Medicare, they do so by lowering prescription drug costs, not by cutting benefits. In fact, we estimate the policies as a whole would improve benefits by lowering premiums and out-of-pocket costs — including through a $2,000 annual cap on out-of-pocket costs.”
Scott is also wrong about the law including money for 80,000 new IRS “agents.” As we have written, the law does include roughly $79 billion for the IRS over 10 years, but most of the new hires it pays for will replace retiring or departing workers and most new positions would be in customer service, the Treasury Department told us. Some hires would be tax enforcers, but their focus would be auditing high-income earners to make sure they pay the taxes they legally owe the government, administration officials have said.
We should note that while Scott didn’t characterize the new IRS hires as an “army” that could “carry guns” (as Trump once did), the senator’s TV ad shows an IRS agent firing a weapon at a gun range. Only IRS “special agents” in the Criminal Investigation division are law enforcement officers who are authorized to carry guns.
What’s ironic is that immediately after criticizing Biden for hiring new IRS enforcement agents, Scott then criticizes Biden for avoiding some Medicare taxes. Going after high-income taxpayers who underreport salary in S corporations to avoid Medicare taxes is exactly the kind of thing new IRS agents might do.
“The IRS is completely outgunned,” Rosenthal said, referring to the small number of IRS revenue agents confronting a large amount of underreported taxes.
Editor’s note: FactCheck.org does not accept advertising. We rely on grants and individual donations from people like you. Please consider a donation. Credit card donations may be made through our “Donate” page. If you prefer to give by check, send to: FactCheck.org, Annenberg Public Policy Center, 202 S. 36th St., Philadelphia, PA 19104.
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America’s biggest trading partner is no longer China but this country
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America’s biggest trading partner is no longer China but this country
By Shannon Thaler
Published Sep. 12, 2023, 4:27 p.m. ET
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Mexico has overtaken China as America’s biggest trading partner as the US looks to import goods closer to home and minimize its reliance on geopolitical rivals, according to Bloomberg.
America’s southern neighbor made up 15% of US imports in July, compared to 14.6% from China, according to data analyzed by the outlet.
The number of Chinese shipments in July were at their lowest level since the start of COVID, dropping by 14.5% in July compared to the same month last year, according to data released by Beijing last month.
The findings also showed that imports fell by 12.4% as the ruling Communist Party struggles to dig out of its post-pandemic funk.
Meanwhile, foreign direct investment (FDI) in Mexico is up more than 40% in the country this year as US companies increasingly shun China, Bloomberg reported.
Last month, President Joe Biden and Congress imposed trade restrictions on Beijing, which seek to protect domestic microchip and tech-related manufacturing.
Aside from appealing to the US for its proximity, Mexico — which shares a border with California, Arizona, New Mexico and Texas — is also attractive for its currency, which is the world’s strongest this year.
AP
Mexico is now the world’s ninth-largest FDI recipient, according to Santander Bank.
The growth comes ahead plans by Tesla to break ground on a $5 billion assembly plant in Monterrey, Nuevo León — located about three hours from the Reynosa/McAllen Texas border.
Tesla confirmed its plans for the so-called “Gigafactory Mexico” at its Investor Day in March, though it has yet to start construction and may not do so until around 2026, according to Mexican news site Reforma.
Mexico made up 15% of US imports in July, while only 14.6% were from China.
Federal Reserve Bank of Dallas
Mexico’s resurgence has helped the peso boast the world’s strongest currency this year and one of the best-performing stock markets, Bloomberg reported
The peso has been appreciating at a steady pace since 2020 thanks to the Mexican central bank, which has been hiking interest rates at a faster rate than the Federal Reserve.
The Bank of Mexico has been holding interest rates steady at 11.25% for three consecutive months, while US central bankers’ latest hike brought the benchmark federal-funds rate to a range between 5.25% and 5.5%.
Many Chinese companies have reportedly set up shop in Mexico to skirt around trading tariffs, which are more expensive for businesses exporting from China to the US rather than from Mexico.
REUTERS
As of Tuesday, $1 was equivalent to over 17 pesos.
US companies aren’t the only ones flocking to Mexico.
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A survey published in July by Spanish bank BBVA showed that one in five of the new arrivals are actually Chinese businesses, probably seeking to skirt US tariffs, according to Bloomberg.
The Biden administration currently requires Chinese companies to pay a 25% tariff on its approximately $250 billion worth of exports, according to the Tax Foundation.
However, there are no tariffs on qualifying goods imported to the US from Mexico thanks to NAFTA — the North American Free Trade Agreement, which took effect in 1995.
FILED UNDER CHINA FOREIGN CURRENCY IMPORTS MEXICO TARIFFS TRADE US BORDER 9/12/23
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GTA
12 September, 2023
This is why the USMCA, which substituted the North America Free Trade Agreement (NAFTA) is a mutually beneficial win for North American (USA Canada and Mexico) workers, farmers, ranchers, and businesses. The Agreement creates more balanced, reciprocal trade supporting high-paying jobs for Americans...
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Tron
12 September, 2023
The USMCA did very little to change NAFTA, except update it for e-commerce
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Tom
13 September, 2023
So China is bypassing the tariffs imposed by the US and setting up businesses in Mexico to export to the US?
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Tom Suh
13 September, 2023
Yes, most of the parts are made in China and assemble in Mexico and they just put a Spanish label on it and you got made-in-Mexico.
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Big Kahuna
13 September, 2023
Exactly correct… and it gets China closer to our border so if Biden get re-elected it will get to the point that they can just walk right in and he will just hand them the keys to the Whitehouse ….. the funny thing will be watching all these Trump hating democrats being imprisoned and put to death...See more
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ShutUp Boy
13 September, 2023
China is has already built and is building more factories in Mexico. Labor costs for China are now lower in Mexico than at home. It also cuts down their supply chain woes drastically, as their products are already I'm the America's.
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The secret trade routes helping Putin dodge Western sanctions
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The secret trade routes helping Putin dodge Western sanctions
‘Nutso numbers’ show Kremlin-friendly nations have boosted war imports
By
Melissa Lawford
19 August 2023 • 8:00am
Western sanctions on Russia are tougher than ever and the impact is clear to see in trade figures.
Germany’s exports to the country were down by 54pc in the first six months of this year compared to the same period in 2019, according to an analysis by the Institute for International Finance (IIF).
In the initial months of the war, Russian imports plunged as the West turned its back. In dollar terms, monthly imports in March 2022 were down by 30pc year-on-year.
Yet they bounced back within months.
“Imports have now fully recovered from the sanctions hit,” says Liam Peach, senior emerging markets economist at Capital Economics.
What happened?
In part, Putin has turned to his allies. While exports to Russia from Western nations such as the US, the UK and Germany have plunged, trade with friendly nations such as Turkey, China and India has surged.
However, analysts say Moscow appears to have also found a very successful workaround.
Putin has turned to friendly countries to help it access foreign goods, importing Western products via other nations to muddy the paper trail and get around sanctions.
Take Kyrgyzstan. Germany’s exports to the small land-locked nation, which is part of the Eurasian Economic Union and has a free trade agreement with Russia, were up by 2,000pc during the first half of this year.
“The German customs agency got back to us and said we checked these transactions and they are legit,” says Robin Brooks, chief economist at the IIF.
“The paperwork checks out. But no one at the top is saying, hey, wait a minute, this is totally weird. Because the last time I checked, Kyrgyzstan was not booming.”
The IIF tracks exports across a group of Central Asian countries: Armenia, Azerbaijan, Belarus, Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan.
Exports from Germany and the US to this group of Central Asian nations have jumped by 11.5pc so far this year on 2019 levels. Polish exports to the group are up 27pc. In Lithuania, a 37pc increase in exports to Central Asia has more than offset a drop in its exports to Russia.
Brooks believes the increase in exports to Central Asian countries friendly with the Kremlin is a sign that they are being used as backdoors into Russia.
“There is a question about whether the goods that are showing up as going to Central Asia ever even touch the ground,” says Brooks. “It’s possible that this is just paperwork and actually the stuff just goes straight to Russia.”
To support his theory, he points to the fact that Germany records more exports to Kyrgyzstan than the Central Asian nation records in imports.
“There is stuff that just evaporates,” Brooks says.
This gap has widened over the last year and a half. “That is pretty suggestive that Kyrgyzstan is just kind of a phantom destination,” says Brooks.
The Baltic states, such as Lithuania and Estonia, are also “hotbeds” for trade diversion, he believes. So is Poland.
Peach agrees that the data suggests that Kyrgyzstan has “become a conduit for trade from parts of the Western world.”
“The fact that exports from Western Europe are going to a tiny, landlocked place like Kyrgyzstan suggests that there has been a clear regime shift. Certainly the growth rates in exports to Central Asia are nuts. It certainly leaves open the possibility that there is official involvement.”
The Kremlin certainly approves of these new trade routes. Russian President Vladimir Putin introduced a parallel imports programme in May 2022 in response to the mounting list of international sanctions.
The programme was focused on a list of Western goods that Putin said could be imported via secondary trade routes. It encompasses goods needed in industry, cars, machinery and some consumer goods such as cosmetics and clothing.
The parallel imports list effectively gave Russian businesses a mandate to source alternative trade routes for these goods.
“You needed that approval from the Russian government to say that it’s fine to be buying these Western products,” says Peach.
2.4 million tons of goods worth more than $20bn (£15.7bn) were imported into Russia under the parallel imports scheme during its first six months of operations, according to central bank figures.
Imports have only risen since then and the list of products on the scheme have expanded.
“It’s reasonable to assume that the value of these parallel imports over the past 12 months is now probably double that,” says Peach.
These phantom imports may make up as much as 40pc of Russia’s annual total, which typically runs a bit over $100bn.
However, these new trade routes are costly.
“Central Asia is landlocked. It has never been a trading hub for anything,” says Brooks. Transportation costs are therefore steep, while the added bureaucracy of multiple legs of exports is also expensive.
Last year, the cost of an Apple iPhone in Russia was up nearly 50pc compared to before the war.
“A lot of these Western goods that were so freely available before the war are now much more expensive,” says Peach, of Capital Economics. They are also much more difficult to get hold of, even if they are still trickling into Russia.
Brooks argues that Western countries need to look seriously at how effective Moscow’s parallel imports scheme has been and take action.
“We have ended up with these completely nutso trade numbers because nobody is adding up all the numbers and saying something is going on here,” he says.
He believes politicians must draw up rules to crackdown on rampant trade diversion. If companies are profiting from a surge in sales to Kazakhstan, they are likely profiting from a surge in sales to Russia.
Perhaps the simplest and most effective solution will be to restrict Russia’s income, says Brooks. “So it comes back to lowering the oil price cap.”
Peach says: “Last year, sanctions weren’t effective. Maybe they were in some parts of the economy, but the overall story last year was one in which Russia rode the wave of an energy price boom and that bailed the economy out quite a lot.
“We are now at the point where sanctions can really bite. The West is in a position where it can apply a lot more pressure on Russia.”
In the meantime, Kyrgyzstan’s trade continues to boom.
Related Topics
Russia, Vladimir Putin, Trade Deals, Russia-Ukraine war
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Mitch McConnell’s plans for FTC nominee hit awkward bump: sources
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Mitch McConnell’s plans for FTC nominee hit awkward bump: sources
By Lydia Moynihan
Published June 1, 2023
Updated June 1, 2023, 7:37 p.m. ET
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Mitch McConnell has been notably discreet about his pick to fill an empty seat on the Federal Trade Commission — and some insiders say it’s not hard to see why.
Earlier this week, the Senate minority leader told the White House he plans to nominate James Lloyd, an associate deputy attorney general in Texas and antitrust hawk, as his pick for one of two vacant FTC commissioner roles, sources told On The Money.
McConnell’s quiet move comes as Lloyd’s boss, Texas Attorney General Ken Paxton, has been impeached by a Republican House of Representatives over charges of bribery and misuse of office.
A source close to the situation said McConnell may be trying to keep the name hush-hush given that scandal.
“The Paxton impeachment should complicate things,” one FTC insider added. “It’s gotta give McConnell’s office some pause because drawing attention to Paxton’s office isn’t a good look right now.”
While the impeachment may delay a public announcement, those in favor of cracking down on Big Tech are hopeful the nomination can eventually get through.
Mitch McConnell, left, and James Lloyd, an associate deputy attorney general in Texas.
“Texas has been the lead state in terms of suing Google and holding tech accountable,” one antitrust insider said. “Lloyd has served as point person on those investigations so that gives conservatives cause to celebrate.”
The news is a welcome relief after DC insiders fretted that McConnell – who is responsible for submitting nominees to the White House – might shy away from candidates seeking to reign in big tech.
“This isn’t a pillow fight you need someone who is going to bring a machete to the fight,” the source added.
But the antitrust bona fides that came from working with Paxton could also be a weakness.
“McConnell has to ask himself is there downside in terms of everything going on with the Paxton impeachment,” one source added. “Does that create any unnecessary risks in terms of Democrats or Big Tech trying to use that against Lloyd?”
While the timing couldn’t be worse, others are just glad to see any movement forward.
“McConnell has dragged his feet for months on these nominations – it’s time he starts putting forward names so that Republicans can have a voice and a seat at the table in terms of FTC enforcement,” another source added.
12
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A spokesperson for McConnell declined to comment.
McConnell has two vacancies to fill. Former Commissioner Noah Phillips left last year. Former Commissioner Christine Wilson — whose bombshell op-ed in the Wall Street Journal raised concerns over whether Lina Khan has been following the law with her fierce clampdowns on tech companies — is preparing to exit at the end of the month.
FILED UNDER FTC MITCH MCCONNELL NOMINATIONS ON THE MONEY 6/1/23
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Biden's 'Buy American' Rules Are Getting in the Way of Biden's Rural Broadband Push
Industrial policy is never as simple as it seems.
ERIC BOEHM | 4.7.2023 11:55 AM
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FTC creating tech office putting AI, ad makers in crosshairs as last GOP commissioner exits
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US farmers sound alarm on single-most catastrophic thing headed for corn crops
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ECONOMY Published January 31, 2023 12:49pm EST
US farmers sound alarm on single-most catastrophic thing headed for corn crops
Corn farmers visit DC warning they could go out of business over Mexico's genetically modified corn ban
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By Kristen Altus FOXBusiness
video
Mexico ban on genetically modified corn could 'corn-er' the US market
FOX Business' Madison Alworth speaks to Hinkel Farms' Elizabeth Hinkel, who warns their corn crop faces a shortage risk over a proposed regulation.
A regulatory move within Mexico’s agricultural sector has U.S. farmers concerned it will "corn-er" their corn crop production.
"Most farmers, my generation and younger, have never even used conventional corn. We're not set up to do it. We don't have the equipment to do it," Hinkel Farms' Elizabeth Hinkel told FOX Business’ Madison Alworth on "Mornings with Maria" on Tuesday. "So it would be a huge investment if we had to go back to growing conventional. And on top of that, our yields would be decreased."
American farmers are headed to Capitol Hill to voice concerns about Mexico’s proposed ban on U.S. imports of genetically modified corn, reportedly warning the move could become the most catastrophic thing to happen to corn farmers.
Mexico represents America’s biggest buyer of corn, purchasing more than $10 billion worth of yellow and white U.S. corn last season alone.
FLORIDA ORANGE GROWERS STRUGGLE TO KEEP JUICE ON TABLES AFTER ‘UNPRECEDENTED SETBACKS’ SQUEEZE INDUSTRY
"Even though here in Pennsylvania, our corn stays fairly local, our price is still determined by the board," Hinkel explained. "So if that price goes down, it's going to affect farmers all over the United States, no matter where their corn is being sold."
Mexico's proposed ban on genetically modified corn will "affect farmers all over the United States," Hinkel Farms' Elizabeth Hinkel said Tuesday on "Mornings with Maria." (Getty Images)
Farmers remain husky about Mexico’s GMO ban as they fear it’ll hit their bottom line.
