by | ARTICLES, BLOG, HYPOCRISY, POLITICS, TAXES
There have been recent articles about the SPLC and their “millions in offshore accounts.” But as a tax accountant, there doesn’t appear to be anything illegal or suspicious in the way they invest their funds — much in the same way that Mitt Romney’s items were completely fine. Non-profits have restrictions on the way they can and cannot invest, so what the SPLC has done or is doing in this regard appears to be rather ordinary.
But if I were the SPLC, I would like nothing better than to have people jumping up and down about my “foreign bank account” so that they’ll completely ignore the fact that the IRS should investigate and reconsider the tax status of the SPLC.
The SPLC intentionally and willfully becomes political by going after various groups, people, and ideologies –with whom they disagree –to denigrate them while lumping them in with true extremists (like the KKK). Then the SPLC issues press releases and maps for the media to pick up the stories. Their running count of “hate” is 917, and their total amount of “monitoring of hate” is 1,600+ — how is this not political?
by | ARTICLES, BLOG, ECONOMY, POLITICS, TAXES, TRUMP
As the new jobs report posted 156,000 jobs (forecasted 180,000) and a slight uptick in unemployment (4.4% from 4.3%), CNSNews noticed a shift in government workers stats:
The number of people working for the federal government has declined by 11,000 in 2017 while the number working for state governments has declined 2,000, according to data published today by the Bureau of Labor Statistics.
But because the number of people employed by local governments has climbed 12,000 so far this year, the overall decline in the number of people employed nationwide by government has only dropped by 1,000 in 2017.
Meanwhile, even though manufacturing jobs have increased by 137,000 this year, the number employed by government in August still exceeded the number employed in manufacturing by 9,818,000.
In December 2016, there were 22,299,000 people employed by federal, state and local governments in the United States. By August, that had dropped to 22,298,000—a decline of 1,000.
On the federal level, there were 2,819,000 people employed by government in December 2016. That dropped to 2,808,000 in August—a decline of 11,000 so far this year.
On the state level, there were 5,085,000 employed by government in December 2016. That dropped to 5,083,000 in August—a decline of 2,000.
On the local level, there were 14,395,000 employed by government in December. That climbed to 14,407,000 in August—an increase of 12,000.
With federal and state governments dropping a combined 13,000 employees so far this year, and local governments adding 12,000, the net change in government employment nationwide so far in 2017 has been a decline of 1,000.
The 22,298,000 people employed by government in the United States in August continues to far outstrip the 12,480,000 people employed in manufacturing—evening though manufacturing has seen employment gains this year as government employment has marginally declined.
“Manufacturing employment rose by 36,000 in August,” the BLS said in its release today. “Job gains occurred in motor vehicles and parts (+14,000), fabricated metal products (+5,000), and computer and electronic products (+4,000). Manufacturing has added 155,000 jobs since a recent employment low in November 2016.”
Of those 155,000 manufacturing jobs added since last November, 137,000 have been added since last December. In the last month of 2016, there were 12,343,000 people employed in manufacturing in the United States. In August, there were 12,480,000–accounting for the 137,000 gain in manufacturing jobs thus far this year.
Even with the recent gains in manufacturing jobs and the small drop in government jobs, the 22,298,000 people employed by government in the United States in August still outnumbered the 12,480,000 employed in manufacturing jobs by 9,818,000.
From 1939, when the BLS started tracking manufacturing and government jobs, through 1988, manufacturing jobs always outnumbered government jobs in the United States. In August 1989, for the first time, government jobs exceeded manufacturing jobs in this country.
by | ARTICLES, BLOG, ECONOMY, GOVERNMENT, HYPOCRISY, POLITICS, RETIREMENT, TAXES
Minnesota’s pension fund was recently revealed to be in crisis-mode after changing the accounting formula to more accurately reflect market realities:
“The jump caused the finances of Minnesota’s pensions to erode more than any other state’s last year as accounting standards seek to prevent governments from using overly optimistic assumptions to minimize what they owe public employees decades from now. Because of changes in actuarial math, Minnesota in 2016 reported having just 53 percent of what it needed to cover promised benefits, down from 80 percent a year earlier, transforming it from one of the best funded state systems to the seventh worst, according to data compiled by Bloomberg.”
