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a gift to loopholes…...

Democrats and the Washington press corps spent the last week insisting that the party was about to close a notorious tax loophole that allows many Wall Street billionaires to pay a lower tax rate than most Americans. 

In truth, the proposal would have left most of the loophole open, fulfilling Senate Majority Leader Chuck Schumer’s (D-N.Y.) longstanding pledge to protect the private equity industry that bankrolls his campaigns. Now, the plan is gone.

 

BY Matthew Cunningham-Cook & Andrew Perez

 

Dems’ Gift To Their Wall Street Donors

Democrats were set to mostly preserve, not close, a Wall Street tax loophole, before they dropped it entirely.

 

On Thursday night, Sen. Kyrsten Sinema (D-Ariz.), a favorite of private equity donors, announced that Democrats "have agreed to remove the carried interest tax provision.” Meanwhile, President Joe Biden — who pledged to close the loophole — continues to decline to try to use his executive tax enforcement authority to shut the tax break.

Taken together, Democrats’ bait and switch allowed party lawmakers to pretend they were finally cracking down on private equity moguls, while actually protecting them.

That political gift to Wall Street comes after the private equity industry has delivered $83 million to Democratic politicians and $62 million to Republicans at the federal level over the last two election cycles. That includes $1.2 million to Schumer in just the last cycle, and $283,000 to Sinema.

Despite the fact the provision was always set to mostly preserve the loophole, corporate media outlets echoed Democratic leaders’ insistence that they were closing it — even as a major corporate law firm and other experts acknowledged that was not actually happening.

“Contrary To Discussions In The Media”

At issue is the so-called “carried interest” tax loophole, which permits private equity managers to classify their earnings as capital gains rather than regular income. That allows them to have portions of their income taxed at the lower capital gains rate of 20 percent, as opposed to the top income rate of 37 percent.

Democratic politicians have long pledged to close the loophole, and they have previously introduced legislation to reap $63 billion by completely eliminating it. They spent the last week insisting their new Inflation Reduction Act (IRA) would do that.

“I think the people that have benefited from carried interest for years and years and years knew that they had a good run, it was long overdue to get rid of it and you can’t justify it anymore,” Senator Joe Manchin (D-W.Va.) told The Hill last week.

However, the proposal negotiated by Manchin and Schumer rejected the party’s previous legislation and would have only slightly limited the tax break.

Instead of generating $63 billion in savings, as a 2021 proposal to fully close the loophole would, the new version would have only recouped $14 billion — effectively preserving most of the controversial tax break.

The measure would have only increased the time that firms must hold assets in order for their income to qualify as carried interest, changing it from three years to five years.

This reform would have increased the amount of private equity income subject to taxes at the ordinary rates, but only modestly, because many private equity investments last far longer than five years.

For instance: The Carlyle Group’s investment in Manorcare, a nursing home company, lasted 11 years. Petsmart has been in BC Partners’ portfolio for more than seven years. The Blackstone Group held Hilton Hotels for 11 years.

Tax law professor Victor Fleischer, a former top Democratic tax policy aide on Capitol Hill who initiated the effort to end the carried interest loophole in 2007, said on Twitter, “The Schumer-Manchin deal on carried interest isn’t great. All it does is extend the holding period from 3 to 5 years… Most private equity deals are 5-7 years, so most carried interest will continue to be taxed as long term capital gain.”

DLA Piper, a law firm with a large private equity practice, noted in a client alert last week, the IRA “would not, contrary to discussions in the media, close the carried interest loophole.”

One way to know for sure: As corporate lobbyist Liam Donovan tweeted, existing Democratic legislation to fully close the loophole would have raised more than four times as much revenue as the provision originally included in the Manchin-Schumer deal.

Big Donors To Democrats

It should not come as a shock that Democrats weren’t pushing to outright close the carried interest loophole.

Schumer, for example, has long been an ally of the private equity industry. In 2009 and 2010, he tried adding a poison pill to a legislative effort to kill the loophole.

His recent carried interest proposal arrived just days before a private equity giant hired his son-in-law.

The industry has also showered President Joe Biden with cash. Private equity manager Marc Lasry raised more than $3 million for Biden’s 2020 campaign, while Blackstone Group executives donated $350,000 to a pro-Biden super PAC.

While the IRA would not have closed the carried interest loophole, and would not have affected the majority of private equity income, the industry went through the motions of pressing allied lawmakers to strip the carried interest changes out of the bill.

