by | ARTICLES, FREEDOM, GOVERNMENT, OBAMA, POLITICS
Attorney General Jeff Sessions announced yesterday that civil asset forfeiture would continue to be a viable practice among law enforcement. In fact, Sessions went so far as to roll-back asset forfeiture restrictions that were put in place during the Obama Administration after a series of high-profile cases and reports revealed egregious misuses of the law which resulted in billions in seizures over several years for state and federal agencies. Sessions announced, “We will continue to encourage civil asset forfeiture whenever appropriate in order to hit organized crime in the wallet.”
Civil asset forfeiture allows law enforcement to take money or property from a citizen who is merely suspected of criminal activity — not charged or convicted. Though original asset forfeiture laws were aimed at drug cartels to interrupt their business and money, it use has expanded rapidly in recent years. It’s not being used just for “organized crime” anymore; that’s a red herring that gives police a green light to continue to abuse citizens and take their property without due process.
“Under the equitable sharing program, federal authorities may “adopt” state and local forfeiture cases and prosecute them at the federal level. Those local police departments get to keep up to 80 percent of the forfeiture revenue, while the rest goes into the equitable sharing pool and is distributed among partner departments around the country.” I gave credit to Obama for addressing asset forfeiture and restrictions were rightly implemented as a stepping stone to reign in this abominable practice. Sessions is now loosening those once again.
According to Reason, “The Justice Department did include several requirements that it says will safeguard the due process rights of property owners. The directives require state and local police to provide additional information showing probable cause that a crime occurred before federal authorities will adopt the seizure. Seizures of under $10,000 will have to be accompanied by a warrant, a related arrest, or the seizure of contraband. Absent those provisions, a U.S. attorney would have to sign off on an adoption.
Clarence Thomas wrote a scathing dissent of asset forfeiture last month when SCOTUS chose not to hear a case on the matter. He wrote, “this system—where police can seize property with limited judicial oversight and retain it for their own use—has led to egregious and well-chronicled abuses. He further pointed out, “because the law enforcement entity responsible for seizing the property often keeps it, these entities have strong incentives to pursue forfeiture.”
Thomas is right to condemn the practice. Asset forfeiture is a practice that denies citizens the right to due process; no one should lose property because of mere suspicion of criminal behavior. Sessions and the Department of Justice is wrong on this matter.
For interested parties, here’s a link to the entire policy directive:
by | ARTICLES, ECONOMY, FREEDOM, OBAMA, OBAMACARE, POLITICS, TAXES
I have to admit that I was a bit surprised to read an article by AEI (“This health care tax could spark a GOP civil war,” July 13, 2017) which treated the Net Investment Income Tax (NIIT) as a pesky tax that was wreaking havoc on health care reform, because <gasp>, some Republicans wanted to eliminate it.
But nobody has been talking about the series of tax changes that occurred when Obama and his Democrat cronies passed the Obamacare increases in the first place. These raised the Bush tax rates on only the wealthiest from 36% – 39.6 % and then again raised the tax rates on the wealthiest by adding the 3.8% Net Investment Income Tax (NIIT), which covered all investment income. Then there was the 0.9% Obamacare Medicare surtax on upper-income earners. Obamacare increases also raised capital gains on the wealthiest ones from 15% – 20%. When the 3.8% tax would get tacked on, capital gains rates effectively went from 15%- 23.8% — an increase of about 55%. Taxes like these punish investment!
How is that not ridiculous? Or rather, how is it considered ridiculous that some Republicans want to eliminate the NIIT? Democrats continuously refer to it as an “upper-class tax cut.” Don’t fall for the rhetoric!
by | BLOG, FED, GOVERNMENT, POLITICS
Something that Congress needs to seriously consider is eliminating the authorization of federal agencies to designate violations of their rules as actual crimes.
Unbeknownst to the vast majority of Americans, federal agencies – consisting of no elected representatives at all – have the right to create criminal statutes. There are numerous, egregious instances that have come about where people were convicted of crimes made by agencies that no one knew -or even should have known – was a crime in the first place. This needs to end!
