America needs more taxes

The more value a country has, the more it has to tax. The United States has a massive economy. It has so, so much to tax. What’s comparison with other countries who have so much less to tax? How do the US compare in terms of how much we have (GDP) versus what the tax is?




Uber and State Supremacy

Uber provides an illustration of the supremacy of various levels of government in the United States. First, let’s start with the bottom of the governmental totem pole.

The taxi companies of yore were local beasts. They functioned as most companies do nowadays, one part business venture, one part lobbyists. They provided the taxi service and made enough money to lobby the local government. Said local government then wrote laws that raised the regulatory threshold for taxi companies so high that they had no real competition. A side effect was that taxis were also quite safe. Sure, it wasn’t the real intent, but it was a little bonus. So that’s local government at the municipal level. A little scummy, but not altogether terrible.

Everybody knows that in the US, municipal governments are basically always run by liberals. I don’t really know why, but that seems to be how it works. That frequently puts the cities at odds with the state governments in conservative states (like Kansas or Texas).

The way it seems to go is the cities regulate Uber for safety and also because taxis are a racket. Uber is fanatical about running their own background checks, which is why Uber just decided to pull out of Austin. They just CAN’T allow their drivers to be cross-referenced to via fingerprints to prove their identity. It was the biggest city that didn’t give up and decide it was easier to grovel at the feet of almighty Uber. For instance, in Kansas City, Uber freaked out and the city backed down. And that’s just one example of many.

Interestingly, the very conservative state of Kansas was on track to do some regulating. Of course, when Kansas tried to make their own Kansas Bureau of Investigations run the background checks, Uber freaked out and got very cozy with Gov Brownback (one of my favorite people to hate). Needless to say, in a state as conservative as Kansas, the idea of regulation didn’t go far and Brownback got the regulations nixed.

All over the US, cities are trying to regulate Uber. Of course, given that the states are higher on the government supremacy totem pole, it’s no surprise that conservative states are squashing down municipal regulations.

So here’s something unrelated. Much like taxi companies rely on municipal government for protection, car dealerships rely on state government to run their racket. I don’t understand why conservatives feel differently about dealerships?

Anyway, I guess I should mention the last tier of government.

The federal government, the highest tier on that supremacy totem pole, isn’t going to be regulating Uber any time soon. Not only is congress eating itself and failing to pass any substantial legislation (but hey, how about those buffalo…amirite?), but it’s a bunch of regulation-hating Republicans anyway, so there’s no way they’re going to do anything.

HOWEVER, for a “fun” game, let’s say they did. Let’s say they passed a law saying all Uber drivers had to be fingerprinted. It would roughly be the same as the state legislatures overruling the municipal governments, right? But it would be trampling on states rights!

States rights: mystical and sacrosanct.

Municipal rights: nonexistent.

To end this discussion, I want to mention a few things. I actually think the idea of Uber is excellent. I also think local taxi companies don’t deserve to stick around. It’s an outdated model that provides stupidly slow service. Unfortunately, Uber is full of scumbags who refuse to provide health insurance and keep cutting rates (which hurts the drivers). That alone is enough to give me pause, but their relationship with anti-regulation Republicans is enough to seal the deal for me.

We could have better taxi service that’s good for the drivers. We really could. But as far as I can tell, we’re not even close to moving in that direction.

Not a coup

Dilma Rousseff is facing impeachment in Brazil. Why? Well, that’s actually rather complicated. To start, it has a lot to do with the fact that she’s supposed to be a leftist, but her government hasn’t helped the poor as promised.

Not only has she presided over a faltering economy (not her fault), but the country is facing an Olympics that’s shaping up to be a huge mess (and has already been very messy and very classist), there’s Zika to contend with, and on top of all that, the machine of corruption and graft that is Petrobras was opened up and exposed.

Even worse was her reaction to the economic problems. From a BBC article:

Ms Rousseff won the election by promising to keep the stimulus in place and criticised opponents who said an adjustment – such as higher taxes and budget cuts – was needed. But once re-elected, she single-handedly opted for an aggressive fiscal adjustment, angering those who voted for the opposition and leaving her own supporters feeling betrayed.

That, however, was not criminal. Stupid, yes, but not impeachment-worthy. As is often the case, it’s not the original deed that gets the politician in trouble, it’s when they try to cover their tracks. In her case, the original deed was merely a mishandling of economic issues. Covering it up, on the other hand…

From the same BBC article:

Brazilian governments are required to meet budget surplus targets set in Congress. Ms Rousseff is accused of allowing creative accounting techniques involving loans from public banks to the treasury that artificially enhanced the budget surplus. This gave the appearance that government accounts were in better shape than they actually were. The surplus is one of the measures taken into account by investors of how sound an economy is.

