Report: High Flyers 2017

The private jet lobby – and their super-wealthy passengers – have created a parallel universe of perks and privileges that would shock most commercial passengers if they knew about them. In both tax policy and homeland security, the high flyers have used their power to create one set of rules for themselves and another set of rules for the rest of us.

This report examines how they are publicly subsidized, the security threats they pose, and the detrimental environmental impact they present. This report follows the work of a report released by the Institute for Policy Studies in 2008 of the same title.

Some major takeaways:
• The private jet lobby spent $ 56 million lobbying over the past ten years to save more than $ 1 billion in annual taxes they avoid due to preferential tax treatment.
• The tax cut package under consideration in the Senate maintains and expands the private jet tax carve-out, while the Republican budget plan increases fees on commercial airline passengers.
• Private jets contribute less than one tenth of the resources they use from the Federal Aviation Administration Trust Fund. Commercial airline passengers heavily subsidize private jet passengers.
• Commercial jets are taxed at up to 40 times the rate of private jets on the exact same route despite identical needs in terms of transportation infrastructure.
• Private jets threaten our national security as owners can obscure their identity and passengers face zero security screening.
• A single private jet trip burns more greenhouse gases than the average American does in a whole year.

Solutions:
• End the private jet tax carve-out and tax private jets at the same rate or higher than commercial air travelers. Don’t make it more expensive to fly commercial while subsidizing private jet travel.
• Close the security loopholes in private jet travel and tax carbon emissions effectively to account for the environmental impact of private jets.

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Stop Talking About ‘Winners and Losers’ from Corporate Tax Cuts

Dollar bill being cut up

(Photo: Tax Credits/Flickr)

Republicans are pushing a huge corporate tax cut bill through Congress. You might’ve seen a lot of coverage trying to sort out “who wins” and “who loses.”

All that misses the point.

The driving motivation behind this bill, rhetoric and packaging aside, is to deliver a whopping $ 1 trillion tax cut for a few hundred badly behaved global corporations — and another half a trillion to expand tax breaks and loopholes for multi-millionaires and billionaires.

All the other features of proposed tax legislation are either bribes (“sweeteners”) to help pass the bill or “pay fors” to offset their cost.

The news media has been talking about “winners and losers” like this were some sort of high-minded tax reform process with legitimate trade-offs, as in 1986.

But this isn’t tax reform. This is a money grab by powerful corporate interests.

The key question isn’t who wins and loses, but whether we should undertake any of these trade-offs to give massive tax breaks to companies like Apple, Nike, Pfizer, and General Electric — companies whose loyalty to U.S. communities and workers is historically abysmal.

These companies have been dodging their taxes for decades while small businesses and ordinary taxpayers pick up their slack to care for our veterans, maintain our infrastructure, and educate the next generation.

Apple alone is holding $ 250 billion in offshore subsidiaries to reduce their taxes.

For wealthy individuals, the proposed House tax bill eliminates the federal estate tax, which is paid exclusively by families with over $ 11 million, mostly residing in coastal states.

It eliminates the Alternative Minimum Tax, a provision that ensures that wealthy taxpayers chip in at least a few dollars after gaming all their possible deductions.

And while the top tax rate on high earners remains roughly the same, Congress is proposing to open up a “pass through loophole” that will enable wealthy people and their tax accountants to convert their income to be taxed at a lower tax rate.

We should avoid distracting debates over whether to reform one provision or another, such as the home mortgage interest deduction. The real estate industry understands the score. “These corporations are getting a major tax cut, and it’s getting paid for by the equity in American homes,” said Jerry Howard, chief executive of the National Association of Home Builders.

Reforming the home mortgage interest deduction makes a lot of sense — the current tax break mostly benefits the already wealthy and fails to expand homeownership. But we shouldn’t restructure housing tax incentives to pay for a massive tax cut for billionaires and badly behaved global corporations.

Nor should we eliminate the deductibility of student debt, eliminate the deduction for state and local taxes, or require families with catastrophic health expenses to pay more to reduce taxes on big drug companies and Jeff Bezos of Amazon. This tax bill would do all of those things.

The good news is people aren’t falling for the marketing baloney that this tax cut will help the middle class. Fewer than 30 percent of voters support these tax cuts, and solid majorities believe that the wealthy and global corporations should pay more taxes, not less.

But this won’t stop Republicans who care more about their campaign contributors than they do about voters.

