The Choice Is Yours

The 3 Choices When it Comes to Trump

First, you can complain. Yell. Bang on the dinner table. Tell your family and friends the man is a dangerous fool. Explode every time you read something about him. Swear every time you see him on TV. Go ballistic when you listen to him or about him on the radio. 

Complaining may feel good, but it won’t help.  

Your second choice: You can bury your head in the sand. Pretend he’s not there. Stop reading the news. Turn off the TV and radio. No longer visit political Internet sites. When family or friends bring up his name, change the subject. 

Burying your head in the sand may also feel good, but it certainly won’t help, either.

You have a third choice. You can get active, and make it harder for Trump to damage America. This coming November 6, 34 senate seats, all 435 seats in the House of Representatives, and 36 governorships will be up for election or re-election.

Support primary candidates who will resist Trump. Mobilize to get out the vote. Organize so that November 6 becomes a total repudiation of Donald Trump and all he stands for. 

Start right now. Find an Indivisible group near you. Go Indivisible.org and become part of the solution. If you’re already in a blue state and want to reach out to purple or red parts of the country, visit swingleft.org or sisterdistrict.com.

Democracy is fragile, it requires all of us to protect it. 

Robert Reich

February 19, 2018

Trump’s Big Buyback Bamboozle

Trump’s promise that corporations will use his giant new tax cut to make new investments and raise workers’ wages is proving to be about as truthful as his promise to release his tax returns.

The results are coming in, and guess what? Almost all the extra money is going into stock buybacks. Since the tax cut became law, buy-backs have surged to $88.6 billion. That’s more thandouble the amount of buybacks in the same period last year, according to data provided by Birinyi Associates.

Compare this to the paltry $2.5 billion of employee bonuses corporations say they’ll dispense in response to the tax law, and you see the bonuses for what they are – a small fig leaf to disguise the big buybacks.

If anything, the current tumult in the stock market will fuel even more buybacks.

Stock buybacks are corporate purchases of their own shares of stock. Corporations do this to artificially prop up their share prices.

Buybacks are the corporate equivalent of steroids. They may make shareholders feel better than otherwise, but nothing really changes.

Money spent on buybacks isn’t reinvested in new equipment, research, or factories. Buybacks don’t add jobs or raise wages. They don’t increase productivity. They don’t grow the American economy.

Yet CEOs love buybacks because most CEO pay is now in shares of stock and stock options rather than cash. So when share prices go up, executives reap a bonanza.

At the same time, the value of CEO pay from previous years also rises, in what amounts to a retroactive (and off the books) pay increase – on top of their already humongous compensation packages.

Big investors also love buybacks because they increase the value of their stock portfolios. Now that the richest 10 percent of Americans own 84 percent of all shares of stock (up from 77 percent at the turn of the century), this means even more wealth at the top.

Buybacks used to be illegal. The Securities and Exchange considered them unlawful means of manipulating stock prices, in violation of the Securities Acts of 1933 and 1934.

In those days, the typical corporation put about half its profits into research and development, plant and equipment, worker retraining, additional jobs, and higher wages.

But under Ronald Reagan, who rhapsodized about the “magic of the market,” the SEC legalized buybacks.

After that, buybacks took off. Just in the past decade, 94 percent of corporate profits have been devoted to buybacks and dividends, according to researchers at the Academic-Industry Research Network.

Last year, big American corporations spent a record $780 billion buying back their shares of stock.

And that was before the new tax law. 

Put another way, the new tax law is giving America’s wealthy not one but two big windfalls: They stand to gain the most from the tax cuts for individuals, and  they’re the big winners from the tax cuts for corporations.

This isn’t just unfair. It’s also bad for the economy as a whole. Corporations don’t invest because they get tax cuts. They invest because they expect that customers will buy more of their goods and services.

This brings us to the underlying problem. Companies haven’t been investing – and have been using their profits to buy back their stock instead – because they doubt their investments will pay off in additional sales.

That’s because most economic gains have been going to the wealthy, and the wealthy spend a far smaller percent of their income than the middle class and the poor. When most gains go to the top, there’s not enough demand to justify a lot of new investment. 

