FREE POLITICAL POSTER: Donald Trump Swamped With Taxing Situations, Declares MOST UNDRAINING EVER!

Donald Trump’s promise to “Drain the swamp” from Washington, DC, is perhaps his most surreal promise of all. Today, President Donald Trump is campaigning for Senate candidate Roy Moore, who has been facing mounting credible evidence of his predatory sexual behavior, especially against teen girls. Roy Moore has proven himself a liar, not that The Don has a problem with that.  With Roy Moore, Donald Trump wants to fill the swamp, officially bringing pedophilia to the Senate. Of course, Trump’s cabinet and advisers are replete with long-time corporate and political insiders. Trumpcare and the Republican tax scam were literally written by corporate tools and lobbyists.  To top it off, the Trump administration is on course to be the most corrupt Washington administration in history.  The Don may make Richard “Tricky Dick” Nixon look like an amateur criminal.  As Prez Donald Trump becomes increasingly unhinged, swamped with taxing situations, he arrogantly declares, “MOST UNDRAINING. EVER.” Thus, I have created a free political poster: Donald Trump Swamped With Taxing Situations, Declares MOST UNDRAINING EVER!  Please enjoy and feel free to share with friends and enemies.FREE POLITICAL POSTER: Donald Trump Swamped With Taxing Situations, Declares MOST UNDRAINING EVER!

For another perspective on the “drain the swamp” landscape, try this commentary, Trump Made the Swamp Worse. Here’s How to Drain It:

Donald Trump’s pledges to “drain the swamp” of corruption in Washington attest to his genius for unintentional irony. Nepotism, egregious conflicts of interest, flights on the public dime to see Wimbledon and the eclipse — the Beltway wetlands are now wilder and murkier than ever.

It would be a mistake, though, to dismiss the swamp metaphor on account of Mr. Trump’s hypocrisy. You can’t make sense of his shocking victory last year without reference to the downward spiral of public faith in governing elites and established institutions. Years of stagnating incomes, combined with dimming prospects for the future, have primed voters for the message that the system is “rigged” and that only an outsider not beholden to the corrupt establishment can clean it up.

In other words, one key to this populist moment in American politics is the link in the public mind between dysfunction in Washington and the economic malaise of the 21st century. An effective political response to this perilous moment begins with the recognition that this link is real — and that key changes in the policymaking process, supported by a major push from organized philanthropy, will be needed to turn things around.

The image of the swamp conveys a profound truth about the American economy. Our predicament of slow growth and sky-high inequality has many causes, but one important factor is the capture of the American political system by powerful insiders — big businesses, elite professionals, wealthy homeowners — that use it to entrench their own economic power. In so doing, they protect themselves from competition, fatten their bank accounts with diverted wealth and slow the creative destruction that drives economic growth.

Four key policy areas shed light on the growth of this political-economic swamp — financial regulation, intellectual property, occupational licensing and zoning. They show that the swamp isn’t confined to Washington; it can also be found in 50 state capitals and countless local jurisdictions.

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In the financial sector, a web of regulatory subsidies sustains financial institutions’ unhealthy reliance on extremely high levels of debt. These subsidies, including policies that strongly encourage mortgage securitization as well as the implicit promise to bail out “too big to fail” institutions, swell profits in the near term while increasing the systemic risk of a catastrophic meltdown in the long run. The result is a financial sector much bigger than the economy needs, chronic misallocation of capital and the diversion of some of the country’s top talent into counterproductive work. Luring people into excessive debt, draining their savings with hidden fees, inflating the next asset bubble — these and other dubious “contributions” by finance to the economy need to be curtailed.

Intellectual property laws are supposed to encourage innovation by granting temporary monopolies to copyright and patent holders. But if those monopolies get too broad and too onerous, innovation takes a hit — and that is precisely what has happened, at the urging and for the benefit of Hollywood, Big Pharma and some interests in Silicon Valley.

Occupational licensing rules at the state level help explain why professionals in the United States are paid so much more than their peers in other countries. Primary care physicians, for example, make 50 percent more in the United States than in other advanced countries, and specialists do even better. State regulations protect the incomes of doctors, dentists, undertakers and optometrists — not to mention makeup artists and auctioneers — while also stifling innovation.

