Is This The Right Time For a Big Tax Cut?

Senate Majority Leader Mitch McConnell addressed a tax reform news conference on Capitol Hill last Thursday, alongside Sen. Shelley Moore Capito of West Virginia and representatives of small business groups.

Chip Somodevilla/Getty Images

hide caption

toggle caption

Chip Somodevilla/Getty Images

Republicans say the tax-cutting overhaul being debated in Congress will jump-start the U.S. economy, leading to a lot more investment and hiring by companies.

But some economists say the tax plans — which would sharply cut corporate and business taxes and eliminate numerous deductions for individuals — come at precisely the wrong time. Lower taxes could also be undercut by Federal Reserve policymakers, who are gradually raising interest rates, they say.

Tax cuts can be a good way to stimulate the economy when growth is slowing down, by encouraging businesses and people to keep spending when their finances are growing tighter.

But the economy is in the midst of its longest postwar recovery on record, with an annual growth rate of 3.3 percent last quarter. The unemployment rate is down to 4.1 percent.

Economists often argue that during periods of growth like this, governments should be paring down debt, giving them more fiscal breathing room during the next recession.

“It’s always valuable to keep your powder dry, if you can, so you do have fiscal space if there is a downtown,” says former Fed Gov. Randall Kroszner, now a professor of economics at the University of Chicago Booth School of Business.

But the Republican tax cuts would create more than $1 trillion in debt over the next decade, according to Congress’s Joint Committee on Taxation.

“I think the timing of this tax cut from the perspective of the deficit is completely upside down,” says Jared Bernstein, senior fellow at the Center on Budget and Policy Priorities.

He adds, “when you get to this stage of recovery and you’re closing in on full employment, you absolutely want your deficit and debt to be coming down.”

There’s an even bigger, macroeconomic problem with pushing through tax cuts right now.

If tax cuts are done right, they can increase incentives for investment and lead to productivity growth, Kroszner says.

But they can also lead to higher inflation, which can spur the Fed to raise interest rates.

“If it’s seen as something that’s just short term, the Fed is likely to offset that by making sure the economy doesn’t overheat and inflation doesn’t get too high,” Kroszner says.

That’s a real concern right now. To Fed policymakers, the economy is already at or near full employment. They’ve already raised rates twice this year and are widely expected to do so again this month.

While supporters say that tax cuts would boost growth, Fed officials may decide they amount to more stimulus than the economy needs.

“I think they would say we already have pretty much a fully employed economy. A boost to aggregate demand is not exactly what the doctor ordered at this point. So maybe we should offset some of it by raising interest rates faster,” says former Fed Vice Chairman Alan Blinder, a professor of economics and public affairs at Princeton University.

In an interview with The Wall Street Journal last week, New York Fed President William Dudley said he supported efforts to make the tax code simpler, but appeared to question the need for a tax cut.

“It would be a reasonable question to ask, is this the best time to apply fiscal stimulus, when the economy’s already close to full employment?” Dudley said. “It’s probably not the best time.”

Let’s block ads! (Why?)

Is Trump Waging A Hidden Campaign Against Mitt Romney?

President-elect Donald Trump calls out to the media as Mitt Romney leaves Trump National Golf Club Bedminster in Bedminster, N.J., shortly after Election Day. Romney was under consideration for secretary of state at the time. Now, he’s eyeing a Senate race in Utah .

Carolyn Kaster/AP

hide caption

toggle caption

Carolyn Kaster/AP

President Trump went to Utah on Monday. The official purpose of his trip was to announce the reduction of two national monuments in the state, though he could have signed those orders in the Oval Office.

But the journey west may have served a political purpose for the president — to keep a political rival out of Washington.

Trump said on Monday that he hopes seven-term Utah Sen. Hatch stays in the Senate “for a very long time to come.” Hatch is 83 years old, and according to someone familiar with his thinking, he would indeed like to retire. Hatch’s wife wants him to retire. But Donald Trump does not want him to retire because of the person who would most likely replace him: Mitt Romney.

Trump had hours to persuade Hatch to run again while on Air Force One flying back and forth from Washington. Trump also made time to lavish praise on Hatch. “You are a true fighter, Orrin,” he said at the beginning of a speech on the national monuments.