Which also means that as long as public policies are tilted to the benefit of those at the top – as is Trump’s tax cut, along with Reagan’s legalization of stock buybacks – we’re not going to see much economic growth. 

We’re just going to have more buybacks and more inequality.

Robert Reich
THURSDAY, FEBRUARY 8, 2018

Everybody loves the library

Our public libraries, our literary commons, are gradually being enclosed -- sealed off to the public by a series of acts of our government -- local, state and federal -- as it bows to the dictates and priorities of corporations. The public library is one of the few settings where people can enter for free, access materials for free and stay without being expected to buy anything. The value of public libraries not only exists in the materials they lend and the non-commercial model they embody, but in the commons that they represent: A public area that offers Americans liberated intellectual spaces, the potential for community dialogues and organizing.

It seems that we need more money to help libraries to survive, and we need to stop the turning of our libraries from cultural, educational, community institutions to commercial ventures. To get a clearer insight into these problems, we need to look at how libraries were influenced by capitalism.In fighting this enclosure, The New York Times advocates more money for libraries. It presents a vision of libraries as places for poor children to "learn to read and love literature, where immigrants learn English, where job-seekers hone résumés and cover letters, and where those who lack ready access to the internet can cross the digital divide.... They are havens for thinking, dreaming, studying, striving and -- for many children and the elderly -- simply for staying safe, and out of the heat." An article in the Public Library Quarterly titled "Libraries and the Decline of Public Purposes," adds that libraries "help make possible the democratic public sphere." The author also warns that libraries are shifting from public service organizations to business and profit models that lead to the destruction of a public space.

Libraries as a System of Social Control

As we look at the rise and decline of public libraries, we will see that the changes are often related to the prime directive of capitalism: profit. If something goes wrong -- that is, if something endangers the possibility of profit -- it will serve as a convenient scapegoat and be reduced or eliminated in the budget of local, state and federal agencies. Public libraries, public education and public lands are three of the current victims of a shift in capitalism, for they have become "unnecessary expenses" which hinder the need for increased profits.

For our purpose, capitalism is an economic system based on wage labor (working for a wage), private ownership or control of the means of production (things like factories, machinery, farms and offices), and the production of commodities for profit, where a tiny corporate elite uses its wealth and political power to generate the priorities, finances and actions of Congress for their own benefit. The variations of capitalism over the years contain one constant: the struggle between the owners and workers for wealth and power. Since corporate capitalists have the money and power, they usually control the society. But when a depression occurs, the going gets tough for the much larger working class, they react, organize and struggle for more wages, benefits and control. The worker reaction to the Great Depression led to the enactment of Franklin Delano Roosevelt's New Deal in the 1930s, which ultimately regulated capitalism in order to save it. Part of that workers' rebellion was due to the excessive wealth inequality of the Gilded Age, where the capitalist class accumulated the wealth at the expense of the workers, similar to today's wealth inequality in the new Gilded Age.

This conflict between owners and workers can be seen in the history of the public library movement. Libraries are part of a system of social control: they provide resources and education to immigrants. When the owners encourage the creation of public libraries, they see them as a training ground for immigrants for their industries. One example is Butte, Montana, in 1893, in which the new Carnegie library was touted by the mine owners as an "antidote to the miners' proclivity for drinking, whoring and gambling" as well as creating a community for immigrants, so that job turnover would be reduced.

Andrew Carnegie, an early capitalist philanthropist, typifies the intentions of the capitalist class to maintain the system (profits), and stop workers from revolting. In his 1889 article, "The Gospel of Wealth," he argued that the wealthy can reduce social protest through philanthropy. It was better to squeeze money from workers' paychecks, collect it and give some back to the community. Carnegie belittled workers, stating,

If I had raised your wages, you would have spent that money by buying a better cut of meat or more drink for your dinner. But what you needed, though you didn't know it, was my libraries and concert halls. And that's what I'm giving to you.