After many news stories indicated Sinema was pushing to remove the measure, she issued a statement saying that Democrats are nixing the carried interest proposal. She added that she's planning to work with Sen. Mark Warner (D-Va.), to "enact carried interest tax reforms, protecting investments in America's economy and encouraging continued growth while closing the most egregious loopholes that some abuse to avoid paying taxes.”

Corporate Media Gets The Story Wrong

As the private equity industry and Sinema worked to kill Democrats’ carried interest proposal, corporate media outlets repeatedly oversold the measure, saying it would end the loophole entirely. These mistakes had the effect of making Schumer and Manchin look like populist heroes while also providing cover to those who wanted the measure gone.

On Wednesday, NPR compared the current carried interest language to a 2019 proposal that would have also raised $14 billion over a decade, rather than the gold standard 2021 proposal from Senate Finance Committee Chairman Ron Wyden (D-Ore.) and Sen. Sheldon Whitehouse (D-R.I.), which would have raised $63 billion over a decade.

In their August 2021 press release, Wyden and Whitehouse said, “Unlike other bills, the senators’ bill would close the entire carried interest loophole.” Similarly, Punchbowl News, one of the Beltway’s most reliable purveyors of corporate spin, oversold the carried interest changes several times. 

Last week, Punchbowl asserted that the Manchin-Schumer “plan eliminates the carried-interest loophole.” Punchbowl similarly wrote on Wednesday, “Perhaps the biggest question in the reconciliation process is whether the elimination of the carried-interest loophole makes it through Congress.”

 

READ MORE:

https://www.levernews.com/dems-stealth-gift-to-wall-street-donors/

 

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knowing schumer…..

Charles Schumer, who is Jewish, was born in 1950 and is currently serving as the senior United States Senator from New York and as Senate Majority Leader. 

Schumer was first elected to the U.S. Senate in 2004. He was reelected in 2010 and 2016 and has been the leader of the Democrats in the Senate since 2017. Before being elected to the Senate, Schumer served in the U.S. House of Representatives from 1981 until 1999. He was also a member of the New York State Assembly from 1975 until 1980. Senator Schumer was Chairman of the Democratic Senatorial Campaign Committee from 2005 until 2009, and Chairman of the Senate Democratic Policy Committee from 2011 until 2017.

As Democratic Leader, Senator Schumer does not serve on any committees in the Senate. Most recently, he served as Ranking Member of the Committee on Rules and Administration.

Below is Senator Schumer’s voting record and public positions on issues important to the Jewish community. 

Senator Schumer opposed the Iran nuclear deal. He opposed UN Security Council Resolution 2334 that claimed that Israel’s settlements have no legal validity and supported the move of the U.S. embassy to Jerusalem. 

Senator Schumer supported the Taylor Force Act, which states that no American governmental funds shall be given to a Palestinian entity that financially rewards terrorists or their families.  

In 2018, Senator Schumer cosponsored the United States-Israel Security Assistance Authorization Act, a legislation that supported full funding of security assistance to Israel as outlined in the 2016 U.S.-Israel Memorandum of Understanding. 

Senator Schumer opposes the Boycott, Divestment, and Sanctions (BDS) movement and cosponsored the Israel Anti-Boycott Act and the Combating BDS Act, two bills that aim to fight discriminatory boycotts of Israel. In June 2019, Senator Schumer expressed his support for a resolution that opposes the delegitimization of Israel and the global BDS movement.

In 2019, he voted for the Strengthening America’s Middle East Security Act which, among other things, strengthened Israel’s security and allowed a state or local government to adopt measures to divest its assets from entities that boycott Israel.

 

READ MORE: 

https://ajcongress.org/jewishpoliticalguide/senators/chuck-schumer/

 

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Note: 

Chuck Schumer

@SenSchumer


Now that Julian Assange has been arrested, I hope he will soon be held to account for his meddling in our elections on behalf of Putin and the Russian government.


4:11 AM · Apr 12, 2019·Twitter Web Client

 

I LEAVE SCHUMER'S STUPIDITY AND HISTORICAL INNACURACIES WITH YOU...... HE SEEMS TO WORK MORE FOR ISRAEL THAN FOR THE USA....

helping pharma cash floods……...

