Many Warren Reports readers wrote to us following Professor Warren's recent appearance on Fresh Air. If you haven't done so already, I encourage you to listen to her discussion about the credit card industry.
In the coming weeks I'm going to try to highlight on this blog some of the stories and feedback that folks have asked us to look into and publicize. Let's start with merchants rather than consumers.
By (popular) demand (very exciting for my second day!) here's a little Estate Tax 101.
Simply put, the estate tax is a tax on property owned by a decedent at death. The tax has been controversial in the last decade or so. In 2000, Congress passed a bill repealing the estate tax, which President Clinton vetoed. Then Congress tossed in a sunset provision, and as a result a temporary repeal was enacted in 2001 (any subsequent attempts to pass a permanent bill have been blocked in the Senate).
The law works like this: from 2001 to 2010, the exclusion amount (the amount up to which there is no estate tax) will increase, and the estate tax rates will decrease; then, the estate tax will be “repealed” in 2010 for the year, and then kick back in at the original rates in 2011. IRS sec. 2001. (This provision has always puzzled me because of the incentives it creates … Would it be so surprising if the number of fatal “accidents” involving extremely wealthy old people miraculously increased in 2010?).
I'm not giving you the link because I don't want you to read it in full. Take my precis:
Sally Quinn writes in the Washington Post that she is from Savannah, Ga., and typically notices people's skin color but in the case of Barack Obama she doesn't, sort of, although she's aware of it enough to note that she isn't all that aware of it, and that somehow makes her think she doesn't really know him, since mere skin color won't suffice, at least in this case, and yet what would let her know him isn't listening to him or reading either of his books but instead knowing who's on his staff, which she says "we" don't know.
Actually there have been dozens of articles
Hello from the newest blogger here at Warren Reports. Although most people don’t believe me when I say this, my primary interests are in taxation and tax policy, which means that I couldn’t be joining the blog at a better time!
If you’re into tax, news and politics have recently become much more interesting. With the presidential election approaching, it is natural that tax is becoming a matter of public interest and heated debate. But this time, it seems that the discussion will involve some fundamental issues regarding the tax system (as opposed to the usual partisan bickering over raising or cutting taxes).
Several recent developments may lead to what I hope will be a much broader debate: the recent AMT (fiasco?), the looming expiration of President Bush’s tax cuts (and the estate tax repeal), and of course, the calls for the abolition of the income tax system in favor of a flat sales tax. The middle-class taxpayer will be the one particularly affected, and significantly at that, regardless of which way the debate shakes out. So, the debate should continue, which should give me a lot to blog about. I am looking forward to starting this discussion here at Warren Reports, and I hope you’ll join me with your comments.
Today’s report on job market conditions is among the weakest we’ve seen in a while and a potentially ominous signal that the slowing economy is finally catching up to the job market.
One month does not a trend make, but averaging over the past three months, payrolls have been expanding at a monthly rate of 118,000 per month, compared to 195,000 in the prior three months, a deceleration of 77,000 jobs per month. If this trend persists, unemployment will rise, as job seekers begin to outnumber job openings.
Importantly, average hourly earnings growth are slowing (see Figure after the break). Hourly earnings were up 0.2% last month, and 3.7% over last April. While still a decent nominal growth rate, that’s the slowest annual gain since last May. Adding the impact of declining average weekly hours, weekly earnings fell slightly in April and are up 3.4% over past year, about one point slower than March’s comparable figure of 4.3%.
As employment and wage growth slow, especially in a climate where energy and food prices are pushing up inflation, consumers will be hard pressed to continue boosting overall consumption, the one consistently strong component of GDP growth.
By our count:
- Candidate mentions of Reagan: 20
- Candidate mentions of Bush: 1
Perhaps it is trite to say it, but the very existence of the Winograd Commission says something very profound about Israel's political system.
It is not merely that the Israeli system is democratic. There are many democracies worldwide including the oldest one of them all, the United States -- but Israelis seem, oddly enough, to have more faith in their democracy than citizens in most of the others, including this one.
I know that sounds odd.
You can be very critical about what President Bush does and says and stands for, and still see considerable merit in the walls that are finally being erected in Baghdad. They separate Shia and Sunni neighborhoods, protecting each from the other's car bombs and death squads. True, these walls do not stop the bloodshed.
Nothing does. However, given the rank anarchy and violence that prevails the area, any peaceful measure that enhances security should be welcomed.