"I just can't even picture in my mind what this is going to do," Hinkel said. "It's farmers from one end of the United States to the other. It doesn't matter where you sell it or what it's used for, it's going to have an effect."
With the ban set to take effect in 2024, Mexico has claimed that the regulation would help increase its own domestic production. Last week, U.S. trade representative Jayme White met with Mexico’s Under Secretary of Economy for Foreign Trade Alejandro Encinas to further discuss the GMO decision and the countries’ future relations.
Mexico purchased more than $10 billion worth of U.S. corn in the 2022 season. (Getty Images)
Following the meeting, the USDA released this statement: "Mexico's proposed approach, which is not grounded in science, still threatens to disrupt billions of dollars in bilateral agricultural trade, cause serious economic harm to U.S. farmers and Mexican livestock producers, and stifle important innovations needed to help producers respond to pressing climate and food security challenges."
A fifth-generation Nebraska corn farmer, who mainly grows white corn for Mexican consumption, noted he wouldn’t switch to growing non-GMO corn due to environmental and financial consequences.
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"Our destinies are tied together. They need us as much as we need them," Nebraska Corn Growers Association Chairman Andy Jobman also told Alworth on Tuesday. "And so we really need to come to the table and just resolve this issue and allow GMO corn to continue going into Mexico."
As Mexico prepares for the potential ban, the country, in the meantime, has passed regulation that discourages exports, including a 50% tariff on any white corn leaving the nation.
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Democrats’ Climate Bill Sparks Potential Green Trade War With Europe
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https://dailycaller.com/2023/01/17/dem-climate-bill-green-war-europe/
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Samsung's profit sinks to 8-year low on slowing demand
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https://www.allsides.com/news/2023-01-06-0524/technology-samsungs-profit-sinks-8-year-low-slowing-demand
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https://www.foxbusiness.com/technology/samsungs-profit-sinks-8-year-low-slowing-demand
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SAMSUNG Published January 5, 2023 11:49pm EST
Samsung's profit sinks to 8-year low on slowing demand
The weakening global economy has hurt the company, impacting memory chip prices and overall demand for tech devices
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By Ken Martin FOXBusiness
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Samsung Electronics supplied a first look at the company's quarterly earnings report Friday.
The company says quarterly profit tumbled by two-thirds to an eight-year low.
A weakening global economy has impacted memory chip prices and curbed demand for electronic devices.
The report may be a harbinger of things to come, setting the tone for other tech firm's results.
SAMSUNG RECALLING OVER 663,000 TOP-LOAD WASHING MACHINES OVER FIRE HAZARD
Samsung Electronics shows its memory chips. (Samsung newsroom)
Samsung is the world's largest memory chip, smartphone and TV maker.
Analysts expect Samsung's profit to take another hit in the current quarter after the South Korean company announced its October-December operating profit likely fell 69% to 4.3 trillion won ($3.37 billion) from 13.87 trillion won a year earlier.
It was Samsung's smallest quarterly profit since the third quarter of 2014 and fell short of a 5.9 trillion won Refinitiv SmartEstimate.
Samsung's signage is seen in a store in Manhattan, New York City. ( REUTERS/Andrew Kelly / Reuters Photos)
SAMSUNG GETS TEMPORARY OK ON CHINA CHIP FACILITIES
Quarterly revenue likely fell 9% from the same period a year earlier, according to the preliminary earnings statement issued by the company.
Its mobile business' profit declined in the fourth quarter as smartphone sales and revenue decreased due to weak demand resulting from prolonged macroeconomic issues, Samsung added.
Samsung Electronics logo and graph. (iStock / iStock)
SAMSUNG'S EARNINGS PLUNGE ON BIG DROP-OFF IN CHIP DEMAND
Three analysts said they expected Samsung's profits to dive again in the current quarter, with a likely operating loss for the chips business as a glut drives a further drop in memory chip prices.
The company will release full results later this month.
Reuters contributed to this report.
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Biden Starts a Climate Trade War
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https://www.allsides.com/news/2022-12-06-0928/economy-and-jobs-biden-starts-climate-trade-war
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https://www.wsj.com/articles/biden-starts-a-climate-trade-war-electric-vehicles-ira-batteries-minerals-north-america-protectionsim-11670169459?mod=hp_opin_pos_1
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India Will Surpass Japan And Germany As The World’s Third Largest Economy
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https://www.allsides.com/news/2022-12-01-1427/world-india-will-surpass-japan-and-germany-world-s-third-largest-economy
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https://www.dailywire.com/news/india-will-surpass-japan-and-germany-as-the-worlds-third-largest-economy
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— NEWS —
India Will Surpass Japan And Germany As The World’s Third Largest Economy
By Ben Zeisloft
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Dec 1, 2022 DailyWire.com
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Soltan Frédéric via Getty Images
India is projected to surpass Japan and Germany as the world’s third-largest economy in the next decade, according to a forecast from ratings agency S&P Global.
The real gross domestic product of India will average 6.3% yearly growth between fiscal years 2021 and 2030, enabling the country to surpass Japan and Germany in nominal terms. Real GDP per capita will grow at a 5.3% rate as the population of India continues to expand.
“These projections assume continued structural reforms, including trade and financial liberalization, infrastructure and human capital investment, and labor market reform,” wrote the S&P Global analysts. “Although the current government has a parliamentary majority to pass legislation, trade unions are strong, comprise millions of members in sectors highlighted for liberalization, and have routinely opposed policies that they claim threaten job security and increase the influence of big business.”
India had a real GDP of $3.2 trillion as of last year, according to data from the World Bank, while the value of finished goods and services in Japan and Germany respectively amounted to $4.9 trillion and $4.2 trillion. The United States and China are the world’s first and second largest economies, with real output of $23 trillion and $17.7 trillion respectively.
After India gained independence from the United Kingdom in 1947, widespread refugee travel between India and Pakistan provided continued economic strain. India has experienced robust growth since the nation pivoted away from socialism and liberalized trade policy.
The Indian government introduced the Production Linked Incentive Schemes two years ago, a policy regime that encourages foreign and domestic investors to achieve higher manufacturing output through tax rebates, project-specific land acquisition, and license clearance. “A greater share in global value chains would also contribute to India’s goals of improving leverage in multilateral negotiations and gaining advantage in its competition with mainland China,” the S&P Global analysts continued.
India is also slated to eclipse longtime geopolitical rival China as the world’s most populous country next year. The former nation presently maintains a fertility rate of 2.2 children per woman, while the latter has a fertility rate of 1.7 children per woman, according to data from the Organization for Economic Cooperation and Development.
India currently boasts a trade surplus with the United States and a trade deficit with China, the latter of which is viewed as a vulnerability among Indian officials. The dynamic “encourages policymakers to seek alternatives, particularly in pharmaceuticals, automobiles, and electronics, where the aim is to make India a major exporter itself,” according to S&P Global.
India had been experiencing benefits from “small but steady annual increases in economic freedom” before the lockdown-induced recession two years ago, according to a report from the Heritage Foundation’s Index of Economic Freedom, which ranks the country “mostly unfree.” The nation still has lackluster court systems, investment freedom, and government integrity.
“India’s diverse economy encompasses traditional village farming, industrial-scale agriculture, handicrafts, and a wide range of modern industries,” the conservative think tank remarked, noting the importance of internationalization for the nation’s future. “Capitalizing on its well-educated English-speaking population, India has become a major exporter of information technology services, business outsourcing services, and software workers.”
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Nissan pulls out of Russia, sells all assets to state for 1 Euro
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https://www.allsides.com/news/2022-10-11-0629/russia-nissan-pulls-out-russia-sells-all-assets-state-1-euro
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https://www.foxbusiness.com/economy/nissan-pulls-out-russia-sells-all-assets-state-1-euro
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AUTO Published October 11, 2022 7:15am EDT
Nissan pulls out of Russia, sells all assets to state for 1 Euro
Nissan will lose $687 million in the deal, forfeiting its plant in St. Petersburg
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By Anders Hagstrom FOXBusiness
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Gen. Jack Keane on Putin's next steps: 'Probability of using nuclear weapons is quite low'
Fox News senior strategic analyst Jack Keane responds to Russian missile strikes against Ukraine and Biden's rhetoric condemning the attacks.
The Nissan car manufacturer sold all of its assets in Russia to the Russian government for a single Euro on Tuesday.
Nissan is only the latest major company to flee Russia following Russian President Vladimir Putin's invasion of Ukraine in February. The deal costs Nissan roughly $687 million, but the company believes it will not affect the earnings forecast for the fiscal year, according to Reuters.
Nissan's move comes months after the company cut business ties with Russia in March, suspending production at its plant in St. Petersburg. The company has roughly 2,000 employees in the country.
"On behalf of Nissan, I thank our Russian colleagues for their contribution to the business over many years," Nissan President and CEO Makoto Uchida said in a Tuesday statement. "While we cannot continue operating in the market, we have found the best possible solution to support our people."
RUSSIA MAY HAVE AVOIDED HISTORIC DEBT DEFAULT FOR NOW
Shares of Nissan Motor Co Ltd dropped 4% in early trade on Monday, following a report that its top shareholder Renault SA is exploring a potential stake sale. REUTERS/Brendan McDermid (REUTERS/Brendan McDermid / Reuters Photos)
New Nissan Qashqai crossovers at a Nissan factory in Komendantsky Prospekt Street. Nissan Technical Center engineers have redesigned the crossover for Russian roads. Alexander Demianchuk/TASS (Photo by Alexander DemianchukTASS via Getty Images) (Getty Images)
The deal allows Nissan to purchase back the assets within 6 years.
Marriott, McDonald's and a slew of others have also opted to pull out of the country and leave assets to the Russian government.
PUTIN ACCUSES UKRAINE OF ‘TERRORISM’ IN CRIMEA BRIDGE EXPLOSION
Marriott closed all of its corporate offices in Moscow in June, and McDonald's sold all of its franchises in the country to the Russian oligarch Alexander Govor.
"We have come to the view that newly announced US, UK and EU restrictions will make it impossible for Marriott to continue to operate or franchise hotels in the Russian market," Marriott wrote in a statement at the time. "We have therefore made the decision to suspend all Marriott International operations in Russia."
Russian president Vladimir Putin holds meeting on metallurgical sector via a video link at the Kremlin in Moscow, Russia on Aug. 1, 2022. (Sputnik/Pavel Byrkin/Kremlin via REUTERS / Reuters)
Nissan's departure comes days after Russian forces conducted brutal missile attacks on Kyiv and more than a dozen other Ukrainian cities this week.
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The missile strikes came after months of relative calm in most Ukrainian cities. The country's forces achieved significant victories throughout September, pushing Russian forces well into the territories Putin claimed to annex.
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Home heating prices are surging. Here's how the Biden administration could help
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https://www.allsides.com/news/2022-09-27-0851/energy-home-heating-prices-are-surging-heres-how-biden-administration-could
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https://www.washingtonexaminer.com/restoring-america/patriotism-unity/home-heating-prices-are-surging-heres-how-the-biden-administration-could-help
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Natural gas home heating in New England will be expensive this winter. Utility companies may face energy shortages, resulting in some families seeing monthly utility bills as high as $1,000 per month .
A limited government solution to this problem exists, but it requires politicians to do something noble: stand up to special interest groups and put the people they represent first. If the federal government were to offer a Jones Act waiver for liquefied natural gas imports to New England , it would help negate these rising energy costs.
New England has no natural gas pipelines, and transporting LNG by rail is controversial. But the region gets plenty of natural gas imported by sea to a terminal in Everett, Massachusetts. Even though the United States is the world’s largest natural gas producer, none of this product is domestic. Instead, New England gets LNG from places such as Trinidad and Tobago, Nigeria, and even Russia.
This is happening because an archaic shipping regulation is protecting a nonexistent industry.
The Jones Act says that for goods to be shipped from one U.S. port to another, the ship must be built, staffed, and operated by Americans. However, almost no ships in the American fleet can make the trek from the Gulf of Mexico to New England to deliver LNG. The few Jones Act-compliant LNG tankers primarily refuel other ships .
If the U.S. has plenty of this resource, why not ship it up from the Gulf of Mexico using an LNG tanker from an ally country with a vibrant shipbuilding industry such as South Korea or Japan ?
Supporters of the Jones Act say it's necessary to protect shipbuilding and staffing jobs. However, no one is shipping LNG from the Gulf of Mexico to New England by water. How can they protect a nonexistent industry?
The cost of living is already horrible in New England. The country faces high inflation, and home heating bills will worsen the problem for New Englanders this winter.
If President Joe Biden’s administration is serious about reducing inflation, this is something it should do. Six New England governors, a bipartisan group of three Republicans and three Democrats, requested a Jones Act LNG waiver for at least part of this winter back in July.
Sadly, the federal government lacks interest in solving this problem. Former President Donald Trump refused to grant Jones Act LNG waivers, and it’s hard to imagine the Biden administration making the change for two reasons. For one, Biden supports the Jones Act . The other: Marty Walsh, who has deep ties to organized labor, is his secretary of labor.
While workers have the right to unionize and fight for their best interests, it doesn’t mean politicians should kowtow to demands that come at the expense of ordinary people.
Tom Joyce ( @TomJoyceSports ) is a political reporter for the New Boston Post in Massachusetts.
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United States and Mexico to Cooperate on Semiconductors, Electric Vehicles
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https://www.allsides.com/news/2022-09-13-0530/trade-united-states-and-mexico-cooperate-semiconductors-electric-vehicles
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https://www.theepochtimes.com/united-states-and-mexico-to-cooperate-on-semiconductors-electric-vehicles_4727261.html
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ECONOMY
US, Mexico to Cooperate on Semiconductors, Electric Vehicles
Workers work inside the clean room of U.S. semiconductor manufacturer SkyWater Technology where computer chips are made, in Bloomington, Minnesota, in April 2022. (SkyWater Technology/Handout via Reuters)
By Naveen Athrappully
9/13/2022
Updated:
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The United States and Mexico are planning to cooperate on semiconductor and electric vehicle production, according to a White House fact sheet.
Both nations seek to establish a Supply Chain Working Group with the initial focus being on semiconductors and information and communications technology supply chain ecosystems, the Sept. 12 fact sheet states. A Memorandum of Understanding has been signed between the Mexican Ministry of Economy with leading tech firms and manufacturers to “facilitate emerging technologies and workforce development in Mexico.”
Senior officials from the United States and Mexico met in Mexico City on Monday as part of the U.S.–Mexico High-Level Economic Dialogue where the trade discussions took place.
In a joint statement, the officials said that they will be working together on a pilot project to determine the feasibility of near-shoring semiconductor manufacturing inputs.
In January, a report by the U.S. Department of Commerce warned that the country was facing a chronic shortage of semiconductor chips and that a long-term solution was needed to avoid economic and security risks arising from this issue.
In August, President Joe Biden signed the CHIPS legislation to boost domestic research and manufacturing of semiconductors. Washington recently announced that tech companies receiving funding from the $280 billion CHIPS act will be prohibited from establishing advanced facilities in China for a period of 10 years.
At a Sept. 12 press conference, U.S. Secretary of Commerce Gina Raimondo pointed out that the testing, packaging, and assembly industry for semiconductors in China and Taiwan is a $60 billion industry. In North America, the industry is only valued at $3 billion.
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“So there is a huge opportunity for growth in North America and job creation just in the semiconductor supply chain,” she said.
Electric Vehicles
Mexico’s Ministry of Foreign Relations has set up a Transport Electrification Working Group in collaboration with academics, industry representatives, and the University of California.
The group will support the transition of American and Mexican automotive industries toward production of electric vehicles, the fact sheet states. Both Mexico and the United States have a shared commitment to making 50 percent of new vehicle sales electric by 2030.
The Biden administration’s push to transition America to use more electric vehicles is a controversial policy that has attracted criticism.