Increasingly severe constraints on building in high-income coastal cities inflate the asset values of affluent homeowners, contributing significantly to rising disparities in wealth. And by making housing unaffordable, they prevent the less well-off from moving to where the good-paying jobs are, reducing geographic and social mobility.

This regressive regulatory swamp isn’t a natural landscape; it grows because of forces in our political environment. The beneficiaries of upward redistribution are always far more organized than those who pay the costs. They can divert some of their artificially high profits into lobbying and policy research that bestow a patina of the public interest on schemes that are, in practice, legalized robbery. Drugmakers, for example, portray even the most modest retrenchment of patent law as catastrophic for American innovation, while financiers warn that any restraint on subsidized risk-taking (through higher capital requirements, for example) will starve American industry of the capital it needs to invest and grow.

This unequal battle for the minds of policymakers is particularly damaging at a time when the resources that Congress and the bureaucracy have for independent research have been systematically dismantled. In finance, in particular, Congress has a difficult time hiring and retaining staff with the technical knowledge and experience to assess the impact of new regulations, leaving them dependent on the abundant resources of the industry itself.

In addition, many regressive regulations are made in obscure places with limited participation, such as state licensing boards and town councils in charge of approving new housing. Insiders with narrow interests, whether self-serving professional groups or Nimby neighbors, have the motivation and resources to show up at poorly attended meetings and work the system, often at odds with the general public’s interest in low prices and economic opportunity.

Really draining the swamp means changing the policymaking process to shield it against insider takeover and manipulation. For starters, congressional staffs need to be expanded, upgraded and professionalized. Legislators would then be better able to make their own assessments of complex regulatory issues without having to depend on the biased expertise of industry lobbyists.

Philanthropists need to put their dollars behind a network of organizations to counter the organizational presence of the forces of upward redistribution. The Ford Foundation did this in the 1970s by investing in a network of environmental law firms like the Natural Resources Defense Council and the Environmental Defense Fund. More recently, the Eli and Edythe Broad, Walton Family, Robertson and other charitable foundations have made similar investments in educational reforms.

Whatever you think of the merits of these causes, the new interest groups funded by sustained philanthropy changed the political landscape in these issue areas, forcing policymakers to recognize that there were, in fact, two sides to be considered. A network of new organizations with the resources and expertise to compete with big banks, the medical lobby and other industry groups could have a similar impact today. Activist groups could show up regularly in all the obscure places where rules are set and make sure that someone speaks up for the public interest.

State and local governments need to institute regulatory review procedures that expose back-room deals to objective scrutiny. While cost-benefit analysis by the Office of Management and Budget is standard for new federal regulations, no such reviews are conducted when states propose to license new occupations or cities stymie new housing construction.

Courts at all levels need to be less deferential to regulatory schemes that — in contrast to environmental or labor regulation — have no justification other than the protection of incumbent interests. For example, courts could force legislatures to explicitly approve expansions in the scope of occupational licensing, depriving licensing boards of the power to do so in shadowy obscurity.

In the political arena, the issues of regressive regulation cut across the usual partisan and ideological battle lines, and so tend to be kept off the agenda by legislative leaders who emphasize issues that hold their caucus together. Libertarian-leaning conservatives and egalitarian liberals need to forge strange-bedfellows coalitions to tackle policies that are simultaneously bad for growth and inequality. In recent years, cross-party coalitions in the states have started to make progress on criminal justice reform. Opposition to upward redistribution can galvanize support for similar alliances on regulatory issues.

The administration of Donald Trump has shown no interest in draining the real swamp that is drowning America’s economy and corrupting its politics. If public-spirited Democrats and Republicans fail to do so, trust in democracy will continue to erode. And the next demagogue who cashes in by saying he alone can fix things is likely to be more disciplined and focused than Mr. Trump — and hence even more dangerous.

FREE POLITICAL POSTER: Sen. Rob Portman cannot tell a lie, so he will not be talking about unfunded tax cuts for the rich

Sen. Rob Portman (R-OH) is well practiced at not speaking in truly public forums about his public policies and rationale.  This lack of public accountability as an elected public official is a symptom of an ailing and dysfunctional democracy. This free poster, another addition to my “Parity or Parody” series of posters, speaks to the pathetically low bar of not speaking at all in order to avoid the web of lies that entangles one’s so-called public policy. Sen Rob Portman likes to portray himself as independent and he has tried to put political space between him and President Donald Trump; nevertheless, when it come to enacting legislation, he shows up as a highly reliable Trump Republican, a committed partisan. The current Republican tax bills seem to be no exception for Sen. Portman.