Pardon me, but hasn't our own Michael Bérubé been suckered by Thomas Sowell? His snide questions about Sowell's earnest invitation of a military coup ("Why don’t liberals trust our men and women in uniform? What have they got against a coup? Is it that they don’t . . . support the troops?") objectively blow smoke, for, whether he means to or not, Bérubé joins Sowell in overlooking (or shall we say obscuring?) the slow-motion military coup that is already in progress under cover of the surge.
Yes, the military is already declaring independence--it's already disgruntled with the Commander Guy's mastery of war. Just the other day, the NYT was reporting that CentComm chief Admiral William J. Fallon has "quietly retired" the penetrating phrase "Long War." The next thing you know, he'll be refusing orders to drop the big one on Iran.
Linguistically, the coup has already begun--and we haven't even reached the seventh day of May.
Looking around the liberal blogs lately, I get the sense that some people are a tad upset that Thomas Sowell has apparently begun cashing in his chips on this whole "democracy" idea:
When I see the worsening degeneracy in our politicians, our media, our educators, and our intelligentsia, I can't help wondering if the day may yet come when the only thing that can save this country is a military coup.OK, well, call me cynical, but I think Sowell’s setting a trap, and Kevin Drum and Eric Alterman have walked right into it. I’ve watched the right play this game over the past five years, and I know what’s coming next: Why don’t liberals trust our men and women in uniform? What have they got against a coup? Is it that they don’t . . . support the troops?
Today’s episode of TPMtv is a little different from the usual. You won’t be seeing any of Josh’s agreeable mug or hearing any of his wise words. This one is just a mix-tape of some choice snippets of President Bush and Press Secretary Tony Snow talking recently about the new standard of success in Iraq. Apparently it’s not so much a flourishing democratic society we’re fighting for anymore… No, we’ll be satisfied if normal Iraqis can merely live their lives in slightly less terror than they currently are.
We think the clips in this one pretty much speak for themselves.
Take 1200 prisoners from Arizona, hire Indiana at $64 per day to house them, then ship them 1500 miles from home and loved ones to a private prison in New Castle, Indiana run by the GEO Group, a private prison company that has been repeatedly cited for substandard conditions. When a riot among 500 prisoners broke out last week, with prisoners taking over the facility for two hours, it was hardly surprising to observers.
As the Fort Wayne Journal Gazette noted in an editorial:
I know, you miss the open threads. Or maybe you don't. Either way, here it is.
In preparation for tonight's GOP debate, MSNBC is running a non-stop Reagan nostalgiafest (the debate is at the Reagan Presidential Library) complete with video of each of the major candidates declaring at CPAC or another conservative forum that President Reagan is their hero, their idol, their secular lord. Frankly, it's a bit pitiful to watch the GOP candidates engage in false nostalgia for a politician whose career was largely based on false nostalgia. Just sayin'.
Enough from me. You?
George Tenet never learned the first law of crisis management--when you are in a hole, quit digging. Despite a disastrous appearance on 60 Minutes last Sunday, Tenet continues his publicity tour hyping his book and seems oblivious to the reality of Lexis Nexis, Google, and videotape. The anger and outrage that many of my former CIA colleagues and I feel toward George Tenet is not personal, at least in the sense that we "dont' like him". On a personal basis Tenet can be gregarious and generous. He is a good dad and husband and did some good things at CIA.
Our beef with Tenet is simple--he not only repeatedly failed to tell the Congress and the American people the truth he knew about Iraq on several critical issues, but he consciously participated in selling a lie to the American people. Don't take my word for it, take Tenet's. Consider the issue of the alleged relationship between Al Qaeda and Saddam Hussein.
Here is what George Tenet said on 60 Minutes last Sunday:
Attorney General Alberto Gonzales has bumbled and fudged his way through a good two months worth of press conferences, op-ed pieces, and congressional hearings, his repute declining precipitously among first Democrats and then Republicans. With Gonzales scheduled to return to Capitol Hill on Thursday, May 10 to testify before the House Judiciary Committee, the question on everyone’s mind seems to be, “What in the world is it going to take to get this guy fired??”
In a seminal piece posted on The New Republic yesterday, Jonathan Chait explains how activist netrooters are “The Left’s New Machine.”
While the activist netrooters serve the progressive cause, they have learned their strategy, says Chait, not from the Left of the sixties--but from the Right.
For the Left, ideology was all. By contrast, “ideology is not the Netroots’ defining trait,” Chait writes. “What unites them is a desire to replicate the successes of the conservative movement dating back to the 1960s. . . ..” He quotes netrooter Markos Moulitsas Zúniga: “’They want to make me into the latest Jesse Jackson, but I'm not ideological at all: ‘I'm just all about winning.’"