If the GOP majority in Congress were responsive to voters, they’d invest in updating our aging infrastructure and in skills-based education, as we did after World War Two. Instead of saddling the next generation with tens of thousands in student debt, real leaders would be figuring out how to lift up tomorrow’s workers and entrepreneurs, just as we did in previous generations.

Under this tax plan, small business and ordinary taxpayers will be the big losers. That’s the only score that matters.

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America’s Wealth Inequality Has Reached Staggering New Levels

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Jeff Bezos recently became the richest person on earth.

Bezos, head of the online retail behemoth Amazon, saw his wealth jump by $ 10 billion in just the past month to now more than $ 90 billion. That’s a stunning leap. But what’s truly stunning is that Bezos and the next two wealthiest Americans, Bill Gates and Warren Buffett, together now own more wealth than the entire bottom half of the American population combined.

The rich are getting richer.

We tracked the rise of today’s uber-wealthy in a new report, “Billionaire Bonanza 2017: The Forbes 400 and the Rest of Us,” published by the Institute for Policy Studies. We compared those at the top to the rest of the nation, whose economic condition isn’t plastered on the glossy pages of Forbes magazine, but instead buried in a study the Federal Reserve releases every three years.

We looked specifically at wealth — the money left over after totaling a family’s assets and subtracting their debt. Wealth is where the past meets the present. It’s a more accurate depiction of economic status than income, which just shows how much money one makes in a given year.

When Forbes first started compiling their famous list of the 400 wealthiest Americans in 1982, just $ 75 million would get you ranked. Even after accounting for inflation, that’s still less than $ 200 million in today’s dollars.

These days, the price of admission is a record $ 2 billion — more than 10 times higher.

This group of just 400 multi-billionaires owns a combined $ 2.68 trillion. That’s trillion with a T. And it’s more wealth than the bottom 64 percent of the U.S. population, an estimated 204 million people. That’s more people than the populations of Canada and Mexico combined.

On the other side of the economic spectrum, where the rest of the country resides, economic conditions are largely stagnant. The median family owns about $ 80,000 in wealth, excluding durable consumer goods like cars and appliances. This figure is essentially unchanged from 1983, when the Federal Reserve first started tracking household assets using a uniform survey.

In other words, despite 30 years of economic growth, the typical American family has barely seen a budge in their economic standing.

Today, about one in five households lives in “underwater nation,” with either zero or negative wealth. That figure is even higher for black and Latino households, the result of decades of discrimination.

We are witnessing the rising concentration and consolidation of our nation’s wealth into fewer and fewer hands. Most concerning is the potential for these wealth hoarders to use their outsized bank accounts to buy outsized power over our government.

A surefire way to make today’s economic inequality greater is to offer a massive tax break to the very wealthy, as President Trump’s “tax reform” plan would do. In fact, major tax breaks for the already wealthy is a big part of what’s created the inequality we see today.

When three people own more than half the country, and when a fifth of us have nothing, that’s the exact opposite of what we need to be doing.

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Private Jets and Trust Fund Kids Show Where the GOP’s Tax Priorities Lie

private-jet-gop-tax-plan

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It’s hard to keep track of the fast-flying tax legislation making its way through the sausage-making process in Washington. It’s even harder to know just what’s in each bill, as the thousands of pages of provisions are constantly in flux. To know what’s really behind the Republican tax cutters’ priorities, cut out all the noise and consider just two things: private jets and trust fund kids.

You’ve likely heard of some provisions included in the Senate tax bill under consideration right now, like lowering the corporate tax rate and changing the tax brackets for individual income tax returns. Less discussed is how the bill treats private jets: A measure in the bill exempts private jet owners from paying taxes on all the costs that go along with owning a private jet such as storing it, maintaining it, hiring staff to fly it and cater on it, and so on and so on. In other words, this is basically a blatant gift to folks who own private jets.

Who likes private jets? Well consider the major controversy of Trump administration officials racking up seven-figure private jet fees on the taxpayer dime this year. Such behavior cost former Health and Human Services Secretary Tom Price his job, and probably should have cost others theirs as well.

The private jets provision is indicative of who’s at the table when details are getting hashed out in the Senate – the wealthiest presidential cabinet in American history. Also at the table: their multi-millionaire and billionaire friends.

The idea that private jet owners need a tax break is absurd on its face. Private jets are heinous for the environment, clog up our airports and already receive massive tax advantages. If you can afford a private jet, you can afford to pay taxes on it. That just seems basic.