In an interview with NTD, Jerry Simmons, president of the Domestic Energy Producers Alliance, said that he was shocked at how much taxpayer money Washington is pumping into “unreliable renewable sources.”
Simmons pointed to California, which is promoting the use of electric cars while asking people not to charge their electric vehicles because of an energy shortage, something he said is “absurd.”
The California Independent System Operator recently asked citizens to avoid charging electric vehicles as there was a large demand for electricity owing to the heightened use of air conditioners amid a brutal heat wave.
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Biden administration sourcing 380,000 pounds of baby formula from Australia as part of 'Operation Fly Formula'
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https://www.allsides.com/news/2022-06-02-0921/biden-administration-sourcing-380000-pounds-baby-formula-australia-part
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https://www.foxnews.com/politics/biden-admin-sourcing-baby-formula-from-australia-operation-fly-formula
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WHITE HOUSE
Biden administration sourcing 380,000 pounds of baby formula from Australia as part of 'Operation Fly Formula'
The delivery is expected to include 380,000 pounds of Bubs Australia infant formula and approximately 4.6 million 8-ounce bottles.
By Brooke Singman Fox News
Published June 1, 2022 2:28pm EDT
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The Biden administration announced Wednesday it is acquiring more than 4 million 8-ounce bottles and 380,000 pounds of infant formula from Australia to be delivered to the United States by next week to address the ongoing baby formula shortage gripping the nation.
The move is part of President Biden’s "Operation Fly Formula," which was launched last month to speed up the import of infant formula and to begin sending more formula to stores across the U.S.
The president on Wednesday said the administration is sourcing two flights, facilitated by the Department of Health and Human Services (HHS) to transport Bubs Australia infant formulas from Melbourne, Australia, to Pennsylvania on June 9 and California on June 11.
The delivery is expected to include 380,000 pounds of Bubs Australia infant formula and approximately 4.6 million 8-ounce bottles. The administration said additional deliveries of Bubs Australia formula will be announced in the coming days.
BIDEN INVOKES DEFENSE PRODUCTION ACT, 'OPERATION FLY FORMULA' TO ADDRESS SHORTAGE
Last week, the Food and Drug Administration (FDA) announced that Bubs Australia could export infant formula. It is expected to export enough powdered formula to produce 27.5 million 8-ounce bottles in the U.S.
Empty shelves show a shortage of baby formula at a CVS store in San Antonio, Texas. (REUTERS/Kaylee Greenlee Beal)
The formulas include Bubs Organic Infant Formula S1, Bubs Organic Follow On Formula S2, Bubs Supreme Infant Formula, Supreme Follow On Formula, Bubs Goat Milk Infant Formula S1 and Bubs Goat Milk Follow On Formula S2.
Biden also on Wednesday announced a third Operation Fly Formula mission to ship approximately 3.7 million 8-ounce equivalents of Kendamil infant formula.
Last month, Biden invoked the Defense Production Act to address the nationwide baby formula shortage and directed his administration to use Defense Department aircraft to pick up formula from overseas that meets U.S. health and safety standards.
The announcement comes as the supply of infant formula across the country has decreased 40% since April, leaving parents of newborns frantic to find food to feed their babies. In addition, Abbott Laboratories announced a Similac recall, exacerbating formula shortages in recent months.
The White House has said it is working "24/7" to address the issue.
Empty store shelves in Columbus, Ohio, as parents panic over worsening baby formula shortage. (FOX Business)
The president directed HHS and the Department of Agriculture to use Department of Defense (DOD) commercial aircraft to pick up overseas infant formula that meets U.S. health and safety standards, "so it can get to store shelves faster."
UNITED AIRLINES TO FLY BABY FORMULA FROM LONDON TO US AS PART OF BIDEN'S OPERATION FLY FORMULA
The White House said DOD will use its contracts with commercial air cargo lines, as it did to move materials during the early months of the COVID-19 pandemic, to transport products from manufacturing facilities abroad that have met FDA safety standards.
Store shelves are empty after a baby formula shortage. (Fox News Digital)
The Defense Production Act was first enacted in 1950 as a response to the Korean War and has since been invoked more than 50 times. The act also addresses voluntary agreements — or what the government says is "an association of private interests, approved by the Government to plan and coordinate actions in support of the national defense." The provision permits business competitors to work together to plan and coordinate measures to increase the supply of materials.
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For the week ending May 22, the out-of-stock rate for baby formula rose to 70% nationwide, according to recent data by retail data firm Datasembly. It's a significant increase from the week prior when the national out-of-stock rate for baby formula stood at 45%.
Abbott Nutrition's Sturgis, Michigan, facility, which exacerbated the industry-wide shortage, is expected to restart production June 4, meaning products from the plant won't return to store shelves until at least mid-July, according to the company's production timeline.
Brooke Singman is a Fox News Digital politics reporter. You can reach her at [email protected] or @BrookeSingman on Twitter.
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Mexican drug cartels pay Americans to smuggle weapons across the border, intelligence documents show
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https://www.allsides.com/news/2023-09-14-1529/world-mexican-drug-cartels-pay-americans-smuggle-weapons-across-border
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https://www.cbsnews.com/news/mexican-drug-cartels-american-weapons-smuggled-across-border/
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CBS REPORTS
Mexican drug cartels pay Americans to smuggle weapons across the border, intelligence documents show
BY E.D. CAUCHI
UPDATED ON: SEPTEMBER 18, 2023 / 5:31 PM / CBS NEWS
Watch the CBS Reports documentary "Arming Cartels: Inside the Mexican-American Gunrunning Networks" in the video player above.
Mexican drug cartels have been smuggling a vast arsenal of even military-grade weapons out of the U.S. with the help of American citizens, a CBS Reports investigation has found.
Exclusively-obtained U.S. intelligence documents and interviews with half a dozen current and former officials reveal that the American government has known this for years but, sources said, it's done little to stop these weapons trafficking networks inside the United States, which move up to a million firearms across the border annually, including belt-fed miniguns and grenade launchers.
Dozens of cartel gunrunning networks, operating like terrorist cells, pay Americans to buy weapons from gun stores and online dealers all across the country, as far north as Wisconsin and even Alaska, according to U.S. intelligence sources. The firearms are then shipped across the southwest border through a chain of brokers and couriers.
This infographic was created by the Drug Enforcement Administration's Special Operations Division as a visual representation of intelligence findings, to depict how an American supply chain provides firearms and ammunition to Mexican cartels.
PROJECT THOR / OBTAINED BY CBS NEWS
When CBS News pressed the Justice Department about its findings, a senior official confirmed that "We absolutely recognize the problem here that … the lion's share of firearms trafficked to Mexican cartels are coming from the United States."
For more than 50 years, the U.S. government has waged an unsuccessful war on drug traffickers, who are now fueling a deadly fentanyl epidemic. The free flow of American guns across the southern border empowers the cartels to protect their drug operations and outgun Mexican authorities, U.S. officials said.
"We have allowed the cartels to amass an army," said Chris Demlein, who served as a senior special agent with the Bureau of Alcohol, Tobacco, Firearms and Explosives — the ATF — until 2021.
Guns and ammunition seized by U.S. law enforcement at the border.
U.S. GOVERNMENT PHOTO
Demlein led the first interagency intelligence project aimed at identifying and dismantling the cartels' international weapons supply chains across the U.S. Within months of its launch on July 25, 2018, the initiative, known as Project Thor, connected the dots between hundreds of disparate law enforcement cases, uncovering vast networks that give these criminal groups on-demand access to American guns. They briefed hundreds of government officials on their discoveries, including the National Security Council and senior Justice Department leadership.
This illustration, based on an intelligence map generated by DEA Special Operations Division Project Thor, depicts the smuggling paths of a "supernetwork" of interconnected gun supply chains that were illegally funneling military-grade firearms at the direction of the Jalisco New Generation cartel in Mexico.
CBS NEWS
Project Thor found that the problem of cartel weapons smuggling was far worse than previously understood. They estimated that cartels were trafficking between 250,000 and 1 million weapons every year, with a retail value of up to $500 million, not including ammunition and tactical supplies, according to intelligence analysis reviewed by CBS News.
Project Thor concluded that American guns were being used to fuel an unprecedented spike in violence across Mexico. Up to 85% of firearms found at those crime scenes traced back to the U.S.
Without Project Thor, U.S. law enforcement "bureaucracies were more interested in defending their turf than prosecuting criminal organizations," said Edwin Starr, who retired from the ATF as a senior special agent in December 2022. Starr credited the interagency program with leading to a major breakthrough in one of his firearms trafficking cases that, according to Demlein, helped take down an entire cartel gunrunning network.
On Dec. 8, 2021, ATF chief of staff Daniel Board praised Project Thor's "insight, initiative and hard work" as he presented the team with the agency's Distinguished Service Medal.
But Project Thor was denied funding for fiscal year 2022, according to internal documents and sources with direct knowledge, effectively shutting it down. The Justice Department and ATF would not disclose how much money is dedicated to the mission of countering international firearms trafficking to Mexico.
Over the course of four months in 2023, CBS News repeatedly asked the Justice Department about its efforts to combat international gun trafficking. When senior officials finally agreed to speak, they said they were "not familiar" with Project Thor, even as they agreed with its findings about the magnitude of cartel gun running operations on U.S. soil.
The Biden administration signaled a new commitment to tackle the issue at a June 14 press conference, pointing to the ATF's Operation Southbound, an investigative and prosecutorial "nationwide initiative" designed to "disrupt the trafficking of firearms from the U.S. to Mexico" focused on border states. Officials also pointed to funding for gun tracing and ongoing diplomatic efforts to train and equip Mexican law enforcement with that technology.
However, other law enforcement, intelligence and diplomatic officials told CBS News they doubt their own agencies' commitment to dismantling cartel gunrunning networks across the U.S., and criticized the ongoing approaches as "ineffective."
"Any U.S. strategy that depends, for its success, on Mexican law enforcement efforts in Mexico is doomed to failure," warned Christopher Landau, who served as U.S. Ambassador to Mexico until 2021. "We've been talking about this for 10, 20 years. Nothing is changing. … This has been a major bipartisan failure of the U.S. government for many decades."
Senior officials defended their approach to countering weapons smuggling out of the country.
"ATF is committed to stopping as many guns as possible from being illegally trafficked into Mexico," ATF Director Steven Dettelbach told CBS News in a statement, touting the prosecution of 100 people in the past year. "Investigating straw purchasers is just one tool that we use. Our efforts also include large scale, long term, complex investigations of entire trafficking networks."
Neither the Justice Department nor ATF provided evidence to demonstrate that their efforts have meaningfully reduced the flow of American firearms to Mexico. U.S. law enforcement seized 1,720 firearms in the first six months of fiscal year 2023. According to Deputy Attorney General Lisa Monaco, speaking at a news conference in June, "that's a more than 65% increase over the same period last year." But it accounts for less than 1% of all firearms being smuggled across the border, based on estimates by Project Thor and the Mexican government.
-Adam Yamaguchi and Sarah Metz contributed reporting.
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How booming Vietnam offers the US an alternative to China
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https://www.allsides.com/news/2023-09-11-1048/trade-how-booming-vietnam-offers-us-alternative-china
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President Joe Biden left Vietnam Monday after a visit that deepened economic ties between Washington and Hanoi as part of efforts to reduce America’s reliance on China.
The former foes formally upgraded diplomatic ties to a “comprehensive strategic partnership,” a symbolic yet highly important move that experts say will solidify trust between the nations as America seeks an ally in Asia to counteract political tensions with China and advance its ambitions for key technologies, such as chipmaking.
Companies from Apple (AAPL) to Intel (INTC) have already pushed deeper into the country to diversify their supply chains, maxing out many Vietnamese factories and helping fuel an economic expansion that continues to defy a global slowdown.
On Monday, the White House announced a “landmark deal” between Boeing and Vietnam Airlines worth $7.8 billion, which is expected to support more than 30,000 jobs in the United States. Boeing said that the carrier will buy 50 of its 737 Max jets.
“Southeast Asia is one of the world’s fastest growing aviation markets, and the 737 MAX is the perfect airplane for Vietnam Airlines to efficiently meet that regional demand,” Brad McMullen, Boeing senior vice president of commercial sales and marketing, said in a statement.
Biden’s visit, which followed the G20 summit in India, was the first by a US president to Vietnam since Donald Trump’s 2019 trip. He met with Vietnamese General Secretary Nguyen Phu Trong and other leaders to “promote the growth of a technology-focused” Vietnamese economy, as well as discuss ways to improve stability in the region, according to the White House.
President Biden, right, and US Secretary of State Antony Blinken, left, meeting with Vietnam's General Secretary Nguyen Phu Trong at the Communist Party of Vietnam Headquarters, in Hanoi on Sunday
Evan Vucci/AP
In recent years, their trade has already soared under an existing partnership agreed in 2013, so the elevation in relations is “just catching up with the reality that already exists,” Ted Osius, president of the US-ASEAN Business Council and a former US ambassador to Vietnam, told CNN.
The United States imported nearly $127.5 billion in goods from Vietnam in 2022, compared with $101.9 billion in 2021 and $79.6 billion in 2020, according to US government data.
Last year, Vietnam became America’s eighth largest trading partner, rising from 10th place two years earlier.
Shifting supply chains
The two sides have been moving closer as US officials, particularly Treasury Secretary Janet Yellen, have repeatedly pointed to the importance of “friend-shoring.”
The practice refers to the movement of supply chains toward allies in part to shield businesses from political friction.
“Rather than being highly reliant on countries where we have geopolitical tensions and can’t count on ongoing, reliable supplies, we need to really diversify our group of suppliers,” she said in a speech last year at the Atlantic Council think tank.
Those tensions add to a litany of pressures, including rising labor costs and an uncertain operating environment that have already made corporations think twice about how much business they do in China, which is still considered the factory of the world.
But increasingly, it has competition. During the US-China trade war, which started in 2018, businesses of all sizes began moving manufacturing to emerging markets such as Vietnam and India over tariffs.
Biden traveling to Vietnam following G-20 summit next month
After the pandemic broke out, corporations were increasingly forced to consider strategies known as “China plus one,” which meant spreading out production hubs as a way to reduce reliance on a sole manufacturing base.
The latest exodus could cost China dearly: In a 2022 report, Rabobank estimated that as many as 28 million Chinese jobs directly relied on exports to the West and could leave the country as a result of “friend-shoring.”
Some 300,000 of those jobs, focused on low-tech manufacturing, are expected to move to Vietnam from China, analysts wrote.
From an industrial perspective, the country has been booming for years, said Michael Every, a Rabobank global strategist who authored the report. Relatively lower wages and a youthful population have provided Vietnam with a solid workforce and consumer base, bolstering the case to invest in the nation of 97 million people.
A fruit vendor walking past an Apple store in Hanoi
Nguyen Huy Kham/Reuters/File
But companies hoping to make the switch may already be too late, as some factories are so stretched, customers must wait, he said.
Alicia García-Herrero, chief economist at Natixis, pointed to what she called “overheating,” saying demand for manufacturing in Vietnam has outstripped supply in some cases.
“Too many companies [are] going to Vietnam,” she told CNN.
Vietnam enjoyed an advantage, as it was first in the region to build up supply chain capabilities “for many, many sectors” years ago, she explained.
Key technologies
Shortly after Biden landed in Vietnam on Sunday, the White House announced a new semiconductor partnership.
“The United States recognizes Vietnam’s potential to play a critical role in building resilient semiconductor supply chains, particularly to expand capacity in reliable partners where it cannot be re-shored to the United State,” it said in a statement.
The semiconductor industry has emerged as a key source of tension in US-China relations. Beijing and Washington are both racing to boost their prowess in the sector, and each side has recently enacted export controls aimed at limiting the other’s capacity.