Utah polls show that big majorities of voters want Hatch to retire and that Romney would easily win the seat. If that happened, Romney would immediately become the most prominent elder statesman of the GOP. Dignified and disciplined, the 2012 Republican presidential nominee would become the center of gravity for those in the party who are uncomfortable with Trump’s behavior.

Now that Sens. Bob Coker, R-Tenn., and Jeff Flake, R-Ariz., are retiring, and Sen. John McCain, R-Ariz., is gravely ill, Romney would also become the de facto head of the non-Trump republicans — although not necessarily the anti-Trump Republicans.

President-elect Donald Trump eats dinner with Mitt Romney and then-incoming White House Chief of Staff Reince Priebus at Jean-Georges restaurant at the Trump International Hotel in New York, in Nov. 2016.

Evan Vucci/AP

hide caption

toggle caption

Evan Vucci/AP

Romney was very tough on Trump during the campaign. He called him “a phony, a fraud” in a major speech. But the two men seemed to reconcile over frog legs at dinner in the Trump International Hotel in New York during Trump’s search for a secretary of state. Although many thought Romney may have looked the part, he did not get the top job at Foggy Bottom.

Since then Romney has only criticized Trump in public after the President’s remarks creating a moral equivalence between neo-Nazis and their opponents after the racial violence in Charlottesville, Va., in August. On Monday, reporters asked Trump about Romney’s possible candidacy in Utah, and Trump said, “He’s a good man. Mitt’s a good man.”

But as we were reminded when Trump attacked Hilary Clinton again Monday morning over her treatment by the FBI, there are some political rivalries President Trump just can’t seem to get over.

Let’s block ads! (Why?)

Supreme Court OKs Trump Travel Ban Pending Lower Court Rulings

Muslim and civil rights groups and their supporters in Washington, D.C., protest the Trump administration’s travel ban in October. The Supreme Court said Monday the ban can be fully enforced for now.

Manuel Balce Ceneta/AP

hide caption

toggle caption

Manuel Balce Ceneta/AP

The U.S. Supreme Court will allow the Trump administration to fully enforce its revised ban on allowing entry to the United States by residents of eight countries while legal challenges are heard by a federal appeals court.

Six of the countries — Syria, Libya, Iran, Yemen, Chad and Somalia — are majority-Muslim nations. The other two are North Korea and Venezuela.

The announcement that the high court sided with the administration, which had requested a lifting of lower courts’ rulings preventing full enforcement of the travel ban, came in a terse order without explanation of its reasoning. The justices also said that they expect the Court of Appeals for the 9th Circuit to issue its ruling “with appropriate dispatch.”

Justices Ruth Bader Ginsburg and Sonia Sotomayor were dissenting votes.

Let’s block ads! (Why?)

10 Arrested In Malta Over Assassination Of Prominent Journalist

Signs are placed at the gates of the Police Headquarters in Valletta, Malta, on Oct. 22, during a rally demanding justice for murdered Maltese journalist and anti-corruption blogger Daphne Caruana Galizia. Maltese police have now arrested 10 suspects in connection to her assassination.

Matthew Mirabelli/AFP/Getty Images

hide caption

toggle caption

Matthew Mirabelli/AFP/Getty Images

Maltese police have arrested 10 suspects in connection to the October assassination of investigative journalist Daphne Caruana Galizia, who was renowned for her unflinching scrutiny of the corrupt and powerful on the Mediterranean island nation.

All of the suspects are from Malta and most have criminal records, NPR’s Frank Langfitt reports, citing Maltese Prime Minister Joseph Muscat.

Frank reports that the FBI is assisting with the investigation into Caruana Galizia’s murder, which drew international attention:

“In October, Caruana Galizia was killed by a car bomb so big it hurled the vehicle nearly 90 yards into a field.

“Through her blog, ‘Running Commentary,’ she made a name for herself exposing corruption in a nation famous for it — and collecting enemies along the way.

“Caruana Galizia’s critics called her a force of nature who had on at least one occasion almost single-handedly brought the government to collapse.

“Eight of the world’s largest media organizations — including The New York Times and the BBC — have demanded the killers be brought to justice.”

As NPR’s Sylvia Poggioli reported in October, Caruana Galizia’s independently operated website “often drew more readers than the total circulation of Malta’s newspapers.”