During the most recent recession, the Governmental Accounting Standards Boards made accounting rules changes because it began to be more apparent that a majority of local and state pension systems were continuously understating the long-term obligations. It was common practice to depend on and project 8%-10% investment returns even when the reality was more along the lines of 2%.
When the public sector (and unions) signed off on lavish pension provisions for the employee, they hoped there would be enough growth and investment returns to cover it way down the road. There were no provisions made to handle the possibility of a low-interest rate society or a fledgling economy like we’ve experienced the last nine years; they took their chances and their fallback was always that they could suck money from the taxpayer by raising taxes to cover budgeting shortfalls. That is reckless and irresponsible.
Years of fiscal mismanagement in the public sector has resulted in this fiscal nightmare. Because the public sector does not have the economic forces of competition to keep compensation levels in check, as the public sector does, it was always incumbent upon public negotiators to manage contracts properly. Failing to properly negotiate, making cozy deals, and maintaining unsustainable defined-benefit plans has created the soaring budget and pension deficits we see across the country. Though the rules changes to actuarial math are a start, in some places, it’s too little, too late.
by | ARTICLES, BLOG, BUSINESS, ECONOMY, POLITICS, RETIREMENT, TAXES
Despite Connecticut’s status as one of the wealthiest states in the country, its fiscal health is in rapid decline. A hefty debt load has left the state without a budget for two months as lawmakers squabble how to best deal with the reality of “high taxes, outmigration, falling revenues and $50 billion of unfunded pension liabilities.”
Governor Malloy has an executive order ready to go into effect that will reduce or eliminate funds for localities and schools if the state government cannot come to a consensus. Lawmakers are staring down a multi-billion deficit for the next two years so austerity measures could be both drastic and necessary.
According to Reuters, “one major factor for the debt load is municipal spending. Some $23 billion of outstanding municipal debt has also constrained spending. Bondholders must be paid ahead of most other expenses like non-essential services and payments to vendors….Connecticut has borrowed for decades to fund school construction, whereas nearly all other states typically borrow at the local level for those projects.”
Other issues besides municipal projects have wreaked havoc. Skyrocketing pension costs have been a major contributor, although Connecticut has been staring down this problem for nearly a decade; Connecticut “piled on debt to bolster its public pensions, selling $2.3 billion of bonds in April 2008.” And budget deficits are not new; 18 months after the bond sale, “in December 2009, the state sold $916 million of economic recovery notes to close a budget deficit after depleting its rainy day fund during the Great Recession.”
So here we have a debt-ridden state — quite possibly the worst of all 50 states — suffering from financial woes for years now with only bandaid solutions. Sufficient tax revenue is not the problem; zealous overspending and fiscal mismanagement is. Unfortunately, Connecticut is one of several states facing the same issues; state insolvency is going to get worse in many places before it gets better.
by | ARTICLES, BLOG, ELECTIONS, GOVERNMENT, POLITICS
Kamala Harris, the junior Senator from California, has been fueling speculation that she might be a Democrat contender for President in 2020. For months now, she has been holding fundraisers with high-dollar big-wigs, and now there are indications that she will be “knocking on doors in Iowa” according to former Los Angeles Mayor Antonio Villaraigosa, who is running for Governor in California in 2018.
Harris first came on my radar in 2015, when she partnered with the Department of Education to close some for-profit colleges in California when she was the Attorney General. In an earlier post on the subject, I noted that Harris worked in conjunction with the Department of Education specifically targeting the Corinthian College system. According to the Wall Street Journal, “Last summer the Education Department began to drive Corinthian out of business by choking off federal student aid for supposedly stonewalling exhaustive document requests. The Department claimed to be investigating whether Corinthian misrepresented job placement rates as California Attorney General Kamala Harris alleged in a lawsuit.”
Corinthian agreed to turn over their education centers to other non-profits, but Kamala Harris refused to release any buyer of potential future liability, meaning anyone purchasing would be under constant threat of a lawsuit. Last November, “the nonprofit Education Credit Management Corporation (ECMC) “agreed to buy more than 50 Corinthian campuses for $24 million plus $17.25 million in protection money to the feds for a release from liability. But ECMC passed up Corinthian’s 23 schools in California because Ms. Harris wouldn’t quit.” The alternative to having no buyer for these particular schools would ultimately be to shut them down.
