Monthly Archives: November 2012

Grover Norquist Lost

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Obama won, Grover Norquist lost

2012 election results are in, and Obama won. President Obama should also win Florida. That means an electoral college tally of 332-206.

The U.S. Chamber of Commerce, which spent at least $28 million against Democrats, lost.

 

Represented by Chamber of Commerce

American Crossroads and Crossroads GPS, which spent $1 billion against the president and against Democrats, lost.

Karl Rove lost. Grover Norquist lost. Donald Trump lost. Rudy Giuliani lost. Rush Limbaugh lost. Charles Krauthammer lost. George Will lost. Bill O’Reilly lost.

(Here from YouTube is Rove, on air, trying to dispute the outcome in Ohio: http://www.youtube.com/watch?v=eQLV7nqD3CA)

The grotesques lost.

‘Winners’ and ‘losers’ are worse than useless as words. The winners-and-losers language cannot be trusted, anyway, as to validity. The commentators most eager to identify winners and losers self-identify as less eager to nail accuracy; a vulgar mindset characterizes notable non-wizards. I do not want to sound as though I were auditioning to become one of the sillies.

But clearly on election day 2012 some won, some lost.

 

The president

Won:

President Obama and Vice President Joe Biden won re-election, and rightly so. They won the popular vote as well as the electoral college. For the first time since 1936, they won re-election with over 50 percent of the popular vote.

FDR

Several deserving Democratic senators won hard-fought re-election in an avalanche of negative advertising, including Sherrod Brown in Ohio, Joe Manchin in West Virginia, Bill Nelson in Florida, and Jon Tester in Montana.

 

Massachusetts Senator-elect Elizabeth Warren

Elizabeth Warren won in Massachusetts, Claire McCaskill won in Missouri, Tammy Baldwin won in Wisconsin, Heidi Heitkamp won in North Dakota, Mazie Hirono won in Hawaii. There are now twenty women in the United States Senate–a record. The senate is better off with such women Democrats.

Alan Grayson won as U.S. Rep in Florida, rightly so.

Tammy Duckworth won for the House in Illinois, in the process defeating the disgraceful Joe Walsh. The swing from awful to good is even bigger than the outcome.

 

Lost:

Lackluster corporate ally Mitt Romney and Paul Ryan, the author of the Ryan so-called budget, lost. (Rep. Ryan won re-election to the House.)

Rep. Allen West lost decisively in Florida. Way past due, but better late than never.

GOP Senate candidate George Allen lost in Virginia.

Rep. Joe Walsh lost in Illinois.

 

Big money lost.

The Koch brothers, who spent tens of millions on the election, lost.

Sheldon Adelson, who donated tens of millions first to Newt Gingrich and then to Mitt Romney, lost.

The Chamber of Commerce losses and the losses of Rove’s groups, the losses incurred by all the super-PACs massed on the pro-corporate, pro-tax haven, anti-union side of the aisle, are the biggest money losses. But it is worth mention again that wealthy self-funding candidates also lost. Linda McMahon lost in Connecticut; Steven Welch lost to incumbent Sen. Bob Casey in Pennsylvania; most others lost in primaries. The national political press could have seen an augury for fall 2012 in the losses of so many self-funders.

Along with the billionaires and millionaires, corporate executives who stepped off the sidelines to bully the political process through their workplaces lost.

Speaking of losses, the long string of candidates who lost the race for the GOP nomination lost again. They did not help Republicans look better in the general election. Remember the parade–the string of fallen candidates from the GOP campaign trail—Rick Perry, Newt Gingrich, Herman Cain, Rick Santorum, Tim  Pawlenty, Michele Bachmann. None can claim—although that won’t keep them from trying—that the election outcome enhances his individual credibility, or that they enhanced the party’s credibility.

Republicans lost. They lost the presidential race; they lost seats in the senate; they lost seats in the house; and they lost seats in the state legislatures. Only in governorships did the GOP eke out an advantage, and even there, with more to defend, Democrats kept or took five governorships including the hard-fought governorship of West Virginia.