Carnegie's generosity was double-edged: to diminish the potential for worker uprisings, and to maintain and increase his profits. He was a generous man, but he was not wholly interested in improving or changing society, as demonstrated by his actions around the segregation of African Americans. Under segregation, Black people were generally denied access to public libraries in the Southern United States. Rather than insisting on his libraries being racially integrated, Carnegie founded separate libraries for African Americans. For example, in Houston, Carnegie opened the Colored Carnegie Library in 1909. Still, his generosity allowed him to build half of the American public libraries by 1930. Libraries also multiplied due to the need for public education, which included training the incoming 20-plus million immigrants (1880-1920) necessary to maintain the labor market and uphold the capitalist system.

Wars in our capitalist-controlled world are almost always fought over access to profits, resources and territory between two or more separate sets of ruling classes. In those struggles, propaganda is a useful tool. In WWI, the goal for libraries shifted to the Americanization of the immigrants, which included the suppression of "unpatriotic pro-German" books. In WWII, in contrast to the Nazis' burning of books, US librarians looked to books as weapons of war. During the Cold War (1947-1991), some public libraries also served as propaganda tools for US government foreign policy by limiting Soviet materials through the Foreign Agents Registration Act. This was a time when the ultra-conservative John Birch Society's members were urged to visit every public library in the country to make sure the society's Blue Book was available. The Blue Book contained warnings that the enemy will turn the United States into a communist police state and implied that President Eisenhower was a communist agent. In 1953, during the height of the McCarthy era, a member of the Indiana Textbook Commission tried to ban Robin Hood from schools and libraries for promoting communism because the protagonist stole from the rich to give to the poor. Fortunately, some brave students from Indiana University fought back and organized the Green Feather Movement (representing the green feather Robin Hood wore).

The Economic Attack on Libraries

At the end of the 1970s, training immigrant workers was no longer a concern for capitalist corporations because the labor shortage ended. This was also a time when public library funding began to decline. After 9/11, public fear intensified, as did surveillance by the state. One government reaction was, according to Section 215 of the USA PATRIOT Act, that all libraries were required to give up information about their patrons. Some brave librarians who understood that such a requirement was a danger to our system, rebelled. For example, the Vermont Library Association sent a letter to Congress opposing the library-related features of the PATRIOT Act. Addressing the resulting flare-ups in the Middle East, US propaganda was a concern for some librarians who were alarmed over hyper-patriotic symbolism displayed in libraries right after the 9/11 attack (flags, poster, pamphlets). They endorsed a letter of concern that "such unusual displays may create an intimidating atmosphere for some library users."

Most of the public libraries of the late 20th and early 21st century provided a welcoming common space that encouraged exploration, creation and collaboration among students, teachers and the community. Libraries innovated and brought together physical and digital media to create learning environments. In 1982, the American Library Association promoted "Banned Books Week" that drew attention to books with unorthodox or unpopular beliefs, and made them available for all who wish to read them.

But at this time, there was an unease in the capitalist class about the dangers posed by the supposed democratizing effects of 1960s activism (civil rights, LGBTQ rights, environmental awareness, student movements and anti-Vietnam War activities). The conservative business interests attacked the regulated capitalism of the New Deal and introduced neoliberalism, a variation of capitalism favoring free trade, privatization, minimal government intervention in business, reduced public expenditure on social services (libraries) and weakening the power of labor. Some followed the Powell Memorandum (1971), a roadmap for the conservative business interests to rise up and defend themselves against the alleged assault on "freedom," led by activists like Ralph Nader, Herbert Marcuse and others who had supposedly taken over the universities, the media and the government. At the other end of the spectrum, the liberal internationalists of the Trilateral Commission published a document titled "The Crisis of Democracy" (1975), which hinted that '60s-style activism could turn previously apathetic and ignored citizens into activists who may possibly upset the status quo.

The decline of worker immigration in the '70s and the stress of austerity due to the rise of neoliberalism led to the decline of social services, including the public library system, and the drift towards the business model for some libraries, with a focus on users as customers. They followed the model of corporations, using public relations, information commodification, efficiency, branding and corporate sponsorships to supplement their funding. The local, state and federal tax revenue previously required to maintain public services shifted to the pockets of corporations, the maintenance of the military-industrial-Congressional complex, or was stashed in tax havens. The middle class was fooled by the promise of tax cuts, because they were told that cutting taxes would boost spending, making the US economy flourish, so they mistakenly went along with big business, but the loss of these public institutions hurts everybody but the wealthy.