It was in April 2015 that Corinthian was slapped with the $30 million fine, which effectively drove the final nail in the coffin of the remaining schools because no one in their right mind would shoulder the liability. As for the hefty penalty, “The Department assessed the maximum fine of $35,000 per regulatory violation, which its bureaucrats count as each student that was improperly counted.” By the end of the month, all the rest of the schools indeed closed, throwing out of employment and school, thousands of people.
What makes this whole affair particularly odious is that that “the federal government [didn’t] specify how for-profits calculate their job placement rates. States and accrediting agencies have disparate and often vague rules, which notably don’t apply to nonprofit and public colleges.” Thus, Corinthian Colleges was really just a part of the larger assault on for-profit colleges by the Obama Administration, all tied to his recently implemented “Gainful Employment” rules.
Part of the new regulation change dealt with colleges and federal aid, and it appears Corinthian was a ripe target. What’s more, the Department of Education found a ready and willing partner in Kamala Harris, who just happened to be running for a very important Senate seat in California at the time, the seat of retiring Barbara Boxer. She was elected a year later. Harris has demonstrated her willingness to play along to get along — so it’s important to keep an eye on her in the many months ahead.
by | ARTICLES, BLOG, ECONOMY, OBAMA, OBAMACARE, POLITICS, TRUMP
Anthem announced today that it would discontinue individual insurance coverage plans in Virginia in 2018, the third major insurer to do so this year; Aetna and United Health announced their plans earlier in the year. For Anthem, this marks the 4th state change so far in 2017, after Indiana, Ohio, and Wisconsin.
In their press release, Anthem noted,
“Today, planning and pricing for ACA-compliant health plans has become increasingly difficult due to a shrinking and deteriorating Individual market, as well as continual changes and uncertainty in federal operations, rules and guidance, including cost sharing reduction subsidies and the restoration of taxes on fully insured coverage. As a result, the continued uncertainty makes it difficult for us to offer Individual health plans statewide in Virginia.” Anthem will “reduce its plan offering and will only offer off-exchange plans in Washington and Scott Counties and the city of Bristol, VA.”
According to the Richmond Times-Dispatch, the move would be significant: “More than 206,000 Virginians could lose their individual health insurance policies with the sudden withdrawal of Anthem Blue Cross Blue Shield in Virginia, the state’s largest insurer, from the federal exchange and individual market in 2018.” Anthem will still employer-based plans, as well as Medicare and Medicaid plans.
The move leaves just five insurers in Virginia — Optima, Kaiser, Piedmont, Cigna, and CareFirst. Some localities will be left with just one insurer choice next year. This move by Anthem is a big deal, and yet another major failure of the poor structuring of the entire Obamacare apparatus. Americans deserve better.
by | ARTICLES, BLOG, ECONOMY, NEW YORK, POLITICS, TAXES
Mayor DeBlasio released a new plan to add a “nearly 14 percent tax increase on high-income Big Apple residents” in order to raise money for various transportation projects. It is projected to raise $800 million/year and would be used to pay for subway repairs, bus system upgrades, and low-income train rides.
DeBlasio pitched a city income tax hike that “would raise the rate for individuals making more than $500,000 and married couples earning over $1 million from 3.876 percent to 4.41 percent.” That translates into ” an additional $2,700 levy on an individual earning $1 million a year, and an additional $8,000 on an individual earning $2 million.”
Using quintessential class warfare speech, DeBlasio invoked Obama’s favorite phrases about the “top 1 percent” who “can afford to do a bit more” arguing that “a transit system that works makes New York City’s economy strong and benefits us all.” What he forgot to mention is that New York City is already one of the top tax-heavy localities in the United States for high income earners, who fork over 50% of their income in combined city, state, and federal taxes. Ridiculous, money-grubbing schemes like these continue to be the reason why the wealthy continue their mass exodus from the area.
by | ARTICLES, BLOG, BUSINESS, ECONOMY, FREEDOM, OBAMA, OBAMACARE, POLITICS, TAXES
Centers for Medicare and Medicaid Services (CMS) have published data which projects that 1,332 counties (over 40%) will have only one health insurer on Obamacare in 2018 and 49 will have none. According to CNSNews, “the data comes from the Health Insurance Exchanges Issuer County Map, which shows projected issuer participation on the Health Insurance Exchanges in 2018 based on the issuer public announcements made prior to late July of 2017.”