Sen. Portman seems to be relishing rather than merely stomaching the regressive taxation scheme, borrowing money from future generations to enrich the already rich, and standing predictably silent on the inevitable growing pressure to cut government programs, even major and popular entitlement programs like Medicare, Medicaid and Social Security, that benefit a broad swathe of Americans often referred to as the middle class and on much rarer occasion the poor.  In public discourse, the poor are largely unmentioned, leaving us with the middle class and the rich, or as I might say, “the meddle class.”

Please enjoy and share freely this free political poster: Sen. Rob Portman cannot tell a lie, so he will not be talking about unfunded tax cuts for the rich.

FREE POLITICAL POSTER: Sen. Rob Portman cannot tell a lie, so he will not be talking about unfunded tax cuts for the rich

If you are more of a policy wonk and want a concise yet detailed analysis of why ignoring deficit-financed tax cuts and ignoring future potential spending cuts, then take a look at The real cost of the Republican tax cuts, with excerpts here:

The primary stated goals of the tax plan are to raise economic growth and increase the after-tax incomes of middle-class households. But taking financing into account appropriately would show how unlikely it is that the plan will achieve those goals…

…But even if one believes the plan will increase the overall size of the economy, spending cuts or tax increases will almost certainly still be required to pay for it. Analyses that do not account for those spending cuts or tax increases, whether they occur in the near term or in the longer term, obscure who will ultimately be hurt by them. Indeed, the very opportunity to obscure who will ultimately pay for the tax cuts likely explains why Congress pursues deficit-financed tax cuts more often than revenue-neutral tax reform or tax cuts accompanied by spending cuts.

A complete analysis of the tax plan including financing would most likely show that it would have a negative impact on many, and perhaps most, Americans…

…The primary purpose of the tax system is to raise revenues. Therefore, evaluating changes in tax policy while ignoring the impact of the policy’s reduction in revenues makes no sense. It ignores the very reason taxes exist. Indeed, absent consideration of financing, simplistic arguments that a 20 percent corporate rate is better than a 35 percent rate — the Republicans’ current proposal — would also imply that a zero percent rate is better than a 20 percent rate.

And a negative 20 percent rate would be still better! Once you consider the need for financing, such simplistic arguments fall apart.

Whether and how tax cuts are financed makes all the difference in the world. Consider two alternatives. One kind of well-designed tax reform can maintain the same level of revenues and boost living standards. Such a reform would inevitably increase taxes on certain activities and decrease them on others.

This type of reform could generate a modest boost in the level of economic output in the long run and, if so, would temporarily increase the growth rate. It could also increase living standards (even with no change in output) by eliminating wasteful tax incentives that encourage people to overconsume certain goods or services to maximize their tax benefits. Revenue-neutral reforms along these lines would almost certainly make some families better off and other families worse off. Who was hurt or helped would depend on the taxes that are changed.

Policymakers could also enact a tax cut financed by a reduction in spending. Just as a well-designed tax reform proposal could improve living standards by changing either consumption patterns or the growth rate, a tax cut financed by a reduction in spending could do the same — if the spending cuts are chosen wisely. As with revenue-neutral reform, some families would be made better off and others worse off after counting both the tax changes and the impact of the spending changes. (Former beneficiaries of the spending that is reduced would obviously pay a price.)

But the situation now is that House Republicans appear likely to release a bill that will cut taxes on net with no indication of how the resulting deficits will be paid for. As a result, we’re left in the dark about the legislation’s ultimate impact.

Conventional distribution tables for tax cuts show most of the gross benefits of tax cuts but not the impact of paying for them. When the proposal increases deficits and does not specify how those deficits will be addressed, the possibilities range from cuts to programs to low-income households to increases in taxes for high-income households.

We give a rough estimate, here, of the impact that three different approaches to financing a large tax cut would have on families across the income distribution. This example is not intended to show the actual distribution of the forthcoming House bill, but is broadly illustrative of the trade-offs involved in financing a tax cut that offers larger benefits for higher-income families than for lower-income families, as it seems likely the bill from House Republicans will do.

