How much harder will Romney work for a tax cut?

Mitt Romney paid 14% tax in 2010, the only year that he has released a (partial) tax return. And that was 14% of his taxable income after he had squirreled away millions in swiss bank accounts.

According to plutocrat economics, low taxes on the rich make them work harder. Mitt paid $6.2 million in taxes on a total of $42.5 million in taxable income leaving him with $36.3 million rather than the $29.8 million he would have left if he had paid tax at a 30% rate.

So how much harder did Romney work for that extra disposable income? Or put it another way, how much less would he have worked had the tax rate been higher?

The answer of course is that Romney was 'unemployed' (NYT). He didn't work at all in 2010. Romney had made enough money as a corporate raider that he didn't need to work at all.

Romney's returns also give the lie to the ludicrous notion that lower tax rates on the rich actually increase tax revenues. If Romney's tax rate was 30%, he would have to be so upset about paying the same as the rest of us that he decided to leave $21.9 million on the table for his taxes to fall. Read the rest of this post...

Is it fair for a man with prosthetics to compete in the Olympics?

A South African athlete, Oscar Pistorius, competing in the Olympics has prosthetics in place of his feet and lower legs. The question for a number of years now is whether this gives him an unfair advantage over other runners. Finally, it was ruled that there was no "net" advantage because studies seemed to suggest the prosthetics helped him run in some ways and hurt him in others.

ESPN seems to sum up some of the arguments in Pistorius' favor:

[T]he sight of Pistorius in an Olympic race was a beautiful thing. How can anyone not stand up and cheer for him? How could anyone seriously oppose his participation in the Olympics? How can his saga be viewed as anything but a dramatic and inspiring story?

I mean, running with carbon-fiber blades is not like steroids or doping. This is not going to become the next performance-enhancer athletes will use to cheat.

"Exactly,'' Jeffrey Kessler said. "No one is going to say, 'I'm going to make myself a double amputee so I can compete with carbon-fiber prosthetics.'''

Well, I can easily see how someone could be understandably skeptical about his inclusion in the race.  On humanitarian grounds of course everyone wants him in.  But that's not really how we determine who gets to be an Olympic athlete, based on our sympathies.

And some of the arguments in his favor seem somewhat irrelevant.  "It's not like doping."  Okay.  But that's not really the question.  The question is whether it gives him an unfair advantage. Or rather, the question is whether this is the same thing as running on two feet.

"It's not like other players would now make themselves double amputees to compete."  Again, that's not really the question.  The question is whether a sport based on legs, or at least feet, is open to those who don't have them.  It's sounds mean, but this is an athletic sport.  Again, you enter based on your physical abilities, not based on our level of sympathy.

Would it be fair for a swimmer without hands or feet to use paddles?  How about a runner with a wheelchair?

And what if Pastorius decides to tweak the prosthetics to make them faster, to make them compensate for whatever disadvantages the scientists previously found?  Would that still make him eligible or would that now be like doping?  And how would anyone know?  There are tests for doping, the tests for the prosthetics, the scientific studies, seem to be all over the place.

Now, the contrary argument which Pastorius made, among others, was that athletes use technology all the time to give them an advantage - whether it's the type of shoes that runners buy, or the swimsuit that swimmers use.  And he's right.  And I have to admit, it's always troubled me that they permit athletes to try to find the best swimsuit, or shoe, to increase their speed - that seems unfair too, and contrary to the notion of whether one person's body is simply faster than the other's.  They ought to all get the same uniforms (or go nude like the Greeks).

I get why folks want to support Pastorius.  I don't think, however, that one's sympathy, or admiration, is the basis for which we allow athletes to compete in the Olympics.  I don't think it's possible to know whether this prosthetic does or doesn't give him an unfair advantage.  What we do know is that he's not a man running on his own two feet.  And to me, at least, that's what this race is.  And if it's not, then permit wheelchairs too.

I know it's not permissible in some circles to write any of this, but I think it's worthy of a more intelligent discussion than ESPN gave it - if only to address the concerns that some folks might have.

Curious what the rest of you think. Read the rest of this post...