All these attacks on public libraries occurred in spite of the fact that libraries are an excellent taxpayer investment. For example, a 2007 study about San Francisco's library found that for every dollar spent on the library, the citizens received three dollars in materials and services.

The effects of the 2008 recession caused libraries to further suffer financially, even though they were used by more people. California completely eliminated state funding for libraries in 2011. Louisiana followed California's lead in 2012. Drastic cuts hurt the New York City public libraries, the Dallas Public Library, libraries in the state of Massachusetts and others. In the current federal budget, there is a plan to eliminate the Institute of Museum and Library Services, which has been progressively reduced by prior administrations, both Democratic and Republican.

Increased budget cuts are leading to the end of our literary commons. How can advocates help public libraries survive and promote real democratic values and critical thinking? First, by understanding the fate of public libraries in the context of the history of capitalism. Second, by organizing and acting to protect public libraries as locations of community connection and potential action, the bane of the disempowering, oligopolistic capitalist system.You can fuel thoughtful, authority-challenging journalism: Click here to make a tax-deductible donation to Truthout.

Wednesday, January 03, 2018By Gus Bagakis, Truthout | Op-Ed

They Cheered When This Tax Bill Passed

I have waited my entire life for this day. I knew it would come, sure as little fish make little fish, and here it is. No more Republican dickering at the edges of it, as they have through all these soft-pedal decades of trickle-down gibberish. No, they went for the thick red meat this time, the prime rib, and they don't frankly care if you know how badly you're getting screwed. Most people don't know. They will, alas, and soon.

The Republican tax bill is a done thing. It passed the House by a gruesome margin, only to be called back on procedural grounds regarding something Ted Cruz wants and something for-profit universities can't have. The Senate then passed it, and the House will pass it again today after they unsnarl last night's mess.

They cheered in the House when it passed the first time with no Democratic votes and all but 12 Republican votes. They cheered. When the time comes, remember that.The bill now awaits only the jagged, shuddering signature of this catastrophe president, like an earthquake signing its ruins with the Richter scrawl of its documented damage. Let the elderly wither, let the infirm wilt, let the students stumble, let the teachers flail, let the seas rise and the skies boil, let the future be only for the gilded few and everything else can fall to dust. They got what they came for, and the paymasters are pleased.

Mammon wins the day. Mammon, the ancient word for "money," adopted by the New Testament and John Milton as the very personification of greed, that which any God-fearing Christian must shun at the cost of their very soul, as explained succinctly in Matthew 6:24: "You cannot serve both God and Mammon." Yet on Tuesday night, the erstwhile "party of God" was busy dancing and cheering in delight around its golden calf.

They cheered. It would be bad enough if they did this with their heads hung low in shame, knowing as we all know that this is only happening because the big GOP donors demanded the key to the Treasury and refused to donate again until they got it. We're sorry, they could (but would never) say, but they made us do it. We had to, we're sorry. Instead, they cheered.When the president of the United States of America signs this bill into law, he will, among many other things, be signing a check to himself and men like Bob Corker. That check has a great many zeroes to the left of the decimal. These are the people the Evangelicals embrace as "theirs," though their pockets will be picked and their futures plundered, once again.

They actually cheered.

For the record: The people who will take this tax bill in the teeth reject and repudiate it out of hand. Only 33 percent of those polled by CNN think the tax bill is anything other than a smash-and-grab looting of the Treasury, and that number correlates exactly with the ever-dwindling number of people who think Donald J. Trump is himself the golden calf, beyond reproach, a shining orange beacon on a hill. If Trump threw out the first pitch at a ballgame and hit a grandmother behind third base with the ball, that 33 percent would call it a strike and denounce videotape footage to the contrary as "fake news."

