Wednesday, December 20, 2017

Democrats, about that tax reform bill
  The unseen Republican political strategy
  as Ryan says minds are going to change

Here's everything you need to know about the Republican tax bill (aka the Tax Cuts and Jobs Act of 2017), the most significant tax reform in 30 years.

In early 2018 the federal withholding tables will be scaled downward (see IRS notice). By March 2018 almost all middle class folks who draw a paycheck will see an increase in their take home pay resulting from that reduction in federal tax withholding. Let me repeat this for the Democrats and cocktail party liberals out there. By March 2018 almost all middle class folks who draw a paycheck will see an increase in their take home pay.

DEMOCRATS, QUIT TALKING ABOUT THAT TAX REFORM BILL!

Democrats are, and apparently will continue to be, telling those folks their extra take home pay will be reduced to nothing by 2027, or in some cases 2023, or 2025 or.... Well, it's complicated and it will be different strokes for different middle class folks.

And they'll be telling those folks, the majority of whom are personally in a-bit-to-deep debt, that the federal government's debt is going to rise, by some number which no one knows.

And maybe those liberals will publish for each other to read some long working papers and brilliant magazine articles on the inequities of the tax bill.

In any event, the "pointed-headed intellectuals" will be telling each other how bad the tax bill is/was.

And they'll share that discussion with the middle class workers who will be puzzling how what they are being told relates to their reality - extra bucks in the paycheck. (Yeah, ok, their electronic payroll deposit.)

If asked about the possible disappearance of that extra take home pay, the Republicans will explain that if the Democrats in 2017 had just joined them in cutting taxes they could make the middle class tax cuts permanent - all it would require is a one time rule change. And they will explain that the voters could replace the Democrats with Republicans and that will get the job done.

And the middle class folks who might just vote for Democrats in 2018 because of morality issues will be asking those very same Democrats in 2020 if they're going make permanent the Republican tax cuts for the working folks. Because they know that almost every year income tax rule adjustments are approved and that sometimes, such as in the Economic Stimulus Act of 2008 when a bunch of extra tax rebates were sent out, the deficit issue is ignored by Democrats.

After all, the tax cuts for the rich and corporations (who donate to the Democrats as well as the Republicans) are permanent. Why would the Democrats in 2020 oppose that for the working folks?

So to summarize, all you need to know is that in 2018 most folks will take home more income because of the Republican tax cuts. By 2020 they will understand that it was the Democrats who made their tax cuts temporary - Donald Trump will tell them it is true. And it might be the simple truth.

(Note, the 2017 tax return most people will file in April 2018 - as well as January 2018 payments for those who pay taxes quarterly - will continue to follow the 2017 current tax code.)

Some will argue that it's not going to be that simple as various deductions change in the bill. Right? The LA Times offers this information for some real Californians:
The first thing you notice that the only loser in the the new tax bill lottery was the couple that owns a house. As explained by the Times:
    Maya Bader, 39, and her husband Matthew Pratt, 41, bought a new house last year. Between mortgage interest, property taxes and California income taxes, they took more than $58,000 in deductions....
    The plan allows taxpayers to deduct up to $10,000 in combined property and state income taxes....
    But Bader and Pratt, like many Californians who own homes and have good incomes, will still lose. They deducted more than $26,000 in state income and property taxes last year....
    They’ll also lose out on a deduction for interest paid on a home equity loan....
    Richer child tax credits will shave $4,000 off their tax bill.
With this explanation we can see the reality of who loses. Let's begin with income:



To begin with, to be a loser among these four examples, your household income must be in the top 14%. And to be a loser you apparently have to be unaware of the 2008 housing market bubble crash and go deeply into debt to buy a very expensive house.

The couple that rents itemized less deductions and, because the tax plan almost doubles the standard deduction and puts them in a lower tax rate, they will do better seeing their net income rise about $500 per month (compared to the $125 decrease on the homeowner couple). But that means that their federal tax will drop from almost $41,000 per year to almost $35,000 per year.

What is obvious to many Californians is that the federal government tax policy will stop subsidizing unjustified housing price inflation harming lower income folks in California urban areas.

