February 2, 2012 by Mike.

Why was North Dakota the only US State not affected by the banking crisis? (It’s not the oil.)

Because it was the ONLY State with its own Public Bank!The State Bank bills are down to the wire in the WA Legislature.   SB 6310 needs to move out of committee now or the bill is dead for this session.  You can read all about the legislation at WA Public Bank Project.

This would be a bank for the 99%.  North Dakota’s State Bank is the model.  We are not reinventing the wheel with this idea.

The Washington State Treasurer James McIntire has weighed in against the bill and the idea of the State Bank.   McIntire has shown himself to the be the Treasurer for the 1%.

Senators Steve Hobbs and Mary Haugen are the two primary votes in committee that are holding up the bill at this moment.

Steve Hobbs
Steve.hobbs@leg.wa.gov

Mary Haugen
marymargaret.haugen@leg.wa.gov

Democracy is not a spectator sport.

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January 7, 2012 by mike.

The brightest moment in the Jan 3rd meeting with Senator Fraser, Representative Hunt and Representative Reykdal came when Chris Reykdal took the opportunity to talk about the impasse that exists with generating revenue for the State.

Reykdal had campaigned for election to the legislature on tax fairness and he appears to be willing to make efforts on that question.  Chris described the revenue proposal that he and freshman Senator David Frockt will be putting on the table.

Reykdal and Frockt’s proposal will eliminate the State business and occupation tax (B&0).  This element of the proposal is expected to be attractive to the republicans.  According to Reykdal, republicans really hate the B&O tax.   I will take him at his word on that, but I haven’t been able to identify any tax that our current generation of republicans don’t hate.  I guess there is some reason to believe that republicans prefer regressive taxes like sales tax that are paid disproportionately by middle and low income citizens.

So, the first part of this tax proposal that Reykdal referred to as The Hope Act is total elimination of the B&O tax.  The second part of The Hope Act would reduce State sales tax from 6.5% to a flat 5%.  Elimination of the B&O tax may or may not be regressive.  I am a low income small business owner who pays the B&O tax each year.  Last year I was pleasantly surprised to find that a tax credit for small business owners was in effect that reduced my annual payment by a significant amount.  I have checked with other business owners whose scale of business is much larger than mine and have been told that they did not notice any significant reduction in 2010 B&O tax.  So, the elimination of the B&O tax may be fairly regressive if that tax has been made somewhat progressive by an enduring tax credit scheme for low income small businesses, but I think the jury is out on that one.  I think there is no question that the B&O tax raises a lot of revenue for the State, so elimination of that tax structure raises the question about how that lost revenue will be replaced.

Sales tax revenue is clearly regressive, so a reduction of the sale tax rate (State part only, local add-ons will still be in effect) is clearly progressive.  But like the elimination of B&O taxes, the sales tax reduction is a loss of revenue for the State and that translates into cuts in services.  Reykdal and Frockt could probably pass these tax cut elements with 100% support from the Norquist Tax Patriots, but we would probably have to reduce education funding in the State to be K-4 proposition from the current K-12 model.  Most folks who get through the fourth grade with the standard set of skills should be able to operate a deep-fryer or a touch screen cash register and will be able to stock shelves at a big box store, so this model works for a State economy based on 32 flavors of fast food and lowest prices, guaranteed, but there are many of us who think that there is a problem with the consumer utopian society, so there may be need to replace some of the lost revenue.

Revenue generation:  this is where Reykdal/Frockt’s proposal gets interesting.  This proposal seeks to increase State revenue by expanding the 5% State sales tax (we should assume that all local add-ons will follow suit) fromEconomic Opportunity Institute goods to goods and services.

So, the bill from your attorney, doctor, tax preparer, and more would start arriving with a sales tax bite.  There is a large number of small business owners (I look in the mirror and see one) who will now need to start collecting and turning over sales tax if the Reykdal/Frockt proposal becomes law.  Reykdal stated that the expansion of sales to everything, would not include sales tax on food.  Ok.  Sales tax on food is a really regressive source of revenue.  It’s a good thing to keep the sales tax off of food.  That’s progressive.