And that is why she’s facing impeachment. Not because of Petrobras or the Rio Olympics or the economy or anything, but because of deceptive accounting. Now, the real reason I wanted to talk about this was her reaction to it.

She denies that this accounting scheme was wrong. She says she did nothing wrong. As if it’s supposed to be an excuse, she basically said, everybody was doing it. They’re common practice, she claims. Perhaps this is true. Regardless, that doesn’t make them legal.

So here we have a politician who has done something wrong. Her opponents in congress want to impeach her, so they’ve started the process.

Rousseff has repeatedly called the impeachment process a coup. Let us be clear- this is not a coup. There is a process in place. Impeachment is a legit function of government. Is it ugly? Sure. Is it illegal? No. No it is not.

Here’s a line from a different BBC article:

If she is impeached, Vice-President Michel Temer would take over as interim president. Ms Rousseff has accused him of being one of the ringleaders of the “coup” attempt against her.

In an interview to the New York Times, Mr Temer said: “I’m very worried about the president’s intention to say that Brazil is some minor republic where coups are carried out.”

So that’s all very unfortunate. Let’s continue on and take a detour to Venezuela. As you may know, for many years, Hugo Chavez was the popularly elected leader of Venezuela. He functioned as a dictator in many respects, yet it was all through a public mandate. He nationalized a whole lot of industries and basically made Venezuela a petrostate. Before, they actually had quite a few industries, but by the time he died, they sold oil and not much else.

When Chavez died, his handpicked successor was Nicolas Maduro. Now, Maduro was/still is a hardcore Chavista. He will never, ever change the policies of Venezuela. Unfortunately for them, oil is worth way, way less. Their currency is in free fall, yet the price controls artificially inflate the face value of the money, which fucks everything up even more. They can’t keep stores stocked with basic necessities. Everybody is suffering.

In the last election, the Chavistas were crushed. Like, they went from having a decent majority to the opposition party having a substantial majority. Before they went, however, they packed the judiciary (shady but legal). While they still control a lot of the government apparatus, they have zero mandate to govern. At this point, they’re simply trying to hold on.

Here’s a bit from a New York Times article:

Venezuela’s electoral commission on Tuesday released documents that would allow opposition politicians to collect signatures and formally begin a process aimed at removing President Nicolás Maduro from office.

The decision by the commission — which is controlled by Mr. Maduro’s Socialist government and previously resisted handing over the papers — lifted hopes of the opposition politicians, who control the National Assembly and have vowed to oust the president by the end of the year.

And what is the reaction of Maduro?

This is a coup! A terrible coup. Even though the recall process is legally enshrined. Even though this is a process that is clearly described and clearly being followed. Yet he still claims it’s a coup.

Are you noticing a bit of a pattern here? It’s insulting. It’s disgusting. This is a level of disingenuous that borders on criminal, in my opinion. This is their attempt to hijack a legit political process.

I’m not saying impeachment or a recall would be a good thing. I wouldn’t know. But I do know they aren’t illegal. These are not coups. Saying otherwise is a deplorable attempt to tear their own country apart just to stay in power.

Tax cuts aren’t magic

Around this time last year, Kansas was looking at an 800 million dollar shortfall. They managed to take a pinch here and chop a bunch there to take the deficit down to 400 million. Then they robbed several segments of the budget to make up the gap, notable the schools and the highway fund, which then triggered the current fight about school funding.

Each year Kansas faces a huge budget shortfall. In spite of what Gov. Brownback promised, cutting taxes has not, in fact, increased revenue. Shocking. Now, that’s not to say that Kansas doesn’t have a low unemployment rate. Whenever Brownback supporters talk about the tax cuts, they always like to mention the unemployment rate.

The unemployment rate in Kansas peaked in 2009 at 7.3 and the US as a whole peaked a couple months later at 10 even. So that’s where it was, but where is it now? The US is at 5 and Kansas is now at 4. So, with that in hand, we can see that tax cuts were not the cause. The US rate has halved, meaning there’s a strong downward trend anyway. Proponents of Brownback and tax cuts in general like to claim that the tax cuts led to a lower unemployment rate, but that’s not exactly honest.