I remember the quaint days of summer and fall, when the Republican Party could be counted on to be its worst enemy. Remember those attempts at repealing the Affordable Care Act, when GOP "heroes" like John McCain, Lisa Murkowski and Susan Collins thwarted the president and majority leader McConnell? That was only a few hundred billion dollars going to other people. This thing is a trillion dollars and more, all going directly to the wealthy and the corporations they control. McCain got a boozy tax break for his wife's portfolio, Murkowski got oil wells in the Arctic National Wildlife Refuge, and God only knows what brought Collins back into the fold; she will not be enjoying the aftermath, to be sure.

Do not despair. That which has been done can be undone. Trump has made it his mission to erase the very existence of his predecessor, like some tantrum-y pharaoh ordering the scourging of glyphs from the pyramid walls. Let him try. All works can be undone in time. Even this. Especially this.Prepare yourself for this in whatever way best suits. The thing that is about to happen today will be beyond your worst expectations. Donald Trump is going to strut and crow over a bill he has not read and knows next to nothing about, but will sign anyway because that is his purpose in life. It is entirely fitting that a gigantic legislative fraud will be made law by the biggest fraud in presidential history. It simply could be no other way.

They cheered. Never, ever forget that.

William Rivers Pitt

December 20, 2017

Tax plan is a disgrace

Here are the 3 main Republican arguments in favor of the Republican tax plan, followed by the truth.

1. It will make American corporations competitive with foreign corporations, which are taxed at a lower rate.

Rubbish.

(1) American corporations now pay an effective rate (after taking deductions and tax credits) that’s just about the same as most foreign based corporations pay.

(2) Most of these other countries also impose a “Value Added Tax” on top of the corporate tax.

(3) When we cut our corporate rate from 35% to 20%, other nations will cut their corporate rates in order to be competitive with us – so we gain nothing anyway.

(4) Most big American corporations who benefit most from the Republican tax plan aren’t even “American.” Over 35 percent of their shareholders are foreign (which means that by cutting corporate taxes we’re giving a big tax cut to those foreign shareholders). 20 percent of their employees are foreign, while many Americans work for foreign-based corporations.

(5) The “competitiveness” of America depends on American workers, not on “American” corporations. But this tax plan will make it harder to finance public investments in education, health, and infrastructure, on which the future competitiveness of American workers depends.

(6) American corporations already have more money than they know what to do with. Their profits are at record levels. They’re using them to buy back their shares of stock, and raise executive pay. That’s what they’ll do with the additional $1 trillion they’ll receive in this tax cut.

***

2. With the tax cut, big corporations and the rich will invest and create more jobs.

Baloney.

(1) Job creation doesn’t trickle down. After Ronald Reagan and George W. Bush cut taxes on the top, few jobs and little growth resulted. America cut taxes on corporations in 2004 in an attempt to get them to bring their profits home from abroad, and what happened? They didn’t invest. They just bought up more shares of their own stock, and increased executive pay.

(2) Companies expand and create jobs when there’s more demand for their goods and services. That demand comes from customers who have the money to buy what companies sell. Those customers are primarily the middle class and poor, who spend far more of their incomes than the rich. But this tax bill mostly benefits the rich.

(3) At a time when the richest 1 percent already have 40 percent of all the wealth in the country, it’s immoral to give them even more – especially when financed partly by 13 million low-income Americans who will lose their health coverage as a result of this tax plan (according to the Congressional Budget Office), and by subsequent cuts in safety-net programs necessitated by increasing the deficit by $1.5 trillion.

***

3. It will give small businesses an incentive to invest and create more jobs.

Untrue.

(1) At least 85 percent of small businesses earn so little they already pay the lowest corporate tax rate, which this plan doesn’t change.

(2) In fact, because the tax plan bestows much larger rewards on big businesses, they’ll have more ability to use predatory tactics to squeeze small firms and force them out of business.

***

Don’t let your Uncle Bob be fooled: Republicans are voting for this because their wealthy patrons demand it. Their tax plan will weaken our economy for years – reducing demand, widening inequality, and increasing the national debt by at least $1.5 trillion over the next decade.

Shame on the greedy Republican backers who have engineered this. Shame on Trump and the Republicans who have lied to the public about its consequences.