A small, but relevant detail about the sales tax on “everything.”  It’s not quite everything - airplane sales are exempt and would continue to be exempt.  We had a short discussion of the sales tax exemption that exists and will continue to exist if you are selling airplanes.  Planes are a movable feast and buyers might insist on taking delivery of their planes in flight over the Cayman Islands to avoid paying a sales tax, so Reykdal says the only way to generate State tax revenue if you have a company that builds and sells airplanes in your State is through a State income tax.  Hmm…   There will continue to be some tax loopholes so large you can fly an airplane through them.

I am not sure how progressive the expansion of sales tax to services is because I experiencing a bit of resistance to a new tax requirement for my small business operation.  Like a lot of small business owners, I am wondering if I am really going to be able to add this tax without losing some business or if I am going to need to absorb some portion of the sales tax as a business cost that would not be that different from the B&O tax.  My initial calculation on the sales tax v. B&O tax suggests that my small business will be collecting and paying about three times as much money the Dept of Revenue with sales tax than I paid with B&O tax (and that’s before I factor in the surprise small business tax credit that unexpectedly left a few dollars in the till last year).  I think it’s fair to say that businesses and business owners who have not been collecting sales tax are going to be lukewarm at best about the expansion of sales tax to services.  I think we should look to the Economic Opportunity Institute for analysis of Reykdal/Frockt’s proposal. The historical analysis of expansion of sales tax to services is going to suggest that this tax is regressive, but less so than a simple tax rate jump (Gov Gregoire’s and others are ready to go that way to raise revenue).

Finally, the capper on the Reykdal/Frockt tax fairness proposal is implementation of a 1% State income tax.  Reykdal stated that the Washington State Constitution limits State income tax to 1%.  I haven’t fact-checked that assertion, but I am going to trust Chris on that one.  The State has repeatedly rejected State income tax out of ignorance about the woefully regressive nature of our State revenue structure.   We are the most regressive State in the Nation!  We are number 1!

In addition to ignorance and a deep abiding faith and love for the most regressive tax structure in the nation, the opponents of State income tax have always been able to reach into their (deep) pockets and outspend the proponents of a progressive State income tax and I don’t think there is any reason to think that these leopards will change their spots in 2012, so I think the State income tax is going to be a sticking point even though it is a crucial part of the Reykdal/Frockt proposal.

Reykdal projects that this tax package will raise revenue and have instant tax fairness.  I think he is correct.  I am ready to get behind this bill. Bring the fight.  Eyman has been wagging the State’s dog for long enough.  It’s time for the legislature to take back responsibility for the budget and revenue generation.

Well done, Chris.

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January 1, 2012 by mike.

I don’t want to put together a best of list to review 2011.  It was an unsettling year.  The politics of stalemate made it pretty useless and 2012 is an election year, if I am not mistaken, so there is not much chance of legislative action and good public policy in this year (unless an unhappy electorate turns out to the streets in numbers we have not seen to date).

I continue to be bearish on the economy and public policy.  Obama squandered the opportunity of a century to move the country in the right direction, and his financial rescue of Goldman Sachs instead of a jobs program would have to be high on the list of dumbest public decisions of the young century, but we are talking about dumbest public moment of 2011, so that one is out of the running in this context.  

The Herman Cain campaign’s idea of “Women for Herman Cain” was pretty dumb, but it’s the campaign season, so I think that one gets a bye.

Rick Perry had three spectacularly dumb moments, including…   uh…   let’s see….   oops.  Can’t remember the details right now.  I feel bad about having to mention that one. Watching the GOP campaign is  like fishing with dynamite. Some good-looking fish end up floating belly up pretty fast.  Small car, many clowns, it’s a tried and true formula for laughs.

Michelle Bachman has been a disappointment.  Except for a certain deranged twinkle in her eye, she has not really produced.  Michelle Bachman is simply no Sarah Palin. I also want to go on record that I think Sarah would make a dandy ambassador to Saudi Arabia.  You can’t see Saudi Arabia from Alaska, but I am not sure that is very important.

oops…   I digress.

From the Business and Technology sector, I have to give Go Daddy CEO Bob Parsons his due for his video and claims to have shot a “problem, rogue  … bull elephant.”  Discovery News says, well, it was a young female elephant.  Just sayin…   Great white hunter.  Isn’t that one a little tired?  I think we are supposed to go to Africa with vaccines and mosquito nets now, the safari days were last century.  Bob didn’t get the memo.