In October, NPR’s Colin Dwyer reported on the impact of that widely read work:

“Caruana Galizia, a longtime columnist for the Malta Independentand prolific blogger, had spent more than a year perusing the documents included in the Panama Papers, a massive data leak that exposed the offshore bank accounts of politicians around the world. In the course of her investigations, Caruana Galizia accused several high-level Maltese officials of laundering kickbacks from wealthy Russians and Azerbaijani leaders — allegations those Maltese officials firmly denied.

“Her reportage took aim even at the pinnacles of Maltese power: Earlier this year she reported that Michelle Muscat, wife of Malta’s prime minister, secretly owned a mysterious company that had received more than $1 million from Azerbaijan.

“The revelations were enough to prompt massive protests in the streets against corruption and persuade Prime Minister Joseph Muscat to call a general election in June, according to The Guardian. Muscat ultimately won that election and with it, a second term.”

Caruana Galizia’s son called her death “no ordinary murder,” writing on Facebook, “we are a people at war against the state and organized crime, which have become indistinguishable.” He was not comforted by vows from Maltese authorities that they would do their utmost to investigate the assassination.

“It is of little comfort for the Prime Minister of this country to say that he will ‘not rest’ until the perpetrators are found, when he heads a government that encouraged that same impunity,” Matthew Caruana Galizia wrote in mid-October.

Thousands of people have attended rallies demanding justice for the murdered journalist.

Now, after the first major break in the case, distrust continues to shadow the investigation.

The Associated Press reports that Home Minister Michael Farrugia offered few details about the arrests of the 10 suspects:

“Declining to give details on the arrests, Muscat cited concerns any information could compromise prospects to successfully prosecute the case. Farrugia said he wouldn’t disclose anything else because ‘I have been already threatened by legal action by the Caruana Galizia family.’

“Last month, her family had alleged that Farrugia had divulged confidential information that could hamper the investigation. The minister brushed off the allegation, but the family said it was prepared to take legal action to prevent the government from sabotaging the investigation.

“On Monday, her family reacted angrily to how the arrests were announced — saying police should have informed the family, not Muscat first — and reiterating in a statement their uncertainty if justice will be carried out, despite the prime minister’s public insistence earlier in the day that all would be done to solve the case. … ‘When the handling of an investigation is not sound, it is difficult to have faith in its outcome,’ [the family said.]

“The investigation appeared to be continuing throughout Monday, as police and armed forces had cordoned off an area in Marsa, a small port town close to Valletta, the capital.”

A court hearing is set for Tuesday.

Let’s block ads! (Why?)

Ex-Rep. Corrine Brown Sentenced To 5 Years For Stealing From Bogus Charity

Former Rep. Corrine Brown, seen in 2015 in Tallahassee, Fla. She has been sentenced to five years in prison.

Mark Wallheiser/AP

hide caption

toggle caption

Mark Wallheiser/AP

Former Rep. Corrine Brown has been sentenced to five years in prison for pocketing hundreds of thousands of dollars from donors who believed their money was going to charity. A federal judge on Monday sentenced the Florida Democrat, who was voted out of office last year, on 18 crimes ranging from conspiracy to fraud.

“It is a sad day for everyone. It is a sad day for this community,” Judge Timothy Corrigan said in court, according to The Associated Press. “I was impressed with all the outpouring of support for you and it’s a tribute to you and the work you’ve done … and that makes it more tragic and sad.”

The prison sentence marks the coup de grâce for Brown’s political career, which at one time was lauded for its historic, trailblazing achievement. When she won election to the House in 1992, Brown became one of the first three African-American lawmakers from Florida to be elected to Congress since Reconstruction.

Brown, 71, went on to serve 12 terms in the House until she lost last year’s election under the cloud of her indictment.

Brown gets 5 years. Her chief of staff Ronnie Simmons gets 4 and One Door for Education founder Carla Wiley gets 21 months. Earliest she may go to prison is January 8. Her lawyer says he’ll appeal

— Ryan Benk (@RyanMichaelBenk) December 4, 2017

Yet during that long career Brown and her chief of staff, Elias “Ronnie” Simmons, had also been soliciting donations for One Door for Education — a group purportedly funding education for needy children, but really serving as a fig leaf for fraud. As member station WJCT reported, the two raised more than $800,00; just $1,200 actually went where they promised.