Specifically, we use the Tax Policy Center’s analysis of the principles for tax reform released by the Trump administration in April. This analysis found that families in every income group would see lower taxes on average from the plan as proposed, albeit with much larger increases in after-tax incomes for higher-income households.

But if the plan were financed by spending cuts or tax increases enacted at the same time, the distributional effects of the plan would change significantly.

The analysis considers three scenarios for financing. In each scenario, families pay more in tax or receive less in benefits to offset the cost of the tax costs…

…Families in the bottom 90 percent of the income distribution would be worse off on average under each of the three scenarios.

If anything, this…understates just how regressive the total ultimate impact of the Republican plan could be. While an equal payment per family would be regressive, the reductions in Medicaid spending that House Republicans passed earlier this year — which would have a significant impact on lower-income households and very little on the highest-income households — would be even more so.

The analysis…assumes that financing is enacted at the same time as the tax cut. In practice, policymakers can delay the enactment of financing for either a short or extended period. In such a scenario, even larger spending cuts or tax increases in the future would replace the required cuts today. Such an approach would introduce disparities across time as well as income.

Assuming Congress does not reverse course and enact progressive tax increases to offset the cost of the current tax cuts, older, higher-income Americans would likely see the largest increase in incomes, and younger, lower-income Americans would likely lose the most.

Enacting deficit-financed tax cuts allows policymakers to avoid the need to specify spending cuts or tax increases to pay for them and thus obscures the costs of the proposal. In addition, deferring the financing can itself reduce growth and reduce incomes even before the required financing policies are enacted. Those costs magnify the direct costs of any tax cuts.

Preliminary analyses by the Tax Policy Center of the Republicans framework (plus additional assumptions about unspecified elements of the plan from TPC) show the potential long-term consequences of deferring financing. In the short run, the TPC finds that the proposals would boost output. But over the longer run, the effects of mounting deficits and debt would turn the growth impact negative.

At the end of the first decade, the Tax Policy Center estimates that GDP will be 0.1 percent lower than it otherwise would have been, and at the end of two decades, it would be 0.4 percent lower. As a result, wages would likely fall over time, not rise (as recently claimed by the White House).

These results do not show the complete picture, however. The extent to which increased debt and deficits reduce GDP is moderated by an increase in domestic investment financed by foreigners. But this increase in foreign investment in the United States means an increased fraction of future GDP will need to be devoted to paying the return on that investment to those foreign investors. In other words, the gap between incomes generated by economic activity in the United States and incomes accruing to US nationals will grow.

Thus, gross national product (GNP), a concept that subtracts payments we make to foreigners on their US assets and adds payments we receive from foreigners — will decrease by more than GDP, falling by 0.2 percent after 10 years and 0.6 percent after two decades:

In circumstances like these, economists broadly agree that GNP is a better indicator of living standards for American households.

While the above analysis considers only the effects of additional debt, the spending cuts and tax increases ultimately enacted can themselves have negative effects on the economy. Indeed, classic economic arguments suggest that even when government spending is uncertain and varies over time, the most efficient tax system is one that attempts to maintain relatively constant tax rates.

Ignoring tax-cut financing is like doing only one side of cost-benefit analysis

Simplistic arguments in favor of a $1.5 trillion tax cut suggest that a $5 trillion tax cut would necessarily be even better. Clearly such arguments are missing something critical: balancing the costs against the benefits.

The prevalence of such arguments is part of a larger issue with the way tax debates are often conducted, focusing on GDP and downplaying or ignoring the impact of financing.

In recent years, analysts have increasingly assumed, in their models, that deficits resulting from tax cuts are ultimately paid for by tax increases or spending cuts several decades in the future. Thus, they recognize that deficits will be produced (by, say, large tax cuts) but basically assume the deficits will be remedied somehow, without showing the direct effect of those remedies on American households either now or in the future.

This approach can be useful in the context of official analysis of proposed policies, but it obscures the true economic tradeoffs. The promised gains from tax cuts in such cases — even when not eliminated as a result of years of increased borrowing — can amount to little more than borrowing heavily from future generations.

If we recognize the need for financing, a deficit-financed tax cut along the lines of the one House Republicans appear to be prepared to unveil is likely to be bad for the economy in the long run. It is likely to be particularly bad for working- and middle-class families.