For example, in 2007, Lawrence Lewis, pleaded guilty of unknowingly violating the Clean Water Act. His crime? He and his crew followed policy and diverted overflowing waters – which threatened to flood the health care building he was servicing- into the street. Though the drain was connected to the city’s system, it actually emptied into a creek that flowed into the Potomac River. He had to pay a fine and submit himself to unannounced probation checks at home and at his subsequent job.
Likewise, in 2009, Eddie Leroy Anderson and his son dug for arrowheads for his collection while camping. Because it turned out that they were on federal land, that action violated the Archaeological Resources Protection Act of 1979 which they didn’t even know existed. They eventually pleaded guilty to avoid jail time and paid a $1500 fine — and never even found any arrowheads that day.
Then there the case of Robert Kern, a Virginian who was hunting moose in Russia. His hunting group shot animals from a helicopter, which is illegal in Russia; therefore, he was charged with violating the U.S. 2008 Lacey Act, a statute that makes it a felony to import fish or wildlife if it breaks another country’s laws.” The only way he was actually acquitted was due to a Russian official intervening and testifying at his trial that his group had a legal exemption — so he should never have been charged in the first place! What’s more, he was still on the hook for $860,000 in legal bills for something he didn’t even do!
The list could go on and on, because it’s impossible to quantify the number of agency statues. According to the Wall Street Journal (“As Criminal Laws Proliferate, More Are Ensnared, July 23, 2001), there were “an estimated 4,500 crimes in federal statutes, according to a 2008 study by retired Louisiana State University law professor John Baker.There are also thousands of regulations that carry criminal penalties. Some laws are so complex, scholars debate whether they represent one offense, or scores of offenses.
Counting them is impossible. The Justice Department spent two years trying in the 1980s, but produced only an estimate: 3,000 federal criminal offenses. The American Bar Association tried in the late 1990s, but concluded only that the number was likely much higher than 3,000. The ABA’s report said “the amount of individual citizen behavior now potentially subject to federal criminal control has increased in astonishing proportions in the last few decades.” Likewise, a Justice spokeswoman said there was no quantifiable number. Criminal statutes are sprinkled throughout some 27,000 pages of the federal code.”
No one ever intended for federal agencies to have the right to make up their own crimes — never mind the staggering number we have today. We need to remove authorization to create and approve crimes that ensnare good law-abiding citizens and turn them into felons over obscure matters.
by | ARTICLES, OBAMA, OBAMACARE, POLITICS
The 19th co-op since the creation of Obamacare has announced it will cease offering services at the end of 2017. Known as the “Minuteman Health of Massachusetts and New Hampshire,” this co-op will look to reorganize as a new venture to be called the “Minuteman Insurance Company.”
According to the Washington Free Beacon,
“The company cited issues with Obamacare’s risk-adjustment program, which is the program that shifts money away from those with healthier customers to those with sicker enrollees. Minuteman Health said that the negative impact of this program had been “substantial.”
“Unfortunately, the program has not worked as intended,” the company said. “It has been difficult for insurers to predict their risk-adjustment obligations, which has led some to withdraw from the ACA market.”
“The program also unfairly penalizes issuers like MHI that are small, low cost, and experience high growth,” the company said. “The significant relative impact from risk adjustment has been the principal driver of a reduction in MHI’s surplus and capital over 2 [sic] time.”
The co-op was able to grow to 37,000 members since it began in 2014 but said that being subject to certain co-op rules made it hard to adjust its business model to mitigate issues with the risk-adjustment program. The co-op was awarded $156.4 million in taxpayer-funded loans in 2012 and 2013.
The new company, Minuteman Insurance Company, will not be subject to these rules.
The ill-effects of the atrocious Obamacare legislation continues to disrupt lives. You’ll never hear about these failed co-ops, long considered a “jewel” of the program. How can any one rationally defend a 17% success rate for health care reform?
by | ARTICLES, BLOG, BUSINESS, POLITICS, TAXES, TRUMP
There continues to be a notion that carried interest is something that needs to be fixed because of a seemingly unfair low-tax capital gains income rate.