For about a year now, nearly every single month Kansas has collected less than the projected/required amount. They knew this budget shortfall was coming. Yet, here we are. These tax cuts took place in 2012/2013. We’ve got plenty of data at this point. We know tax cuts do not magically increase the state tax revenue. When you think about it, that’s a pretty fucking stupid idea.

Here’s a tidbit from a Wichita Eagle article:

Gov. Sam Brownback blamed the state’s financial troubles on global factors in his first interview since the state’s $290 million budget hole was announced, pointing to dropping oil and agriculture prices as the cause of the shortfall.

“I mean, we’ve got a global commodity market that’s fallen off badly. You’ve got a number of commodity-based states that are struggling now budgetarily,” Brownback said Friday.

He also said any tax increase “would have negative impacts on the state” when it already faces economic challenges.

The Kansas legislature has a weird delusional way of doing things. There’s a budget shortfall of 290 million dollars. The Kansas constitution doesn’t allow the state to have a budget deficit, so they’re required to come up with something.

Now, Brownback is not wrong about the dropping oil and agricultural prices causing problems in the state. But let’s be real, a year ago Kansas has the exact same problem. The issues they’re having now aren’t related to the ag and oil drop, they’re merely causing extra issues. In fact, I would contend that the economic outlook for the global economy means that Kansas should seriously consider temporary tax increase ANYWAY, and when paired with the super-minimal taxes they have now, it’s simply idiotic not to increase them.

So if they aren’t going to raise taxes, what are they going to do?

One option would sell off a portion of the state’s future tobacco settlement money for quick cash. Another would delay a $99 million payment to the state employee pension system.

Great idea! That sounds totally fiscally responsible.

Wow. So I’ve spent a lot of time telling you why these massive tax cuts led to stupid results. But I recently read a Slate article that actually gave a really great and really succinct explanation of why we get those results. Great article, by the way. Read it here. However, for the purpose of this, I’ve snipped out the most important bit:

A brief explanation: Companies organized as pass-through entities, such as partnerships, LLCs, or S-corporations, don’t pay corporate taxes. Instead, their profits get handed over to their owners, who then pay personal income taxes on the earnings. Brownback exempted those profits from state taxes under the theory that it would help spur more small-business growth.

The problem is that many large and successful businesses are also organized as pass-through entities. And, as the right-leaning Tax Foundation gently warned in 2012, there was nothing to stop other big companies from restructuring themselves to avoid taxes. That seems to have happened in a big way: About 70 percent more businesses have taken advantage of the loophole than expected, which has helped cripple the state’s budget projections.

And from this, we get a national effect. The Republican candidates for president aren’t talking about tax cuts. Here’s the final bit from a recent Star column:

So it’s possible the Kansas budget plan has worked, in reverse: it’s convinced politicians across the nation what not to do. It’s like the rest of the country is sticking pins in the state, trying to kill voodoo economics once and for all.

Voodoo economics comes from George H.W. Bush. That’s what he called Reagan’s tax plan. He then lost to Reagan in the primary and didn’t become president until Reagan ran into term limits.
So there you are. Tax cuts don’t create so much growth that they offset the tax cuts. They tried that, over and over, and it just doesn’t work.

Petty Tyrants in the Missouri Legislature

Missouri has an extremely Republican state house and senate. However, Missouri also has Kansas City and St Louis, which are Democratic strongholds. Personally, I live in Kansas City so I know a lot more about what goes on here.

A while back, Kansas City got Uber to agree to some regulations after extensive negotiations. And Uber, being the right-wing company that it is, went to the Missouri legislature because the Missouri legislature is also right-wing. Together, Uber and the legislature are currently trying to make the previously negotiated regulations illegal.

Another thing: Kansas City attempted to raise the minimum wage but the Missouri legislature made it impossible for any municipality to raise the minimum wage. It goes on and on, not just with Kansas City but also St Louis and Columbia.

The Missouri legislature, full of Republicans who criticize the federal government for overreaching, doesn’t allow for local control. It’s the one of the more shockingly hypocritical things that the Republicans do and it happens in every state.

You may have heard about what happened at the University of Missouri. There were some racist stuff, protests that not enough was being done, and then the football team got on board and the whole thing exploded until the MU leaders were forced out. Right? Pretty rough summary, I know, but that’s not what I want to talk about.

Now, the Missouri legislature wants to seize control of the University of Missouri. The university isn’t conservative and the legislature really can’t abide by that. It’s not like MU handled the protests well. No, the legislature is mad that MU handled it at all.

