The New Gilded Age

[malchior]

Pro Publica - a long read but worth it. It only reinforces my belief that our nation is being looted and stripped down for parts by corrupt politicians and billionaires.

In November 2017, with the administration of President Donald Trump rushing to get a massive tax overhaul through Congress, Sen. Ron Johnson stunned his colleagues by announcing he would vote “no.”

Making the rounds on cable TV, the Wisconsin Republican became the first GOP senator to declare his opposition, spooking Senate leaders who were pushing to quickly pass the tax bill with their thin majority. “If they can pass it without me, let them,” Johnson declared.

Johnson’s demand was simple: In exchange for his vote, the bill must sweeten the tax break for a class of companies that are known as pass-throughs, since profits pass through to their owners. Johnson praised such companies as “engines of innovation.” Behind the scenes, the senator pressed top Treasury Department officials on the issue, emails and the officials’ calendars show.

Within two weeks, Johnson’s ultimatum produced results. Trump personally called the senator to beg for his support, and the bill’s authors fattened the tax cut for these businesses. Johnson flipped to a “yes” and claimed credit for the change. The bill passed.

The Trump administration championed the pass-through provision as tax relief for “small businesses.”

Confidential tax records, however, reveal that Johnson’s last-minute maneuver benefited two families more than almost any others in the country — both worth billions and both among the senator’s biggest donors.

Dick and Liz Uihlein of packaging giant Uline, along with roofing magnate Diane Hendricks, together had contributed around $20 million to groups backing Johnson’s 2016 reelection campaign.

The expanded tax break Johnson muscled through netted them $215 million in deductions in 2018 alone, drastically reducing the income they owed taxes on. At that rate, the cut could deliver more than half a billion in tax savings for Hendricks and the Uihleins over its eight-year life.

But the tax break did more than just give a lucrative, and legal, perk to Johnson’s donors. In the first year after Trump signed the legislation, just 82 ultrawealthy households collectively walked away with more than $1 billion in total savings, an analysis of confidential tax records shows. Republican and Democratic tycoons alike saw their tax bills chopped by tens of millions, among them: media magnate and former Democratic presidential candidate Michael Bloomberg; the Bechtel family, owners of the engineering firm that bears their name; and the heirs of the late Houston pipeline billionaire Dan Duncan.

Usually the scale of the riches doled out by opaque tax legislation — and the beneficiaries — remain shielded from the public. But ProPublica has obtained a trove of IRS records covering thousands of the wealthiest Americans. The records have enabled reporters this year to explore the diverse menu of options the tax code affords the ultrawealthy to avoid paying taxes.

The drafting of the Trump law offers a unique opportunity to examine how the billionaire class is able to shape the code to its advantage, building in new ways to sidestep taxes.

The Tax Cuts and Jobs Act was the biggest rewrite of the code in decades and arguably the most consequential legislative achievement of the one-term president. Crafted largely in secret by a handful of Trump administration officials and members of Congress, the bill was rushed through the legislative process.

As draft language of the bill made its way through Congress, lawmakers friendly to billionaires and their lobbyists were able to nip and tuck and stretch the bill to accommodate a variety of special groups. The flurry of midnight deals and last-minute insertions of language resulted in a vast redistribution of wealth into the pockets of a select set of families, siphoning away billions in tax revenue from the nation’s coffers. This story is based on lobbying and campaign finance disclosures, Treasury Department emails and calendars obtained through a Freedom of Information Act lawsuit, and confidential tax records.

For those who benefited from the bill’s modifications, the collective millions spent on campaign donations and lobbying were minuscule compared with locking in years of enormous tax savings.

A spokesperson for the Uihleins declined to comment. Representatives for Hendricks didn’t respond to questions. In response to emailed questions, Johnson did not address whether he had discussed the expanded tax break with Hendricks or the Uihleins. Instead, he wrote in a statement that his advocacy was driven by his belief that the tax code “needs to be simplified and rationalized.”

“My support for ‘pass-through’ entities — that represent over 90% of all businesses — was guided by the necessity to keep them competitive with C-corporations and had nothing to do with any donor or discussions with them,” he wrote.

[Pyperkub]

Musk self dealing in awarding himself $56 billion in stock options as pay?

Starting Nov. 14, Elon Musk as well as present and former directors must stand before the state’s Court of Chancery’s Kathaleen McCormick to defend a mammoth compensation package handed out in 2018 that entitled him to up to $55.8 billion in stock options.

Unlike the Twitter case, it is expected this will not likely result in a prior settlement.

Plaintiff Richard Tornetta is arguing in a 96-page legal brief that the board failed to perform its fiduciary duty to minority investors by green-lighting “the largest compensation grant in human history”—even though the grant was put to a shareholder vote and approved.

At its heart is the issue whether Elon Musk can be considered a controlling shareholder on both sides of the transaction—as chairman of the board owning a 22% stake at the time, as well as the beneficiary of the package. If he were, the deal would be considered a conflicted transaction subject to different governance rules.

[Pyperkub]

This sums it up

Sent from my SM-S908U1 using Tapatalk

[Jaymann]

Love it!

[malchior]

https://twitter.com/m_ccuri/status/1696975744327450990

[malchior]

They are meeting today. Schumer hosted the oligarchs looting our nation to let them have input on how to divide up the choicest morsels. Prominent amongst them? One certain CEO who is stoking antisemitism out there right now. Also various huge company CEOs and labor leaders (teacher's union and writer's guild). I'm not surprised; it's all about power. Still it is disappointing as much as it is enraging.

https://twitter.com/therecount/status/1 ... 9620702633

[Pyperkub]

Another sign of the power of the new oligarchy...