Both higher earning couples in the Times story itemized. In the first part of 2019, as tax filing season gets underway, those taxpayers will be figuring out on their tax returns whether to take the standard deduction or to itemize. The losers will continue to itemize, but the couple with the highest income will probably stop itemizing.

Based on past statistics indicated in the chart below, just consider how few voters will be interested in all the BS in the press about various deductions. But then the press has to fill either space (print media) or time (video news):

Again, the new plan nearly doubles the standard deduction and alters the available itemized deductions (though it does away with the exemption system). So that percentage of taxpayers who itemize likely will go down making tax filing simpler for more people.

And for the Millennials who likely will have to live with much of this tax bill for 30 years, it may be a winner for those working and/or trying to get an education or training as explained by CNN Money.

Regarding all the other stuff in the tax bill, the average American knows that most of the rich and some corporations will do better. As they always do, along with their accountants and tax attorneys.

Really old people with memories know that it was a Democratic Congress that passed the Revenue Act of 1964 when the top tax rate on the relatively few rich folks that liberals carry on about was dropped by 20%, and that the Democrats controlled the House in 1982 when it was dropped by another 20%  and that the Democrats controlled both the House and Senate in 1988 when it was dropped by another 22%. Thus despite the warnings of Republican Dwight Eisenhower, the Democrats dropped the top marginal individual income tax rate from 91% in 1960 to 28% in 1988.

Since then it has gone back up -1991 to 31% and 1993 to 39.6% -  so now this big tax cut drops it all the way down to 37% from 39.6%.

What exactly again is the problem with this again, Democrats?

If anyone thinks the general public will understand and remember the intricacies of this tax bill in 2020, they are deluded. Let me offer a recent article on the bill from one of my sources of information on matters related to municipal issues which discusses complex special provisions in the Bill almost nobody in the general public knows about like "the brand new Base Erosion Anti-abuse Tax" (BEAT), the fact that "engineers and architects won a special exemption in the tax bill", and other matters.

Finally, while some corporations are big winners, some policy surprises lurk in this bill, maybe even for Donald Trump supporters, maybe even for Donald Trump who is never going read it. Consider this article The GOP tax bill is a massive victory for globalization. The possibilities when considered over the long term could mean economic opportunities for struggling California corporations such as Apple and those opportunities could accrue to California with the right incentives.

This is why we see the headline Speaker Paul Ryan: 'Minds are going to change' on Republican tax bill.

Of course, we all know that for any number of reasons before November 2020 the world's economy could be hit by a recession/depression or the U.S. could be hit with runaway inflation or...not. But one of the lesser-known aspect of the plan could create major economic growth: the provision that lets companies fully deduct their investments in plant and equipment in one year. When accelerated depreciation was introduced in the Economic Recovery Tax Act of 1981, according to Tax Foundation modeling the long term impact was an increase in the GDP by 2.69%.

The thing is, that tax bill is a winner for the Republicans and particularly the Koch Neoliberals who already dominate politics in America.

And the bill is a winner because it represents a dozen compromises, where Republicans have had to compromise with each other which resulted in such things as tuition waivers continued, employer tuition assistance remains non-taxable, some state and local taxes remain deductible, etc. No Democrats were involved in the compromises.

Right now the Koch Neoliberals are cheering the current liberal media/politicians sexual morality campaign because they understand that the very-repugnant-to-them Roy Moore received the following vote:

Nonetheless, in 2017 it's the Democrats who are putting at risk the most Congressional and legislative seats in the sexual morality campaign.

The Republicans understand that for American voters in 2020 it will be all about "the economy, stupid" meaning how much money the folks take home. And they will be taking home more money because of the Republicans.

That's because Republicans understand if you don't win, you have no power. For Democrats, it's about some complicated discussion among the indignant, not winning.

Saturday, December 9, 2017

Foolish planning and the inevitable wildfires
  What could have been learned from John
  Steinbeck about California's true climate


The smoke obscures our vision of reality when it comes to wildfires. This week while reading California's Climate Emergency in Rolling Stone I was confronted with this statement:
In the hills above the Pacific Ocean, the world crossed a terrifying tipping point this week.
[...]
As the largest of this week's fires skipped across California's famed coastal highway 101 toward the beach, rare snowflakes were falling in Houston, all made possible by a truly extreme weather pattern that's locked the jet stream into a highly amplified state. It's difficult to find the words to adequately describe how weird this is. It's rare that the dissonance of climate change is this visceral.
[...]
For years, climate scientists have warned us that California was entering a year-round fire regime. For years, climate campaigners have been wondering what it would take to get people to wake up to the urgency of cutting fossil fuel emissions. For years, we've been tip-toeing as a civilization towards a point of no return.