The legislature prefers suppression of dissent rather than dialogue or, you know, finding a solution. They prefer ignoring problems, which you can tell because the Missouri highway system is in shambles and they do nothing because it’s easier to ignore the problem than allocate some funding on what is clearly a bipartisan issue.

What I’m getting at is, the Missouri legislature is full of scumbags who abuse their power as lawmakers to attack anyone they disagree with. As you may have gathered, it makes me very angry but can’t do anything about it because they’ve manipulated redistricting to give themselves a permanent control of the legislature.

Kansas school funding

I came to this post to talk about how the Kansas legislature were a bunch of bastards for ignoring the Kansas Constitution. I came to say that the Kansas Supreme Court was keeping the legislature accountable to the Constitution. That’s the whole point of the Supreme Court! To hold the legislature to laws that the legislature itself passed! 

To explain a little more, I was vaguely aware that Kansas has an actual constitutional amendment that requires the school system be funded (it also does some other stuff). Now, I decided I should actually go check out the exact wording and that’s what I did. Said amendment requires the legislature to “make suitable provision for finance of the educational interests of the state.”

Contrary to my initial reaction, now that I’ve actually looked at the exact wording of the amendment, I suddenly realized that they…well, they aren’t really ignoring it. The amendment doesn’t have any details. It doesn’t specify what is adequate funding. The wording is so vague that it could mean absolutely anything.

It all depends on what you think the “educational interests of the state” are. I’m not sure that it means a damn thing. However, let’s be honest here. The Kansas Supreme Court is the one body that actually gets to decide what that exact word specifically means. Not the legislature, not the governor, not school boards, no. The Supreme Court gets to decide. That’s what they do.

This mess with the school funding sparked a serious backlash where the Kansas legislature tried to redefine how the justices were appointed. In other words, the legislature declared open war with the courts. In response to the Supreme Court striking down that bit of outrageous theater, the legislature tried to DEFUND THE ENTIRE COURT SYSTEM. The legislature relented because it was pretty much the worst fucking idea ever.

I get the idea the Kansas Supreme Court is taking this way further than they should. I get the idea that they’re really reading more into that amendment that is really there. Yet, perhaps there’s some kind of established precedent that I missed with the school funding thing.

All I can say for sure is that the legislature is in the wrong. They tried to manipulate the court system in a way that clearly violated the sanctity of our entire system of checks and balances. You might say the courts were wrong to strike down this law, but it’s their job to decide what the laws mean. That’s what the courts do. But it’s not the legislature’s job to try to unduly influence the courts. It’s not for the legislature to decide how the courts vote. That’s the entire point of the Supreme Court. Sure, you might not like it, BUT THEY GET FINAL SAY. That’s how the system works.

All politics are national

Earmarks are a thing of the past. One of my local representatives, Emanuel Cleaver, is pushing to bring earmarks back. That’s at odds with one of my favorite senators, Claire McCaskill, who is stridently opposed to earmarks. Both are Kansas City establishment and both are Democrats.

The funny thing is, Emanuel Cleaver’s reasoning is this: bipartisanship works so much better with earmarks. It makes politicians care about passing legislation. Is is wasteful? Absolutely, without a doubt. Is it financially sound? It can be, as long as we continue to pay for everything. However, if you hate big government, it’s terrible. Pork. Disgusting pork.

But you know what? Ever since we got rid of earmarks, congress has been completely gridlocked and seized up. Politics isn’t local anymore. Now everything is decided on a national level. Republicans no longer care about their districts. Instead, they just bash Obama (endlessly, mindlessly, eternally).

Ever since earmarks were given the boot, there’s no been compelling reason for politics to work. Nobody has a vested interest in getting a bill passed beyond their voting record. The old game of trading favors and amendments and earmarks has died. And what replaced it? Nothing.

Ever since our old system of horse trading favors ended, it inclines each and every politician to play to one, single audience: the hardcore base. And that’s not the only reason this happened. For one thing, gerrymandering crafted districts to contain supermajorities of their given party. That means, every district has a radical partisan in control. And to get re-elected, whoever runs in these radical districts have to have radical ideologies or they’ll get crushed in the primaries. Even worse, because of national media, there’s less reliance on local sources and less emphasis on the local benefits. Instead, it’s all ideological hardliners on all sides with no reason to work together.

With these three factors, it’s no wonder bipartisan politics are dead. Local politics transcend parties. Local politics involve communities of all different sorts. If all we do is focus on the broad picture, on the national scene, we’ll never band together to help out the localities where we actually live.