My personal favorite though is Pepper Spray? “It’s a food product, essentially.”

atta girl.  Pretty dumb moment.  by the way, pepper spray?  It’s not a food product.  Have you tried it?

I guess it would have looked even worse if the police had sprayed non-violent protesters down with ketchup.

Mustard gas?  Can we get Megyn’s take on that one?  Sounds like a food product, right?

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November 26, 2011 by mike.

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October 3, 2011 by mike.

I know that there are folks who think Obama has done a lot of good, I am just not one of them. I believe that ACA is a sellout to industry that I think will be gutted by the SCOTUS or repealed by a reactionary Congress, it was not the revolution to Medicare for Everyone that is needed. DADT is gone at long last, Obama’s justice department is no longer defending DOMA (is that audacious?).  Baby steps in the right direction. 

But, those baby steps are dwarfed by Obama’s increased use of drone attacks outside of war zones, his embrace of the War on Terror which knows no boundaries or limits, and now, the assassination of an American citizen by drone attack. Make no mistake, this is an impeachable offense, a high crime. A crime that Obama is unlikely to held accountable for, but it is a high crime, an awful precedent, a betrayal of our 5th Amendment right to due process. I am no fan of the Osama bin Laden assassination. I see nothing to celebrate in assassinations. In a human sense, a moral sense, there is no difference between the presidential assassination of bin Laden and the presidential assassination of al-Awlaki, but there are some constitutional differences that scholars may parse if they are so inclined.

We are now holding a handful of meaningless constitutional rights. Read’em and weep.

Happy Monday to all.

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October 2, 2011 by mike.

It’s easy to beat up on Keynsian economics in good times, but in a serious economic downturns, keynsian economics are the way up and out.  The push and pull between keynsian economics and free market economics represent a scale and reasonable people will understand that both have their place in large-scale economic, real world applications.  <img src=”http://upload.wikimedia.org/wikipedia/commons/thumb/e/e2/US_annual_federal_deficits_1901_to_2006_redblue.svg/449px-US_annual_federal_deficits_1901_to_2006_redblue.svg.png” title=”Wiki Commons courtesy 84user” alt=”Wiki Commons courtesy 84user” vspace=”3″ width=”365″ align=”right” border=”2″ height=”271″ hspace=”3″ />

Unregulated free markets give you the mortgage crisis economic collapse.  The answer?  regulate the free market.  Regulation does cut into profits.  It also prevents rampant corruption in the free market that can create a long term economic downturn in exchange for short term bonus income.  Regulate the free economy.  It ain’t rocket science.  The second tool to create a relatively stable and honest “free” market is a steeply progressive tax schedule that makes short term profit-taking too difficult.  It changes the dynamics of corruption, greed, temptation for folks with weak ethical constitutions if they know that the government is going to get the lion’s share of their income if they throw out good sense and choose to enrich themselves at the expense of their businesses and the larger economy.

Well, that’s where we are these days and we are not getting out of the global economic slump without turning to Keynsian economic fixes.  They are counter intuitive and they work.  The deficits have to increase to get the economy growing again (this would be a good time to spur green economic growth - clean energy?  energy independence? move away from internal combustion personal transportation?).

But the free market fundamentalists cannot understand that their end of the economic scheme spectrum cannot bring an economy out of a slump.  It’s akin to “the beatings will continue until morale improves,” pulling more money out of the economy in a slump by cutting government spending simply deepens the downturn.

There are different problems that can develop with an economic model that is too tightly regulated, central state economic planning cannot harness the economic engine of fashion, desire, etc. that is like a force of nature.  Free market economics knows how to derive growth from the force of nature that is fashion, fad and desire.  But we don’t have to worry about too little free market freedom.  That is not our problem today.