Also underreported is the Senate plan to first weaken, then fully eliminate, the federal estate tax, a levy on the intergenerational transfer of immense wealth. The bill will give a tax break to just 5,000 people a year, all of whom will be heirs and heiresses to multi-million and billion dollar wealth dynasties. Seriously, in what world do these people need a tax break?

To really understand just how nuts this is, consider this: The billionaires who make up the full Forbes 400 list now own more wealth than the bottom 64 percent of the U.S. population, an estimated 80 million households or 204 million people — more people than the populations of Canada and Mexico combined.

Never before has so much money funneled into so few hands in the modern history of the United States. And what we’re witnessing, before our very eyes, is the transfer of that wealth into political power.

No one wants to see the rich pay less in taxes except the rich themselves and folks who think they’re about to get rich – but they’re not a majority of this country. Year after year, polling from Gallup (as well as a bunch of other polls) shows that most people want to see the rich pay more, not less, in taxes.

The backers of this tax plan have seen these polls, and they know that it’s bad optics to ask a nurse to pay more in taxes while the descendants of the Mars, Koch and Walton families, the nation’s three richest, all get handouts.

The folks who need a break are the 1 in 5 households that have zero or negative wealth, meaning they owe more than they own. That break comes in the form of basic public programs, funded by tax revenue, that form the backbone of civic society and generate economic opportunities for folks who weren’t born rich to build wealth. Eroding the tax base through tax cuts for the rich, and eliminating those public programs by extension, is bad economics.

This tax plan is irreparable. Congress should start over with the needs of working people at the forefront, not the billionaires.

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Private Jets and Trust Fund Kids Show Where the GOP’s Tax Priorities Lie

private-jet-gop-tax-plan

Shutterstock

It’s hard to keep track of the fast-flying tax legislation making its way through the sausage-making process in Washington. It’s even harder to know just what’s in each bill, as the thousands of pages of provisions are constantly in flux. To know what’s really behind the Republican tax cutters’ priorities, cut out all the noise and consider just two things: private jets and trust fund kids.

You’ve likely heard of some provisions included in the Senate tax bill under consideration right now, like lowering the corporate tax rate and changing the tax brackets for individual income tax returns. Less discussed is how the bill treats private jets: A measure in the bill exempts private jet owners from paying taxes on all the costs that go along with owning a private jet such as storing it, maintaining it, hiring staff to fly it and cater on it, and so on and so on. In other words, this is basically a blatant gift to folks who own private jets.

Who likes private jets? Well consider the major controversy of Trump administration officials racking up seven-figure private jet fees on the taxpayer dime this year. Such behavior cost former Health and Human Services Secretary Tom Price his job, and probably should have cost others theirs as well.

The private jets provision is indicative of who’s at the table when details are getting hashed out in the Senate – the wealthiest presidential cabinet in American history. Also at the table: their multi-millionaire and billionaire friends.

The idea that private jet owners need a tax break is absurd on its face. Private jets are heinous for the environment, clog up our airports and already receive massive tax advantages. If you can afford a private jet, you can afford to pay taxes on it. That just seems basic.

Also underreported is the Senate plan to first weaken, then fully eliminate, the federal estate tax, a levy on the intergenerational transfer of immense wealth. The bill will give a tax break to just 5,000 people a year, all of whom will be heirs and heiresses to multi-million and billion dollar wealth dynasties. Seriously, in what world do these people need a tax break?

To really understand just how nuts this is, consider this: The billionaires who make up the full Forbes 400 list now own more wealth than the bottom 64 percent of the U.S. population, an estimated 80 million households or 204 million people — more people than the populations of Canada and Mexico combined.

Never before has so much money funneled into so few hands in the modern history of the United States. And what we’re witnessing, before our very eyes, is the transfer of that wealth into political power.

No one wants to see the rich pay less in taxes except the rich themselves and folks who think they’re about to get rich – but they’re not a majority of this country. Year after year, polling from Gallup (as well as a bunch of other polls) shows that most people want to see the rich pay more, not less, in taxes.

The backers of this tax plan have seen these polls, and they know that it’s bad optics to ask a nurse to pay more in taxes while the descendants of the Mars, Koch and Walton families, the nation’s three richest, all get handouts.