That time is now.
Well, yes and no. As John Steinbeck said "...God save me from amateurs. [...] They have the authority of ignorance, something you simply cannot combat."

California has a climate history clearly described in the writings of that California native Steinbeck, most significantly in his second novel To A God Unknown published in 1933 which tells an allegorical tale of the California experience.

The protagonist, Joseph, comes to California to create his future. He discovers a place of apparent wealth and promise. And indeed he appears to be achieving all that he dreams. But over time, tragedies strike and drought undoes his life work.

The story is about the arrogance of Californians who hold the belief that their efforts as humans, individually and collectively, create orderly wealth in a place where natural wealth has always existed in its own order of things.

Steinbeck later acknowledged that To A God Unknown was the hardest for him to write, taking him more years than his better known works. Part of the problem is that he initially tried to adapt a play written by a friend but kept adding context based upon facts as he understood them. And what he understood from the generations of Californians who preceded him was the truth about the land and the water, a truth we need to face.
    About every thirty years there have come periods of rainlessness to Central and Southern California. These desolating years seem to come creeping up out of the white desert to warn the west that it will one day die as the desert has died. They are like the Reminders of Death at an Egyptian feast ....
    And now the periodic drought had settled on the land. Little by little, year on year the water was sucked from the ground. The hills looked gaunt and hungry and pale. The bones of many thousands of starved cattle were whitening on the ground. Two families of Waynes packed up their possessions and drove away. Joe watched his dying land with terror and with loathing. - From an early draft of To A God Unknown by John Steinbeck
Sadly Joe's "terror" derived from a normal California weather cycle. Twenty years ago in 1993, Scott Stine, Ph.D, of the Department of Geography and Environmental Studies at California State University, Hayward, completed a research study entitled "Extreme and Persistent Drought in California and Patagonia During Mediaeval Time" which was subsequently published in June 1994 in the academic journal Nature. In it he offers the evidence, now supported by others, that indeed before and after the year 1000 AD California had two droughts that lasted well over 100 years.

In May 2001 the website Sierra Nature Notes: The Online Journal of Natural History News in the Sierra Nevada published a followup article by Stine "The Great Droughts of Y1K" in which he explained what he believed to be the weather pattern associated with the 100+ years droughts:
    One may reasonably ask why these droughts occurred. The simple answer lies in the wintertime configuration of the "storm track" (a.k.a. the "jet stream" and the "polar front") over the northeastern Pacific. When the storm track persists over California for much of the winter (as it did, say, in 1982, ‘83, 86, and ‘96), many Pacific cyclones are steered over the state, and we accumulate much precipitation. When the track lies to the north of California, the fronts are steered away, and the region remains dry. This latter case prevailed during the 1976-77—the one period of our instrumental record dry enough to provide an analog to the Medieval droughts....
    Evidence is now emerging that the "dry-winter-in-California, wet-winter-in-Alaska" model holds true not only for 1976-77, but for much of upper Medieval time as well....
    ...Persistent droughts, moderate by Medieval standards but strident relative to our "normal" conditions of the past 150 years, drew lakes and rivers well below their modern levels on numerous occasions during the past two millennia, most recently during the late 18th and early 19th centuries. Indeed, increasing evidence indicates that there is little that is climatically "normal" about the past century - and- a-half; it appears, in fact, to be California’s third- or fourth-wettest century-scale period of the past four or more millennia.
    Since statehood, Californians have been living in the best of climatic times. And we’ve taken advantage of these best of times by building the most colossal urban and agricultural infrastructure in the entire world, all dependent on huge amounts of water, and all based on the assumption [it] will continue as it has during the past 150 years. Yet even in these best of times we have run out of surplus water, and we fight over allocation.
So yes, Climate Change may very well be speeding up the return to an "upper Medieval time" dry weather period measured in centuries. We could, of course, have simply read Steinbeck's story which  begins as California migration stories begin and ends with an expression of regret:
   After a time of wandering, Joseph came to the long valley called Nuestra Señora, and there he recorded his homestead. Nuestra Señora, the long valley of Our Lady in central California, was green and gold and yellow and blue when Joseph came into it. The level floor was deep in wild oats and canary mustard flowers.
[...]
   Joseph leaned back against his saddle again, and suddenly he chuckled. "I will go," he said. "I will take every means. Look, Juanita. You know this place, and your ancestors knew this place. Why did none of your people come here when the drought started. This was the place to come."
   "The old ones are dead," Juanita said soberly. "The young ones may have forgotten."
   And time passed and Joseph grew grey too.... "I should have known," he whispered.... "I am the land," he said, "and I am the rain." - from To A God Unknown by John Steinbeck
Indeed, the young ones do "forget" in the sense that from generation-to-generation people start over by leaping at opportunities without studying to learn the lessons of all times before them. And so in California there was this:


