Month: December 2022
The relationship between taxation and U.S. economic growth
“So, what did corporations spend their large tax cut on, if not wages or investment? Analysts at the International Monetary Fund find that 80 percent of the corporate tax cuts were repurposed into stock buybacks and dividends, which overwhelmingly benefited wealthy shareholders.16 And Lenore Palladino of the University of Massachusetts Amherst documents that these corporate buybacks and dividends also widened the racial wealth divide, finding that White stock-owners hold $27 for every $1 in corporate equity and mutual fund value held by a Black or Hispanic stock-owner.17
The main effects of the Tax Cuts and Jobs Act were less government revenue and regressive tax cuts for corporations, wealthy shareholders, and executives who bear nearly all the burden of corporate taxes even as the rate changes had little effect on business investment or workers.””
Americans Oppose Big Government, Unless Their Party Is in Power
“”Republicans and Democrats are more inclined to say the government has too much power when the president is from the other party, and less inclined when a president from their own party is in the White House.” For more than a decade, Republicans have said that government has too much power, but the intensity of their feelings fluctuates depending on whether they hold the White House. Democrats also vary in their feelings, though they tend to believe the government is too powerful only when the presidency is held by Republicans. Majorities of independents have pretty consistently stuck to their guns in opposing an overpowerful state no matter which party has the edge.”
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“”Negative partisanship is the idea that people choose a party not necessarily based on the party’s platform or even the candidate. They do so out of animosity or dislike or disdain toward the opposing party,” Chris Weber, an associate professor in Arizona State University’s School of Government and Public Policy, commented in 2020. Weber points out that Americans haven’t really changed their feelings towards their own parties over the years, but their dislike of political opponents has intensified.
“Viewing half of the country or a large section of the country as antithetical to American democracy is actually really harmful,” he added. “It’s an outgrowth of political polarization that has potentially very serious consequences.””
Yes, You Can Yell ‘Fire’ in a Crowded Theater
“The erroneous idea comes from the 1919 case Schenk v. United States. The case concerned whether distributing anti-draft pamphlets could lead to a conviction under the Espionage Act—and had nothing to do with fires or theaters.
In his opinion, Justice Oliver Wendell Holmes wrote that “the most stringent protection of free speech would not protect a man in falsely shouting fire in a theatre and causing a panic.” However, this idea was introduced as an analogy, meant to illustrate that, as Trevor Timm wrote in The Atlantic in 2012, “the First Amendment is not absolute. It is what lawyers call dictum, a justice’s ancillary opinion that doesn’t directly involve the facts of the case and has no binding authority.” The phrase, though an oft-repeated axiom in debates about the First Amendment, is simply not the law of the land now, nor has it ever been—something made all the more apparent when Schenk v. United States was largely overturned in 1969 by Brandenburg v. Ohio.
“Anyone who says ‘you can’t shout fire! in a crowded theatre’ is showing that they don’t know much about the principles of free speech, or free speech law—or history,” Foundation for Individual Rights and Expression President Greg Lukianoff wrote in 2021. “This old canard, a favorite reference of censorship apologists, needs to be retired. It’s repeatedly and inappropriately used to justify speech limitations.””
Senator Dick Durbin Doesn’t Understand the First Amendment
“As much as Durbin may dislike hateful speech or speech that spreads conspiracy theories, they are both generally protected by the First Amendment.”
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“Durbin had plenty of reason to be troubled by these developments—the mass-tweeting of hateful language is concerning, and so too is such a powerful figure seemingly fooled by an online hoax—he was mistaken when asserting that Musk’s tweet was somehow not covered “by free speech.””
Biden ‘confident’ U.S. can address EU concerns about IRA subsidies
“Much of the European ire is directed at an IRA requirement that electric vehicles must have their final assembly in North America to qualify for a $7,500 tax credit. That has eliminated many European models that previously qualified, and even more could be excluded when additional domestic content provisions take effect, beginning in January.
The Treasury Department is currently developing guidance for how it will implement that tax provision, and Biden referred specifically to language that provides better treatment for countries that have a free trade agreement with the United States as one area where the law could be implemented in a flexible manner.
“That was added by a member of the United States Congress who acknowledges that he just meant allies. He didn’t mean literally free trade agreement. So there’s a lot we can work out,” Biden said.
That would solve some of the EU’s problems, since it doesn’t have a free trade pact with the United States. However, there is still the bigger problem that many of the cars that European companies sell in the United States are assembled in Europe, disqualifying them for credit because of the North American assembly requirement.
Biden did not say how that could be addressed, but U.S. lawmakers in recent days have said the administration is considering giving automakers more time to comply with the IRA provisions. That’s an issue that the France and other EU member states will continue to discuss with the United States through a recently established bilateral task force.”
Freight rail strike averted, after frenzied negotiations
“The Senate voted Thursday to avert a freight rail strike just days before crucial drinking water, food and energy shipments were set to be sidelined, after hurried talks in both chambers of Congress and a visit to the Senate from two of President Joe Biden’s Cabinet secretaries — but a bipartisan push to add paid sick leave to the deal fell short.
Ultimately the Senate voted 80-15, with Sen. Rand Paul (R-Ky.) voting present, to pass a bill that would impose the terms of a contract negotiated among freight railroads and most of their unions in September. Four out of the 12 unions involved had been holding out for additional paid sick days, making a strike possible as soon as Dec. 9.”
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““What’s frustrating is that the railroads know that their backstop is federal government intervening in a strike,” said Tony Cardwell, president of the Brotherhood of Maintenance of Way Employes Division, one of the four unions that rejected the tentative agreement. “The railroads would have come running to the bargaining table if they knew that we would have been able to go on strike. But they were reliant on the Congress stopping our strike, and therefore they bargained in bad faith.””
Musk drops the bipartisan pose — and Republicans cheer
https://www.politico.com/news/2022/12/02/musk-gop-twitter-moves-00071758
How economists know whether inflation is getting better
https://www.vox.com/policy-and-politics/2022/11/10/23450034/fed-inflation-consumer-price-index