Schumer Lets Aide Kill Key Drug Price Reforms       The decision comes as Schumer is now the Senate’s #2 recipient of pharmaceutical industry campaign cash. 

Senate Majority Leader Chuck Schumer (D-N.Y.) let a U.S. Senate adviser kill key parts of Democrats’ promised drug pricing legislation, as Schumer has become the Senate’s second largest recipient of pharmaceutical industry cash.

On Saturday, the Senate's parliamentary adviser Elizabeth MacDonough — who Schumer can remove — issued a non-binding advisory opinion saying Democrats should remove provisions in their spending bill that would punish drugmakers for inflating their prices for patients in private health insurance plans. The provision could have saved $40 billion, according to one estimate.

“The exclusion of the private insurance price limits means there is little left that will reduce costs for the vast majority of Americans who receive health insurance through their private sector employer,” reported Politico.

MacDonough also advised Democrats against including a provision in their legislation to cap out-of-pocket insulin costs at $35 a month for people on private insurance plans. Democrats ultimately held a failed vote to overrule her on the insulin cap.

Democrats’ legislation does still allow Medicare to negotiate drug prices for the first time — but only on 10 drugs by 2026, and eventually 20 drugs per year. Removing the inflation cap will substantially limit protections for patients on private health insurance plans. Medicare patients will benefit from the $35 cap on out-of-pocket insulin costs, but patients on private insurance plans will not.

Taken together, Democrats’ signature drug pricing measure is now a shell of the proposal that lawmakers debated for much of last year, and far weaker than the compromise deal negotiated by the party’s drug industry allies.

 

“Unfortunate Ruling”

Like Republicans have done in the past, Schumer could simply fire MacDonough or the Democrats’ presiding officer of the Senate could ignore her opinions. Instead, though, Schumer has issued public statements lamenting the advisories, but refusing to do anything to change, stop, or ignore them.

Before this, he allowed the parliamentarian to initially kill Democrats’ promised $15-minimum wage legislation, and then eight Senate Democrats voted with Republicans to prevent it from being revived. The parliamentarian also killed Democrats’ immigration reform plan.

In this new case, pharmaceutical lobbyists have been working with Republican lawmakers to help them influence MacDonough’s advisories.

“While there was one unfortunate ruling in that the inflation rebate is more limited in scope, the overall program remains intact,” Schumer said of his aide’s latest non-binding opinions.

MacDonough, the parliamentarian, also helped kill the $35 cap on out-of-pocket costs for insulin. Democrats could have ignored her advice but didn’t, before trying to keep the measure in the bill anyway.

Sen. Lindsey Graham (R-S.C.) raised a point of order, which led to a vote to keep the measure in the bill that would have required 60 votes to succeed. Handled differently, Democrats could have set up a scenario in which it may have required 60 votes to exclude the provision from the bill.

In the end, all 50 Democrats voted to keep the insulin cap in the bill, along with seven Republicans, and it failed.

 

Pharma Cash Floods Into Democratic Coffers

Schumer’s refusal to do anything about the parliamentary adviser’s edict on the drug inflation cap comes as he has raked in more than $289,000 from donors in the pharmaceutical and health products industry during his 2022 election campaign. Eight of the Senate’s top 10 recipients of donations from that industry are Democrats.

That includes Arizona Sen. Kyrsten Sinema, who has raked in more than $556,000 from the industry since 2017. She has also benefited from a flood of supportive TV ads from a Big Pharma front group. 

Sinema recently said her support of the bill would be subject to the parliamentarian's review. She previously said: “There is no instance in which I would overrule a parliamentarian’s decision.”

Yet, Sinema actually voted on Sunday to overrule the parliamentarian and keep the $35 insulin cap in the bill. Perhaps she would have voted differently if the measure had a genuine shot at passage. 

 

In all, the pharmaceutical and health products industry has funneled more than $61 million to Democratic candidates in the last two election cycles, far more than it gave to GOP lawmakers in the same time period.

 

levernews relies on readers pitching in to support our journalism. If you like this story, please support their work.

 

READ MORE:

https://www.levernews.com/schumer-lets-aide-kill-key-drug-price-reform/

 

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the don't look up act…...

No, Criticism of the Democratic Climate Bill Isn’t About Bitter “Internet Leftists”

 

BY
BRANKO MARCETIC

Have you heard? All criticism of the Inflation Reduction Act can be boiled down to moralizing hippies and a bitter, "Internet-poisoned" left. This is absurd: deflecting from the bill's flaws does a disservice to the climate fight.