Apple got rich in China. Other Asian markets offer the next 'golden opportunity'
The United States needs a trusted partner for its supply of chips, and Vietnam can do just that, Osius said.
Intel sees it that way. The California-based chipmaker has committed $1.5 billion to a sprawling campus located just outside Ho Chi Minh City, which it says will be its largest single assembly and test facility in the world.
Osius expects more investments in the field to follow as Washington shores up ties with Hanoi.
“The significance of Vietnam in that supply chain will increase,” he predicted. “We’re going to see an acceleration when it comes to collaboration in tech.”
Rapid growth
The International Monetary Fund projects Vietnam’s growth will slow to 5.8% from 8% last year as it copes with less overseas demand for its exports.
But that compares favorably with a global growth forecast of 3%, and is noticeably faster many of the world’s major economies, such as the United States, China and the eurozone.
“As the rest of Asia underwhelms, Vietnam will still be one of the fastest growing economies,” Natixis said in a recent research note.
That’s compelling for corporations looking for bright spots in an otherwise gloomy environment.
VinFast shares soar again as buzz over Vietnamese EV maker grows
Such interest was noted in March, when the US-ASEAN Business Council led its biggest-ever business mission to Vietnam. The delegation consisted of 52 American firms, including corporate heavyweights such as Netflix (NFLX) and Boeing (BA).
Of course, companies still have reservations over factors such as Vietnamese tech regulations, which they fear could include limits on the “transfer of data across borders, or too many rules requiring data localization,” according to Osius.
In some cases, businesses are also concerned by how the country’s infrastructure still pales in comparison to a longtime trade powerhouse like China’s.
US companies including Netflix and Boeing join 'biggest' business mission to Vietnam
For example, “there isn’t a sufficient port capacity for some of the goods to be exported as quickly as companies want them to be moved,” Osius said.
Politically, Vietnam shares many similarities to China in that it is an authoritarian one-party state that tolerates little dissent.
But overall, businesses simply want an easy way to hedge their bets.
Vietnam is an obvious choice, because it’s a cheap alternative to manufacturing in China, said García-Herrero.
For various sectors, transitioning isn’t difficult, because many Chinese suppliers also moved there because of US tariffs, she explained. “It’s the most similar because you have the same providers as in China.”
The Biden administration, too, will likely be keen to secure that alternative.
“It’s quite clear that they’re trying to set up a series of foreign policy victories ahead of 2024 [by] signing a strategic comprehensive partnership with Vietnam,” said Every, the Rabobank analyst.
— CNN’s Kyle Feldscher, Jeremy Diamond and Kevin Liptak contributed to this report.
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Trump vows massive new tariffs if elected, risking global economic war
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https://www.allsides.com/news/2023-08-22-1043/donald-trump-trump-vows-massive-new-tariffs-if-elected-risking-global-economic
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https://www.washingtonpost.com/business/2023/08/22/trump-trade-tariffs/
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Donald Trump waves to the crowd on the campaign trail at the Iowa State Fair this month. (Demetrius Freeman/The Washington Post)
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Even in the face of growing personal legal peril, Donald Trump summoned his top economic advisers to his private golf club in New Jersey for a two-hour dinner last Wednesday night to map out a trade-focused economic plan for his presidential bid.
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Trump and top aides, including former senior White House officials Larry Kudlow and Brooke Rollins, as well as outside advisers Stephen Moore and former House speaker Newt Gingrich, spent the dinner discussing how Trump could attack President Biden in the 2024 election on the economy, amid a recent spate of positive economic news that has buoyed Biden’s fortunes, according to three people familiar with the meeting, who spoke on the condition of anonymity to describe the private event.
Among the ideas they discussed was Trump’s plan to enact a “universal baseline tariff” on virtually all imports to the United States, the people said. This idea, which Trump has taken to describing as the creation of a “ring around the U.S. economy,” could represent a massive escalation of global economic chaos, surpassing the international trade discord that marked much of his first administration. Trump advisers have for months discussed various potential levels to set the tariff rate, and they said the plan remains a work in progress with major questions left unresolved, the people said.
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On Fox Business on Thursday, the former president called for setting this tariff at 10 percent “automatically” for all countries, a move that experts warn could lead to higher prices for consumers throughout the economy and could lead to a global trade war.
“I think we should have a ring around the collar” of the U.S. economy, Trump said in an interview with Kudlow on Fox Business on Thursday. “When companies come in and they dump their products in the United States, they should pay, automatically, let’s say a 10 percent tax … I do like the 10 percent for everybody.”
Trump touts authoritarian vision in second term: ‘I am your justice’
The proposed expansion of the tariff policy, which aides said is expected to be a central 2024 campaign plank, reflects how Trump is aiming to expand the power he wielded in the White House, eyeing sweeping authoritarian measures for his second term that range from deploying the military to fight street crime to purging the federal workforce. Trump is opting not to explain this vision to voters at the first Republican presidential primary debate, being held Wednesday. Trump said he will not attend.
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Economists of both parties said Trump’s tariff proposal is extremely dangerous. Adam Posen, president of the Peterson Institute for International Economics, a Washington think tank, called the idea “lunacy” and “horrifying” and said it would lead the other major economies around the world to conclude the United States cannot be trusted as a trading partner. Although aimed at bolstering domestic production, a 10 percent tariff would hurt the thousands of U.S. firms that depend on imports, while also crippling the thousands of U.S. firms that depend on foreign exports, Posen said.
The United States today imposes an average tariff on imports of just above 3 percent, according to Posen. That number is higher for some countries, with goods coming from China facing an average import duty of 19 percent. “You would be depriving American families of an enormous amount of choice, making their lives much more expensive, and putting millions of people out of work,” Posen said.
Trump could use unilateral authority to exempt whatever countries he chooses from the automatic import tariffs. It would create enormous opportunities for influence-peddling, Posen said, following four years of a Trump presidency in which Saudi Arabia and other nations sought to steer Trump by frequenting his private businesses. “It is a recipe for corruption,” Posen said. “They will decide that whoever cozies up to Trump, or whoever his commerce secretary is, will get the exception.”
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Even former Trump economic officials were sharply critical of the idea. “A tariff of that scope and size would impose a massive tax on the folks who it intends to help,” said Paul Winfree, an economist who served as Trump’s deputy director of the Domestic Policy Council and is now president of the Economic Policy Innovation Center, a center-right think tank. “It would get passed along through higher prices at a time when the Federal Reserve has had difficulty limiting inflation.”
Republicans may have to rethink economic attacks as inflation falls
Jason Miller, a spokesman for Trump, pushed back on the criticisms, pointing out that Trump’s tariffs had coincided with low inflation during his administration. Miller pointed to an International Trade Commission finding earlier this year that Trump’s steel and aluminum tariffs significantly led to a decrease in imports from China, with only minimal increases in prices.
“The globalists who push false claims of economic disaster have been proven wrong time and again,” Miller said in an email. “No amount of fearmongering from special interests and establishment hacks in Washington will stop him from defending American workers and fighting to return millions of manufacturing jobs to the USA.”
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Although Republicans have long expressed confidence that they can effectively attack Biden’s economy, Trump’s team may find that task harder than initially anticipated. Inflation is slowing, recession fears are abating and Biden’s aides are newly confident about the economic upswing that they hope will carry through the 2024 election.
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Trump disrupted the bipartisan policy consensus in 2016 when he ran for president demanding the United States confront China through trade protectionism and other populist policies. As president, he used his unilateral authority to impose tariffs on a wide range of foreign products, including solar panels, washing machines, steel and aluminum.
In 2018, Trump escalated that strategy by slapping tariffs on $200 billion worth of imports from China, leading Beijing to impose retaliatory tariffs on U.S. agricultural exports. Trump also imposed tariffs on Mexico and Canada, before signing a new trade deal with the country’s North American allies in 2019. The legacy of these measures is hotly debated: Most economists said they hurt the U.S. market, contributing to global economic head winds and slowing business investment.
Judge approves $200,000 bond for Trump in Georgia election case
But most of the trade barriers Trump imposed on China were ultimately extended by the Biden administration, and they have been praised by influential unions for promoting domestic industry. Biden has taken economic measures that have fueled international trade tensions, including domestic subsidies for clean-energy firms that have been sharply criticized by the European Union.
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Trump’s universal tariff plan, however, would represent a dramatic intensification of economic nationalism that could draw more significant reproaches from foreign governments, experts said. Two Trump aides, who spoke on the condition of anonymity to describe campaign deliberations, said no rate had been settled on for the policy.
The aides said the Trump campaign was likely to provide more details as the election season progresses. Trump has also said revenue raised by the tariff would be used to reduce taxes on domestic companies, although it would effectively be a tax on American consumers that would raise their costs.
“It will be controversial,” Gingrich said in an interview. Gingrich said the policy would amount to returning to Republican Party roots during the late 19th and early 20th centuries, when large domestic companies pressed for trade restrictions to reduce foreign competition. “When we were the dominant economy, free trade was the rational strategy. Whether that is still a rational strategy is unclear.”
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The policy idea reflects how much Trump has changed the Republican Party, which had more recently been allergic to these kinds of trade restrictions. Robert E. Lighthizer, who served as U.S. Trade Representative under Trump, has suggested imposing a universal tariff at 10 percent or higher, and then increasing or decreasing it as necessary, but emphasized in an interview he was not tied to any specific numbers.
DeSantis unveils economic plans like Trump as he trails in the polls
“We have had people across this country, in the Midwest but elsewhere too, where you drive through and you see this blight that is the result of U.S. policy that went off the rails in the 1990s,” Lighthizer said, arguing that Trump tried to reverse that decline through his industrial policy.
Chris Clarke, an economist at Washington State University, said the tariffs that Trump imposed on imported washing machines cost American consumers roughly $800,000 for every job saved. But later studies, which took into account the impact of retaliatory tariffs as well, found that the tariffs did not save any jobs, Clarke said.
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“On net, this would harm the American economy substantially” and “would gum up our whole production process,” Clarke said. “Producers would have higher costs, and now all the consumers are paying higher prices for goods that used to be imported.”
Michael Strain, an economist at American Enterprise Institute, a center-right think tank, said international trade restrictions enacted in 1930 are widely viewed as exacerbating the Great Depression. Trump’s trade war had a chilling effect on the U.S. economy, Strain said, but if his new plan were enacted, it could have a far bigger impact.
“It would be a disaster for the U.S. economy. It would raise prices for consumers and be met with considerable retaliation from other nations, which would raise the costs facing U.S. businesses. It would reduce employment among manufacturing workers,” Strain said. “It would be very, very bad.”
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America is heavily reliant on Russia for nuclear fuel. Congress might change that.
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https://www.allsides.com/news/2023-08-03-0807/federal-state-and-tribal-powers-america-heavily-reliant-russia-nuclear-fuel
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https://www.washingtonpost.com/politics/2023/08/03/america-is-heavily-reliant-russia-nuclear-fuel-congress-might-change-that/
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Good morning and welcome to The Climate 202! ICYMI, several news outlets fell for a scam this week that claimed all Mattel toys would be plastic-free by 2030. This Barbie thinks using less plastic is fantastic.
Not a subscriber? Sign up for The Climate 202 to get scoops and sharp analysis in your inbox each morning.
In today’s edition, we’ll cover why New York is in danger of missing its 2030 clean-energy target. And as a scheduling reminder, the newsletter is only publishing Tuesday through Thursday during the congressional recess. We’ll be back in your inbox on Tuesday. But first:
America is heavily reliant on Russia for nuclear fuel. Congress might change that.
Nearly a year-and-a-half after Russia launched a brutal invasion of Ukraine, Congress appears poised to reduce America’s reliance on Moscow for uranium, the main fuel used by nuclear power plants.
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Lawmakers took swift action to ban Russian oil and gas imports a month after the February 2022 invasion. But stemming the flow of Russian uranium imports has taken much longer, in part because Moscow provides more than 20 percent of U.S. nuclear fuel.
Yet before leaving town last month, the Senate took a key step toward bolstering domestic uranium supply chains and displacing the Kremlin as a key supplier.
The Senate last week passed its version of the National Defense Authorization Act, which includes an amendment aimed at boosting U.S. uranium production and enrichment. The amendment passed by a nearly unanimous vote of 96-3, suggesting it could be included in the final version of the Pentagon policy bill that could head to President Biden’s desk this year.
Leaders in the nuclear industry, which provides nearly one-fifth of U.S. electricity without any carbon emissions, cheered the proposal’s passage as a win-win for America’s national security and climate goals.
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It was “a kumbaya moment,” said Daniel Poneman, president and CEO of the nuclear fuel supplier Centrus Energy and the former deputy secretary of energy under President Barack Obama.
Jeff Navin, director of external affairs at TerraPower, a Bill Gates-backed nuclear energy firm that has worked with Centrus, said the vote sent a strong statement. “You can’t get 96 senators to agree that the sun is going to come up tomorrow or the color blue exists,” he said.
TerraPower announced in December that an advanced nuclear reactor proposed for southwestern Wyoming would probably be delayed at least two years, given the difficulty of securing fuel from non-Russian sources. The amendment could address this delay and others like it.
Russia ranks as the biggest supplier of enriched uranium in the world. Its state-owned nuclear power conglomerate, Rosatom, has earned billions from U.S. and European customers, even as it works to supply the Russian arms industry with components, technology and raw materials for missile fuel.
The details
The amendment mirrors the Nuclear Fuel Security Act, which was introduced by Senate Energy and Natural Resources Committee Chair Joe Manchin III (D-W.Va.) and Sens. John Barrasso (R-Wyo.) and James E. Risch (R-Idaho).
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The bipartisan bill directs the Energy Department to establish a program aimed at ensuring a disruption in Russian uranium supplies would not harm the development of advanced nuclear reactors or the operation of the existing nuclear fleet.
The agency would need to acquire at least 20 metric tons per year of high-assay low-enriched uranium, or HALEU, from at least two U.S. nuclear energy firms by 2028. HALEU is needed to fuel advanced reactors such as small modular reactors.
“We spend nearly $1 billion each year on Russian uranium. Russia uses these revenues to fund its invasion of Ukraine,” Barrasso said on the Senate floor last week. “Here in America we have the resources to fuel our own reactors.”
The three lawmakers who voted against the amendment were Sens. Bernie Sanders (I-Vt.), Edward J. Markey (D-Mass.) and Elizabeth Warren (D-Mass.). Sanders has long opposed building new nuclear plants, given the lack of a federal plan for storing nuclear waste, while Markey has raised concerns about contamination from uranium mining on tribal lands.
The Senate approved another nuclear bill, the Advance Act, as an amendment to the NDAA by a vote of 86-11. The bipartisan measure would prohibit U.S. nuclear plants from receiving a license for enriched uranium from Russia or China if the Departments of Energy and State determine that the fuel poses a national security risk.
In the House
The House has not yet passed its version of the NDAA or approved the Nuclear Fuel Security Act as an amendment. But there appears to be some bipartisan support for doing so.
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Rep. Robert E. Latta (R-Ohio), who introduced the companion bill in the House, said in an emailed statement that he “will continue working with my colleagues in both chambers to get these policies across the finish line so we can strengthen our nuclear energy capabilities, lower carbon emissions, create good-paying jobs, and spur economic growth.”
Rep. Frank Pallone Jr. (D-N.J.), the ranking member of the House Energy and Commerce Committee, said in his own emailed statement: “If we’re serious about weaning ourselves off of Russian uranium, then we have to get serious about making investments in our domestic uranium supply chain. The Senate amendment is nearly identical to the one I offered in Committee earlier this year, and it is absolutely critical to ending our dependence on Russian uranium.”
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Yet one challenge looms: House Republican leaders have refused to approve new spending that is not offset by spending cuts or tax increases. The Nuclear Fuel Security Act has an estimated price tag of $2.7 billion.
To offset some of this spending, House GOP appropriators have proposed repurposing unspent money from the bipartisan infrastructure law aimed at preventing struggling nuclear reactors from closing. It remains to be seen whether Democrats will object to this plan.
