Republican tax cuts

Hey, it seems that Donald Trump’s tax ‘proposal’ (basically one page of notes) has been analyzed. Take a look:

A new analysis by the Tax Policy Center finds that the tax cuts included in the Trump administration’s outline for tax reform released in April could cut federal revenues by as much as $7.8 trillion over 10 years, and that the benefits would go almost exclusively to the top 5 percent of earners.

Even if the plan included some very large tax hikes to offset the cuts (like doing away with personal exemptions and other common deductions) and taking into account effect on economic growth, the cost still comes to $3.4 trillion over 10 years.

The revenue raisers also serve to make Trump’s plan even more regressive. If you just look at the tax cuts he’s proposing, 60.9 percent of the benefits go to the top 1 percent of Americans. That’s a pretty astonishing tilt toward the rich. But if you look at the combined effects of the cuts and the revenue raisers, 76.3 percent of the benefits go to the top 1 percent, and 94.8 percent go to the top 5 percent.

Trump’s proposal gives the vast majority of the tax cuts to the rich and blows a hole in the budget? I’m stunned. Or the opposite of that.

Renewable energy helps the economy

So Trump is taking the US out of the Paris agreement and still won’t say that he believes in global warming:

Environmental Protection Agency Administrator Scott Pruitt was asked the same question over and over and over again during a Friday briefing with reporters: Does President Trump still believe global warming is a hoax?

And each time, Pruitt refused to answer with a ‘‘yes’’ or a ‘‘no,’’ telling reporters that as he and the president discussed exiting the Paris climate deal, the topic of climate change never came up.

‘‘All the discussions that we had through the last several weeks have been focused on one singular issue: Is Paris good or not for this country?’’ Pruitt said when asked the question a first time. ‘‘That’s the discussions I’ve had with the president. So, that’s been my focus.’’

Trump has long been skeptical of climate change, despite vast scientific evidence showing that human activity has contributed to the problem, and has repeatedly suggested that it is a ‘‘hoax.’’ A Vox analysis found that Trump has tweeted such skepticism at least 115 times since 2011, describing global warming as ‘‘mythical,’’ ‘‘nonexistent,’’ ‘‘fictional,’’ an ‘‘expensive hoax’’ and ‘‘bulls—.’’

Let’s look at the economics:

Trump sees this move as a way to help stoke the nation’s coal industry. But coal’s importance is expected to dwindle anyway. New England’s largest coal plant, the Brayton Point complex in Somerset, closed for good this week. The main reason: It simply couldn’t compete with cheaper natural gas-fired plants.

Nearly 66,000 people work in the coal industry nationwide, compared to roughly 100,000 clean-energy jobs in Massachusetts alone.

Trump is already trying to take an ax to renewable energy programs. The president proposed a 69 percent cut to the Office of Energy Efficiency and Renewable Energy, which funds advances in everything from automobiles to wind power.

More troubling for Massachusetts: Trump proposed eliminating the “ARPA-E” program, which subsidizes high-tech energy research. Massachusetts has been the second largest beneficiary of ARPA-E grants after California, with more than $150 million flowing into the state since the program’s inception in 2009.

The US under Trump is reducing its funding for the part of the energy sector that is growing faster than any other. Maybe there’s still time to bring back the buggy whip industry.

Wellness programs don’t really work … except for employers

I’m a little slow on this but it seems companies really want to get genetic information on employees:

A little-noticed bill moving through Congress would allow companies to require employees to undergo genetic testing or risk paying a penalty of thousands of dollars, and would let employers see that genetic and other health information.

Employers got virtually everything they wanted for their workplace wellness programs during the Obama administration. The ACA allowed them to charge employees 30 percent, and possibly 50 percent, more for health insurance if they declined to participate in the “voluntary” programs, which typically include cholesterol and other screenings; health questionnaires that ask about personal habits, including plans to get pregnant; and sometimes weight loss and smoking cessation classes. And in rules that Obama’s Equal Employment Opportunity Commission issued last year, a workplace wellness program counts as “voluntary” even if workers have to pay thousands of dollars more in premiums and deductibles if they don’t participate.