The folks who need a break are the 1 in 5 households that have zero or negative wealth, meaning they owe more than they own. That break comes in the form of basic public programs, funded by tax revenue, that form the backbone of civic society and generate economic opportunities for folks who weren’t born rich to build wealth. Eroding the tax base through tax cuts for the rich, and eliminating those public programs by extension, is bad economics.

This tax plan is irreparable. Congress should start over with the needs of working people at the forefront, not the billionaires.

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The GOP Tax Bill Does Nothing to Address Our Racial Wealth Divide

home-mortgage-loans

(Photo: Shutterstock)

Wealth is concentrating upwards in this country — we’ve known that for years. But new numbers really drive home just how severely.

According to our new report, Billionaire Bonanza 2017, there’s been a rapid updraft of wealth into the top echelon of multi-billionaires. The wealthiest 400 Americans now have more wealth together than the bottom 64 percent of the population, over 200 million of us.

That’s bad enough. But through the lens of race, these statistics reveal another dimension of the story. Only seven of the 400 wealthiest Americans are black or Latino — the rest are almost entirely white.

It takes barely half of that list to blot out the total wealth of blacks and Latinos alike. The wealthiest 269 billionaires equal the combined wealth of the entire African-American population of 47 million people. For Latinos, it takes just 252 billionaires.

Read the full article on the Hill.

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A Year Out, the Election Day Hangover We Can’t Get Rid Of

(Photo: Gage Skidmore via Flickr)

About a year ago I woke up with one of the more punishing weekday hangovers of my adult life. It was a bleak, headachy day, and I’d been up late hastily rewriting a piece about the 2016 election. That was how “making America great” started for me.

Although Hillary Clinton won about 3 million more votes, Donald Trump gamed our rickety, 18th-century election system by flipping several Rust Belt states President Obama had won, including my home state of Ohio.

Trump made a two-pronged appeal to states like mine. First, with racially tinged invectives against immigration, “inner-city crime,” and “political correctness.” And second, with a populist-sounding line on economics that spoke to voters long overlooked by Washington.

“What truly matters is not which party controls our government,” Trump said at his inauguration, “but whether our government is controlled by the people.”

A year out, how are the people faring?

Amid pledges to “drain the swamp” in Washington, Trump appointed the wealthiest ever U.S. Cabinet — one Newsweek recently called “the most corrupt in history.” A Daily Beast investigation into hundreds of Trump appointees found that more than half profited from the industries they were tapped to regulate.

What he’s done on Capitol Hill is almost worse.

He’s pushed health care bills that would strip health coverage from more than 20 million Americans. When those failed, he nixed subsidies for companies that insure low-income customers — about 70 percent of whom live in states he won, by the way — and virtually guaranteed a hike in premiums for everyone.

And his tax plan? It would permanently slash the corporate tax rate and completely eliminate taxes on multi-millionaire estates. Meanwhile, it would end popular middle-class deductions (sorry, student loan payers) while actually raising the rate the lowest income payers face.

All this would blow a $ 1.5 trillion hole in the U.S. deficit. As my colleague Josh Hoxie has written, that’s enough to double college grants and cancer research, treat 300,000 people suffering from addiction, train 3.5 million workers, and help 6 million kids get child care — every year for 10 years. Instead, it goes to tax breaks for people like Trump and his Cabinet.

On the environmental front, pulling out of the Paris climate agreement and letting companies dump coal ash in freshwater have done precisely nothing to bring back flagging coal jobs. Yet Trump has duped many miners into rejecting job retraining, Reuters reports.

So Trump’s economic populism was a hustle. But what about his not-so-subtle threats against people who don’t resemble his white base? Well, there things are happening.

Immigration arrests are way up. Authorities insist they’re targeting “gang members” and “bad dudes.” But they seem to be spending an awful lot of time haunting schools, domestic violence centers and hospitals — where they recently picked up a 10-year-old girl getting treatment for cerebral palsy.

At the same time, refugee admissions have been dramatically curtailed, and the administration says it wants to cut legal immigration in half.

Meanwhile, the Justice Department is canceling reform plans for police departments with records of racial discrimination and brutality. The FBI has labeled black civil rights activists a domestic threat. And the Department of Education is rolling back protections for LGTBQ students and sexual assault survivors.

No wonder so many read making America “great” again as making America “white” again. But handing the government over to racist billionaires isn’t a great deal for most white people either. Neither is threatening war with Iran and North Korea.

