President Obama recently invoked a surly and petulant tone when he lashed out against critics of the proposed Trans Pacific Partnership fast track trade deal (TPP). TPP is a so-called free trade agreement that would theoretically increase economic integration among twelve Pacific Rim countries with the notable exclusion of China. President Obama claimed that the critics of the legislation didn't know what they were talking about. President Obama said that if this deal wasn't good for working Americans he wouldn't support it. It's ironic that at the same time President Obama was telling Senator Warren that she didn't know what she was talking about and angrily denouncing anyone who would question his advocacy of certain trade deals that he also had temporarily to break stride and apologize for bombing and killing people who shouldn't have been bombed or killed. In other words he made a mistake. He was wrong. I might discuss the drone situation sometime later but contrary to what the Boxers among us might think, Napoleon President Obama is not always right. Like many corporate bosses when things go well, (Bin Laden is dead), the President takes credit. When things go wrong some supportive media suddenly releases detailed information on how the drone program doesn't need the President's signoff for every target and so mistakes really aren't the President's fault. Fascinating. The President might want to remember that just because he supports something doesn't mean other people need to accept his judgment without question. The President's interests are not synonymous with America's interests. If he was wrong about something like a drone program, he just might be wrong about a trade deal. President Obama's good intentions do not necessarily make something good. There was no need for President Obama to make policy differences personal, but I guess when you don't have to run for election again you can drop certain masks. So it goes.
It's alternately amused and irritated me that President Obama tends to save his most biting personal criticisms not for the open racists on the right, who have continuously insulted him, his wife, father, daughters, and mother in the ugliest and most personal of terms but for people on the left who question his policies. In what universe does it make sense for President Obama to compare Senator Warren to Sarah Palin? TPP, divorced from economic and historical reality, might sound good in theory. But like everything else the devil is in the details. Of course we don't know all the details because those are secret. We do have some general outlines though. It's safe to say that just as with NAFTA, the TPP is not as much about free trade as it is about increasing the ability of corporations to exploit labor and sidestep restrictions on profit making activities across nations. It's about wage arbitrage. TPP would reduce the ability of governments at all levels to "interfere" with corporations as they pursue their happiness. This is a good thing if you happen to be a corporation, a lobbyist, a trade or patent attorney, or perhaps someone at a high level who works for the aforementioned entities. But if you're not in that group you might want to consider if the TPP is a good thing for you. Hint, it's not. You also might want to review how median income has done over the past fifteen years. You might wonder if helping corporations to outsource more jobs from the First World and raise drug costs in the so-called developing world really is the path we ought to be taking. You might want to go down to your local clothing or electronics store and see how many goods you can find that are still made in the US. You might wonder how it is that so many jobs have moved overseas and what that means for American workers. But if you want to know the answers to these questions and have your Senators and Representatives debate and discuss them openly the President will accuse you of not knowing what you're talking about. People like MSNBC analyst Chris "tingle up my leg" Matthews will say you're a protectionist. Well someone who does know what he's talking about and is not a protectionist is Nobel Award winning economist Joseph Stiglitz. Over a year ago he sounded the alarm here. And he hasn't changed his tune, pointing out that those in favor of these deals are all corporations and wealthy capitalists. This isn't news to the people on the streets. The working class, the people of all colors who are most impacted by crappy trade deals, isn't buying it. And some members of the Congressional Black Caucus, which as a group has often given cover to the President's more centrist or rightist agenda elements, may have found a limit to how far they will go.
To make up for what could be dozens of Republican No votes in the House, the administration may need to persuade 20 or more House Democrats to vote Yes. The White House hopes some of those votes will come from members of the black caucus. But the going has not been easy. Rep. Yvette Clarke of Brooklyn is a loyal Obama supporter, but she found she couldn’t say yes earlier this month when the president engaged in some personal lobbying. Ms. Clarke promised to “go back and have a conversation with my constituents,” she said, recounting the conversation. But she isn’t optimistic: “The people in my district—they are radically against” the Pacific trade deal, Ms. Clarke said in an interview. But by last week, Mr. Rangel sounded pessimistic about finding common ground with the Obama administration. He said the White House hadn’t offered him anything concrete that would assure jobs—at least “nothing that I could explain to my voters.”
Two-thirds of the House members in the caucus signed a letter to Mr. Obama complaining that any trade deal would need to do more to strengthen workers’ rights. And only Rep. Gregory Meeks (D., N.Y.) is on record in favor of the fast-track legislation, and Rep. Eddie Bernice Johnson (D., Texas) is thought to be a swing vote.
“There’s too much downward pressure on wages,” said Rep. David Scott (D., Ga.), a frequent ally of businesses who said he has made clear that the White House shouldn’t even bother trying to win his vote.