It is true the rate is low. But so what? It’s not as though the income isn’t from capital gains. If the law was changed so that the operators were taxed at ordinary income only, it wouldn’t get rid of those gains — it would simply mean that the investors get the benefit of the capital gains lost by the operators. This fixes nothing.
Ultimately such a change –which is being proposed by President Trump like it was by President Obama — will merely shift the tax benefit from the operators to the investors. This takes a tax break away from people who are working for a living and gives it to millionaires who are just investing – pure hypocrisy from liberals who wish to inflict additional taxes on the wealthy at every step. It make compensation deals for hedge fund operators a bit more complicated (i.e. requiring more assistance from accountants), but the amount of compensation stays revenue neutral.
Therefore, it takes a whopping dose of either incompetence or disingenuousness from the many carried interest critics to look at the hedge fund industry and proclaim that “carried interest” is a problem that needs to be addressed.
by | ARTICLES, BUSINESS, ECONOMY, POLITICS, TAXES
It’s kind of funny that the AP is reporting a story that has not been “news” for years to tax professionals. The state of Illinois is running out of taxpayer money, as its obligations exceed its revenue intake. This is what happens when a state has been mismanaged for decades by incompetent Democrats: From CHICAGO (AP):
The Illinois official responsible for paying the state’s bills is warning that new court orders mean her office must pay out more each month than Illinois receives in revenue.
Comptroller Susana Mendoza must prioritize what gets paid as Illinois nears its third year without a state budget.
A mix of state law, court orders and pressure from credit rating agencies requires some items be paid first. Those include debt and pension payments, state worker paychecks and some school funding.
Mendoza says a recent court order regarding money owed for Medicaid bills means mandated payments will eat up 100 percent of Illinois’ monthly revenue.
There would be no money left for so-called “discretionary” spending – a category that in Illinois includes school buses, domestic violence shelters and some ambulance services.
Is Illinois going to be the first state to become truly insolvent? Is Illinois going to file for bankruptcy? The situation is critical enough that we need keep an eye on it in the coming weeks and months.
by | BLOG, BUSINESS, ECONOMY, FREEDOM, GOVERNMENT, HYPOCRISY, OBAMA, POLITICS
The idea of “disparate impact” holds that a defendant can be held liable for racism and discrimination for a race-neutral policy that statistically disadvantages a specific minority group even if that negative “impact” was neither foreseen nor intended. This tactic was increasingly used in recent years during the Obama Administration, most often by Loretta Lynch, Obama’s Attorney General, and Thomas Perez, his Secretary of Labor.
It follows then that minimum wage laws are racist and discriminatory. There’s no question that the effect these policies have on minorities are unfavorable. The citizens who are going to lose their jobs or will be unable to get jobs as a result of raising the cost of wages are disproportionately larger populations of minorities. If you can impute and infer racial bias because of an adverse impact and then use it to determine the legality of a law, it is unequivocally clear that minimum wage laws should be deemed unconstitutional.
by | ARTICLES, BUSINESS, ECONOMY, POLITICS
23% of Puerto Ricans voted today for a statehood referendum, and 97% of them cast a vote in favor of it. 1.5% percent voted for independence from the United States, according to Decision Desk HQ, while 1.3% voted to keep the current status of a territory of the United States.
The catalyst for this vote for statehood — the first one since 2012 — was the declaration of a form of bankruptcy in early May. Many did not vote because the vote actually did nothing. Congress would still have to formally agree to statehood, which is highly unlikely due to its crippling debt.
Last month, Puerto Rico sought financial relief in federal court, “the first time in history that an American state or territory had taken the extraordinary measure. The action sent Puerto Rico, whose approximately $123 billion in debt and pension obligations far exceeds the $18 billion bankruptcy filed by Detroit in 2013, to uncharted ground.”
I have written numerous times on Puerto Rico in the past due to business there over the years. My take has always been about reduction; reducing the size and scope of government is a major key part of getting Puerto Rico back on track.