Chait then zeroes in on the “the netroots' incessant use’of the words “‘meme’ or ‘frame’” to describe ideas: “It is a formulation that assumes that establishing the truth about an idea matters less than phrasing the idea in the most politically effective way and repeating it as much as possible.”
Consider the difference between an idea and a “meme.” Memes are notions that spread easily. Like mass hysteria. Or the belief that the war in Iraq is a war against terror. Or the belief that Islam is the enemy. Or the “domino theory” (which justified the war in Vietnam). Ideas encourage people to think. Memes, like ads, PR campaigns and some (but not all) religions, are meant to cut off thought.
Our stimulating--to me anyway (an easily stimulated person, apparently)--discussion around inflation morphed into an important discussion about productivity growth.
But for this pesky day job, I could go on for days chattering about this. But let me just make a few points now.
It is beginning to look like Prime Minister Ehud Olmert will be forced out of office following issuance of the Winograd report on the government's decision to go to war with Hezbollah in 2006. And also because of the way it conducted the war.
As an American, I cannot help but be impressed at the accountability that Israelis apparently demand.
Prime Minister Golda Meir was forced out of office after an investigative commission reported on her government's failures in the Yom Kippur War. Defense Minister Ariel Sharon was similarly driven out of office following a commision report on his role in the Sabra and Shatila massacre. And now Olmert and Defense Minister Peretz seem to be on the verge of losing power.
Jonathan Chait's large and dispositive New Republic cover article on the netroots is bound to become a lightning rod for discussion of this subject, online and in the MSM. But reaction in the blogosphere has been somewhat slow, probably because Chait's take, published in a magazine that has been a frequent object of progressive blogospheric abuse, doesn't follow any predictable pattern.
Chait clearly validates the positive and important role of the netroots in Democratic politics, but in doing so says some things about the biases and habits of progressive bloggers that they aren't going to be happy about. As someone whom Chait accurately describes as having a "complicated relationship to the netroots," I'll take the risk of wading into this controversy since nobody other than cscs has so far addressed it in the Coffee House.
Congress held hearings today on the two-year anniversary of the Bankruptcy Code. Last night a woman who wasn't invited to the hearing talked about how lucky she was. She's a 72-year-old widow who filed for bankruptcy last month to try to save her home (more on the story below).
But here's why she felt lucky: The mandatory credit counseling session that will cost her $75 and for which she will have to drive 60 miles to attend has been scheduled for the day after her social security check will be deposited. That way, she explained, she can use her "food money to pay for gas and the counseling."
Gosh, what a lucky woman.
First let me apologize for the slowdown in content from some of us bloggers here at Warren Reports. It's that time of the year (final exams) when we stop worrying as much about things like credit cards and instead start worrying about little frustrations like trying to graduate...
But back to credit cards for the moment. Here's an interesting story about the power of regulation to restructure a market -- without any regulation actually occurring. The idea is that industry would rather appear to be consumer-friendly by fixing itself, so once the spotlight is turned on abusive practices even the threat of regulation can start to result in positive effects.
We know TPMtv promised you a rundown of the latest news from the US Attorney scandal today, but we decided at the last second that this Niger/uranium story we chatted about yesterday demands a follow-up.
As you may have seen from the clip we posted on TPM yesterday, retired CIA analyst Ray McGovern went onto Tucker Carlson’s MSNBC show yesterday afternoon and made one seriously eyebrow-raising claim: Vice President Dick Cheney was behind the Niger forgeries. The question we ask in today’s episode of TPMtv is: does Ray McGovern know what he’s talking about?
On p. A21 of this morning's NYT (though mysteriously missing online) appears a tantalizing tidbit by Benedict Carey under the headline, "Handicapping With Optimism." It seems that, according to a University of Pennsylvania psychologist, Martin Seligman, and co-researchers Andrew Rosenthal and Prateek Sharma, the presidential candidate who gives the most optimistic stump speeches, characterizing problems as "temporary and manageable" rather than "chronic and global," has won "more than 80 percent of the presidential elections since 1900." (Roll over, Michael Dukakis, who won the 1988 stump test but...stuff must have happened.) This year, the "clear front-runner" on this scale is--Hillary Rodham Clinton. The loser is Rudy Giuliani. (The article doesn't explain which candidates' stump speeches have been inspected going back to 1900, but for now, never mind.)