Remember when Bush didn't want DOJ to check terrorists' gun purchases right after 9/11?

How do you say "fast and furious" in Arabic?

Forget about stopping crazy people from buying guns.

The gun nuts that control the Republican party, and the conservative wing of the Democratic party, didn't even want us restricting the gun rights of terrorists right after September 11.  From the NYT, December 6, 2001:

The Justice Department has refused to let the F.B.I. check its records to determine whether any of the 1,200 people detained after the Sept. 11 attacks had bought guns, F.B.I. and Justice Department officials say.

The department made the decision in October after the F.B.I. asked to examine the records it maintains on background checks to see if any detainees had purchased guns in the United States.

Mindy Tucker, a spokeswoman for the Justice Department, said the request was rejected after several senior officials decided that the law creating the background check system did not permit the use of the records to investigate individuals.

Ms. Tucker did not elaborate on the decision, but it is in keeping with Attorney General John Ashcroft's strong support of gun rights and his longstanding opposition to the government's use of background check records. In 1998, as a senator from Missouri, Mr. Ashcroft voted for an amendment to the Brady gun-control law to destroy such records immediately after checking the background of a prospective gun buyer. That amendment was defeated.

You think they're gonna care about crazy people if they're willing to defend Osama bin Laden's right to be arms right after he killed 3,000 people in NY and Pennsylvania?

Get a clue, America. Read the rest of this post...

USA Today: 7 dead, including gunman, in shooting at Wis. Sikh temple

I don't want to hear a word about how guns kill people.  The gunman was simply exercising his constitutional right to bear arms and mass murder innocent people, the way God, the Republican party, and the gun nuts who control the GOP intended.

So let's have a few days of faux outrage and then get back to the business of ignoring the elephant with the gun in the room.

PS I wonder how Mitt Romney's fundraiser with Wayne LaPierre, the head of the NRA, went yesterday?

Another PS: Buzzfeed has photos from the scene. Read the rest of this post...

Sands, hotel of Romney top donor, under fed money-laundering investigation

Reuters, via Political Carnival:

Las Vegas Sands Corp, controlled by billionaire Republican donor Sheldon Adelson, is the target of a federal investigation into possible violations of U.S. money-laundering laws, the Wall Street Journal reported on Saturday.

The Los Angeles U.S. attorney’s office is looking into the casino company’s handling of the receipt of millions of dollars from a Mexican businessman, later indicted in the United States for drug trafficking, and a former California businessman, later convicted of taking illegal kickbacks, the Journal said, citing lawyers and others involved in the matter… The Journal said there are no indications that actions by Adelson, who is the company’s chief executive officer and largest shareholder, are being investigated.

Gaius has written extensively on this topic, including this. Read the rest of this post...

Bush-era holdover FHFA chief refuses to implement Obama homeowner mortgage forgiveness

This story comes to us via Paul Krugman.

Edward DeMarco, acting director of the FHFA (Federal Housing and Finance Agency) and a Bush-era holdover, has refused a request from the Obama administration to implement a program of debt relief for underwater mortgages.

FHFA is the controlling agency for Fannie Mae and Freddie Mac, "the government-sponsored lenders that were effectively nationalized in the waning days of the George W. Bush administration."

In other words, a Bush-appointee (and "civil servant" or non-political jobholder) is refusing to implement administration economic policy that offers debt forgiveness (a form of bailout) to someone other than banks.

As Krugman says elsewhere, "Fire Ed DeMarco. Do it now."

There are many angles to this story. Let's unpackage them, starting with why debt matters in the current crisis.

■ Personal debt (economists call it "debt overhang") is one of the main reasons our economy is not recovering. As I noted here:

[W]hen all the women who wanted jobs had gotten them ... our "prosperity" became debt-driven. That period lasted until, oh, yesterday (ok, 2008). By my count, that's 20-plus years of debt intake. Clearing that debt is a job that has to be done. Starting now is a very good thing.

How long will it take to clear 20 years of debt? If it "only" takes ten years, we'll have gotten off lightly — and it will feel like forever.