Puerto Rico’s debt crisis is the result of years of government mismanagement. Dozens of agencies and publicly owned corporations have run deficits year after year, making up the difference by borrowing from bond markets, though there was a brief respite during the year of Governor Fortuño. Puerto Ricans must have to first experience tough reforms and cutbacks help Puerto Rico thrive once again.
by | ARTICLES, BLOG, ECONOMY, OBAMACARE, POLITICS, TAXES
President Donald Trump told the American public that he wants to keep Obamacare, at least to the extent of the provisions that protect individuals with pre-existing conditions and allow 26 years olds to stay on their parent’s plan.
This is, in fact, a ridiculous comment. Most people (myself included) believe that a competent Health Plan would contain these provisions. And they will. But they will be part of a new plan which will be entirely rewritten. No part of Obamacare should be retained. It needs to be repealed in total.
The new replacement for Obamacare can (and should) have provisions for people with pre-existing conditions to get insurance and even keeping 26 year olds on the plan (possibly), but not in the way the law is currently written. Free market pricing will keep overall costs down, and with respect to individuals whose premiums become unaffordable (due to pre-existing conditions, low income, etc) there could be risk-pools and/or subsidies to deal with the issues. The Obamacare method of forced overpayments and intrusively detailed regulation with perverse incentives on every component of health care, has failed. That’s why we’ve been seeing an exodus of insurers; they simply cannot sustain their fiscal health they way the current system is.
Only by replacing the law with one that focuses on free-market solutions can we make progress in fixing our health system to actually help our citizens and in a fiscally sound way.
by | ARTICLES, BLOG, FREEDOM, POLITICS, TAXES
The National Review reprinted an article from their archives, first written on May 30, 1994. It recounts the media treatment of George Bush, Sr.’s tax returns from 1991. Not surprisingly, the analysis omitted certain facts from the return to make the Bushes appear to pay less income taxes for a high income earner, in order to satisfy a particular agenda.
It’s worth it to read the old article in its entirety to appreciate how such media manipulation has been going on for at least a generation.
“Donald Barlett and James Steele are two of the most successful journalists in the United States. As reporters for the Philadelphia Inquirer, they have won two Pulitzer Prizes. Their gargantuan nine-part series, “America: What Went Wrong?,” was published in 1992 and reprinted in numerous newspapers. The series became an immediate best-seller when it was turned into the book of the same name.
Barlett and Steele’s new book, America: Who Really Pays the Taxes?, has now been excerpted, syndicated, and run as a series in newspapers throughout the United States. It is undoubtedly destined for the same bestseller status. The authors’ answer to the question posed in the new book’s title is — not surprisingly, in light of their earlier work — that the tax system is rigged against average Americans, who pay more than their fair share of income taxes while higher-income Americans pay less.
This thesis is demonstrably false. Although average Americans are indeed overburdened by taxes, upper-income taxpayers are even more so. Furthermore, although Barlett and Steele have described themselves as supplying “detailed information” that their readers “can get nowhere else,” their economic journalism constitutes little more than slanted anecdotes mixed with statistical sleight-of-hand.
Every year, the Internal Revenue Service analyzes tax returns and publishes data showing how much income was reported and how much tax paid by taxpayers in various income groups. These IRS figures are widely distributed, and no one writing an entire book on the subject could possibly be unaware of them. Barlett and Steele’s avoidance of these hard data is easy to understand, however, because the IRS figures destroy their thesis. In 1991, the most recent year for which the figures have been compiled, the top 1 percent of tax filers reported 13 percent of the nation’s total adjusted gross income (i.e., before most deductions), but paid 24.6 percent of all federal income taxes. The top 5 percent of taxpayers reported 26.8 percent of the income, but paid 43.4 percent of the taxes. And the top 10 percent — those earning over $61,952 — reported 38.2 percent of the income, but paid 55.3 percent of the taxes. The bottom 50 percent of tax filers, by contrast, reported 15.1 percent of the income, but paid only 5.5 percent of the taxes, leaving 94.5 percent of the tax bill to be paid by those with above-average incomes.