Successful healthcare systems do not continuously lose insurers, accumulate massive debt, and leave citizens with little to no choice. Obamacare has continued to wreak havoc on our citizens. It has to go. We can do better.
by | ARTICLES, BLOG, FREEDOM, GOVERNMENT, POLITICS, RETIREMENT, SOCIAL SECURITY, TAXES
Last week, the Social Security Board of Trustees released their annual report on the long-term financial status of the Social Security Trust Funds. The news does not continue to bode will for the long-term survival of Social Security — but on the other hand, this is nothing that we haven’t heard before. Unfortunately, no one really wants to tackle the problem of reform.
Straight from their press release:
“The Social Security Board of Trustees today released its annual report on the long-term financial status of the Social Security Trust Funds. The combined asset reserves of the Old-Age and Survivors Insurance, and Disability Insurance (OASDI) Trust Funds are projected to become depleted in 2034, the same as projected last year, with 77 percent of benefits payable at that time. The DI Trust Fund will become depleted in 2028, extended from last year’s estimate of 2023, with 93 percent of benefits still payable.
In the 2017 Annual Report to Congress, the Trustees announced:
- The asset reserves of the combined OASDI Trust Funds increased by $35 billion in 2016 to a total of $2.85 trillion.
- The combined trust fund reserves are still growing and will continue to do so through 2021. Beginning in 2022, the total annual cost of the program is projected to exceed income. (emphasis added)
- The year when the combined trust fund reserves are projected to become depleted, if Congress does not act before then, is 2034 – the same as projected last year. At that time, there will be sufficient income coming in to pay 77 percent of scheduled benefits.
“It is time for the public to engage in the important national conversation about how to keep Social Security strong,” said Nancy A. Berryhill, Acting Commissioner of Social Security. “People understand the value of their earned Social Security benefits and the importance of keeping the program secure for the future.”
Other highlights of the Trustees Report include:
- Total income, including interest, to the combined OASDI Trust Funds amounted to $957 billion in 2016. ($836 billion in net contributions, $33 billion from taxation of benefits, and $88 billion in interest)
- Total expenditures from the combined OASDI Trust Funds amounted to $922 billion in 2016.
- Social Security paid benefits of $911 billion in calendar year 2016. There were about 61 million beneficiaries at the end of the calendar year.
- Non-interest income fell below program costs in 2010 for the first time since 1983. Program costs are projected to exceed non-interest income throughout the remainder of the 75-year period.
- The projected actuarial deficit over the 75-year long-range period is 2.83 percent of taxable payroll – 0.17 percentage point larger than in last year’s report.
- During 2016, an estimated 171 million people had earnings covered by Social Security and paid payroll taxes.
- The cost of $6.2 billion to administer the Social Security program in 2016 was a very low 0.7 percent of total expenditures.
- The combined Trust Fund asset reserves earned interest at an effective annual rate of 3.2 percent in 2016.
The Board of Trustees usually comprises six members. Four serve by virtue of their positions with the federal government: Steven T. Mnuchin, Secretary of the Treasury and Managing Trustee; Nancy A. Berryhill, Acting Commissioner of Social Security; Thomas E. Price, M.D., Secretary of Health and Human Services; and R. Alexander Acosta, Secretary of Labor. The two public trustee positions are currently vacant.”
View the 2017 Trustees Report at www.socialsecurity.gov/OACT/TR/2017/.
by | ARTICLES, BLOG, CONSTITUTION, FREEDOM, GOVERNMENT, POLITICS, TRUMP
Daniel Mitchell from CATO put together a round-up over of articles over the last few days from various sources chiming in their opinion of Session’s expansion of asset forfeiture. It was published on International Liberty. The list is below; you should also read the article its entirety.
Writing for USA Today, Professor Glenn Reynolds correctly castigates the Attorney General for his actions.
David French of National Review is similarly disgusted.
Erick Erickson adds his condemnation in the Resurgent.
In a column for Reason, Damon Root of Reason adds his two cents.
Last but not least, the editors of National Review make several important points.
One last point of note that Mitchell included is that “the first two administrators of the federal government’s asset forfeiture program now want it to be repealed.”