That doesn’t sound very good but at least it helps the health of employees:

Rigorous studies by researchers not tied to the $8 billion wellness industry have shown that the programs improve employee health little if at all. An industry group recently concluded that they save so little on medical costs that, on average, the programs lose money. But employers continue to embrace them, partly as a way to shift more health care costs to workers, including by penalizing them financially.

and from here:

The so-called “Safeway Amendment” was added to the ACA. Now, if you fail, or refuse to take part in, your employer’s “voluntary” wellness test, it can increase your premium by 30 percent — or, if you’re a smoker who refuses to quit, by 50 percent.

There is no evidence that this new rule produced a significant drop in America’s health-care costs. And that isn’t terribly surprising — since Burd’s column was composed almost entirely of lies.

“[A] review of Safeway documents and interviews with company officials show that the company did not keep health-care costs flat for four years, the Washington Postreported in January 2010. “Those costs did drop in 2006 — by 12.5 percent. That was when the company overhauled its benefits … the decline did not have anything to do with tying employees’ premiums to test results. That element of Safeway’s benefits plan was not implemented until 2009.”

In other words, Safeway reduced costs for a single year by raising its employees’ deductibles. It didn’t save money by encouraging its workers to lead healthier lives — it saved money by making its workers pay a larger portion of their health-care costs.

Gee, it doesn’t help the employees but does help the employers. What a shock. And it gets better:

The privacy concerns also arise from how workplace wellness programs work. Employers, especially large ones, generally hire outside companies to run them. These companies are largely unregulated, and they are allowed to see genetic test results with employee names.

They sometimes sell the health information they collect from employees. As a result, employees get unexpected pitches for everything from weight-loss programs to running shoes, thanks to countless strangers poring over their health and genetic information.

So, to summarize, Obama and Congress were convinced to put a provision into the ACA that did basically shifted costs from the employer to the employee for little or no health benefits and now the GOP wants to expand that provision. You have to love it.

But it helps the rich

It seems the Trump administration is contemplating a tax break so corporations will repatriate cash:

Drug makers are promising to create tens of thousands of American jobs if President Donald Trump follows through on his promise to give them a big tax break if they “repatriate” cash they’ve stashed overseas.

The article points to a Senate report: repatriatingoffshorefundsreportoct202011wexhibitsfinal. Here are the conclusions in the executive summary:

1. U.S. Jobs Lost Rather Than Gained. After repatriating over $150 billion under the 2004 American Jobs Creation Act (AJCA), the top 15 repatriating corporations reduced their overall U.S. workforce by 20,931 jobs, while broad-based studies of all 840 repatriating corporations found no evidence that repatriated funds increased overall U.S. employment.
2. Research and Development Expenditures Did Not Accelerate. After repatriating over $150 billion, the 15 top repatriating corporations showed slight decreases in the pace of their U.S. research and development expenditures, while broad-based studies of all 840 repatriating corporations found no evidence that repatriation funds increased overall U.S. research and development outlays.
3. Stock Repurchases Increased After Repatriation. Despite a prohibition on using repatriated funds for stock repurchases, the top 15 repatriating corporations accelerated their spending on stock buybacks after repatriation, increasing them 16% from 2004 to 2005, and 38% from 2005 to 2006, while a broad-based study of all 840 repatriating corporations estimated that each extra dollar of repatriated cash was associated with an increase of between 60 and 92 cents in payouts to shareholders.
4. Executive Compensation Increased After Repatriation. Despite a prohibition on using repatriated funds for executive compensation, after repatriating over $150 billion, annual compensation for the top five executives at the top 15 repatriating corporations jumped 27% from 2004 to 2005, and another 30%, from 2005 to 2006, with ten of the corporations issuing restricted stock awards of $1 million or more to senior executives.
5. Only a Narrow Sector of Multinationals Benefited. Repatriation primarily benefited a narrow slice of the American economy, returning about $140 billion in repatriated dollars to multinational corporations in the pharmaceutical and technology industries, while providing no benefit to domestic firms that chose not to engage in offshore operations or investments.
6. Most Repatriated Funds Flowed from Tax Havens. Funds were repatriated primarily from low tax or tax haven jurisdictions; seven of the surveyed corporations repatriated between 90% and 100% of their funds from tax havens.
7. Offshore Funds Increased After 2004 Repatriation. Since the 2004 AJCA repatriation, the corporations that repatriated substantial sums have built up their 5 offshore funds at a greater rate than before the AJCA, evidence that repatriation has encouraged the shifting of more corporate dollars and investments offshore.
8. More than $2 Trillion in Cash Assets Now Held by U.S. Corporations. In 2011, U.S. corporations have record domestic cash assets of around $2 trillion, indicating that that the availability of cash is not constraining hiring or domestic investment decisions and that allowing corporations to repatriate more cash would be an ineffective way to spur new jobs.
9. Repatriation is a Failed Tax Policy. The 2004 repatriation cost the U.S. Treasury an estimated net revenue loss of $3.3 billion over ten years, produced no appreciable increase in U.S. jobs or research investments, and led to U.S. corporations directing more funds offshore.