Trumpism, journalist Matt Yglesias concludes, is “a bet that if you punch nonwhite America in the face, white America will be so busy gawking they won’t notice their pockets are being picked too.” Sad!

The silver lining? A new era of activism.

Ordinary Americans have rallied to stave off assaults on their health care, preserve the climate, protect immigrants and refugees, and take a knee for racial justice. Record numbers of women and people of color are running for office. And a majority of Democrats now want their party to move left — away from the corporate center Hillary Clinton never abandoned.

For those reasons I’m cautiously optimistic, but we’re walking a real razor’s edge. If we make it through the next three years intact, it’ll be with a hangover for the ages.

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Jeff Bezos, Bill Gates, and Warren Buffett Are Wealthier Than The Bottom Half of the Country Combined

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(Photo: Shutterstock)

It can be hard to grasp just how much money is concentrated in just a few hands in our lopsided economy today. But here’s a start: The richest three people in the United States — Jeff Bezos, Bill Gates and Warren Buffett — together have more wealth than the entire bottom half of the country combined.

To put an even finer point on it: That’s three people versus about 160 million people.

To really comprehend just how insane the wealth concentration has become, consider Bezos, the head of Amazon. Worth about $ 90 billion, he recently was declared the richest man in the world. In October alone, his wealth jumped by $ 10 billion — or about $ 4 million per second.

Given his massive wealth, one might imagine that his company has enough to pay its warehouse workers a minimum of $ 15 an hour. But apparently it doesn’t. Amazon pays some of its workers as little as $ 12.84 an hour.

Read the full article on  LA Times.

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VIDEO: Trump Is All in on the Philippine Drug War

U.S. President Donald Trump recently met Philippine President Rodrigo Duterte for the first time — in fact, the two were photographed clinking champagne flutes. Duterte’s brutal war on drug users, which has left upwards of 13,000 dead from extrajudicial executions, has been roundly condemned by world leaders — except for Trump himself.

The U.S. president has praised Duterte and even invited him to the White House. In return, Duterte made the developer of Trump Tower Manila his envoy to the United States. Emolument clause, anyone?

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What Else Could a Tax Cut for the Richest 1% Buy in Your State?

Methods & Data Sources

For the cumulative and average tax cuts to the richest 1 percent in each state, as well as the average income of the richest 1 percent in each state, we relied on estimates from the Institute on Taxation and Economic Policy Microsimulation Tax Model for the Tax Cuts and Jobs Act introduced on November 2, 2017.

Health premiums

For health insurance premium costs in the individual marketplace, we relied primarily on 2018 premium data registered by insurance providers with healthcare.gov. The premium cost for our calculations was the cost of the second-least expensive Silver plan in the most populous county in each state, for a single 40-year-old adult.

Because healthcare.gov data only covers states in the federal marketplace, we also used data from the Kaiser Family Foundation’s 2018 premium calculator for the United States and for states with their own marketplaces (California, Colorado, Connecticut, District of Columbia, Idaho, Maryland, Massachusetts, Minnesota, New York, Rhode Island, Vermont, and Washington). We used the unsubsidized premium for the second-lowest cost Silver plan for a single, 40-year-old nonsmoker in each state’s most populous county.

Pell grants

The maximum Pell grant award for the 2017-2018 school year is $ 5,920. Our calculations represent the number of maximum awards that could be covered.

Infrastructure Jobs

The number of infrastructure jobs created by a federal investment depends on many factors: the specific type of infrastructure, the location, the likelihood that the infrastructure would be built without a federal investment, and more.

For the purposes of these calculations, we reviewed various estimates of the cost per infrastructure job created, ranging from roughly $ 36,000 per job created (Feyrer & Sacerdote, 2011) for investment through the Department of Transportation, to $ 92,136 per job created by government investment under ARRA (Council of Economic Advisors, 2009), among others.

For these calculations, we use an estimate from Feyrer & Sacerdote (Dartmouth/ NBER, 2011) of $ 105,485 per job created by federal investments through the Department of Transportation, Department of Energy, and the Environmental Protection Agency. Since the cost per job is high compared to other estimates, our estimates of job creation may be low. Also, in reality job creation costs are likely to vary by state. The Feyrer & Sacerdote approach means the reported job effects represent direct, indirect and induced effects – that is, employment in construction and related industries directly resulting from federal investment, but also the resulting boost to the local economy as the initial investment passes through to existing local businesses and their employees.