When the dust came up, people were starving; they had no place to go. Naturally, they went in a direction where they would not suffer from cold: they went toward California. They came in the thousands to California. - John Steinbeck in an interview on British radio
Life's struggles brought millions of migrants from states east of the Rocky Mountains to California as recognized in the above John Steinbeck quote. It also brought millions of migrants (which the other migrants called immigrants) from other nations. And because from 1950 through 1988, the California economy was rich by all comparative historical standards, they kept coming.

Ignoring history and Steinbeck, Californians bought land and built buildings and were and are homeowners and businesses owners. Now they have to live with what always was the normal California climate. And they need to quit calling it a "drought" when history and science tell us most of the 20th Century was a very extended wet cyclonic period, an abnormal time.

What we cannot do honestly is blame it on Global Warming which at worst only accelerated an inevitable timeline.

And we are not going to "fix it" because we are the environmentally aware California.

In fact, as explained in the San Francisco Chronicle despite our environmental activism California is the source of more harm than ever and it is just possible that human population growth and related governmental planning for real estate development based on historical scientific studies going back as long as ...oh... a couple of decades is a cause:
Over the course of just a few weeks, a major fire can pump more carbon dioxide into the atmosphere than California’s many climate change programs can save in 12 months. Scientists debate whether California’s vast forests are emitting more carbon dioxide through fires than they absorb through plant growth.

Friday, December 8, 2017

About today's important headlines
 So what news story will impact the most
 21st Century Americans in the next decade?

North Korea Says U.S. Declared War and Is Trying to Invade With Help From South and Japan and A dangerous choice looms for Trump on North Korea are among the headlines today. The images below show some news stories that appeared today and in recent days.

They aren't about A-to-D-list celebrities or politicians. And they don't represent anything that you can do anything about. In other words, they aren't entertaining and there is no "me" in them for anyone not in the highest levels of government.

Well, maybe there is a "me" in these stories if you are bothered by the increasing likelihood that tens of millions of people soon will be killed in a nuclear war and one of them might be you.


I've already written about this issue:


A reporter recently wrote “In Kim, Trump has met his match. The risk of two arrogant fools blundering into a nuclear exchange is more serious than at any time since October 1962.” That writer noted that Steve Bannon said: “There’s no military solution [to North Korea’s nuclear threats], forget it. Until somebody solves the part of the equation that shows me that ten million people in Seoul don’t die in the first 30 minutes from conventional weapons, I don’t know what you’re talking about, there’s no military solution here, they got us.”

I don't agree with Bannon on much, but he got that piece of the North Korea war equation right. The other piece is that the Western U.S. is well within North Korea's nuclear strike zone, the Pacific States particularly. Bannon was fired from the White House so he doesn't have Trump's ear.

If you just can't bear to tear your eyes away from the other "top" stories of this week for more than one story about North Korea, read This is how nuclear war with North Korea would unfold and note that the possible North Korean nuclear missile strikes described could be anywhere in the U.S. - the writer just picked out a couple. Hopefully these headlines won't be the ones that impact the most 21st Century Americans in the next decade. But winning a war that devastated the West Coast would would be a good reelection move for Trump.