So it worked very well for the rich. I can see why the Trump administration would be for it.

Let’s cut jobs so we can increase pollution

In a shocking move (or, you know, the opposite of that), the Trump administration has already taken down the page on climate change at whitehouse.gov (I’m taking this from the Vox article, because I’m not going to link to a Trump anything today):

For too long, we’ve been held back by burdensome regulations on our energy industry. President Trump is committed to eliminating harmful and unnecessary policies such as the Climate Action Plan and the Waters of the U.S. rule. Lifting these restrictions will greatly help American workers, increasing wages by more than $30 billion over the next 7 years.

Sound energy policy begins with the recognition that we have vast untapped domestic energy reserves right here in America. The Trump Administration will embrace the shale oil and gas revolution to bring jobs and prosperity to millions of Americans. We must take advantage of the estimated $50 trillion in untapped shale, oil, and natural gas reserves, especially those on federal lands that the American people own. We will use the revenues from energy production to rebuild our roads, schools, bridges and public infrastructure. Less expensive energy will be a big boost to American agriculture, as well.

The Trump Administration is also committed to clean coal technology, and to reviving America’s coal industry, which has been hurting for too long.

Well, let’s look at the job report for the energy sector:

The 2017 U.S. Energy and Employment Report (USEER) finds that the Traditional Energy and Energy Efficiency sectors today employ approximately 6.4 million Americans. These sectors increased in 2016 by just under 5 percent, adding over 300,000 net new jobs, roughly 14% of all those created in the country.

Hmm, looks like the energy sector is doing ok already.

Electric Power Generation and Fuels technologies directly employ more than 1.9 million workers. In 2016, 55 percent, or 1.1 million, of these employees worked in traditional coal, oil, and gas, while almost 800,000 workers were employed in low carbon emission generation technologies, including renewables, nuclear, and advanced/low emission natural gas. Just under 374,000 individuals work, in whole or in part, for solar firms, with more than 260,000 of those employees spending the majority of their time on solar. There are an additional 102,000 workers employed at wind firms across the nation. The solar workforce increased by 25% in 2016, while wind employment increased by 32%.

The 2017 USEER also shows that 2.2 million Americans are employed, in whole or in part, in the design, installation, and manufacture of Energy Efficiency products and services, adding 9133,000 jobs in 2016. (Energy Efficiency employment is defined as the production or installation of energy efficiency products certified by the Environmental Protection Agency’s ENERGY STAR® program or installed pursuant to the ENERGY STAR® program guidelines or supporting services thereof). Almost 1.4 million Energy Efficiency jobs are in the construction industry. In addition, construction firms involved in the Energy Efficiency sector have experienced an increase in the percentage of their workers who spend at least 50% of their time on Energy Efficiency-related work, rising from 64.8 percent in 2015 to 74.0 percent in 2016. Finally, an improved USEER survey methodology identified almost 290,000 manufacturing jobs, producing Energy Star® certified products and energy efficient building materials in the United States.