Sen. Minority Leader Mitch McConnell (R-Ky.) lost.

House Republicans lost. They lost their two ugliest members, they lost some of their ‘base’, and once and for all the scorn of establishment Republicans for the anti-abortionists was clarified for all to see.

 

Won:

Democrats won. Not all state tallies are complete, but enough returns are in to clarify a nationwide pattern.

Democrats gained two seats in the senate, giving them the edge 53-45. Of two independents–Vermont’s Bernie Sanders and Maine’s Angus King–at least one will caucus with the Democrats. Given the quality of the new Democrats elected, that means the Democrats are stronger now than with the nominal ‘filibuster-proof’ sixty they had in 2009, relying on Joe Lieberman.

Democrats gained at least six seats in the house. In a notable upset, physician Raul Ruiz defeated GOP Rep. Mary Bono Mack in California. (Bono Mack’s husband, Connie Mack, also lost his senate race in Florida.) Dem Pete Gallego beat Quico Consego in south Texas. Lois Frankel beat Adam Hasner in South Florida. If Scott Peters has beaten Rep. Brian Bilbray in California, the gain is at least seven for Dems.

In the states, Dems gained the New Hampshire Executive Council. Democrats flipped at least eight state chambers from Repub to Dem in 2012, including chambers in Colorado, Maine, New Hampshire, New York and Oregon, losing only two. Early estimates are that Democrats picked up 200 seats in state legislatures, partly making up for the large losses of 2010. Local races parallel the federal and state patterns.

Lost:

Media grotesques lost.

Charles Krauthammer and Rush Limbaugh lost, as mentioned. George Will and Bill O’Reilly lost. Sarah Palin lost. Sean Hannity lost. Dick Morris lost.

The rightwing noise machine lost.

Fox News lost.

Rupert Murdoch lost.

The Wall Street Journal lost. The Chicago Tribune lost.

A host of auxiliary right-wing pundits installed by the newspaper I subscribe to, the Washington Post, lost. David Gergen lost. For that matter, most pundits lost. Dan Balz lost. The WashPost‘s layout editors–whoever composed the unfavorable headlines and picked the disfiguring photos of Obama–lost. George Stephanopoulos’ Round Table on ABC’s This Week lost. Face the Nation lost. Meet the Press lost. Chris Matthews lost.

Many or most of the pollsters–except for Nate Silver–lost.

 

The middle class won. Some degree of tolerance won. Health care won. Social Security won. American labor won. Reproductive rights won. The U.S. automobile industry won. Collective bargaining won. College students won. Mortgage holders won. Banking customers won.

Unfortunately, Paul Ryan won re-election to the House. So did Michele Bachmann. We can’t have everything. Bachmann’s race was tight, though. In theory that should end any discussion of Bachmann as some kind of powerhouse. Still, politically progressives won. Racism lost. Anti-immigrant campaigning lost decisively.

I am not gloating. This is a celebration of improvement, of steps toward a cleaner and healthier body politic. People like Joe Walsh and Allen West never did have any place in public office and should never have gotten a federal office in the first place. Anyone who held the opinion that the election was Mitt Romney’s to win was never qualified to be a political reporter in the first place. Any writer who thought ‘the economy’ an issue that would work in Romney’s favor is unqualified to appear in print. Corporate managers who spent more time throwing their weight around than they did improving their companies never should have been managers in the first place. Corporate management should never have been so pinned to stock price in an imaginary paper market as to neglect product, service and labor in the first place.

Political reporting, like every other kind of reporting, is supposed to shoot for accuracy. So read it here, all you buckaroos and buckaresses who spent a year and a half predicting a ‘close election’ and a ‘late election night’:

  • The presidential race was not close.
  • The battleground states were not razor-thin.
  • Democrats won. It was not fifty-fifty. It was not split-the-difference.
  • Republicans lost. The party has also lost name affiliation among registered voters.
  • Progressives won. Where Democrats lost, it was either a Blue Dog, a Republican-leaning district, or a hard race, sometimes close, where a challenger took on an entrenched incumbent. As mentioned, Alan Grayson won.
  • The right wing lost. As mentioned, Joe Walsh and Allen West lost. So did Todd Akin and Richard Mourdock, although their brand of conservatism differs from the ugliness of Walsh and West.

