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WEEKLY WONK

Originally Published: 11/4/2017

Manafort & Gates:  On Monday morning Trump’s former campaign chair, Paul Manafort, and his “business associate,” Rick Gates, were ordered to surrender themselves. The indictment includes 12 counts: “conspiracy against the United States, conspiracy to launder money, unregistered agent of a foreign principal, false and misleading FARA [Foreign Agents Registration Act] statements, false statements, and 7 counts of failure to file reports of foreign bank and financial accounts.” The NY Times has a piece on how the feds believe the money laundering was done. Aaron Blake at the Washington Post broke down all the counts. You’ll notice Blake points out that Manafort and Gates funneled millions of dollar in payments into foreign bank accounts, “opened by them and their accomplices.” One of these was Cyprus. Wilbur Ross, our Commerce Secretary (TWW, Wilbur Ross, 3/4/17), was, during this time, vice chair of the Bank of Cyprus. (In-Cyprus) Manafort surrendered to federal officials in Washington. The indictment documents “appear to show the charges stem from Manafort’s and Gates’ private dealings as consultants overseas - not from their work for the Trump campaign.” (Roll Call) Allegations are that “for nearly a decade” Manafort and Gates “laundered money through scores of U.S. and foreign corporations, partnerships, and bank accounts, and gave false statements to the Justice Department and others when asked about their work on behalf of a foreign entity.” (Washington Post) Stephen Colbert, naturally, has some interesting things to say about Manafort. (You Tube)

 

George Papadopoulos:  He was Trump’s campaign adviser. The Washington Post has a good rundown on who he is. He pleaded guilty (read the indictment at The Hill) “to lying to the FBI about a contact with a Russian professor with ties to Kremlin officials.” (NY Times) This guy has already flipped. Apparently he told one of Trump’s campaign advisers in April 2016 that Moscow had “dirt” on Clinton “in the form of ‘thousands of emails.’” He was in contact “with several senior Trump campaign aides about his efforts to broker a relationship between Trump and Russian President Vladimir Putin.” (Washington Post) According to the NY Times: “The United States government has concluded that Russia hacked Democratic email accounts and released thousands of embarrassing emails related to Mrs. Clinton’s campaign. The emails began appearing online in the summer of 2016 and the Trump campaign has repeatedly denied any inside knowledge about that.” The NY Times has the details of the charges and his connections. The Washington Post has the “who’s who” and names some of those not named in the charges.

 

Carter Page:  Contrary to all public comments, the foreign policy adviser to the Trump campaign (TWW, Carter Page, 5/13/17) admitted to the House Intelligence Committee that he met Russian government officials during a July 2016 trip to Moscow. Shortly thereafter he “sent an email to at least one Trump campaign aide describing insights he had” after meeting “with government officials, legislators, and business executives.” The email was read aloud during the closed-door testimony. (NY Times)

 

Lobbying:  The Podesta Group and Mercury Pubic Affairs are lobbying groups that were both working with Paul Manafort and Rick Gates “from 2012-2014 in lobbying to improve the image of the Ukrainian government.” In the above indictment, “the firms are referred to as ‘Company A and Company B,’ according to people familiar with the companies’ involvement.” Tony Podesta is the brother of Democratic operative John Podesta who ran the Clinton campaign. He resigned amid the indictments “that cast a shadow on work his firm had done with” Manafort, saying: “It is impossible to run a public affairs firm while you are under attack by Fox News and the right wing media.” (Washington Post)

 

Sam Clovis:  He has withdrawn his nomination to be the Agriculture Department’s chief scientist. (TWW, Sam Clovis, 9/23/17) Think it has anything to do with the fact that he oversaw George Papadopoulos and “encouraged his efforts to meet with Russian officials?” (Washington Post) It has nothing to do with the fact that he’s not a scientist and has no experience with agriculture. He’s a right-wing talk radio host who worked on the Trump campaign. (AlterNet)

 

Jerome Powell:  Trump has nominated him to head the Federal Reserve. He’s a wealthy businessman, a former Carlyle Group executive. His latest financial disclosure lists his net worth between $19.7 million and $55 million. “If he gets the job, Powell would be the richest Fed chair since banker Marriner Eccles, who held the position from 1934 to 1948.” (Washington Post)

 

Michael Dourson:  He’s Trump’s pick for assistant administrator of the Environmental Protection Agency (EPA). His nomination passed through the Senate Committee on the Environment and Public Works and now heads to the floor for full approval. Dourson, “a massively conflicted scientist,” is known “for his ability to come up with standards companies like, create science to justify them, and then ‘sell’ the package to the EPA.” (The Intercept)