The court found that the rest was siphoned into lavish events, when it wasn’t going straight into the congresswoman’s bank account.

Simmons and Carla Wiley, the executive director of One Door, both accepted plea deals and reduced prison sentences for testifying against Brown, who in turn blamed all the wrongdoing on Simmons.

Corrigan did not believe this explanation — though he did grant Brown a lighter sentence than the maximum for the crimes, which ranged up to nine years.

Brown’s lawyer has vowed to appeal.

Let’s block ads! (Why?)

'House Of Cards' Will Get One More Season — Starring Robin Wright

Robin Wright — shown in character as Claire Underwood in Netflix’s House of Cards — will be the lead actor in the final season of the show. Her former co-star Kevin Spacey has been accused of sexual harassment and assault.

David Giesbrecht/Netflix

hide caption

toggle caption

David Giesbrecht/Netflix

Netflix will film eight more episodes of House of Cards, in a final season that will feature female lead Robin Wright — with former star Kevin Spacey cut out of the show completely.

Spacey has been accused of sexual assault and harassment by multiple men, including an actor who says he was 14 when Spacey made a sexual advance, and an unnamed man who says he was 15 when Spacey attempted to rape him.

After the reports began to surface in late October, Netflix announced it was cutting ties with the actor.

The fate of House of Cards, the political drama starring Spacey as scheming politician Frank Underwood, was initially unclear. The streaming platform first said it would end after the sixth season, a 13-episode arc set for release in 2018. The season had already begun filming with Spacey in the lead. Then Netflix said production of the season was suspended and the company would “evaluate our path forward as it relates to the show.”

“Now the streaming service says it will resume production early next year, making an eight-episode final season for the show,” NPR’s Eric Deggans reports.

“Netflix’s version of House of Cards, which Spacey helped develop as an executive producer, was the first big original series hit for the streaming service after its 2013 debut,” Eric notes.

The plot of the final, shortened season will “be refocused to center on co-star” Wright, The Guardian reports.

It’s not yet clear how Frank Underwood’s absence will be explained within the narrative.

Wright plays Claire Underwood, who started out as a less central figure on the show than her husband. But as time went on, Wright’s character — who is as savvy and strategic as her powerful, manipulative spouse — played a more and more prominent role, prompting some watchers to suggest she could anchor the show (or a spin-off) solo.

“We are excited to bring closure to fans,” Netflix CEO Ted Sarandos said at a conference Monday, according to the Guardian.

Previously, as Newsweek notes, staff had been uncertain about their future. “Union members (including the cast) have been getting paid in their time off the past two months,” Newsweek wrote last week. “But everyone else, from production assistants to other nonunion, hourly-wage workers, are neither on the job nor receiving paychecks.”

As the staff of House of Cards faced the possibility of losing their jobs over Spacey’s actions, it was a double blow for some — who were already victims of

All the cast and crew faced the possibility of losing their jobs. But for some of those staffers, it was reportedly a double whammy — because they had already been victims of the same behavior that put the show’s future in question.

Current and former employees who worked on House of Cardstold CNN that Spacey would target young men on the production team with “nonconsensual touching and crude comments.”

Now, with the final season slated for production, some 2,000 production staffers will be able to return to work, according to the Guardian.

After the first allegation against him surfaced, Spacey issued a widely criticized statement in which he said he did not remember the incident but was sorry for the feelings the actor described, and then pivoted to come out publicly as gay. As more allegations surfaced, Spacey’s representative told the press that the actor was seeking treatment.

Spacey also lost a role in an upcoming film, All the Money in the World. After initially filming the movie with Spacey as J. Paul Getty, director Ridley Scott re-shot those scenes with actor Christopher Plummer in the role instead.

Let’s block ads! (Why?)

Sexual Abuse Allegations Against James Levine Spell Trouble For Met Opera

James Levine, shown leading the Boston Symphony Orchestra in 2007, has been suspended by the Metropolitan Opera following allegations of sexual abuse.

AFP/AFP/Getty Images

hide caption

toggle caption

AFP/AFP/Getty Images

The Metropolitan Opera has suspended its longtime conductor and former music director, James Levine, following allegations of sexual abuse reported by The New York Postand The New York Times. The three sets of allegations span from the 1960s to the ’80s.