President Obama should know that snark and sarcasm are no substitute for facts and transparency. Various corporations have been able to see the text of the TPP. Duh! They're the ones writing it! If, as President Obama claims, the TPP is a great deal for workers, then as Senator Warren suggests, declassify it. Let's have it openly debated and discussed. Perhaps the President is correct. Once we all know the details maybe there will be hundreds of thousands of $14/hr American workers marching in the streets demanding passage of the TPP. American IT workers may rejoice at the prospect of training their Pacific Rim lower cost replacements. Maybe American workers in general think that they have too much safety in their job and want their boss to have more flexibility to replace or fire them. But I doubt it. I think that the TPP is just the latest in a long line of moves by corporations and the wealthy to reduce labor costs and limit democratic oversight of business. Senator Warren is right. President Obama is wrong on this one. He needs to be fought tooth and nail on this. And he needs to lose.
President Obama is head of the executive branch of the Federal government. He has, like it or not, pretty expansive powers to direct or change the enforcement priorities of the executive branch. Arguably he has exceeded those powers in his latest executive immigration policy. The courts will end up making that decision. However the legislative branch, has, like it or not, the authority to determine what the budget is and on what it may be spent. In its own way this power is just as awesome as that of the President. Reckless or not, Congress has the ability to defund executive actions that it does not like. Ultimately this is what happened with the Vietnam War. However for either the President or Congress to effectively wield those powers which they possess they must be willing to say "Damn the torpedoes, full speed ahead!" and ignore objections to valid use of those powers. For all the criticism which President Obama has received, some valid, some not, for being a weak vacillating mouse of a man who is too eager to find common ground where there isn't any, on this executive action on illegal immigration, it turns out that at least to this point he's the one with the intestinal fortitude. Faced with the reality of what a DHS shutdown would mean to the country, DHS employees, and to their poll numbers Senate and House Republicans blinked, approving a one week DHS funding bill. President Obama signed the legislation last night. UPDATE: HOUSE GOP SURRENDERS!! The Republican-controlled House of Representatives voted today to fund the Department of Homeland Security through the end of the budget year — without any restrictions on immigration. The vote is a victory for President Obama as Republicans had wanted to strip funding for the president's executive actions on immigration from the bill. The measure now heads to President Obama, who is expected to sign it. Two hours before a midnight deadline, Congress has narrowly averted a shutdown of the Department of Homeland Security for one week, setting up another funding showdown for next Friday.
Hours before a midnight deadline, the House easily approved a one-week extension of the funding. The vote was 357-60. It required two-thirds of members' support to pass.
President Barack Obama later signed the bill. The move means that DHS will not experience a shutdown at midnight, but it also fails to resolve the impasse created when the House initially lashed together the agency's budget and so-called "riders" that would gut the president's immigration proposals. Some House conservatives said that Obama's actions are unconstitutional and must be stopped - even at the cost of a DHS funding lapse. LINK
This raises the question of what is going to change in one week? So are the Republicans going to throw another temper tantrum and then cave again? Wash, Rinse and Repeat? Another one week extension? What happened to the so-called tough guys who were going to stop the "Kenyan usurper" in his tracks? I'm joking but there are some conservative activists who are asking that very question. Erick Erickson had a bizarre and amusing full gay panic meltdown over at Redstate over the approaching Republican cave-in. The fact that when it came down to it the President was not bluffing while many Republicans were is useful information for future negotiations. There is no reason to take Republican threats seriously because they've shown again and again that they lack follow through. This is basic game theory stuff. If you don't or won't do what you threatened you were going to do your power is much diminished. And by power here I mean masculinity as so much of this fight was understood by all concerned as a brutal test of willpower and manhood. It is of course possible that in one week the Republicans will find a spinal column but if I were the President I would be betting otherwise. Time will tell. Perhaps the Republicans will be so ashamed of their approval of the one week clean bill that they will feel cornered and not back down next time. But again all we know right now is that the Republicans are just like a dull knife that just ain't cutting. They're just talking loud and saying nothing as Soul Brother Number One might have pointed out.
Occasionally I might or might not purchase items from Amazon and other online retailers. When I file my tax returns the State of Michigan insists that I give it a listing of online purchases and estimate and provide the sales tax I then owe to the state. Now it takes more than a bit of chutzpah to bogart your way into a private transaction that neither involved you nor took place in your jurisdiction and then claim that the actual parties to that transaction owe you a cut and need to let you wet your beak, or else. But that's how states tend to behave when there's money at stake. For obvious reasons I won't discuss my answers to my state's nosy little questionnaire. But in general some higher sales tax states and "brick and mortar" retailers aren't pleased with the explosion in online sales. Apparently some of my fellow true blue Americans don't see the point of paying taxes to their state for transactions in which that the state had no role. Even excessively honest people tend to get amnesia about the $1500 or so they spent online last year without paying sales tax. Retailers who aren't primarily online get annoyed with people using their stores as a showroom or to price check for items they intend to purchase online. Some consumers visit a bookstore or electronics shop with no intention of purchasing anything therein. All they're doing is getting a hands on experience before ordering elsewhere. This makes some retailers rather peeved, as you might imagine. They have less money to kick up to their mob captain, state.