Also this, from the same piece:

We won't have a real recovery until that debt is either paid off or destroyed (via bankruptcy, forgiveness, or some other form of debt-clearing). ...

Think of household debt as a hole that has to be filled (with money) before big-screen spending can resume. The ratio of "debt relative to income" is a key metric in recovery of the consumer economy. The point at which debt-burdened people "feel" unburdened enough to start spending — that's when their personal economy recovers.

In other words, no recovery without debt reduction in some form. And the slow way — making every banker whole in a depressed jobless economy — can be slow the point of "never gonna happen." Personal debt must be cleared by some faster means.

■ The barriers to clearing personal debt are many. They include:

1. Republican desire to kill the economy in order to recapture the White House.
   
   
2. The desire of both Democratic and Republican elites (office holders and power brokers) to make sure their paymasters (sorry, our bankers) don't lose a dime.
   
   
3. The desire of the rubes (sorry, media-led American voters) to make sure no "undeserving" person gets one federal cent that a rube might otherwise pocket for himself.

About the first, need any more be said?

About the second, Krugman notes this about the Obama administration's debt-relief policy:

Unfortunately, the administration’s initial debt relief efforts were ineffectual: Officials imposed so many restrictions to avoid giving relief to “undeserving” debtors that the program went nowhere.

About the third, as soon as Lyndon Johnson–created welfare programs benefited dark people, white America rebelled. From Nixon's "southern strategy" to Reagan's "welfare queens" to Clinton's "welfare reform" — the War on Poverty quickly became a war on the poor. To thunderous bipartisan applause.

■ The Obama administration has apparently seen the light, or at least some of it. Krugman again:

More recently ... the administration has gotten a lot more serious about the [personal debt] issue. And the obvious place to provide debt relief is on mortgages owned by Fannie Mae and Freddie Mac ...

The idea of using Fannie and Freddie has bipartisan support. Indeed, Columbia’s Glenn Hubbard, a top Romney adviser, has called on Fannie and Freddie to let homeowners with little or no equity refinance their mortgages, which could sharply cut their interest payments and provide a major boost to the economy.

The Obama administration supports this idea and has also proposed a special program of relief for deeply troubled borrowers.

That administration support involves Tim Geithner and the Treasury Department. Krugman from a different source:

Treasury Department [has requested that FHFA] offer debt relief to troubled homeowners ... backed by an offer by Treasury to pay up to 63 cents to the FHFA for every dollar of debt forgiven.

But DeMarco, acting head of FHFA, has refused the offer. And that's where things stand. For Krugman, this is unacceptable.

[T]here is simply no way that it makes sense for an agency director to use his position to block implementation of the president’s economic policy, not because it would hurt his agency’s operations, but simply because he disagrees with that policy.

■ Who is Ed DeMarco and why is he acting this way?

He’s a civil servant who became acting director of the housing finance agency after the Bush-appointed director resigned in 2009. He is still there, in the fourth year of the Obama administration, because Senate Republicans have blocked attempts to install a permanent director. And he evidently just hates the idea of providing debt relief.

He's a Bush holdover (a kind of embed) who ended up acting director because of Mitch McConnell's obstructionism. If he can't be fired, he can certainly be replaced at the start of Obama's second term via a recess appointment, something Krugman strongly advocates.

As to why this refusal to act, Krugman and I differ. He puts all the blame on the aforementioned Senate Republicans, with some justification.

I put the blame on Obama, for not clearing out the embeds years ago — apparently not even wanting to.

And now that he has finally decided to offer a dollop of non-banker bailout (albeit timed for election season), his four-year indulgence of Ed DeMarco has bit him hard.

■ Will DeMarco get away with it? I'm going to guess Yes, though I could be wrong. Even though he's likely doing R-party bidding (Krugman is right about that), his defense will appeal to point three above — rube-hate of the "undeserving" — a position that Mr. Obama, I strongly suspect, fully shares.

How will we know if I'm right? See if DeMarco gets fired (that may or may not be possible). Then, after the election, see if he gets recess-appointed out. I think the odds may be in my favor.

UDPATE: David Dayen agrees that DeMarco won't be fired. Scroll down for the reason.

GP

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