“There are unused dollars in that program, and we believe this is a good repurposing,” said Scott Melbye, executive vice president of uranium miner Uranium Energy and president of the Uranium Producers of America. “But I think a lot of Democrats see the infrastructure bill as one of their signature achievements, and there’s a hesitancy to reopen things that came in that bill.”
In the states
New York in danger of missing 2030 clean-energy goal, report says
New York, long a leader on climate policy, is set to miss a key clean-energy goal unless the state significantly accelerates its efforts, according to a report released this week by State Comptroller Thomas DiNapoli, Zack Budryk reports for the Hill.
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In 2019, New York passed a landmark climate law that calls for reaching 70 percent renewable energy by 2030 and 100 percent by 2040. The report found that to meet the 2030 target, the state would need to add an additional 20 gigawatts of renewables over an eight-year period. For context, the state added 12.9 gigawatts of total generation, including both fossil fuel and renewable sources, over the past 20 years.
DiNapoli cited the length of the permitting process for new projects as a major obstacle, echoing the concerns of many lawmakers on Capitol Hill. Only about 3 percent of renewable generation contracted since 2015 has actually come online, which DiNapoli attributed to the length of the state Public Service Commission’s siting process, local opposition and delays in connecting to the grid.
The state will be able to achieve its 2030 goal if the projects currently under contract speedily pass through the permitting pipeline, but “this is a big ‘if,'” the report says.
International climate
It’s midwinter, but it’s over 100 degrees in South America
It’s the middle of winter in South America, but that hasn’t kept hot weather away from Chile, Argentina and surrounding area in recent weeks, with some places reaching all-time maximums and surpassing summer temperatures, The Washington Post’s Ian Livingston reports.
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This week has set an August record for Chile. In Buenos Aires, where the average high on Aug. 1 is 58 degrees Fahrenheit (14 Celsius), it surpassed 86 Fahrenheit (30 Celsius) on Tuesday.
“South America is living one of the [most] extreme events the world has ever seen,” weather historian Maximiliano Herrera tweeted, adding, “This event is rewriting all climatic books.”
Abnormally warm winter temperatures have also been observed in Australia, Africa and some island regions. Scientists have linked these hot and persistent high-pressure zones to climate change, and expect them to occur more frequently as the world warms. The current hot spell in the region is expected to linger for days.
In the atmosphere
This whale may be the largest animal ever. We have no idea how it got that big. — Dino Grandoni for The Post
Climate change made July hotter for almost every human on Earth — Seth Borenstein for the Associated Press
Corporate ESG claims to soon face audits to address greenwashing fears — Grace Ritchie for Bloomberg News
Iran orders nationwide shutdown because of ‘unprecedented’ heat — Farnaz Fassihi for the New York Times
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Permitting reform is happening, but leaving both sides unhappy
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https://www.allsides.com/news/2023-08-02-1152/economy-and-jobs-permitting-reform-happening-leaving-both-sides-unhappy
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https://www.semafor.com/article/08/02/2023/permitting-reform-is-happening-but-leaving-both-sides-unhappy
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Sign up for Semafor Net Zero: The nexus of politics, tech, and energy. Read it now.
In this article:
The U.S. government’s efforts to make it easier to build energy infrastructure inched forward in the past week, with two major policy revisions aiming to unclog the “interconnection queue” and refashion the environmental review process for new energy and mining projects.
The policy shifts showcase where consensus is forming between Democrats and Republicans on permitting reform, and underscore where they are moving further apart. In both cases, federal officials are reaching the limits of what they can accomplish without new legislation from Congress, which has been held up largely because of complaints by Republican proponents of fossil fuels that Biden administration regulators are biased in favor of renewables.
On Thursday, the Federal Energy Regulatory Commission, which oversees the electricity market, approved stricter criteria that energy project developers will need to meet in order to maintain their place in the interconnection queue. That’s the backlog of grid hookup requests — mostly from renewables — that at the moment is about equivalent to the overall capacity of the entire U.S. electric grid. Under the new rules, developers will have a hard deadline to complete studies of how their project will impact the grid (previously that deadline was loose) and will need to pay a deposit to maintain their place in the queue, both of which should filter out many speculative projects.
The FERC rules, which were passed by its two Republican and two Democratic commissioners, aren’t particularly controversial. Not so a separate White House proposal on Friday on changes to the National Environmental Policy Act, the law governing environmental impact assessments.
The NEPA revisions would impose stricter page limits and deadlines for environmental reviews, and make it easier for certain projects with small environmental impacts to bypass the process. But they would also require federal agencies to weigh the global climate impacts of a project, which would invariably lead to significant marks against fossil fuel infrastructure. And the revisions would make it easier for groups or individuals to sue to block projects they oppose.
That last measure — a reversal of NEPA revisions made under the Trump administration that made it harder to sue — is especially bothersome for Republicans, since such lawsuits are routinely filed against fossil fuel and mining projects. Only about 10% of NEPA lawsuits lead to a judge blocking the project, but delays can drive away investors, and preparations to deflect potential lawsuits are time-consuming and expensive even if one never arrives. The question of who can sue, under what conditions, is an element of permitting reform that is “regrettably moving in the wrong direction,” said Nick Loris, vice president of public policy at the Conservative Coalition for Climate Solutions, a think tank.
“The White House says [its proposed NEPA revisions] will ensure a level playing field and speed up timelines, but it will only make it easier than ever for their environmental activist friends to tie up and drag out expensive litigation. I am sick and tired of the doublespeak and sneaky backdoor attempts to regulate fossil fuels out of existence.” — Sen. Kevin Cramer (R-N.D.)
The complexity of permitting-related lawsuits came to the fore in June when the Sierra Club and other environmental groups sued the federal government over the Mountain Valley Pipeline, a natural gas project in West Virginia championed by that state’s Democratic Senator Joe Manchin. Permits for the project were mandated in the debt ceiling legislation that passed last month, a measure that the Sierra Club has argued unconstitutionally hands permitting authority to Congress instead of to the relevant executive-branch agencies. But as Heatmap reports, that line of argument could set a precedent against Congressional interference in specific permitting debates, which might one day backfire against renewables.
The new FERC rules leave out one element of grid planning that will prove harder to resolve: How utilities, project developers, and customers should divide the costs of grid upgrades. FERC has promised to take that issue up in a later ruling — until then, many utilities will continue to push back against an onslaught of renewable energy projects.
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F.T.C.’s Court Loss Raises Fresh Questions About Its Chair’s Strategy
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https://www.allsides.com/news/2023-07-12-0834/trade-ftc-s-court-loss-raises-fresh-questions-about-its-chair-s-strategy
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https://www.nytimes.com/2023/07/11/technology/lina-khan-ftc-strategy.html
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F.T.C.’s Court Loss Raises Fresh Questions About Its Chair’s Strategy
Lina Khan has said a fear of defeat should not deter the agency from suing big tech companies. But after Microsoft won a ruling this week, her critics say that strategy is flawed.
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Lina Khan has argued that even legal defeats could result in tougher antitrust enforcement, but recent rulings have emboldened her critics.
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By Cecilia Kang
Reporting from Washington
July 11, 2023
Lina Khan became chair of the Federal Trade Commission two years ago on a promise to bring bold action against the biggest tech companies.
For too long, Ms. Khan said at the time, the agency had been a weak cop and needed to challenge behemoths like Microsoft, Amazon, Meta and Google in the courts to stem their growing power. Even if the F.T.C. lost the cases, she later added, they would be a partial victory because the agency would signal that antitrust laws needed to be updated for the modern internet era.
But on Tuesday, Ms. Khan suffered the biggest blow yet to her hallmark agenda. A federal judge rejected the F.T.C.’s attempt to stop Microsoft’s $70 billion acquisition of the video game maker Activision Blizzard from closing, saying the agency failed to prove the deal would reduce competition and harm consumers. On Wednesday, the F.T.C. filed a notice that it would appeal the judge’s decision.
That followed a loss in February, when a judge rejected an F.T.C. lawsuit seeking to block Meta from buying the virtual reality start-up Within.
The defeats raise questions about Ms. Khan’s ability to carry out her ambitious goal of reversing decades of weak antitrust enforcement, as political pressure mounts and patience wanes for the 34-year-old academic, who has ruffled the feathers of corporate America. Ms. Khan’s critics are more emboldened and are speaking out more loudly to poke holes in her take-it-to-the-courts strategy, saying the losses are not even partial wins — they’re just losses.
“I completely disagree with this approach,” Anthony Sabino, a professor of business and law at St. John’s University, said of Ms. Khan’s methods. “She’s trying to change a century’s worth of antitrust law overnight, and that’s not necessarily wise.”
Adam Kovacevich, the chief executive of Chamber of Progress, a tech trade group, said the defeats made the F.T.C. appear less credible. “All these court losses are making their threats look more like a paper tiger,” he said.
Others wondered if Ms. Khan was wasting the F.T.C.’s resources on can’t-win cases. “They’ve crossed the line to being reckless with the cases they are bringing,” said Ashley Baker, a director of public policy for Committee for Justice, a conservative think tank.
The tide of criticism puts Ms. Khan in the hot seat as she prepares further potential actions against the tech giants. The F.T.C. has filed antitrust suits against Meta and could bring a case against Amazon, which it has been investigating over claims of illegal monopolization.
Now Ms. Khan will first have to defend herself. On Thursday, she is expected to be grilled at a House Judiciary Committee hearing on oversight of the F.T.C., with the Republican-led panel’s website saying it wants to “examine mismanagement of the F.T.C. and its disregard for ethics and congressional oversight under Chair Lina Khan.”
Ms. Khan declined to comment for this article, and Douglas Farrar, an F.T.C. spokesman, also declined to comment on how the court losses will affect her agenda. After the Microsoft-Activision ruling on Tuesday, Mr. Farrar said the agency was “disappointed in this outcome given the clear threat this merger poses to open competition in cloud gaming, subscription services and consoles.”
Ms. Khan rose to fame while a Yale law student in 2017 when she argued in a paper for a law journal that Amazon was crushing competition and violating antitrust laws despite lowering prices for consumers. The paper helped kick off a debate about how to limit the tech giants and how to modernize antitrust practices.
After President Biden picked Ms. Khan to lead the F.T.C., she repeatedly argued that it needed to go to court — win or lose — to send the tech industry a strong signal that the agency was becoming a tougher sheriff. Even losses in court, she maintained, would gradually reform theories of antitrust.
Ms. Khan applied that thinking when the F.T.C. sued to stop Meta last year from buying a small virtual-reality company, Within. The case was a surprise because virtual reality is a nascent technology, making it hard to argue that the deal would reduce competition in a market that has not yet formed.
But Ms. Khan argued that regulators must stop violations of competition and consumer protections at the bleeding edge of technology, not just in areas where the companies had already become behemoths.
“What we can see is that inaction after inaction after inaction can have severe costs,” she said in an interview with The New York Times and CNBC in January 2022. “And that’s what we’re really trying to reverse.”
Early this year, a federal judge rejected the F.T.C.’s demand to block Meta’s acquisition of Within. But the judge agreed with some of the F.T.C.’s arguments, including how the agency defined tech markets in the case.
The loss on Tuesday in the Microsoft-Activision case was more stinging, partly because the blockbuster merger has become a test of whether tech megadeals can go through despite rising regulatory scrutiny. Judge Jacqueline Scott Corley of U.S. District Court for the Northern District of California said consumers benefited from Microsoft’s expectation of a tough review, writing: “That scrutiny has paid off.” But her ruling left little else that was redeeming for the F.T.C.
In the case, the agency argued that the deal should not close because it might harm competition. Microsoft might make some of Activision’s games exclusive to its Xbox game consoles or degrade the experience of playing games like Activision’s Call of Duty on competing consoles like Sony’s PlayStation.
But Judge Corley wrote that the F.T.C. probably wouldn’t win its challenge to the merger in the agency’s internal court and said, essentially, that Microsoft was doing enough to prevent rivals from being hurt.
“The F.T.C. has not identified a single document which contradicts Microsoft’s publicly stated commitment to make Call of Duty available on PlayStation,” she wrote.
Eleanor Fox, a professor emeritus at New York University’s law school, said it was too soon to have a verdict on Ms. Khan’s strategy. Elsewhere in the world, especially in the European Union and in Britain, regulators have also pursued antitrust actions against large tech companies, she noted.
Ms. Khan, she said, “is only an outlier in the U.S., not globally.”
Cecilia Kang covers technology and regulation and joined The Times in 2015. She is a co-author, along with Sheera Frenkel of The Times, of “An Ugly Truth: Inside Facebook's Battle for Domination.” More about Cecilia Kang
A version of this article appears in print on July 13, 2023, Section B, Page 1 of the New York edition with the headline: F.T.C. Losses Raise Doubts On Strategy. Order Reprints | Today’s Paper | Subscribe
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US Navy says it repelled Iranian effort to seize oil tankers
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https://www.allsides.com/news/2023-07-05-1126/world-us-navy-says-it-repelled-iranian-effort-seize-oil-tankers
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US says Iran fired on one ship, but there were no casualties, and fled both times when a US ship arrived at the scene in the Gulf of Oman.
The United States Navy has said that it prevented Iranian forces from seizing two oil tankers near the Strait of Hormuz, the latest in a series of such incidents in one of the world’s most vital energy passageways.
US Naval Forces Central Command said Wednesday that a guided missile destroyer, the USS McFaul had driven off Iranian vessels attempting to intercept two oil tankers off the coast of Oman, including one incident in which Iranian forces reportedly fired on one of the tankers.
“On July 5, US forces prevented two attempted commercial tanker seizures by the Iranian Navy after the Iranians had opened fire in one of the incidents near the coast of Oman,” a news release from the US Navy read. “Both of these incidents occurred in international waters.”
The encounters came at a time of high tensions between the US and Iran, which have struggled to revive a nuclear agreement that the Trump administration unilaterally broke off in 2015. The US has long accused Iran of harassing and seizing commercial vessels in the Strait of Hormuz.
Iran has stepped up those activities in recent months, seizing two oil tankers in one week during the months of April and May.
In these latest attempts, the first incident took place at about 1am local time on Wednesday, (21:00 GMT on Tuesday) when Iranian forces approached the Marshall Islands-flagged oil tanker TRF Moss. The Iranian vessel left when the USS McFaul, arrived on the scene.
About three hours later, the US Navy said that it had received a distress call from a Bahamian-flagged oil tanker, the Richmond Voyager, which had been told by an Iranian naval vessel to stop.
As the US ship made its way to the scene, Iranian forces fired on the Voyager with “long bursts from both small arms and crew-served weapons”, but that no serious damage or loss of life occurred the statement from the US Navy said. The Iranian forces left when the USS McFaul arrived.
The US Navy said that it has increased its presence in the Strait of Hormuz since May, citing an uptick in Iranian efforts to seize commercial vessels. The US says that Iran has “attacked or seized” nearly 20 such vessels since 2021.
“We remain vigilant and ready to protect navigational rights in these critical waters,” US Vice Admiral Brad Cooper said in the release.
Iran, which the US placed under heavy sanctions after the Trump administration unilaterally abandoned the nuclear deal, has not commented on the incident.
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The U.S. Is Paying Billions to Russia’s Nuclear Agency. Here’s Why.
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Nuclear power companies rely on cheap enriched uranium made in Russia. That geopolitical dilemma is intensifying as climate change underscores the need for emissions-free energy.
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Fake Signals and American Insurance: How a Dark Fleet Moves Russian Oil
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VISUAL INVESTIGATIONS
Fake Signals and American Insurance: How a Dark Fleet Moves Russian Oil
By Christiaan Triebert, Blacki Migliozzi, Alexander Cardia, Muyi Xiao and David BottiMay 30, 2023
In February, an oil tanker transmitted a signal showing it was sailing west of Japan.