Nearly a third (30.8%) of consumers making between $100,000 and $149,999 a year are concerned about making ends meet in the next six months, according to the Philly Fed survey, which was fielded from March 22 to April 6.

[LordMortis]

It's weird because I think of 100 to 149k as pretty far from "the wealthy economy" but I also think of that household wage as one that should be pretty far from "concerned about making ends meet." even raising a small family with a newish mortgage unless you live in crazy high CoL areas. That seems like core of the middle class lifestyle for most of the US, PA included.

[Blackhawk]

I can't even imagine that someone with many multiples of my income is worried about paying the bills. It makes me seriously question what they consider 'necessity.'

[Kraken]

If they can't make ends meet on >$100k, maybe they have too many ends. That ought to be comfortably middle class in most of the country.

[Pyperkub]

It's weird because I think of 100 to 149k as pretty far from "the wealthy economy" but I also think of that household wage as one that should be pretty far from "concerned about making ends meet." even raising a small family with a newish mortgage unless you live in crazy high CoL areas. That seems like core of the middle class lifestyle for most of the US, PA included.

My point is that the Middle-class crunch/shrinkage is well underway (esp when compared with the Median incomes map in the other thread).

[LordMortis]

I was thinking more about the article and its verbiage and the concepts it was putting forth with it. I don't think of that income range as either wealthy or as should be having to worry about making ends meet. Kinda the very essence of middle class. I get blind sided by the way things are being said even before the idea that 30% of these "consumers" are concerned that they don't make enough to continue living the life they are accustomed to. I don't know why but things like that always strike me and then set off alarms in my head.

[Blackhawk]

If they can't make ends meet on >$100k, maybe they have too many ends. That ought to be comfortably middle class in most of the country.

That's my thought. This isn't about not having enough to make ends meet, it's about living above their means. If you make $150,000 and live like you have $200,000, yeah - you're going to have issues. But that doesn't mean that you can't make ends meet.

[stessier]

If they can't make ends meet on >$100k, maybe they have too many ends. That ought to be comfortably middle class in most of the country.

That's my thought. This isn't about not having enough to make ends meet, it's about living above their means. If you make $150,000 and live like you have $200,000, yeah - you're going to have issues. But that doesn't mean that you can't make ends meet.

Making ends meet doesn't mean theoretically being able to find the money for what you need, it means being able to pay the bills you currently have at the end of the month. People in the situation you describe are already in a hole and would absolutely worry about making ends meet at the end of the month.

[Blackhawk]

If they can't make ends meet on >$100k, maybe they have too many ends. That ought to be comfortably middle class in most of the country.

That's my thought. This isn't about not having enough to make ends meet, it's about living above their means. If you make $150,000 and live like you have $200,000, yeah - you're going to have issues. But that doesn't mean that you can't make ends meet.

Making ends meet doesn't mean theoretically being able to find the money for what you need, it means being able to pay the bills you currently have at the end of the month. People in the situation you describe are already in a hole and would absolutely worry about making ends meet at the end of the month.

Every definition of it that I've seen (and I double-checked) is some variant of 'Having enough to money to pay for what you need.' Some form of 'need' or 'necessity' or 'living expenses' shows up in practically every one. You don't pay for a $15,000 vacation, then complain that you can't make ends meet when you can't afford private school, ballet lessons, and eating out four times a week. I'd describe that as "Can't do math", or "Can't figure out a budget." And it certainly doesn't merit a news piece about people not having enough money.

[stessier]

If they can't make ends meet on >$100k, maybe they have too many ends. That ought to be comfortably middle class in most of the country.

That's my thought. This isn't about not having enough to make ends meet, it's about living above their means. If you make $150,000 and live like you have $200,000, yeah - you're going to have issues. But that doesn't mean that you can't make ends meet.

Making ends meet doesn't mean theoretically being able to find the money for what you need, it means being able to pay the bills you currently have at the end of the month. People in the situation you describe are already in a hole and would absolutely worry about making ends meet at the end of the month.

Every definition of it that I've seen (and I double-checked) is some variant of 'Having enough to money to pay for what you need.' Some form of 'need' or 'necessity' or 'living expenses' shows up in practically every one. You don't pay for a $15,000 vacation, then complain that you can't make ends meet when you can't afford private school, ballet lessons, and eating out four times a week. I'd describe that as "Can't do math", or "Can't figure out a budget." And it certainly doesn't merit a news piece about people not having enough money.

This isn't a scholarly work. People were surveyed and asked if they are worried about making ends meet at the end of the month. If I was asked that and my paycheck would not cover my expenses for the month, regardless of how I got here, I would answer yes. And that information drives markets, so it is worthy of news coverage.

[Blackhawk]

Sorry, I disagree on this one. Go ask twenty random people what "making ends meet" means, and you're going to have most of them tell you that it means paying for living expenses. Unless the article decided to go with a different definition than the one that people actually use (and I didn't see them provide an alternate meaning), I stand by what I said.

[YellowKing]

I'm not sure if it matters if they *actually* have enough to pay their bills, or they only perceive that they don't have enough. If they're curbing spending, it's a ripple effect that impacts the entire economy.

[LordMortis]

For the political process and for corporations that encourage and profit from ever increasing discretionary spending, yes. But maybe that's a problem with a grow or die economy that eventually needs to be mitigated against. Feeling you're taking the short end of the stick while you vacation on different continents every year and buy two new cars every five years in your 2+ car household makes me have empathy with the snowflake as critical thinking crowd, a company I don't want to keep.

[Pyperkub]

If they can't make ends meet on >$100k, maybe they have too many ends. That ought to be comfortably middle class in most of the country.

People making more than 100k generally don't live in what you are terming "most" of the country. The areas with jobs that pay >100k are in areas where houses cost >1m and other things are more expensive as well (see Gas in CA hovering around $5/gal).