Hmm, it looks like clean energy production is doing really well. It seems to be the wave of the future. Of course, this means Trump will concentrate on oil and gas, thus not only increasing the amount of pollution but allowing other countries to jump ahead in the sectors of energy production that are growing by leaps and bounds. Good job.

What cutting costs means

I can see that people on the MBTAs Control Board don’t know how things work:

When the two cleaning companies contracted by the Massachusetts Bay Transportation Authority cut costs this fall, they slashed the hours — and in the process, health insurance — for dozens of their employees, the agency’s general counsel said Monday.

For months, workers have protested the changes before the MBTA’s fiscal and management control board, saying many of their fellow employees have lost health benefits and don’t have enough cleaning supplies to do their job.

John Englander, general counsel for the MBTA and the state Transportation Department released figures confirming that close to 80 workers for the two companies, about 25 percent of the staff, were laid off or lost health insurance when their hours were reduced.

This came out of this:

Shortsleeve told Boston Public Radio Friday that he believes the administration of Charlie Baker’s predecessor, Deval Patrick, overpaid the companies the MBTA contracts with to clean its stations. He thinks the stations can be maintained for $36.5 million, instead of the $53.1 million that has actually been paid out.

“For the last three years, the prior administration, for a variety of reasons, had been overpaying against those contracts as opposed to enforcing them on a performance basis,” Shortsleeve said. “What we’ve done, and what we’ll start on August 31, is simply to enforce those contracts on a performance basis, which means those companies are on the hook.”

Shortsleeve said that the MBTA does not employ janitors directly, and so any resulting layoffs will be the decision of the cleaning companies the agency contracts with and their labor unions–not the MBTA’s.

The reason they added money to the contract the last time was the private companies made big cuts in pay and benefits last time. This means that Brian Shortsleeve agreed to these cuts knowing it would lead to layoffs and cuts in benefits and he didn’t care.

It also comes straight out of the attitude of one Charlie Baker:

“I don’t care if a service is provided publicly or privately. What I care about is performance, productivity,” and that public money is “well spent,” Baker said.

Notice there’s nothing about treating employees well. He doesn’t care.

A conundrum

The conventional wisdom (which is often wrong, but I’m too lazy to look this up) is that Donald Trump did well among people who are worried about stagnant wages, loss of benefits, and the loss of jobs overseas. This is why he did better with union households than the last few Republican candidates.

There is one set of groups whose purpose is to protect workers–unions.

And Donald Trump and the newly ascendant Republican Party are anti-union:

Trump has expressed support for so-called right-to-work legislation, which allows workers to avoid paying union dues. Republican leaders in Congress have consistently sought such a change at the national level.

Among his concerns, he listed a Supreme Court case this year in which public-sector unions scored a victory related to funding organized labor – but only because the court deadlocked 4-4. The appointment of a new conservative judge by Trump to replace the late Justice Antonin Scalia could change that.

in September the Obama administration finalized an executive order requiring federal contractors to provide sick leave to workers, as well as rules expanding the types of data employers are required to provide on pay. A separate Labor Department rule expanding which employees are eligible for overtime pay is scheduled to take effect next month.

Those actions drew criticism from business groups, and all could be reversed under a Trump administration.

Steven Bernstein, a partner at law firm Fisher Phillips, which represents employers, said the Trump administration and Congress may also target recent NLRB rulings that allowed workers to picket on private property, expanded the type of worker activity protected by federal labor law and gave graduate students the right to unionize.

“It’s also fair to assume that Trump will be inclined to repeal a host of executive orders supporting unions,” particularly rules that apply to federal contracts, Bernstein said in a statement.

I guess I don’t understand how these people think: they are worried about their jobs, benefits, and pay so they vote for someone who is against the groups that are fighting for workers? Do they think that businesses will just give them higher pay and better benefits out of the goodness of their hearts?

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