 

Afghanistan:  The Special Inspector General for Afghanistan Reconstruction (SIGAR) reported that the Pentagon “is withholding from the public critical information” about what’s going on there. He said that “certain data about the Afghan army and police was, for the first time, shielded from public view.” (District Sentinel)

 

Spain:  A Spanish judge ordered 8 members of the “deposed” Catalan government “to be remanded in custody pending possible charges over last week’s declaration of independence.” (TWW, Spain, 10/28/17) They’re being jailed while possible charges of sedition, rebellion, and misuse of public funds are being investigated. (Guardian

 

Arizona:  The U.S. Circuit Court of Appeals for the 9th Circuit rejected arguments by attorneys for Salt River Project (SRP), a company that provides electricity, that SolarCity cannot challenge its pricing system. SolarCity is suing SRP for anti-trust violations “for the rates it sets solely because it’s a quasi-governmental entity.” This allows SolarCity to move ahead with its suit against SRP. (Arizona Capitol Times)

 

Puerto Rico:  The Puerto Rico Electric Power Authority (PREPA) canceled the $300 million contract with Whitefish. (TWW, Puerto Rico, 10/28/17) (Washington Post) This came after Governor Ricardo Rosselló asked for it to be canceled. (NY Times)

 

GOP Tax Plan:  On Thursday House Republicans released their tax plan, the largest tax cut since 1918. It’s mostly what we expected - tax cuts for corporations, from 35% to 20% (Washington Post) and purportedly some cuts for the middle class. Let me remind you one more time that the statutory tax rate is 35% but, with all the deductions we allow, the effective tax rate is only 18%, with the biggest corporations paying less than 10% and some paying nothing at all. This is just more redistribution of wealth from the lower classes to the very top class. The total cut is $1.5 trillion over 10 years but the amount of revenue generated is only about $14.9 billion. (Washington Post) And the cuts for most Americans are small and temporary, they are phased out over 5 years. But the cuts for corporations and the 1% are huge - and permanent. (Robert Reich) The NY Times wrote that it will “tilt” us closer “toward the kind of tax system long championed by businesses.” This plan will change as it goes through the process, but right now it collapses the 7 tax brackets into 4, not 3 as was originally proposed - 12%, 25%, and 35%, and keeping the top rate of 39.6% for the highest earners. Here are some of the details.

 

Estate Tax:  It doubles the estate tax exemption to roughly $11 million from the current $5.49 million. (NY Times)

 

AMT:  The bill eliminates the alternative minimum tax. The AMT was the $31 million tax Trump paid in 2005. (TWW, Tax Leak, 3/18/17) Without this tax, he would have paid nothing. (Washington Post)

 

Deductions:  The plan doubles the standard deduction for the middle-class, as was proposed earlier. Remember, this is only for filers who don’t itemize. Apparently they are planning to expand the child tax credit to $1,600 from $1,000 “and add a $300 credit for each parent and nonchild dependent.” Mortgage interest deduction will remain for existing homeowners, “but future purchases will be capped at $500,000.” Property tax deductions will be capped at $10,000. The biggest change is that it will eliminate medical expenses deductions. (NY Times)

 

Pass Through Companies:  Businesses run as sole proprietorships, partnerships, or LLCs would pay a rate of only 25% on 30% of their business income. (Washington Post)

 

401(k)s:  They made no changes to the 401(k) retirement plans (TWW, 401(k)s, 10/28/17) (NY Times)

 

Foreign Subsidiaries:  It also creates a new 10% tax on U.S. companies’ “high-profit foreign subsidiaries, calculated on a global basis, in a move to prevent companies from moving profits overseas. . . Foreign businesses operating in the United States would face a tax of up to 20% on payments they make overseas from their American operations.” (Reuters)

 

Johnson Amendment:  This is the 63-year-old law that prohibits churches from politicking. (Wikipedia) The tax bill modifies the Amendment to the point of almost eliminating it entirely. (Salt Lake Tribune

 

Corporate Tax Cuts & Wages:  Paul Krugman, writing at the NY Times, calls the corporate tax cut a $700 billion gift to wealthy foreigners.” He pointed out the fallacy of the claim that giving corporations more money will result in higher wages. The Economic Policy Institute analyzed this claim. Check out this graph that shows that, since 1953, lower corporate rates (the dark line) have not noticeably boosted productivity or wage growth (the lighter lines). “Both productivity and wage growth were substantially stronger in the first decades following World War II, when corporate tax rates were significantly higher than they were in the 1980s, 1990s, and 2000s.”