Beyond his work at the Met, Levine has been a hugely influential figure in the classical music world for the past half-century — leading major orchestras, including the Boston Symphony Orchestra, and mentoring young musicians and opera singers at summer music programs such as the Ravinia Festival near Chicago.

NPR’s Anastasia Tsioulcas speaks with Mary Louise Kelly about the allegations, what they mean for the Met and some of the broader implications for classical music. Hear the conversation at the audio link.

Let’s block ads! (Why?)

Across The World, If You Eat For Your Health, You'll Help The Planet

Brahman cattle graze in a field in Innisfail, Queensland, Australia. Researchers can estimate the greenhouse gas emissions and land used to produce various foods in different parts of the world. They’ve used that data to calculate the environmental impact of a shift in what people eat.

David Messent/Getty Images

hide caption

toggle caption

David Messent/Getty Images

Telling people what to eat is perilous, whether the advice is aimed at a friend or an entire country. Of course, people and governments do it anyway. Dozens of countries have come up with recommendations for the perfect, most health-promoting diet.

Those recommendations are aimed at improving people’s health. But Paul Behrens, a researcher at the University of Leiden, in the Netherlands, wanted to know whether this advice — if people actually followed it — might affect the environment. Producing foods, after all, has profoundly altered the planet, and those impacts can vary a lot, depending on which foods people demand.

Behrens just published his analysis in the Proceedings of the National Academy of Sciences. He looked at what would happen if people in 37 different countries followed the dietary recommendations of their own governments. In general, he says, those shifts would be good for the planet. Greenhouse gas emissions would fall, waterways would suffer less pollution from fertilizer, and less land would be required to feed people.

“We have the perfect tool to analyze this,” says Behrens. Scientists have assembled a massive database that allows them to calculate the emissions of greenhouse gases, the demand for land, or the fertilizer pollution caused by growing different kinds of food in different parts of the world. It can even distinguish, for instance, between the greenhouse gas emissions resulting from letting cattle graze on grass in Australia, versus feeding them corn in North American feedlots.

Behrens and his colleagues took that database and calculated, first of all, the impact of what people are eating now. Then they calculated the impact of a shift in diets, in each country, following that government’s recommended diet.

In most countries (although not all) shifting to the recommended diet would mean eating less meat, poultry and eggs. That means, in turn, less land required to grow the feed for animals, lower greenhouse gas emissions, and less water pollution. This is especially true of Brazil and Australia, where people eat lots of beef.

There are exceptions, though. In India, where consumption of meat, poultry, and eggs is extremely low, the government wants people to eat more of those foods. Supplying those Indian consumers with the food that the government wants them to eat would increase greenhouse emissions. Shifting to the recommended diet in South Africa also would add to environmental stresses, because South Africans are supposed to eat more dairy products. And in Switzerland, people are supposed to eat so many more vegetables, fruit and nuts that producing that food also would increase greenhouse gas emissions.

What I found most intriguing about Behren’s paper, in fact, is the detailed information he’s assembled about dietary recommendations in dozens of different countries, as well as differences in what people actually eat.

Latvia, for instance, tells its citizens to eat mostly grains, while in South Korea, grains make up only a tiny share of the recommended diet. I’d assumed that Italians fill up on pasta, but in fact the Italian government wants its citizens to eat more grains, not less.

In the United States, the official dietary guidelines do not explicitly call for a reduction in meat consumption. The amount of meat, poultry and eggs that the guidelines recommend, however, is generally lower than what Americans — at least adult men — currently consume. The guidelines call for an even bigger reduction in sugar consumption. All of this would mean less pollution, and more land available for nature.

Behrens says only a handful of countries even mention the potential environmental benefits of following their dietary recommendations. He thinks that’s a mistake. “It’s another reason to shift to a healthier diet,” he says.

The last time the U.S. revised its dietary guidelines, several of the scientists involved in the effort tried to do exactly that, but ran into fierce criticism from Congress. Lawmakers attached a “directive” to a spending bill instructing the Department of Health and Human Services to disregard environmental considerations when drafting its dietary advice, and the HHS complied.

Let’s block ads! (Why?)