 

 

The Inflation Reduction Act (IRA) is at once a massive fossil fuel industry giveaway, a historic but inadequate investment in clean energy, and our best hope for staving off planetary catastrophe. In other words, discussion of it would seem to call for a bit of nuance.

Not so, according to Slate’s Jordan Weissmann. In a widely circulated piece purporting to explain “why internet leftists are so pissed about Democrats’ historic climate bill,” Weissmann explains why, if you’ve heard any concern or criticism about the IRA these past few days, you shouldn’t worry — it’s safe to block your ears and turn off your brain, because these are simply irrelevancies cooked up by a bitter and terminally online left.

In Weissmann’s telling, “the internet-poisoned left” has written off the IRA as a mere fossil fuel giveaway that won’t move the needle on climate, and this “chorus” has been “led” by Don’t Look Up creators Adam McKay and David Sirota. Their criticisms are simply the product of a “kneejerk resentment toward the Democratic Party that’s endemic among the online left,” combined with the sour grapes among “some of the most dedicated climate activists” that they’ve “lost a basic philosophical battle over how best to combat climate change”: namely, that we need to urgently stop investing in fossil fuels and keep as much of them in the ground as possible as we transition to renewables.

“The supply-side approach to climate advocacy has always seemed to involve a dose of moralism, a sense that fossil fuels are inherently immoral and ought to be cut off wherever possible,” muses Weissmann. For him, it’s simply “the most hardcore corners of the movement [that] are deeply attached to supply-side solutions.”

In other words, there’s no need to grapple with the IRA’s complexities, build momentum for further federal action, or envision the next stage of public pressure to undo its most damaging provisions. We’re done here. Go back to sleep.

Every part of Weissmann’s case is uninformed or misleading. First, the idea that criticism of the bill comes only from a hard core of internet-hardened leftists, or that it’s being “led” by McKay and Sirota, is nonsense. Rather, the criticism has been led by major environmental organizations like Greenpeace. I know, because I actually talked to climate advocates when the bill was unveiled two weeks ago.

Weissmann does briefly gesture at some of these groups, but he soft-pedals their opposition. He doesn’t note the fact that literally hundreds of organizations, including Greenpeace and Food & Water Watch, urged Biden to strike out the IRA’s fossil fuel favors last month, or that just yesterday, a variety of groups criticized the bill, including the Center for International Environmental Law, which warned that “solving the climate crisis requires eliminating fossil fuels.” Whether you agree with their analysis or not, it’s groups like Climate Justice Alliance that determined the bill’s fossil fuel provisions outweighed its benefits, with one calling it “smoke and mirrors” — not the director of Talladega Nights.

Even if you disagree with this view, an honest appraisal would at least grapple with the counterarguments. Unfortunately, Weissmann doesn’t give his readers a chance to consider these.

He doesn’t mention the bill’s almost total lack of action on the single largest source of emissions, transportation. He doesn’t inform his readers that, as even Forbes has warned, the bill’s tying of solar and wind projects to mandatory oil and gas leases creates a cluster of veto points over the expansion of clean energy. He evidently didn’t talk to Food & Water Watch’s Mitch Jones, who cautioned that this could also halt some wind and solar projects on private land. He doesn’t note how modest the bill’s emissions cuts actually are, nor how paltry some of its spending commitments are when put into context. He doesn’t discuss its no-sticks-only-carrots approach, which even the leading outside expert behind the bill said last year wasn’t enough to transition from fossil fuels on time.

Weissmann, no stickler for originality, paints the coalition of the bill’s critics as a collection of unreasonable hippies who oppose fossil fuel exploration just because. From the picture he presents, you would hardly guess that the International Energy Agency warned last year that new oil, gas, and coal investments had to end immediately to keep the world within 1.5 degrees warning. He doesn’t mention the 2015 warning from a group of scientists and economists that 75 percent of known fossil fuel reserves have to stay in the ground. He doesn’t tell readers about the UN secretary-general’s warnings that new fossil fuel investment is “delusional” and “doesn’t make political or economic sense.”

You wouldn’t know from reading Weissmann’s piece that this point — that new fossil fuel infrastructure is incompatible with the world’s climate goals — has been made repeatedly by leading scientists, or that it was forcefully advanced just this year by the Intergovernmental Panel on Climate Change. So much for listening to the science.

