Nel's New Day

February 26, 2014

What the Do-Nothing U.S. House Is Up To

Filed under: Uncategorized — trp2011 @ 9:26 PM
Tags: , , , , ,

Wouldn’t it be nice if Congress helped people—create jobs by improving the infrastructure, keep families together by not sending small children back to Mexico when they don’t know anyone and don’t speak the language, etc.  But in the U.S. House, Republicans have announced that they are through legislating until after the 114th Congress arrives in 2015.

Rep. Todd Young (R-IN) hasn’t quit yet. He’s introduced a bill with the optimistic name of “Save American Workers Act” designed to change the definition of “full-time” from 30 hours to 40 hours a week in the Affordable Care Act. Young thinks that corporations that have more than 50 employees are cutting their hours below 30 hours a week to avoid paying health insurance on them. Although there has been no large-scale shift in hours, Young maintains that companies shouldn’t have to pay health insurance for employees working 39 hours a week or less.

The Congressional Budget Office has weighed in on the bill’s effects. Making “full-term” 40 hours would kick about one million people off health insurance. Some of them might find Medicaid in the states that provide this or be able to pay less for insurance through the marketplace tax credits, but almost 500,000 wouldn’t fit into these categories. Another impact would be a $73-billion cost to the government over a ten-year period, adding this amount to the deficit.

Young’s bill had 208 co-sponsors in the House—at least before CBO came out with its numbers.

Rep. Darrell Issa (R-CA) has decided to again question Lois Lerner, former IRS official, who was already interrogated about the myth that the agency audits targeted Tea Party groups. Congress came up with nothing the last time. The FBI came up with nothing. Journalists came up with nothing. House GOP members have paid $14 million in their attempt to create a scandal that wasn’t. A letter from the IRS reports that 255 IRS workers spent 97,542 hours responding to congressional investigations. It also stated that the $14 million didn’t include work by the offices of Legislative Affairs, Public Affairs, Human Capital, and the Executive Secretariat.

This is the background of the investigation costing $14 million. After over 5,000 applications for 501(c)(4) status swamped the IRS within the two years after SCOTUS’s ruling in Citizens United, the agency was falsely accused of giving “heightened scrutiny … to non-profit applications from Tea Party-affiliated groups.” Before this decision, organizations had to report who gave money and how much. After Citizens United, 501(c)(4) organizations could keep all donors secret as long as the groups claimed to be at least a little bit for “social welfare.”

The Revenue Act of 1913, the law that covered this situation before Citizens United,” required that earnings be “devoted exclusively to charitable, educational, or recreational purposes.” In 1959, the IRS adopted a new regulation by adding that this “exclusively” devotion be also “primarily engaged.” Thus Citizens United went with “primarily” which morphed into “somewhat” or “a little bit.”

In June 2013, the Inspector General for Tax Administration sorted out 298 cases of the 5,000 political organizations, none of which was denied 501(c)(4) status. Of these, 96 were identified by “Tea Party,” “9/12,” or “Patriots.” Thus fewer than one-third of the identified cases appeared to be right-wing groups. All of these groups are violating IRS regulation because of the “devoted exclusively” part of the policy.

Today the House voted 243-176 to pass Rep. Dave Camp (R-MI)’s bill to block any new IRS regulations and make it illegal for the administration to follow the law. “Stop Targeting of Political Beliefs by the IRS Act of 2014” would keep the IRS from defining political activities for “social welfare” groups. Fourteen Democrats joined all 229 to vote for the measure.

Camp used the First Amendment in his bill, calling on free speech rights that have nothing to do with 501(c)(4) groups. No regulations prevent the people in these organizations from saying whatever they want with the usual restrictions. The tax-exempt status of organizations is a government subsidy; political campaigning in secret does not receive these subsidies. Up from $1 million in 2006, one-fourth of the $1 billion spent in 2012 came from these groups, some of it illegally provided by foreign donations.

Not satisfied with attempting to ignore existing law by controlling IRS regulations, Camp has released a monumental tax reform plan of almost 1,000 pages. His actions go against the wishes of party leaders who consider—correctly—that this overhaul will endanger the GOP in an election year. One of the most vivid parts of Camp’s plan is his slaughtering the sacred cows of deductions for home mortgage interest and carried-interest tax breaks for hedge fund managers. Deductions for state and local taxes also disappear in the plan. Credit unions would keep their tax exemptions. Banks would gain a tax, but only 0.035 percent.

On the side of the wealthy, the proposal lowers the corporate rate to 25 percent, whacking off 2 percent each year for five years. Taxation on most offshore income that corporations have stashed away would also be limited.

As Politico wrote, the proposal “includes something to offend seemingly everyone: manufacturers, the poor, Wall Street banks, governors and deficit hawks.”

I’m with Kevin Drum when he writes about the nuggets in the long document that make for fun reading.

 

  • It’s highly specific: One of the deductions to be dropped is “preventing makers of violent video games from qualifying for the R&D tax credit.”
  • The language doesn’t always sound like a Republican: The plan makes references to “Wall Street tycoons” and proposes to end tax breaks that allow university presidents to live tax free in mansions.
  • The cuts go across the board: On the one side, he cuts the Earned Income Tax Credit; on the other he wants to get rid of the NFL’s tax exemption on their annual $9 billion take.

 

The House also passed a bill yesterday allowing owners of cell phones to unlock them for personal use but not for resale. It looks as if the House has pretty much quit—at least for now.

They should look at Michigan to see a legislature that passes bills. The extreme GOP legislature has joined with the state’s right-wing governor, Rick Snyder, to pass the emergency manager law allowing the governor to replace any elected official with his own man, the so-called “right to work” law that passed after voters were locked out of the capitol, the “rape insurance” bill requiring women to purchase this insurance separately from other health insurance, and the fanatic anti-abortion legislation. The most recent bill, that gives every indication of passing is a daily $1,000 fine for picketing workers. Any labor organization leading or organizing a strike will be fined $10,000 a day.

Since the GOP took over, Michigan has joined the South in poverty. Its average income ranked 35th in the nation in 2012. Personal income between 2000 and 2010 increased 18.5 percent compared to 45.2 percent for the United States, a state growth that ranked 50th out of 50 states over a 30-year period.

This is what the United States could become if the Republicans take over as they did in Michigan.

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