Some people have come up with a solution. That is a solution from their point of view, not necessarily mine. This solution will of course require you to pay more taxes. It's only fair right? I mean why should some states go without what they view as their tax revenue just because some consumers have decided it's better to order things online on occasion.
Legislation that would empower states to tax online purchases cleared a key hurdle in the Senate on Monday after winning an enthusiastic endorsement from President Obama.
Senators advanced the bill in 74-20 procedural vote on Monday evening, just one vote short of the backing it received in a test vote last month. Twenty-six Republicans joined Democrats in moving forward with the bill..
Major retailers are putting all their lobbying muscle behind the legislation, arguing it would close an unfair loophole that benefits online merchants over brick-and-mortar stores. The National Retail Federation, which represents chains such as Macy’s, and the Retail Industry Leaders Association (RILA), which counts Target and others among its membership, announced it would score lawmakers’ votes. But signs of trouble for the bill also emerged as Wall Street groups urged the Senate to slow down and eBay began marshalling its users in a massive campaign to kill it.
The Securities Industry and Financial Markets Association and the Financial Services Roundtable said the measure could pave the way for financial transaction taxes on the state level, an idea that Wall Street and its supporters fiercely oppose. “It’s important for Congress to explore all the possible outcomes and costs of the proposal, especially the impact on consumers,” Scott Talbott, the senior vice president of public policy for the Roundtable, said in a statement...The Marketplace Fairness Act would empower states to tax out-of-state online retailers, but would exempt small businesses that earn less than $1 million annually.
Under current law, states can only collect sales taxes from retailers that have a physical presence in their state. People who order items online from another state are supposed to declare the purchases on their tax forms, but few do. The proposal has the support of a host of governors, including Republicans Chris Christie of New Jersey, Rick Snyder of Michigan and Bob McDonnell of Virginia. Passage of the bill could bring billions of dollars in new revenue to state governments. The bill has split the tech industry, pitting eBay against the retail giant Amazon.
In email to eBay users, eBay CEO John Donahoe argued that the bill would “penalize small online businesses,” urging the site’s millions of users to contact their members of Congress and voice opposition.The company is lobbying for Congress to increase the small-business exemption from $1 million to $10 million. Donahoe also took a shot at Amazon, a key supporter of the legislation. “Amazon, for example, has fought harder than any other company to require all businesses to collect sales taxes online, while also seeking special tax benefits as it expands its warehouses throughout the country. It’s bad tax policy,” Donahoe wrote....
LINK So as you can see some of this is a case of the elephants fighting and the grass getting trampled. I don't think that Wall Street cares about whether I pay the proper use tax on books or cd's I order online. But Wall Street is very concerned about states attempting to put financial transaction taxes on services that take place in cyberspace. For example California, which has a political class much friendlier to higher taxes than some other jurisdictions, might decide that every transaction which takes place between consumers in California and bankers or financial service companies based in say New York, is now subject to a California tax.
This sort of backdoor tax was disallowed in a 1992 Supreme Court ruling in which North Dakota attempted to tax Quill Corporation, a business which had no sales force, retail outlet or other physical location in the state. Amazingly North Dakota tried to argue that Quill's floppy disks and sales flyers were physically located in the state and therefore so was Quill. The Court rejected this line of reasoning but evidently said that Congress could change the law if it wanted to do so. And now it looks like Congress wants to do so. I think this is a bad idea and also unfair. If you're a business who is only physically located in one state why in the world should you have to figure out the tax policies of 49 other states, and various counties, cities, townships and territories. That's expensive. Additionally this new online tax proposal would seem to discriminate between online purchasers and physical purchasers. There are states who do not have sales taxes or have different sales taxes than my state. That's their right. If I happen to drive across the border to purchase goods or services that's my business and my right to do so. My money doesn't automatically belong to my state or the businesses that reside within. If I order something online from a state with no sales tax like New Hampshire my state wants to be able to track that transaction and get its cut. But if I drive to New Hampshire and purchase something my state is just out of luck? Does that makes sense? Or is Michigan also going to try to put GPS on my car to track down any such trips? If the states feel that their tax structure is no longer feasible because of a change in consumer behavior then they are free to do things more efficiently OR raise other taxes on businesses or individuals within their state. I don't think states should be able to compel other businesses or other states to adopt their tax policy on "their" citizens. I think all this law would do, if passed, would be to squeeze out smaller businesses. It's not coincidental that Amazon is in support. Amazon just happens to be selling new tax policy software and has already negotiated tax exemptions for itself. Or maybe I'm just being selfish. Maybe I'm just opposed to paying my "fair" sales taxes on goods I hypothetically order online...