<a href=”http://news.yahoo.com/doubts-grow-not-economy-under-uk-austerity-drive-071138072.html” target=”_blank”>David Stringer at AP has an article</a> out:
<blockquote><strong>Doubts grow, not economy, under UK austerity drive </strong>
<p id=”yui_3_3_0_1_1317568704325295″>MANCHESTER, England (AP) — Jobs have been lost, libraries shuttered, sailors sacked and street lights dimmed — <span class=”yshortcuts cs4-visible” id=”lw_1317559979_2″>Britain</span> is beginning to taste the bitter medicine <span class=”yshortcuts cs4-visible” id=”lw_1317559979_0″>David Cameron</span> warned was necessary to fix its wounded economy. It’s left some wondering: Is the remedy worse than the symptoms?</p>
</blockquote>
<p id=”yui_3_3_0_1_1317568704325295″>This is a badly flawed question.  The framing of the question suggests that an austerity program is the remedy to deficits that pile up in an economic downturn.  It is not a remedy, it is an expression of free market fundamentalism.</p>
<p id=”yui_3_3_0_1_1317568704325295″>The US free market fundamentalists have a hybrid model, they love government spending that feeds corporations, they have no qualms about government spending as long as the spending is not committed to health care, education, food security.  There is a low profit margin in that stuff compared to weapons systems and war profiteering.  The “austerity” program of US free market fundamentalists is not about austerity, it is about class warfare.  The shift of wealth from the many to the few that has occurred over the past thirty years is not about rewarding the most productive folks in our society, it is about class warfare. Top tax rates of 70% plus did not prevent the US economy from growing and adding jobs.  Obama was correct when he said, it’s not class warfare, it’s math.   And a little history.</p>
The website of G. William Domhoff (sociology professor, UC Santa Cruz) seems to have a lot  of good information.  <a href=”http://sociology.ucsc.edu/whorulesamerica/power/wealth.html”>Who rules America?</a> Is that a rhetorical question?
<p style=”text-align: center”><img src=”http://upload.wikimedia.org/wikipedia/commons/thumb/0/01/Gini_since_WWII.svg/800px-Gini_since_WWII.svg.png” title=”Wiki Commons GNU license” alt=”Wiki Commons GNU license” vspace=”3″ width=”582″ border=”2″ height=”422″ hspace=”3″ /></p>
<p style=”text-align: center” align=”right”> </p>
<p style=”text-align: center” align=”left”>hmm..  we are up there is the top three or four countries of income disparity.  Brazil, US, and China, UK going for more disparity, Bulgaria, Norway, Mexico trending for less disparity.</p>
<p style=”text-align: center”> </p>

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October 1, 2011 by mike.

Not just the candidates or the lack of political will to create public policy to turn the country in the right direction, but the election apparatus itself just got even less respectable.

The Brad Blog carried the story recently that the Diebold voting machines can be easily hacked remotely.   There seems to be some question as to whether the remote control parts to hack the machines will cost $16 or $26, but either way, the technology for controlling election outcomes is dropping dramatically and it makes a person wonder why the campaigns are collecting and spending so much money.  This is money the “job creators” need to turn the country around.

2012 will be an election year when we see unleashed corporate influence in the elections thanks to Citizens United. We will see “new and improved” voter suppression tactics. We have increasing numbers of potential voters who have no “permanent” address other than 100 Street St., State of Economic Misery, Planet Earth. They may have reason to vote for change, but it is not certain that they have reason to believe that change is available at the voting booth, so the building occupation movement may be seen as a truly primary election on the US economy and the rules of the game.

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September 27, 2011 by mike.

Thanks to Abby Zimet at Common Dreams for her thoughts about this and for running this video there.

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September 26, 2011 by mike.

There are reports of police assault on the occupation of Wall Street.   The first amendment grants us the right to assemble and speak out.  It’s a shame that this country has so little tolerance for first amendment rights.

I am reminded of the video I have seen from China when the military was streaming toward Tiananmen Square and the Chinese people flooded into the streets to slow the military, they pleaded with the soldiers to join the protest, to side with the people. The pleas were not heard.

It’s going to be hard for the protestors who occupy Wall Street to reach the police who are ordered to come in and disperse the crowds, but things change when the shock troops of the empire hear the message that peace, freedom, equality, justice are not always compatible with order.   We have to reach across the lines and ask the police to choose constitutional freedoms over order.

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September 25, 2011 by mike.

It’s a live feed, for as long as it lasts or as long as they loop the footage, so the activity and engagement level varies depending on what is going on at any given moment, but thought I would embed the video in case you want to plug in for a minute or two and “be present at this moment” in the Wall Street occupation.

I think it’s fair to say that the corporate media coverage of this real occupation is very slight, but they will jump and run to cover a tea party event funded by right wing plutocrats. Connect the dots, Kemosabe. Catapult the propaganda.

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