Robert Reich

SATURDAY, DECEMBER 16, 2017

Patriotism, Taxes, and Trump

Selling the Trump-Republican tax plan should be awkward for an administration that has made patriotism its central theme.

That’s because patriotism isn’t mostly about saluting the flag and standing during the national anthem. 

It’s about taking a fair share of the burden of keeping America going.

But the tax plan gives American corporations a $2 trillion tax break, at a time when they’re enjoying record profits and stashing unprecedented amounts of cash in offshore tax shelters.

And it gives America’s wealthiest citizens trillions more, when the richest 1 percent now hold a record 38.6 percent of the nation’s total wealth, up from 33.7 percent a decade ago.

The reason Republicans give for enacting the plan is “supply-side” trickle-down nonsense. The real reason is payback to the GOP’s mega-donors.

A few Republicans are starting to admit this. Last week, Gary Cohn, Trump’s lead economic advisor, conceded in an interviewthat “the most excited group out there are big CEOs, about our tax plan.”

Republican Rep. Chris Collins admitted that “my donors are basically saying, ‘Get it done or don’t ever call me again.’”

Republican Sen. Lindsey Graham warned that if Republicans failed to pass tax reform, “the financial contributions will stop.”

Republican mega-donors view the tax payback as they do any other investment. When they bankrolled Trump and the GOP, they expected a good return.

The biggest likely beneficiaries are busily investing an additional $43 million to pressure specific members of Congress to pass it, according to The Wall Street Journal.

They include the 45Committee, founded by billionaire casino oligarch Sheldon Adelson and Todd Ricketts, whose family owns the Chicago Cubs; and the Koch Brothers’ groups, Americans for Prosperity and Freedom Partners.

They’re not doing this out of love of America. They’re doing it out of love of money.

How do you think they got so wealthy in the first place? 

As more of the nation’s wealth has shifted to the top over the past three decades, major recipients have poured some of it into politics – buying themselves tax cuts, special subsidies, bailouts, lenient antitrust enforcement, favorable bankruptcy rules, extended intellectual property protection, and other laws that add to their wealth.

All of which have given them more clout to get additional legal changes that enlarge their wealth even more.

Forty years ago, the estate tax was paid by 139,000 estates,according to the non-partisan Tax Policy Center. By 2000, it was paid by 52,000. This year it will be paid by just 5,500 estates. Under the House tax plan, it will be eliminated altogether.

Why do Americans pay more for pharmaceuticals than the citizens of every other advanced economy? Because Big Pharma has altered the laws in its favor. Why do we pay more for internet service than most other nations? Big cable’s political clout. Why can payday lenders get away with payday robbery? The political heft of big banks.

Multiply these examples across the economy and you get a huge hidden upward redistribution from the paychecks of average working people and the poor to top executives and investors. (I explain this in detail in the documentary “Saving Capitalism,” airing next week on Netflix.)

All this is terrible for the American economy.  

More and better jobs depend on increasing demand for goods and services. This must come from the middle class and poor because the rich spend a far smaller share of their after-tax income.

Yet the middle class and poor have steadily lost purchasing power. Partly as a result, a relatively low share of the nation’s working-age population is employed today and the wages of the typical worker have been stuck in the mud.

The Republican tax plan will make all this worse by burdening the middle class and the poor even more.

A slew of analyses, including Congress’s own Joint Committee on Taxation, show that the GOP plan will raise taxes on many middle-class families.

It will also require cuts in government programs that middle and lower-income Americans depend on, such as Medicare and Medicaid.

And the plan will almost certainly explode the national debt, eventually causing many middle class and poor families to pay higher interest on their auto loans, mortgages, and credit cards.

I don’t care whether the top executives of big corporations, Wall Street moguls, and heirs to vast fortunes salute the flag and stand for the national anthem.

But they enjoy all the advantages of being American. Most couldn’t have got to where they are in any other country. 

They have a patriotic duty to take on a fair share of the burden of keeping America going. And Trump and his enablers in Congress have a patriotic responsibility to make them.  

Robert Reich

Nov. 12, 2017