But the tanker’s path was highly unusual. Over the course of a day, its signals showed erratic behavior as the ship rapidly changed position.
A satellite image, taken during this time, deepened the mystery: There was no ship there at all.
The Cathay Phoenix was sending a fake location signal. This is known as “spoofing.”
In reality, the ship was 250 miles north loading oil at the Russian port of Kozmino, part of a journey to China that likely caused a breach of U.S. sanctions.
The U.S. has also created so-called safe harbor to protect insurers from liability if they inadvertently cover ships violating sanctions. As of May 30, a regularly updated list of American Club’s clients posted on its website showed the company is most likely still insuring the six tankers.
Alma - IMO: 9235892* Age: 20 years old Owned: Irish company Insured: American Club Cargo: Crude oil Spoofed location: Sea of Japan Found location: Kozmino oil terminal, Russia
Age: 22 years old Owned: Hong Kong company Insured: American Club Cargo: Crude oil Spoofed location: Near Niigata, Japan Found location:
Eternal Peace - IMO: 9259745 Age: 19 years old Owned: Hong Kong company Insured: American Club Cargo: Crude oil Spoofed location: Near Niigata, Japan Found location: Kozmino oil terminal, Russia
Ginza - IMO: 9220926 Age: 22 years old Owned: Hong Kong company Insured: American Club Cargo: Unknown Spoofed location: Near Varna, Bulgaria Found location:
Lady Ella - IMO: 9252436 Age: 20 years old Owned: Hong Kong company Insured: American Club Cargo: Unknown Spoofed location: Niigata Port, Japan Found location: Near Kozmino, Russia
Snow Lotus - IMO: 9259733 Age: 19 years old Owned: Hong Kong company Insured: American Club Cargo: Unknown Spoofed location: Near Niigata, Japan Found location:
Mar. ’22
Aug. ’22
Dec. ’22
$40
$60
$80
$100
$120
$140 per barrel
Source: Refinitiv
An even starker warning came in April, with an alert that spoofing around Kozmino, in particular, was most likely related to Russian sanctions evasion. It advised American companies, including insurers, to use “maritime intelligence services” to detect suspicious activity.
Konstantin Zavrazhin/Getty Images
On March 8, the Cathay Phoenix leaves China signaling it’s headed to South Korea.
During the trip, the tanker changes its AIS to signal a new destination: the port of Niigata, Japan. This is the moment it begins spoofing.
On March 24, the ship’s fake signal comes to a stop just beyond the limit of Japanese jurisdiction, 70 miles from the port.
Inexplicably, the ship broadcasts over AIS that it’s taking on more cargo despite never entering Niigata. This signal is received at a ground station nearly 400 miles away, near the port of Kozmino.
This type of ground station only has a 40-mile radius. It’s further evidence that the Cathay Phoenix is nowhere near its supposed location off the coast of Japan.
A closer look at the Russian port hints at the truth. Several tug boats show they’re bringing a ship into port — but no AIS signal is being broadcast from where the ship should be.
A photo posted to Instagram by one of the tugboat’s crew shows what’s really there: the Cathay Phoenix.
Sources: Spire Global, MarineTraffic, Instagram
The Times verified the location and timeframe of a video and photo collage posted by a Ginza crew member to Instagram, with a location sticker that read “Iran.” Source: Instagram Note: Faces have been blurred to protect the poster’s anonymity.
Another ship, the Ginza, was first identified by Bjorn Bergman, a data analyst working for Global Fishing Watch and SkyTruth, two nonprofit organizations focused on the environment and fisheries. The Times corroborated Mr. Bergman’s findings with satellite imagery and additional social media footage. The location of the Instagram video posted from the Ginza was verified by matching the mountain ridge seen in the background with topographical data of Iran's coast.
The Times reviewed both Chinese customs data and Russian trade data which listed oil exports. Both sources confirmed that, since the sanctions came into effect, the average price of crude oil shipped from Russia to China is about $73-per-barrel. This per-barrel price was also independently confirmed in a study conducted by the Kyiv School of Economics.
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Why Chinese Companies Are Investing Billions in Mexico
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Alarmed by shipping chaos and geopolitical fractures, exporters from China are setting up factories in Mexico to preserve their sales to the United States.
By Peter S. Goodman
Peter Goodman reported this story from Monterrey and Salinas Victoria, Mexico, Mexico City and Laredo, Texas.
Listen to this story in the New York Times Audio app on iOS.
Bill Chan had never set foot anywhere in Mexico, let alone the lonely stretch of desert in the north of the country where he abruptly decided to build a $300 million factory. But that seemed a trifling detail amid the pressure to adapt to a swiftly changing global economy.
It was January 2022, and Mr. Chan’s company, Man Wah Furniture Manufacturing, was confronting grave challenges in moving sofas from its factories in China to customers in the United States. Shipping prices were skyrocketing. Washington and Beijing were locked in a fierce trade war.
Man Wah, one of China’s largest furniture companies, was eager to make its products on the North American side of the Pacific.
“Our main market is the United States,” said Mr. Chan, chief executive of Man Wah’s Mexico subsidiary. “We don’t want to lose that market.”
That same objective explains why scores of major Chinese companies are investing aggressively in Mexico, taking advantage of an expansive North American trade deal. Tracing a path forged by Japanese and South Korean companies, Chinese firms are establishing factories that allow them to label their goods “Made in Mexico,” then trucking their products into the United States duty-free.
The interest of Chinese manufacturers in Mexico is part of a broader trend known as nearshoring. International companies are moving production closer to customers to limit their vulnerability to shipping problems and geopolitical tensions.
The participation of Chinese companies in this shift attests to the deepening assumption that the breach dividing the United States and China will be an enduring feature of the next phase of globalization. Yet it also reveals something more fundamental: Whatever the political strains, the commercial forces linking the United States and China are even more powerful.
Chinese companies have no intention of forsaking the American economy, still the largest on earth. Instead, they are setting up operations inside the North American trading bloc as a way to supply Americans with goods, from electronics to clothing to furniture.
The Mexican border state of Nuevo León has positioned itself to reap the bounty. Led by a brash, 35-year-old governor, Samuel García, the state has courted foreign investment while pursuing highway improvements to ease the passage to border crossings.
Mr. García recently attended the World Economic Forum in Davos, Switzerland, to recruit more companies.
“Nuevo León is having a geopolitical planetary alignment,” the governor declared during an interview in the state capital of Monterrey, inside the government palace, a warren of grand rooms with high ceilings and balconies looking out to the jagged peaks of the Sierra Madre. “We’re receiving lots of Asians that want to come to the U.S. market.”
Since Mr. García took office in October 2021, nearly $7 billion in foreign investment has poured into Nuevo León, making the state the largest recipient after Mexico City, according to the Mexican Ministry of Economy.
In 2021, Chinese companies were responsible for 30 percent of foreign investment in Nuevo León, second only to the United States at 47 percent.
Some of this money is financing factories that will make finished products for sale in the United States. But much is focused on a broader refashioning of the global supply chain.
As the pandemic disrupted Chinese industry and jammed ports, companies with factories in the United States suffered shortages of parts made in Asia. Many are now demanding that their suppliers set up plants in North America or risk losing their business.
Lizhong, a Chinese manufacturer of automobile wheels, is erecting the company’s first factory outside Asia at an industrial park in Nuevo León. Lizhong’s largest customers, including Ford Motor and General Motors, pressed the company to open a factory in North America, said its general manager for Mexico, Wang Bing.
A South Korean company, DY Power, which makes components for construction equipment, is considering northern Mexico as the site for a factory near a major customer in Texas.
“After going through the pandemic and the supply chain crisis, the China Covid shutdown, many North American manufacturers would like to eliminate the risk,” said Sean Seo, a Seattle-based executive for DY Power.
“Globalization has ended,” he declared. “It’s local-ization now.”
César Santos has placed a substantial bet on such pronouncements proving true.
A corporate lawyer, Mr. Santos, 65, runs a sideline enterprise as a developer in Monterrey, an industrial boomtown full of upscale restaurants, glittering shopping malls and spas.
A decade ago, he was approached by a developer in Los Angeles who was representing a Chinese electronics company that was contemplating a factory in Mexico. Mr. Santos controlled an asset of considerable interest — a 2,100-acre parcel of land.
Dotted by cactus, the property sat less than 150 miles from the Texas border. While surrounding states grappled with violence linked to drug trafficking, Nuevo León carried a reputation for security. The state boasted a highly skilled work force, given the presence of universities that churned out engineering graduates, among them Tec de Monterrey, often referred to as “Mexico’s M.I.T.”
The land was his family’s cattle ranch when Mr. Santos was a child, the scene of horseback riding adventures. Now, he saw a lucrative opportunity to turn it into an industrial park.
He took a trip to China, riding a high-speed train from Shanghai to the lakefront city of Hangzhou to meet the Holley Group, which had constructed an industrial park for Chinese companies in Thailand.
“China was a country that had developed everything so fast,” Mr. Santos said. “I was really amazed.”
By 2015, he had joined with Holley and another Chinese partner to forge a joint venture, Hofusan Real Estate. They plan a grid of warehouses and factories fronted by a hotel and temporary apartments for visiting managers, plus more than 12,000 homes for workers.
The Holley Group dispatched Jiang Xin to oversee the venture. He had previously worked at the company’s project in Thailand. Mexico presented a different proposition.
“Chinese companies had no idea about Mexico, and the only things we knew were bad things, dangerous things,” Mr. Jiang said. “Then Trump came.”
When he became president in 2017, Donald J. Trump demanded that American companies abandon China. By 2018, he was slapping steep tariffs on hundreds of billions of dollars in Chinese imports.
“The tariff thing did help us,” Mr. Jiang said. “Chinese companies wanted more options. And we are one of their options.”
By the time Mr. Chan began contemplating Mexico in the fall of 2021, 27 other Chinese companies had already locked up land inside the Hofusan park. Only one large parcel remained.
Man Wah had already responded to the tariffs by building a factory in Vietnam, and using it to make products for the American market. But the soaring price of shipping beggared that strategy.
Man Wah was moving 3,500 40-foot shipping containers a month across the Pacific from Vietnam. Voyages that previously cost $2,000 were suddenly 10 times as much.
Mr. Chan used the Chinese social media platform WeChat to connect with Mr. Jiang. His questions were blunt. How soon could Man Wah begin construction? (Immediately.) How were the highways? (Not great, but improving.) Were there any authentic Chinese restaurants in the vicinity? (No.)
Within weeks, Man Wah had committed to purchase the land. In January 2022, Mr. Chan signed the contract before boarding a flight to Mexico, leaving his wife and two children behind in the Chinese city of Shenzhen.
While the factory is being constructed, Man Wah has already begun producing sofas at a small, leased plant nearby.
Even before he located the temporary site, Mr. Chan loaded 70 containers full of machinery and raw materials in China, putting them on a ship bound for Mexico.
“We always do things quickly,” he said. “Don’t worry about anything, just do it.”
Man Wah does worry about a few things: hiring enough workers and cultivating local suppliers.
The company has plans to manufacture nearly 900,000 pieces of furniture per year in Mexico. That will require hiring and retaining 6,000 workers.
Man Wah is accustomed to operating in China and Vietnam, where independent labor unions are essentially barred, and where rural people stream into industrial areas in pursuit of jobs.
In Nuevo León, the unemployment rate is 3.6 percent. The surge of investment has set off a fierce competition for workers.
Savvy companies have wooed their employees with extras like quality meals and transportation to work. But Man Wah and other Chinese companies answer to bosses in China, who are conditioned toward thrift while thinking of workers as easily replaceable.
Finding local suppliers is also a challenge. Under the terms of the North American trade agreement, manufacturers must employ minimum percentages of parts and raw materials from within the region to qualify for duty-free access to the other countries in the bloc.
Three years ago, Lenovo, the Chinese computer maker, opened a factory in Monterrey dedicated to making servers, the boxes that hold data for cloud computing.
Until last year, Lenovo flew in one crucial component — so-called motherboards — from a factory in China. But as international shipping troubles intensified, the company switched to a supplier in the Mexican city of Guadalajara.
Lenovo also stopped importing packaging materials from China, instead buying them in Mexico.
But Lenovo continues to import many key components from China, from memory devices to specialized cables.
“There’s no supply chain for these things in Mexico,” said Leandro Sardela, the company’s Western operations director.
At least, not yet.
Audio produced by Kate Winslett
Peter S. Goodman is a global economics correspondent, based in New York. He was previously London-based European economics correspondent and national economics correspondent during the Great Recession. He has also worked at The Washington Post as Shanghai bureau chief. More about Peter S. Goodman
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FTC sues to block Microsoft’s $69 billion acquisition of Activision Blizzard
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https://www.allsides.com/news/2022-12-09-1235/business-ftc-sues-block-microsoft-s-69-billion-acquisition-activision-blizzard
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The Federal Trade Commission on Thursday sued to block Microsoft’s $69 billion acquisition of Activision Blizzard, challenging one of the largest tech acquisitions in history.
The administrative complaint filed Thursday by the FTC alleges that the blockbuster deal, which would make Microsoft the third-largest video game publisher in the world, would give Microsoft “both the means and motive to harm competition” — claiming it could negatively affect prices of video games as well as game quality and player experiences on consoles and gaming services, according to an agency release.
Microsoft says it has reached a 10-year deal to bring 'Call of Duty' to Nintendo
“We continue to believe that this deal will expand competition and create more opportunities for gamers and game developers,” Brad Smith, Microsoft’s president, said in a statement Thursday. “We have been committed since Day One to addressing competition concerns, including by offering earlier this week proposed concessions to the FTC. While we believed in giving peace a chance, we have complete confidence in our case and welcome the opportunity to present our case in court.”
In an email sent to employees and provided to CNN, Activision CEO Bobby Kotick said the FTC suit may sound “alarming” but he remains confident the deal will close. “The allegation that this deal is anti-competitive doesn’t align with the facts, and we believe we’ll win this challenge,” he said.
The US merger challenge reflects the biggest setback yet for Microsoft as it has aggressively courted regulators around the world in hopes of persuading them to bless the deal. It also marks the FTC’s most significant challenge to the tech industry since it sued to break up Facebook-owner Meta in 2020, underscoring US officials’ vocal promises of a tough antitrust enforcement agenda.
“This is the boldest move the Biden administration has made so far to police mergers involving Big Tech and to expand the realm of merger enforcement,” said William Kovacic, a law professor at George Washington University and a former FTC chairman. “More than anything else they’ve done, this embodies their commitment to get tough on mergers.”
The case could also mark a turning point for how regulators and the courts review proposed deals, at a time when US antitrust enforcers have intentionally brought difficult cases to test the law and to keep up with advances in technology.
Microsoft’s proposed deal would give it control over key video game franchises, including “Call of Duty,” “World of Warcraft” and more. That could give it enormous influence over the future of a multibillion-dollar industry, the FTC said.
“Today we seek to stop Microsoft from gaining control over a leading independent game studio and using it to harm competition in multiple dynamic and fast-growing gaming markets,” said Holly Vedova, director of the FTC’s Bureau of Competition, in a statement.
Officials in the United Kingdom and the European Union have also scrutinized the deal as potentially anticompetitive. But the FTC complaint marks the first attempt by an antitrust regulator to block the deal outright.
Microsoft could use its ownership over Activision titles to raise prices, or to try to funnel players to gaming platforms it controls, such as Xbox or Windows, the FTC said. The deal could also affect the emerging market for cloud-based gaming services, the FTC said, which Microsoft is involved with through its subscription service, Xbox Game Pass.
In recent days, Microsoft has announced a slew of partnerships apparently intended to head off claims that it would withhold gaming content from rivals. This week, Microsoft said it had reached a 10-year deal with Nintendo ensuring that it will have access to Call of Duty for the foreseeable future.