There is one omission for which we can forgive Weissmann: his failure to mention that the news outlet he works for is also, apparently, a mouthpiece for exactly the kind of anti–fossil fuel moralizing driven by left-wing hatred of the Democratic Party that he decries. Just look at all the Slate pieces expressing dismay over Biden’s expansion of drilling, praising disinvestment efforts, criticizing the massive Gulf of Mexico oil and gas fire sale the IRA revives, doubting the “clean hydrogen” solution that this bill invests in, poking holes in the very kind of EV-heavy strategy on which the IRA leans, and even advocating that oil companies be nationalized so they can be shut down.

That Weissmann is so giddy over the apparent collapse of efforts to end fossil fuel production — the cause of the very crisis the IRA is meant to combat — is bizarre enough. But to do it when scientists, experts, and writers deemed credible by his own employer have repeatedly stressed how essential that step is, raises it to another level of absurdity. It’s hard to shake the impression that the whole piece is an elaborate case of projection on Weissmann’s part: a kneejerk and uninformed swipe at his online nemeses for being kneejerk and uninformed and too online.

The dispiriting upshot is that readers of this piece looking for enlightenment on the controversy will come away thinking that continued oil and gas exploration and production is just fine and that radical action is no longer needed — when in reality, the bill’s flaws make this kind of action more urgent.

It’s sad that something as critical as staving off climate disaster has to be refracted through the prism of petty Twitter grudges and intra–Democratic Party skirmishes, because it does us all a disservice. Weissmann is right that Internet brain-poisoning has depressingly infected this debate. But the main vector of transmission is not to be found among the IRA’s critics.

 

READ MORE:

https://jacobin.com/2022/08/democratic-climate-bill-inflation-reduction-act-fossil-fuels-slate-internet-left

 

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MEANWHILE:

Netflix gives every impression of being one of the world’s most climate friendly corporations. 

The streaming company responsible for the blockbuster climate movie “Don’t Look Up” starring Leonardo DiCaprio and Jennifer Lawrence plans to slash or offset all of its corporate greenhouse gas emissions by the end of 2022, a goal known as net-zero.

Netflix is producing and providing a platform for documentaries, TV series, and feature films educating viewers about the climate crisis — about 160 million households globally watched one of these stories in 2020, according tothe company.

“The film industry needs a leader when it comes to climate action,” Katharine Hayhoe, a chief scientist at the Nature Conservancy who belongs to an independent advisory group of experts for Netflix’s sustainability plan, has said. “I’m thrilled at how Netflix is taking on this leadership role.” 

But away from the public eye there is one area where Netflix is anything but green.

The company has donated to a rightwing think tank in Canada that has also been supported financially by the Canadian Energy Pipeline Association, the Exxon-owned tar sands producer Imperial Oil, and the Charles G. Koch Foundation, an organization linked to Koch Industries.

 

READ MORE:

https://www.desmog.com/2022/07/26/climate-leader-netflix-donated-to-rightwing-think-tank/

 

SEE ALSO:

feeding subsidies to the carbon dioxide emitters….

 

 

 

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shut down or shut up?…..

BY Julia Rock,David Sirota & Andrew Perez

Most Dems Mum On Blocking Manchin’s Pipeline Deal


Many lawmakers are criticizing the Schumer-Manchin climate bomb — but only a few have pledged to do what may be necessary to stop it.

As vast swaths of the country are being battered by climate-intensified droughts and heatwaves, Sen. Bernie Sanders (Ind-Vt.) just threw a wrench into Democrats’ reported plans to fast track approval of oil and gas pipelines as part of an unrelated spending bill: On Thursday, he pledged to vote against the proposal, even if it is included in legislation required to avert a partial government shutdown.

The open question now is whether enough other Democrats will use their power to block — rather than merely complain about — a pipeline deal that environmental groups say could detonate a climate bomb amid the intensifying ecological crisis.

Soon after Sanders’ announcement, one Democrat — Rep. Ro Khanna (D-Calif.) — told The Lever that he would similarly vote no on a spending bill if it includes the pipeline measure.

However, House progressives have not committed to providing a bloc of no votes in the lower chamber.

 

 

READ MORE:

https://www.levernews.com/most-dems-mum-on-blocking-manchins-pipeline-deal/

 

 

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