Barlett and Steele contrast the present day with what they view as the golden era of the 1950s, when the top individual and corporate tax rates were higher than they are today. They argue that in recent years higher-income taxpayers have successfully pushed tax burdens onto those who are less well off. What Barlett and Steele fail to mention, however, is that the tax code of the 1950s was so riddled with loopholes that those top rates collected virtually no revenue because hardly anyone paid them. IRS data show that the share of the total tax burden borne by upper-income individuals grew steadily from 1981 to 1991. It is particularly noteworthy that since 1982, when marginal tax rates were cut across the board, the proportion of taxes paid by upper-income people has increased. The share paid by the top 1 percent of tax filers rose from 17.6 percent in 1981 to 24.6 percent in 1991; the share paid by the top 5 percent went from 35.1 to 43.4 percent; the share paid by the top 10 percent rose from 48.0 to 55.3 percent. It is clear, therefore, that the central theme of Barlett and Steele’s book is simply false.
Upper-income Americans pay a disproportionate and growing share of the total tax bill. If middle-income Americans are overtaxed — and they are — it is not because those above them on the economic scale are getting a free ride. The Bushes’ Tax Return Shoddy and uninformed economic analysis is bad enough, but Barlett and Steele’s portrayal of George and Barbara Bush’s taxpaying record can only be described as maliciously misleading. The authors argue that there are “two separate and distinct tax systems,” one for “the rich and powerful” and one for “everyone else.”
The centerpiece of their argument is a comparison of the 1991 taxes paid by the Bushes and those paid by an Oregon resident named Jacques Cotton. Under the rubric of “The Privileged Person’s Tax Law,” they report that George and Barbara Bush earned $1,324,456 in 1991 and paid a total of $239,063 — 18.1 per cent of their adjusted gross income in taxes. They report that Mr. Cotton, on the other hand, paid a total of $6,618 in state, federal, and Social Security taxes on a gross income of $33,499. Barlett and Steele calculate that these tax payments add up to 19.8 per cent of Mr. Cotton’s income, a slightly higher percentage than the Bushes paid. This calculation is set forth under the heading “The Common Person’s Tax Law.” Barlett and Steele conclude from this comparison that the American tax system “responds to the appeals of the powerful and influential and ignores the needs of the powerless.” That’s a rather sweeping conclusion to draw from a comparison of two out of millions of tax returns. But is the comparison a fair one to start with?
It didn’t take much investigation to find out that it isn’t. The Bushes’ 1991 tax return was made public when it was filed, and a number of news stories were written about it at the time. That return was newsworthy because the couple’s income that year was three times as high as in any other year of Bush’s Presidency. Why? Because Barbara Bush earned $889,176 in royalties on Millie’s Book, a humorous look at White House life written from the point of view of the family dog. And why were the Bushes’ taxes relatively low, compared to their income?
Because Barbara Bush donated substantially all of the proceeds of Millie’s Book to charity — $818,803, or 62 per cent of the couple’s income that year. They contributed to 49 different charities, everything from Ducks Unlimited to the United Negro College Fund, but the main beneficiary was the Barbara Bush Foundation for Family Literacy, which received $789,176. After giving away more than 60 percent of their income to charity, George and Barbara Bush had $505,653 left, of which they paid $239,063 — 47 percent — in taxes.
Barlett and Steele must have known these facts, yet chose to mislead their readers by portraying George Bush as a greedy, tax-dodging rich person. We wondered why. In fact, we tried to find out why. We left numerous messages for Barlett and Steele, but they declined to return our calls. We faxed a letter to them asking a number of questions, including why they failed to disclose the Millie’s Book income and the Bushes’ extraordinarily generous charitable contributions. But they declined to respond. We also asked them for copies of their 1991 tax returns. Needless to say, we did not get them. But we think it highly unlikely that these tireless campaigners against greed have ever donated 62 percent of their very large incomes to charity.”
The same scenario plays out over and over again when we discuss marginal tax rates, tax cuts, and tax returns. The media plays upon the fact that most Americans don’t understand how everything works and uses that to stir the pot for class warfare. This article could have been written today, and serves as a reminder that these tactics are nothing new.