In a Wall Street Journal op-ed Monday, Microsoft’s Smith said an FTC suit to block the Activision deal would be a “huge mistake” and added that the acquisition would allow Microsoft to innovate new features such as the ability for consumer to play the same game on multiple devices, just as they can with streaming TV shows or music.
Months earlier, in February, Microsoft made an 11-point pledge related to all of its app marketplaces and its gaming business. The list included a promise, which would cover the proposed Activision deal, not to give preferential treatment to its own published games on digital marketplaces it runs.
The FTC’s complaint uses an internal administrative process that does not involve filing in a federal court. That could give the FTC a theoretical advantage, said Kovacic, as an FTC administrative law judge may be inclined to give regulators the benefit of the doubt. But, he added, the FTC must still marshal convincing evidence and arguments to win the case, which could take years to play out.
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Amazon warehouse workers stage Black Friday strikes and protests around world
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Someone wears a mask of the face of the Amazon founder, Jeff Bezos, as they join other workers in a protest over pay and conditions in India. Photograph: Manish Swarup/AP
Amazon
This article is more than 9 months old
Amazon warehouse workers stage Black Friday strikes and protests around world
This article is more than 9 months old
On one of firm’s biggest shopping days of year, employees demand better wages and conditions
Mark Sweney
@marksweney
Fri 25 Nov 2022 10.48 CET
Last modified on Fri 25 Nov 2022 19.54 CET
Amazon warehouse workers in the UK and 40 other countries are to strike and stage protests timed to coincide with the Black Friday sales, one of the company’s biggest shopping days of the year.
Employees in dozens of countries, from Japan and Australia to India, the US and across Europe, are demanding better wages and conditions in a campaign called “Make Amazon Pay”.
In the UK, hundreds of members of the GMB union are staging strikes or protests at a number of Amazon warehouses, including a protest outside its fulfilment centre in Coventry.
“We are here today to tell Amazon [that] if you want to keep your empire going, talk to GMB to improve the pay and conditions of workers,” said Amanda Gearing, a senior organiser at the GMB. “Amazon workers are overworked, underpaid and they have had enough.”
Profits at Amazon Services UK, the group’s warehouse and logistics operation, which is thought to employ more than half of the company’s UK workforce of close to 75,000 people, have soared by 60% to £204m, with revenues growing by just over a quarter to more than £6bn last year.
Workers are demanding a wage rise from £10.50 to £15 an hour as the cost of living crisis hits household budgets.
However, participating in the action in the UK could mean that protesters miss out on the second part of a £500 bonus Amazon agreed for tens of thousands of frontline workers.
Last month, Amazon UK said that the award of the second part of the payment was dependent on staff taking no “unauthorised absence” between 22 November and Christmas Eve.
The GMB argued that linking the payment to staff attendance could be viewed as an illegal strike-busting move.
In Dublin, Extinction Rebellion has organised a protest outside Amazon’s offices from 1pm.
A spokesperson for Amazon said: “These groups represent a variety of interests, and while we are not perfect in any area, if you objectively look at what Amazon is doing on these important matters, you’ll see that we do take our role and our impact very seriously.”
“We are inventing and investing significantly in all these areas, playing a significant role in addressing climate change with the climate pledge commitment to be net zero carbon by 2040, continuing to offer competitive wages and great benefits, and inventing new ways to keep our employees safe and healthy in our operations network, to name just a few.”
More than 50 security guards and CCTV operators demonstrating outside Harrods over a 'pay cut' . Photograph: Mark Thomas/i-Images
In London, security guards and CCTV operators at Harrods are also going on strike on Black Friday, including staging a protest outside the luxury Knightsbridge store, the first of 12 days of action through the festive period.
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More than 50 staff members are taking part in the protests, which are to be staged across every weekend in December and include Christmas Eve and Boxing Day, over a 7% pay offer they view as a “cut” with inflation running at more than 11%.
Last month, Harrods, which is owned by the Qatar Investment Authority, reported an annual profit of £51m, more than doubled the pay of its managing director to £2.3m and revealed it had collected almost £6m in government support under the Covid furlough scheme.
“Harrods and its owners can absolutely afford to pay these workers a rise that reflects soaring living costs,” said Sharon Graham, the general secretary of the Unite union.
Meanwhile, the industry body UKHospitality said a series of planned rail strikes in the run-up to Christmas would cost UK restaurants, pubs, clubs and bars £1.5bn, and called on the government to bring all partners to the table to try to reach a solution.
Mick Lynch, the general secretary of the National Union of Rail, Maritime and Transport Workers, said the strikes would go ahead, after a first meeting with transport secretary Mark Harper to try to resolve the dispute on Thursday.
Kate Nicholls, the chief executive of UKHospitality, said the disruption and financial cost of the strikes will cause another lost Christmas on the scale of the impact of the Omicron variant of Covid last year.
“This disruption will devastate hospitality businesses during its busiest period of the year and will once again force the public to cancel and rearrange plans,” she said. “The impact of rail strikes already this year has been devastating and wide-reaching but this will pale in comparison to what we will see as a result of the upcoming strikes in December.”
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The Most Complicated Labor Negotiation in the Country Just Got More Complicated
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https://www.vice.com/en/article/akeqxk/the-most-complicated-labor-negotiation-in-the-country-just-got-more-complicated
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Threat of nationwide rail strike grows after 2nd union rejects labor deal
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https://abcnews.go.com/Business/threat-nationwide-rail-strike-grows-2nd-union-rejects/story?id=92196610
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A union representing 6,000 rail workers said its members have voted against ratifying the tentative agreement brokered between rail companies, unions and members of President Joe Biden's administration in September.
The vote by the Brotherhood of Railroad Signalmen, the second union to reject the White House-brokered deal, elevates the likelihood of a nationwide strike when a negotiation deadline arrives in November.
The potential work stoppage could paralyze the nation's supply chain and transportation rail service as the U.S. enters peak holiday season.
White House Press Secretary Jean-Pierre, when asked about the union vote during a briefing on Wednesday, said Biden "remains focused on protecting America's families, farms and businesses by avoiding a rail shutdown."
MORE: US economy grew significantly in 3rd quarter, ending 6 months of shrinking
"We continue to urge both sides to work in good faith and avoid even the threat of a shutdown," she added.
The vote against the contract centered on frustration with a lack of paid sick days, according to a statement from Brotherhood of Railroad Signalmen President Michael Baldwin. "For the first time that I can remember, the BRS members voted not to ratify a National Agreement," he said.
The rejection of the deal came despite a 24% compounded wage increase and preservation of the members' health care benefits, Baldwin added.
The National Carriers' Conference Committee, or NCCC, which represents freight railroads in national collective bargaining, expressed disappointment over the union vote.
The tentative contract "included the largest wage package in nearly five decades, maintained rail employees' platinum-level health benefits, and added an additional day of paid time off," the NCCC said in a statement.
Labor Secretary Marty Walsh discusses organizing unions in the workplace during the Black Caucus Foundation's Annual Legislative Conference, Sept. 30, 2022, in Washington, D.C.
Leigh Vogel/Getty Images
The contract was rejected by roughly 60% of members in the the Brotherhood of Railroad Signalmen, while nearly 40% voted in favor of the deal, the union said. The vote garnered the highest participation rate in union history, it added.
MORE: Voters prefer Republicans on the economy, economists assess their plans to fix inflation
In all, 12 unions representing 115,000 workers stand to ratify a labor agreement with rail companies. The Brotherhood of Maintenance of Way Employees division of the Teamsters, which represents 12,000 members, rejected the tentative agreement earlier this month.
Six unions have ratified the deal brokered by the White House, the NCCC said.
The two largest rail unions -- the Brotherhood of Locomotive Engineers Trainmen, or BLET, and the SMART Transportation Division, or SMART-TD, which make up roughly half of all rail workers -- are set to finish voting in the middle of next month.
MORE: Sales slump at Facebook parent Meta, stock tumbles
The unions that voted down the agreement have vowed to continue negotiations at least until Nov. 19, when a strike could ensue.
"The artery of the US economy is the rail system. It's one of the ways we get everything around. One third of everything gets around this way. And when you cut it, you have a stroke," Diane Swonk, chief economist at global tax firm KPMG, previously told ABC News.
A potential strike could lead to $2 billion a day in lost economic output, according to the Association of American Railroads, which lobbies on behalf of rail companies.
Freight railroads are responsible for carrying 40% of the nation's long-haul freight and a work stoppage could jeopardize these shipments.
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Biden admin officials considering trying to discourage American companies from expanding business ties with Saudi Arabia
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https://www.nbcnews.com/politics/national-security/biden-admin-officials-consider-discouraging-us-companies-expanding-bus-rcna52525
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EXCLUSIVE
JOE BIDEN
Biden admin officials considering trying to discourage American companies from expanding business ties with Saudi Arabia
Officials said it's one option on the table as the administration weighs how to respond to OPEC's cut to oil production without undermining U.S. objectives in the Middle East.
The U.S. is exploring ways to use American businesses as leverage against Saudi Arabia as President Joe Biden says he’s re-evaluating his administration’s relationship with the kingdom and considering how to retaliate against Riyadh over the oil production decision.NBC News / Bloomberg; Getty Images
Oct. 18, 2022, 10:30 AM CEST
By Carol E. Lee and Courtney Kube
WASHINGTON — Biden administration officials are considering trying to discourage American companies from expanding business ties with Saudi Arabia as part of a U.S. response to a recent Saudi-led push by oil-producing countries to cut global production, said three current and former U.S. officials familiar with the discussions.
The administration also will not send any U.S. official to Saudi Arabia’s annual Future Investment Initiative conference in Riyadh next week, officials said, although a senior administration official said the determination was made before the OPEC+ alliance announced Oct. 5 that it would cut oil production by 2 million barrels a day. The official said the administration was unable to make scheduling work to send a U.S. government official to the high-profile conference, sometimes referred to as “Davos in the desert,” which has been a prized event for Saudi Arabia’s de facto leader, Crown Prince Mohammed bin Salman.
Biden administration may try to discourage American businesses from expanding in Saudi Arabia
OCT. 18, 202203:03
Exploring ways to use American businesses as leverage against Saudi Arabia comes as President Joe Biden says he’s re-evaluating his administration’s relationship with the kingdom and considering how to retaliate against Riyadh over the oil production decision. The current and former U.S. officials said no decisions have been made about whether to proceed with such an effort. They said it’s just one of the options under consideration as Biden considers how to balance responding with not undermining some core U.S. objectives in the Middle East, namely uniting Israel and its Arab neighbors against Iran.
The thinking behind a move to pull back American business investment in Saudi Arabia is that it could influence the kingdom without directly affecting U.S. security in the region, but it also would come with a risk that U.S. businesses won’t listen.
Biden to tap strategic petroleum reserve in effort to lower fuel costs
OCT. 19, 202203:24
As of now, American companies are set to appear in full force at next week’s Future Investment Initiative conference, which has drawn business executives, investors and government officials. The event has been a platform for the crown prince, also known as MBS, to showcase business opportunities in the kingdom.
Officials acknowledged that it’s too late to affect the turnout of American business executives at this year’s conference, which begins Oct. 25 in Riyadh, even if the administration wanted to do so. The theme of this year’s conference is “Investing in Humanity: Enabling a New Global Order.”
The Biden administration had already downgraded U.S. participation in the conference from the Trump administration’s level of engagement. The Trump administration sent the treasury secretary to the conference, whereas last year the Biden administration sent Deputy Commerce Secretary Don Graves. The Commerce Department confirmed he will not attend this year.
Adrienne Watson, the spokesperson for the White House National Security Council, said the administration has not reached out to American companies to discourage them from doing business in Saudi Arabia.
“We are not reaching out to companies to make such requests,” Watson said in a statement. “As they do in every part of the world, American companies will make their own decisions about their presence and where to invest, taking into account a range of factors, including legal constraints, the business environment and reputational concerns that can arise from public policy choices made by host countries.”
In addition to considering trying to squeeze the Saudis in the business world, a senior administration official said the Biden administration plans to immediately dial back diplomatic and military engagements with Riyadh, describing a cooling of relations that would likely last until OPEC+ leadership holds its next official meeting on Dec. 4, the 34th OPEC and non-OPEC Ministerial Meeting.
Saudi Arabia announces massive cut to oil production
OCT. 11, 202201:42
The outcome of the December meeting will be pivotal to the future of the relationship between the U.S. and Saudi Arabia, the official said. The meeting convenes the day before a European Union sanctions package against Russia takes effect. The package will include a partial embargo on Russian oil and a ban on importing Russian crude oil from the sea. The sanctions will limit E.U. countries from reselling Russian crude oil and petroleum products.
“That’s going to be a key test, that OPEC meeting,” the senior administration official said. “E.U. sanctions will be going into effect, and a couple million barrels [of Russian oil] will be gone. Does OPEC do nothing then?”
‘Under pressure’
Biden is under pressure from Congress to take dramatic steps, such as cutting off arms sales to the kingdom, and White House officials are furious with Riyadh that after heavy U.S. lobbying not to cut oil production, OPEC+ moved forward with an even larger cut than expected. U.S. officials have said the decision will drive up gas prices and provide an economic lifeline to Russia — a major oil exporter — as it continues its brutal war in Ukraine. Officials also have accused the crown prince of arm-twisting other members of the OPEC+ alliance into the decision.
Saudi Arabia has said the decision does neither of those things, and it has stressed that it was made collectively by a group of countries.
U.S. officials, including the president, have promised a response to Riyadh, but so far none has been implemented, and officials have said decisions would be made in consultation with Congress, which doesn’t return to Washington until after November’s midterm elections.
“The Biden administration seems to be scrambling a bit to find practical measures that could back up the rhetoric from President Biden that there will be consequences,” said Brian Katulis, the vice president of policy at the Middle East Institute.
“One arena where Saudi leaders are very interested in building stronger ties with the United States is in the economic realm and in particular private-sector engagement,” Katulis said. “Saudi leaders are keen to have American businesses and investors come to their country and make big investments to help them advance the goal of diversifying its economy.”
Foreign investment in Saudi Arabia is a core part of the crown prince’s plan to diversify the kingdom’s economy.
Early last year Riyadh announced that starting in 2024 only international companies with regional headquarters in Saudi Arabia could do business with the Saudi government.
The crown prince’s efforts were set back after journalist Jamal Khashoggi was murdered in October 2018. Under bipartisan pressure, Trump administration Treasury Secretary Steven Mnuchin canceled plans to attend the Future Investment Initiative conference held later that month. U.S. intelligence agencies ultimately concluded that MBS approved Khashoggi’s killing. The Saudi government has denied that the crown prince had any role in the murder.
Biden warns of ‘consequences’ for Saudi Arabia for OPEC+ oil cut
OCT. 12, 202200:32
Engagement with Saudi Arabia has picked back up, culminating with Biden’s visit to the kingdom, where he was photographed fist-bumping with MBS in July.
Before the OPEC+ decision this month, U.S. and Saudi officials spent hours discussing the future of oil prices, according to administration officials.
The Saudis told the Americans they were prepared to sustain the increased production until the end of the year, the senior administration official said, and that was the expectation of both the U.S. and other OPEC countries for months.
But then more recently, the Saudis presented the U.S. with an analysis that the price of oil was likely to fall and argued they needed to cut production to avoid a price crater, U.S. officials said. The U.S. disagreed and presented evidence that the prices were likely to remain stable for another 30 days and that the production cut could wait until the next OPEC meeting, and it even argued OPEC could change production at any time if the price started to tank, they said. But, they said, the Saudis wouldn’t budge from their analysis and charts arguing that a price collapse was imminent.
Carol E. Lee
Carol E. Lee is an NBC News correspondent.
Courtney Kube
Courtney Kube is a correspondent covering national security and the military for the NBC News Investigative Unit.
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What is BRICS, which countries want to join and why?
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https://www.reuters.com/world/what-is-brics-who-are-its-members-2023-08-21/
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World
What is BRICS, which countries want to join and why?