 

more later

Mitt Romney and taxes, the last word

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The last word on special tax deductions for filers like Mitt Romney

[Update Mon. Nov. 5

Actually the last word on Romney’s taxes may be this Dutch article of today. The Volksrant reports that Romney lessened his tax pay-up by almost a hundred million Euros, by using tax mechanisms routed through the Netherlands as written earlier.]

 

The last pre-election word on Mitt Romney’s own tax arrangements may be this article published by Bloomberg Oct. 29. Overshadowed by Hurricane Sandy, the report–“Romney Avoids Taxes via Loophole Cutting Mormon Donations”–once and for all clarifies how Romney could, indeed, get away with paying no income tax for years on end.

In pertinent part,

“The charitable remainder unitrust, as it is known, is one of several strategies Romney has adopted over his career to reduce his tax bill . . .

In this instance, Romney used the tax-exempt status of a charity — the Mormon Church, according to a 2007 filing — to defer taxes for more than 15 years.”

“In general, charities don’t owe capital gains taxes when they sell assets for a profit. Trusts like Romney’s permit funders to benefit from that tax-free treatment . . .”

“When individuals fund a charitable remainder unitrust, or “CRUT,” they defer capital gains taxes on any profit from the sale of the assets, and receive a small upfront charitable deduction and a stream of yearly cash payments. Like an individual retirement account, the trust allows money to grow tax deferred, while like an annuity it also pays Romney a steady income.”

“CRUTs were more common in the 1990s when capital gains rates were higher. In 1996, when Romney set up his trust in Massachusetts, the federal rate was 28 percent, compared with 15 percent today. At the time, a Massachusetts state resident who sold shares for a gain of $1 million could have faced a combined state and federal capital gains tax of as much as 40 percent, reducing his take to $600,000.

By contrast, if he contributed the stock to a CRUT, and it sold the shares, it typically wouldn’t owe any tax since it is a charitable trust. The CRUT could reinvest the $1 million and earn a return on the full amount.

“The power of this is the tax deferral,” said Jay A. Friedman, a partner at accounting firm Perelson Weiner LLP in New York. “The money is all growing tax free and he only pays tax on what is distributed to him.”

Concerned that CRUTS weren’t sufficiently philanthropic, Congress mandated in July 1997 that the present value of what was projected to be left for charity must equal at least 10 percent of the initial contribution. Existing CRUTS weren’t affected by the new law.”

As mentioned, Romney set up his trust in 1996. Looks as though his financial advisors were keeping an eye on upcoming developments in Congress.

Speaking of those–

Romney’s own tax returns are only one side of the Romney tax story in election 2012. The other side of the Romney tax story is, as ever, the question of what action a Romney-Ryan administration would take on tax policy. On that side of the story, there has been no last word.

We do know that Romney’s silence, and his past actions, have left an awful lot on the table, ‘on the table’ meaning to be carved up by the same harpies who brought us the Iraq war. Much harm can be done to the big middle of the working class in America under the guise of budget-cutting–just as many windfalls accrue to the undeserving few under the guise of promoting growth. ‘Austerity’ and ‘growth’ are two sides of the same bogus coin. A national economy should meet our needs as a nation, not shoot for some target abstraction or imitate the endless game of ever-boosting stock prices as an index of ‘performance’. The Greek root for economy is oikos, the household.

 

The candidate

If the Romney candidacy stands for anything, it stands for exactly the opposite of meeting our needs. It stands for–if anything–boosting torque in a series of boom-and-bust markets, supporting a temporary marketplace rather than supporting the national economy. Right now, we have only inconsistent or evasive statements from Romney on some of the most important middle-class tax breaks–including the mortgage interest deduction on first homes, and the capital-gains exclusion on first home sales–or no statement at all.