Optimists, explains Dr. Seligman, "tend to try harder under adversity, and that is a very important quality" for leaders. Americans may well think so, at any rate. As a people, at least in the ideal we uphold for ourselves and expect in our standard-bearers, we are the can-doers, the stop-at-nothings, the smiley-facers, the little engines that can. We don't want to be reminded of failure, death, and other bummers. "Americans," in the words of the sage Ronald Reagan, "live in the future."
Meanwhile, two pages on (though behind a TimesSelect turnstile), the Times runs a characteristically on-point column by the best surgeon-writer in America, Atul Gawande, beginning, "We Americans believe instinctively in the power of positive thinking" but arguing for "the power of negative thinking."
All through the first Democratic candidates’ debate, I couldn’t help feeling there was something missing. Each of the candidates did a reasonably decent job of explaining his or her point of view. One might have been shaky on one answer, another firm with a different issue, but on the whole, heck, even David Broder was impressed with the depth of the field.
And yet, something, or should I someone was missing: the person who should be president.
I knew he was a top Hillary adviser. I did not know that he has such strong feelings about the Middle East. The Post deserves credit for this story.
It is not just the candidate whose views matter. It's their top people as well.
World Bank President Paul Wolfowitz, staffed by legal counsel Robert Bennett at his side, will have an opportunity to respond to allegations of nepotism and inappropriate conduct at a meeting today.
The stakes are high for Wolfowitz and the Bank. If one wins, the other loses. Sources tell me that there probably will not be action on Wolfowitz's petition today -- but his fate will be determined within the week.
The real issue at hand is corporate governance inside the bank -- and this of course, is one of the Bank's central themes in its interactions with client governments and collaborating partners and institutions. Reports are bubbling out from Bank staff and World Bank clients that there is no way that Wolfowitz can go back to his position and keep the place from revolting against him, boycotting his presence and work, and the like.
Some governments have already issued private communications to Wolfowitz not to visit them -- at least not until this imbroglio is settled. The Bank staff is in open revolt, and many fear that they will be purged by Wolfowitz if they lose this high-risk battle.
A few weeks ago, in the course of a few hours, I came face-to-face with the inflation conundrum which is, I believe, under-appreciated by the economic punditry.
It all started when the speakers from my faithful, yet ancient, stereo system died of old age. I guess I blasted “Purple Haze” and other boomer anthems one too many times (the big, clunky tuner is as healthy as ever and is living in my attic—I should give it to the Smithsonian). So I headed out to the big box electronics store to get a new high-quality system.
A quarter page advertisement in the New York Times shows a young man and woman laughing, (a boyfriend-girlfriend sort of moment), under the headline "GET THE WHOLE STORY ON HIM, BEFORE IT IS TOO LATE." The advertiser, Intelius, promises to check out two things about this potentially dangerous guy: 1) Bankruptcy, and 2) Domestic Violence Convictions.
At the same time, Katie Porter over at CreditSlips unearthed credit card giant Capital One's 10-K warning investors that future business might not be so rosy if "social factors" such as "the stigma of personal bankruptcy" decline.
So there it is: A huge credit card company says it may see spiraling losses if more people decide to abandon all moral conviction, and a background search company reminds America that guys who file bankruptcy and beat women are on par with each other--shoot, maybe they are the same guys.
There's a terrificly important article in today's New York Times by Jane Gross about the after-effects of chemotherapy, some of which cause otherwise high-achieving women who once juggled ten things at once in their brains and during their day into relying on their electronic organizers for crib-notes. I can attest to that. After thirteen and a half years of relatively mild chemo treatment for breast cancer, I am nowhere without making notes about where I parked my car or who's on my call list. Ask my Hebrew teacher about my vocabulary retention--I was better at it when I studied first year Hebrew in Hebrew School at age 10 than I am today....
The important points of this article are several fold. First and most important: cancer doctors do save lives and there are many more women living today as breast cancer survivors than before. But that means that the after-effects of treatment need to be given as much attention as the treatments themselves and that is not yet the case. No one told me when I decided to do chemo that this type of memory slippage, among other symptoms, could be a side effect. Would it have influenced my decision? probably not, but still, it's good to know so that you don't think you're losing your mind when in fact you are losing your keys ....and your car...
Second, there is an interesting section of the article buried in the jump page for those who still read their Sunday newspaper the old fashioned way-- off-line--and that's how this impacts on women who don't have the resources to be aggressive either financially, intellectually or otherwise in tackling their treatment.
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 David Sirota: Wither the Autocratic Progressives? |
 Jared Bernstein: Uprisings: Bottom Up and Top Down |
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