 

House Schedule:  The House of Representatives released its schedule for this year. They’re giving themselves a week off each month January through July. Then they go on vacation for a month. They’ll come back to work a little before taking another month or so off for the elections. By the way, this is pretty much the same schedule they had this year. No wonder nothing gets done. (Roll Call)

 

Transgender Troops:  U.S. District Judge Colleen Kollar-Kotelly blocked the implementation of Trump’s directive to bar transgender people from the military. (TWW, Transgender Military, 8/26/17) Those currently in the military argued that their due process rights were being violated and, as a result, their careers, families, and medical care were put in jeopardy. (District Sentinel)

 

Deportations:  More than 300,000 Central Americans and Haitians living in the U.S. under “temporary permission,” no longer need shielding from deportation. Secretary of State Rex Tillerson sent a letter to Elaine Duke, the acting director of the Department of Homeland Security, that they don’t anticipate renewing protection for these people. Some of them have been working and living in the U.S. for decades but now, apparently, they’re going to be deported. (Washington Post)

 

Opioid Commission:  The newly-created opioid commission, headed by New Jersey Governor Chris Christie (R), is calling for more drug courts and “easier access to alternatives” for pain. There are more than 50 recommendations in the draft report including “requiring doctors and others who prescribe opioids to show they have received training in the safe provision of those drugs before they can renew their licenses to handle controlled substances.” They also want to mandate that providers check prescription drug-manufacturing databases “to insure that users aren’t ‘doctor shopping’ for prescription drugs.” (Washington Post)

 

Nuclear Arsenal:  Trump is making plans to end the post-cold war disarmament “by bolstering the U.S. arsenal and loosening the conditions under which it would be used.” (Guardian)

 

Cliven Bundy:  Remember him? (TWW, Welfare Cowboy, 4/26/14) He and his 2 sons went on trial this week “accused of conspiracy, assault, firearms offenses, and other charges.” (Reuters)

 

Climate Change:  Contradicting much of the Trump administration, 13 federal agencies unveiled the Climate Science Special Report, an exhaustive scientific report that says that humans are the dominant cause of the global temperature rise that has created the warmest period in the history of civilization. “For the warming over the last century, there is no convincing alternative explanation supported by the extent of the observational evidence.”

 

EPA Advisors:  Environmental Protection Agency administrator Scott Pruitt has “stripped a half-dozen scientists and academics of advisory positions.” He issued new rules barring anyone who receives EPA grants from serving on scientific panels that counsel the EPA. Sound confusing? Here’s the skinny. Many academic researchers, “many of them experts in fields ranging from toxicology to epidemiology,” whose work is primarily funded by the EPA, will now be barred from advising the EPA on scientific matters. Instead advisors will be chosen from the industries the EPA is supposed to be regulating. (NY Times)

 

Carbon Dioxide:  According to the United Nations World Meteorological Organization, the earth’s carbon dioxide in the atmosphere grew “at a record rate in 2016 to a level not seen for millions of years, potentially fueling a 20-meter rise in sea levels and adding 3 degrees to temperatures.” Concentrations reached 403.3 parts per million (ppm), up from 400.0 in 2015. “That growth rate was 50% faster than the average over the past decade, driving CO2 levels 45% above pre-industrial levels and further outside the range of 180-280 ppm seen in recent cycles of ice ages and warmer periods.” (Reuters)

 

Grifter Economy:  Mike Konczal writing at The Nation did a great piece on the Senate’s repeal of the Consumer Financial Protection Bureau’s (CFPB) rule that allowed consumers to sue banks and credit card companies instead of being required to go to arbitration. (TWW, Bank Consumers, 10/28/17) He called the vote a great Wall Street victory. “The financial industry desperately wanted this protection overturned, because it would again give banks control over handling complaints about their own impropriety.” But Konczal pointed out that it isn’t just financial institutions that are benefitting from what he calls Trump’s grifter economy. “The administration’s economic plans are filled with low-grade, penny-ante efforts to allow the scheming and powerful to swindle ordinary people.” For example, the Centers for Medicare and Medicaid Services (CMMS) had barred nursing homes that receive federal funding from including mandatory arbitration clauses in their contracts. This vote upended that. Konczal has other examples. Public Citizen noted that this allows “banks and other financial institutions to rip off American consumers with impunity” and notes that American veterans, servicemembers, and consumers “will pay the price for years, if not decades, to come.” 

 

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