 

Capital gains exclusion for home sale

On the other hand, it’s interesting how much we do know about Romney.

We knew back in August that Romney is cheerfully cognizant of tax loopholes for big business. In August, he said with absentminded candor that “big businesses are doing fine” because they can always use loopholes.

 

Romney hitting the marks

We learned in September, when Romney released a couple of partial returns, that in 2011 his own trust received more from the federal government than it paid. Thus we know–again–that Romney is not all that worried about ‘takers’, when they’re people like him. Again we know that Romney is less than worried about the national debt, since he as another purchaser of U.S. Treasury notes was willing to add to it. Here for convenience again are the documents:

The 2011 tax return:

total adjusted gross income:       $13,696,951.

biggest income source: capital gain:         $6,810,176.

next: dividends:                               $3,649,567.

next: interest:   $3,012,775.

 

The 2011 W. Mitt Romney Blind Trust return:

top line: U.S. Government Interest: $652,018.

U.S. Government Interest reported as Dividends: $12,027.

thus a total of $664,045 from our govt.

 

The 2011 Family Trust return:

top line usgov interest: $662,115.

usgov interest reported as dividends: $90,461.

total $752,576.

 

The 2011 Ann D. Romney Blind Trust return:

top line usgov interest: $362,701.

usgov interest reported as dividends: $156,157.

total $518,858.

As written before, the Romneys’ federal interest income comes to one-seventh, or 14 percent, of the adjusted gross income declared on Romney’s IRS return for 2011. Romney’s income tax burden was almost exactly offset by interest income the Romney trusts received from the U.S. Treasury.

Looking at the same thing another way, without the federal interest income, his adjusted gross comes down to $11,239,472–and that’s just the interest on those U.S. government products. The face value of the Treasury bonds, notes or bills does not have to be reported, nor the purchase date or the type of Treasury product.

 

We knew in 2011 that Romney was less than forthcoming on the heated fiscal debate in Congress. Candidate Romney stayed out of the debt-ceiling fight. He stayed out of the disputes between House leadership and mad-dog Tea Party representatives over the federal budget. He stayed out of disputes between the House and the Senate. Remarkably, he even stayed out of most disputes between Democrats and Republicans. He was inconsistent on Paul Ryan’s budget, and statements between the nominee and his pick for vice president have yet to be fully aligned. That is, the two Republican candidates have not bothered to align their differing positions, even for public consumption.

By 2012 we did have Romney’s explicit statement that he would not release his tax returns if he were nominated. Romney stuck to this (one) position even under serious pressure from his own side.

As to the Romney track record on fiscal management, its main component is Bain Capital. We have long known that Bain Capital benefited from taking over debt-ridden companies. We knew that Bain profited from big employee layoffs, from the bankruptcies of other companies, and from off-shoring. We have long known that Romney himself is aware of the political liabilities in his track record, as his varying accounts of his relationship with Bain Capital indicate. He had fielded questions about Bain before running for the White House. He has been only somewhat less evasive about Bain than about his own taxes, and only somewhat less evasive about his own taxes than about his preferences on future tax policy.

Regardless of any differences on detail, as we know, by the end of March Rep. Ryan endorsed Romney. Ryan could read the map on demographics. There was no possibility of a Santorum win. 

There was a little more mystery in Romney’s choice of running mate. Maybe not all that much, though. We saw Romney come out with the Ryan announcement after being blitzed over a few days by the Wall Street Journal, National Review writer Rich Lowry, and the Weekly Standard, all urging him to pick Ryan.

So much for tacking to the middle.

So much for winning, as far as that goes. In choosing Paul Ryan, Romney did not play to the electorate. He played to some rightist media personalities and to officeholders who are future lobbyists.

To sum up: The foregoing does not add up to a candidate with a vision of government of the people, by the people, and for the people.