Reuters
August 22, 20231:01 AM GMT+2Updated a month ago
JOHANNESBURG, Aug 21 (Reuters) - The BRICS group of major emerging economies - Brazil, Russia, India, China and South Africa - will hold its 15th heads of state and government summit in Johannesburg between Aug. 22 and Aug. 24.
Here are some key facts about the bloc and its members.
WHAT IS BRICS?
The acronym BRIC, which did not initially include South Africa, was coined in 2001 by then Goldman Sachs chief economist Jim O'Neill in a research paper that underlined the growth potential of Brazil, Russia, India and China.
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China-US Tech War Spirals Over Smart Devices
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Chinese Exports Fall at Steepest Pace Since February 2020
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By
Updated Aug. 8, 2023 1:16 pm ET
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(2 min)
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How U.S. microchips are fueling Russia’s military — despite sanctions
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https://www.allsides.com/news/2023-08-07-1106/business-how-us-microchips-are-fueling-russia-s-military-despite-sanctions
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US chip war will end up hurting allies as much as China
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https://www.scmp.com/comment/opinion/article/3230269/us-chip-war-will-end-hurting-allies-much-china
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SCMP Columnist
My Take by Alex Lo
US chip war will end up hurting allies as much as China
The global chip industry was doing perfectly well until the US threw a spanner in the works by offering subsidies it doesn’t need and sanctions that will backfire to contain China’s tech rise
Alex Lo
+ FOLLOW
Published: 9:00pm, 7 Aug, 2023
Why you can trust SCMP
It’s one thing to sanction for national security, it’s another to use that as an excuse to practise protectionism. But to force your friends to join while knowing full well that it will hurt their economies is an egregious breach of basic trust.
I am, of course, talking about the United States’ semiconductor sanctions against China. But perhaps the worst of all is that most independent experts and industry insiders have already warned they are counterproductive and will likely end up hurting everyone, including the US, without achieving the desired result.
No wonder Washington is facing resistance everywhere, not only from allies, but also its own business leaders and industry insiders.
Yang Hyang-ja, a former senior Samsung executive and currently a lawmaker in South Korea, has become the latest influential figure in Asia to warn the US to back off on chip curbs.
“The US should abandon its current approach of trying to get something out of shaking and breaking the global value chain,” she told the Financial Times.
“The more the US sanctions China, the harder China will try to make rapid technological progress. China will provide more national support for the goal. Then it will pose a crisis to South Korea, given China’s abundant talent and raw materials.”
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A chip engineer, Yang previously headed her country’s Democratic Party committee on enhancing semiconductor competitiveness.
“If [Washington] continues to try to punish other nations and to pass bills and implement ‘America First’ policies in an unpredictable manner, other countries could form an alliance against the US,” she said.
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“The US is the strongest nation in the world … It should consider more of humanity’s common values. Appearing to use its strength as a weapon is not desirable.”
China and the US embrace each other’s economic model in new cold war
Last month, Japan started imposing the US-directed sanctions. But top executives had already warned the measures would only upset Beijing without causing lasting damage to the Chinese hi-tech industries.
In December, Sony’s technology head Hiroaki Kitano said he expected the sanctions would only “temporarily impact” China’s ability to procure semiconductors, adding it was “entirely possible” that its advances in artificial intelligence would continue unhindered.
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“The driving force of AI [development] in China is that they have access to very large data sets,” Kitano said. “I am not sure what kind of long-term impact [the US export curbs] can have there.”
NEC chief executive Takayuki Morita has expressed similar doubts. “Personally, I feel that while it may be possible for the US-China technology dispute over chips to slow down China’s technology progress, the overall trend will not change,” he said. “It’s not possible to ignore China’s competitiveness in technology, and it will become one of the forces [to reckon with] in the long run.”
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In his latest interview with The New York Times, Morris Chang – founder of Taiwan Semiconductor Manufacturing Company (TSMC), who is often called godfather of the island’s tech industry – observed drily that US firms would lose business and China would still find ways “to fight back” against the US-led sanctions.
Interestingly, US industry leaders themselves have warned against the whole sanctions plan.
The CEOs of Intel, Qualcomm and Nvidia have all lobbied, albeit unsuccessfully, the Joe Biden administration not to impose any more restrictions on the sales of their products to China. The three tech giants are members of the Semiconductor Industry Association (SIA).
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In an official statement, the SIA said: “Allowing the industry to have continued access to the China market, the world’s largest commercial market for commodity semiconductors, is important …”
It’s fascinating how Mike Gallagher, Republican chairman of a House of Representatives committee on competition with China and typical anti-China hawk, immediately blasted the CEOs.
“I’m alarmed that some American CEOs continue to advocate for weaker export controls on sensitive technology,” he said. “The Biden administration needs to tighten our export controls on advanced chips”
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I suppose just being the head of a politically driven committee makes him an expert on the business and technology of semiconductors.
Liesje Schreinemacher, the Dutch trade minister, opposed her country joining the US sanctions, only to be overruled by her government. Dutch lithography manufacturer ASML is the dominant player in the market and China is one of its primary markets.
Taiwan’s hi-tech jewel is quietly fighting US industrial capture
Still, it may be argued that yes, the sanctions will hurt everyone, not just China. But maybe it will help the US to reshore and rebuild the domestic chip industry.
But will it? While that has been the dream of America’s industrial nationalists, it doesn’t look that way.
Despite the offers of multibillion-dollar subsidies under Biden’s supposedly groundbreaking Chips and Science Act, which looks a lot like industrial policy from the last Cold War except more badly done this time, the leading chip makers and designers in Europe, Taiwan, South Korea and Japan are busy investing in each other’s backyard because they have already built up efficient production lines and supply chains. Their efforts are being redoubled.
Intel, an enthusiastic recipient of Chips Act subsidies, is on record saying it will be investing more overseas than in the US.
What US politicians refuse to admit is that the global chip industry is doing fine on its own, and that it’s only the sudden shift in US foreign policy to contain China’s hi-tech development that has created the problems US measures such as the Chips Act are supposed to address.
But since Washington is suddenly offering free money, of course those chip companies are going to take it, thereby distorting what is about business and technology into politics, or worse, cold war politics 2.0.
So why does the US do it? Because it can, for one. But also it’s good domestic politics to go to extremes on China, never mind that it’s bad foreign policy, bad trade policy, and could potentially set the world economy back, if not threatening global peace.
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America’s Rise as an Energy Export Powerhouse Hinges on One Town
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https://www.wsj.com/articles/americas-rise-as-an-energy-export-powerhouse-hinges-on-one-town-831518c?mod=hp_lead_pos8
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The U.S. has transformed global markets by boosting crude-oil exports more than 30-fold over the past decade. Much of the boom hinges on Corpus Christi Bay.
| 977
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Yellen criticizes China's 'punitive' actions against US companies, urges market reforms
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https://www.reuters.com/world/yellen-urges-china-adopt-market-reforms-insists-us-not-decoupling-2023-07-07/
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World
Yellen criticizes China's 'punitive' actions against US companies, urges market reforms
By Andrea Shalal and Joe Cash
July 7, 20239:48 PM GMT+2Updated 2 months ago
Summary
Yellen says U.S. wants healthy competition, not winner-take-all
Chinese Premier Li calls on U.S. to 'meet China halfway"
U.S. industry welcomes Yellen's 'firepower'
BEIJING, July 7 (Reuters) - U.S. Treasury Secretary Janet Yellen called on Friday for market reforms in China and criticized its recent tough actions against U.S. companies and mineral export controls, while China's premier called on her to "meet China halfway" and put bilateral relations back on track.
Yellen met with Premier Li Qiang on Friday during a visit to Beijing aimed at repairing fractious U.S.-Chinese economic relations, but made clear in her public remarks that Washington and its Western allies will continue to hit back at what she called China's "unfair economic practices."
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China Controls Minerals That Run the World—and It Just Fired a Warning Shot at U.S.
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By
Updated July 7, 2023 11:49 am ET
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U.S. Looks to Restrict China’s Access to Cloud Computing to Protect Advanced Technology
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https://www.allsides.com/news/2023-07-04-0654/china-us-looks-restrict-china-s-access-cloud-computing-protect-advanced
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https://www.wsj.com/articles/u-s-looks-to-restrict-chinas-access-to-cloud-computing-to-protect-advanced-technology-f771613?mod=hp_lead_pos1
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By
Yuka Hayashi
and
John D. McKinnon
Updated July 4, 2023 2:31 pm ET
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The $53 billion Chips Act seeks to end the U.S.’s reliance on foreign-made semiconductors, especially those used by the Pentagon. It is the latest example of the federal government using its cash to remake an industry it sees as crucial to national security.
WASHINGTON—The Biden administration is preparing to restrict Chinese companies’ access to U.S. cloud-computing services, according to people familiar with the situation, in a move that could further strain relations between the world’s economic superpowers.
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FTC Sues Amazon Over ‘Manipulative’ Tactics Used to Enroll Millions in Prime
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With Eye On China, US And Five Allies Condemn Trade-related 'Economic Coercion'
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https://www.allsides.com/news/2023-06-09-1206/business-eye-china-us-and-five-allies-condemn-trade-related-economic-coercion
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https://www.ibtimes.com/eye-china-us-five-allies-condemn-trade-related-economic-coercion-3698901
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By Jeff Mason
06/09/23 AT 9:07 AM EDT
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Flags of U.S. and China are displayed at American International Chamber of Commerce (AICC)'s booth during China International Fair for Trade in Services in Beijing, China, May 28, 2019. REUTERS
The United States and five of its allies on Friday condemned the use of trade practices that amount to economic coercion in a joint declaration that did not single out other countries but appeared to be aimed at China.
Australia, Britain, Canada, Japan, and New Zealand jointly released the statement with the United States, emphasizing that "trade-related economic coercion and non-market-oriented policies and practices" threatened the multi-lateral trading system and "harms relations between countries."
The statement comes after the Group of Seven leaders last month agreed to a new initiative to counter economic coercion and pledged action to ensure that any actors attempting to weaponize economic dependence would fail and face consequences.
The United States, Britain, Japan and Canada are also members of the G7.
The countries expressed concern about "pervasive subsidization," anti-competitive practices by state-owned enterprises, forced technology transfer, and government interference with corporate decision-making.
Washington has regularly raised such concerns about trade practices by Beijing, and an official from the office of the U.S. Trade Representative, who spoke to reporters about the joint declaration, cited China for imposing a ban on imports from Lithuania after Lithuania allowed Taiwan to open a de facto embassy.
China, which regards the democratically-ruled Taiwan as part of its territory, suspended imports of beef, dairy and beer from Lithuania last year.
In May, Beijing protested the G7's declarations, including on economic coercion, saying the U.S. was "pushing hard to weave an anti-China net in the Western world."
In their joint statement on Friday, the U.S. and its five allies also raised concerns about forced labor.
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"We are also seriously concerned about the use of forced labour, including state-sponsored forced labour, in global supply chains. All forms of forced labour are gross abuses of human rights, as well as economic issues, and it is a moral imperative to end these practices," they said.
CHINA
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West Coast ports shut down as union workers ‘no show’ after breakdown in wage negotiations
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Will Geopolitical Pressure Push Biden To Lift Sanctions On Venezuela?
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https://www.ibtimes.com/will-geopolitical-pressure-push-biden-lift-sanctions-venezuela-3693347
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Created by Dr Cyril Widdershoven
05/15/23 AT 10:39 AM EDT
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* This is a contributed article and this content does not necessarily represent the views of IBTimes.
Dr Cyril Widdershoven is a veteran global energy market expert and founder of Verocy, a strategic advisory firm
Photo Caption: European producers like ENI, Repsol, and Maurel & Prom, who understandably want a level playing field with their US counterpart, have existing infrastructure in Venezuela and can therefore help to ramp up production at pace. ENERGY INTELLIGENCE
Energy prices in Europe were trending downwards in March, but OPEC's production cut at the beginning of April has renewed pressures as winter approaches.
In 2022, following Russia's invasion of Ukraine, finance ministries across the continent doled out vast energy subsidies to head off a precipitous drop in living standards and recession.
They will now struggle to repeat the same generosity in the context of high interest rates and jumpy financial markets.
If consumer rates cannot be cushioned directly, then supply will have to expand to bear down on inflation and start the reversal of tight monetary policy in the US and EU.
This reality has led policymakers to reconsider historic energy suppliers like Venezuela as the West decouples from Russia and OPEC plays hardball.
Despite misgivings about the administration of President Nicolas Maduro, Venezuela's oil reserves are proven to outsize even those of energy behemoth Saudi Arabia.
The South American nation also boasts enough liquified natural gas (LNG) – which the EU has deemed a sustainable fuel - to play a major part in supporting the energy transition.
Despite this vast mineral wealth, the Trump era saw the US do everything it could to marginalize Venezuela both economically and politically.
In response, Maduro sought closer ties with US foes Russia and China to secure vital supplies and financial support. The Sino-Russian axis was all too happy to oblige.
If this estrangement continues, then the West (and particularly Europe) will not only lose a vital economic lifeline in Venezuela but push the country into the hands of its rivals.
US policy is key to stopping that from happening but remains muddled despite the recent entreaties of Colombia for an end to sanctions.
On the plus side, the Biden administration has rowed back on Trump's 'maximum pressure' approach, its head turned by Venezuela's energy riches as prices surged in March of last year.
Reconciliation efforts peaked in November when the US government gave Chevron the greenlight to resume pumping oil in conjunction with PDVSA, Venezuela's state oil company.
Despite this step forward, there is recognition that one major isn't enough to truly marshal the country's full energy potential. Moreover, Chevron itself has had to move slowly, seeking permission on a near constant basis from the US for fear of falling outside its remit.
This must all be to the frustration of Europe which needs the oil and gas more than the US, a net energy exporter, and has its own majors that could speed up the process to the whole market's benefit.
Indeed, even with its present constraints, Chevron has significantly increased production since November.
European producers like ENI, Repsol, and Maurel & Prom, who understandably want a level playing field with their US counterpart, have existing infrastructure in Venezuela and can therefore help to ramp up production at pace.
In recognition of this potential, the Maduro administration has initiated a string of reforms to support private sector operators – a strong foundation for the domestic industry's rejuvenation.
While the resumption of Venezuelan oil exports in a meaningful sense is not going to crash prices, it would certainly serve as a reprieve from the current OPEC-induced turbulence.
When it comes to LNG, BP measures Venezuela's proven reserves as the seventh largest on earth and ongoing recertification studies could take it up to third.
This is compelling in isolation, but of extra value when one considers that Russia, Iran, and China – hardly friends of the West - make up three of the top six.
In addition, Venezuela's natural gas can easily be exported via US-licensed, Shell-operated facilities in Trinidad & Tobago, thereby supporting Europe's long-term plans to greenify its energy mix.
While European and British producers are technically limited only by their respective governments, their extensive US operations make them beholden to the policies of the Biden administration.
They therefore need legal clarity from the US government on the 'what, where, and with whom' of operating in Venezuela. Only then can the taps be turned on and Europe bolster its energy security before temperatures drop.
While the country's resources are seemingly unbounding, the Venezuelan play as it stands won't be on the table forever.
As mentioned, a collapse in living standards under US sanctions pushed the Maduro administration towards Russia and China in search of financial and humanitarian aid.
The Sino-Russian axis, with its commitment to 'limitless cooperation', represents an economic and geopolitical alternative to the US-led West not just to Venezuela but to non-aligned states across the globe.
While Iran surprised no one by joining the axis, there is certainly concern in Western foreign policymaking circles about hydrocarbon heavyweights like Saudi Arabia and the UAE both tilting eastwards and refusing to sanction Russia for its war in Ukraine.
In this reality, the US' sanctioning of energy-rich Venezuela into the laps of its antagonists is both a strategic error and a missed opportunity for Europe's energy salvation.
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