Monday, July 28, 2014

Time to Change the US Corporate Tax System

There is a new term that is becoming part of America's daily vocabulary: "inversion."  Investopedia explains corporate tax inversion as:
Re-incorporating a company overseas in order to reduce the tax burden on income earned abroad. Corporate inversion as a strategy is used by companies that receive a significant portion of their income from foreign sources, since that income is taxed both abroad and in the country of incorporation. Companies undertaking this strategy are likely to select a country that has lower tax rates and less stringent corporate governance requirements.
Most recently we have seen the Walgreens company is planning on becoming a non-citizen.  They plan to take the money that they earn in the United States and hold onto it as non-American citizens:
Walgreens, the USA's largest drugstore chain, with more than 8,500 stores, soon will decide whether to take advantage of a loophole in U.S. tax law that would allow it to save billions of dollars by moving its headquarters to Europe, where it is on the verge of acquiring controlling interest in Alliance Boots, a Swiss-based company that operates drugstores in Britain. 
Other companies that are no longer US citizens include Pfizer and Medtronic.  
Pfizer is one of the most aggressive U.S. companies reporting income in countries with lower tax rates than the U.S. as a way of reducing their effective tax rate, according to data compiled by Bloomberg. The drugmaker had the second-highest amount of profit kept overseas, $63 billion, behind only General Electric Co., according to securities filings as of March. 
USA Today reports on Medtronic:
In one recent high-profile "tax inversion," Medtronic, a venerable Minneapolis-based medical device manufacturer, agreed last month to buy rival medical-device maker Covidien PLC for $42.9 billion. Covidien has its "headquarters" in Massachusetts but is "domiciled" in Ireland, which has some of the lowest corporate tax rates in the world at 12.5 percent. The U.S. corporate income tax rate is 35 percent, the highest in the world. 
"When you invert, it makes it easy to strip income out of the U.S. and put it into a tax haven," said Martin Sullivan, chief economist at Tax Analysts, which provides analysis of tax laws and current events for tax professionals and the business community. "U.S. tax rules treat U.S. income and foreign income differently. When that is the case, the states would almost certainly lose revenue because when income is stripped out of the U.S. federal tax base, it is also being stripped out of the state tax base." 
Ken Santema from SoDakLiberty suggests that the reason behind the inversions is simply that the corporate tax rates are too high.  
If the US is serious about ending corporate inversion the current tax rates must be lowered. Unfortunately that isn’t likely to happen any time soon. Too many people think corporations aren’t taxed enough and too many politicians have been bought by big business to provide special tax breaks. In such an environment it is unlikely anyone will look at the obvious answer: cut corporate taxes to a flat rate with no special deductions.
That may be part of the problem, but the corporations are providing less and less to the US Federal Revenue:
America is broke,” declared House Speaker John Boehner a few years ago. But clearly the country is not broke; we are just being robbed, as many corporations create ways of avoiding, dodging, shirking and generally not paying their taxes. The share of federal revenue coming from corporate taxes has dropped from around 32 percent in 1952 to 8.9 percent now. As a share of gross domestic product, it has fallen from about 6 percent of GDP then to less than 2 percent now. Meanwhile the rest of us — including small domestic companies that don’t have armies of tax consultants — have to make up that shortfall, either through increases in things like payroll taxes, or through cuts in the things government does to make our lives better. 
The reality is that the corporate tax rate is not too high, but we have created a system that benefits the powerful lobbyists hired by these corporations and ignores the smaller corporations.  While Walgreens is getting a tax break, Lewis Drug has to cover Walgreens leaving.

What to do about it?  First, I say that these corporations can no longer give to political campaigns.  They are "persons" according to five Supreme Court Justices and it is illegal for foreign nationals to donate to political campaigns.  They should also restricted on their ability to lobby in Congress.  All of the CEOs and other top officials should renounce their citizenship and be required to apply for green cards to live in the United States. 

Another idea is to do something like Mr. Santema suggested.  Make it a level playing field and then you don't have to have such a high rate.  Instead of a flat rate, because companies like Pfizer will still hide profits, one idea is to make their profits more open and establish a Sales Tax Apportionment of Global Taxes.  This idea recently has been pushed in a study by Michael Udell and Aditi Vashist (this is a PDF) to make all companies (US based and Foreign based) pay taxes on sales done in the United States.  The idea would allow for more companies paying their fair share and it could allow for the decrease of the tax rate, helping those companies like Lewis Drug.

Sunday, July 27, 2014

Suffer the Little Children

But Jesus said, Suffer little children, and forbid them not, to come to me: for of such is the kingdom of heaven -- Matthew 19:14 (American King James Version)
There has been a lot to talk about  providing relief and support for undocumented children.  21 children have been placed in South Dakota and the Governor is none to happy about it.  Daugaard complains in a press release about his anger that the federal agency didn't clear it with him.  Then he tries to use fear and xenophobia to label the children as threats. 
“It is disappointing that, despite assurances from federal officials, these children have been placed in South Dakota without notification to the state,” said the Governor. “Although federal officials indicate that these 21 children have been screened and vaccinated, we will be asking for more information so that the state can be sure that these children pose no risk to South Dakotans.”
A lot of people have been discussing this response.  Over at Madville, Cory pointed out the silliness of bringing up a lack of vaccination for the children as a major threat to South Dakota.  The Displaced Plainsman cites the Bob Mercer and points out that all this freaking out over 21 children shows that lack of foresight and planning that is the SD GOP (and national GOP in my opinion).  Over at Dakota War College, you are getting statements from GOP rank and file like these:



SpencerThe National Guard should be called out NOW to remove these kids and their illegal families. Are we really going to wait for Obama to handle this? Take them to the nearest blue state and dump them. No damage or harm to South Dakotans? Really? Illegals are syphoning education and Medicaid dollars away from every other South Dakotan among a multitude of other services and resources while some fools sit there wondering if there is a down side to taking these illegals. Wake up South Dakota!
Charlie HoffmanThere is a Win-Win in this politically nationwide for the GOP but fear is killing the initiative needed. 
DNA ID every child and photo fingerprint them onto the Federal database. Then get a judge to put a secrecy cloak on their location and status. No news going out to further illegal importations. Instead of Obama and Company shoving kids into Gestapo type barracks we put them in homes clearly identified as Pro-American. The adults/parents here illegally gave up their parental rights years ago when they left their children in the slums while they high tailed into the USA whenever they could. 
While politicians and other bicker over these children, we forget that these are children.  Children whose life has been one of hell and suffering.  Whose parents were so desperate that there children could have a better life, or in some cases a life period, that they allowed them to go.  Not everyone of the SD GOP thinks the same as Daugaard and others.  Rep. Steve Hickey (R) makes a fair point on the comment section of Dakota War College:
Steve HickeyWow. Lighten up Spencer. Kids aren’t political footballs to kick back to some other state. I’d like to meet them and hear every single one of their stories. Don’t misread me, I think we can and should shut down the border. But that’s not happening. We have room in SD to love on 21 more kids – it’d actually do us some good. Political leaders can sort it out without tossing kids back and forth. Hopefully it’s not true that SD cares more about stranded cows and wet river communities than it does the children of the world....
We do have room to love on 21 children.  We should have room to love on all of our children.  When you see footage of grown up adults screaming "Not our kids, not our problem!" and those asking, "why can't we just ship them back," I think John Stewart summed it up best: "What the f*** is wrong with you?"

Sister Janet Horstman shared a story in the Argus Leader about what is facing many of these families:
Horstman cited a 2012 case that illustrates the consequences of deportation decisions. Parents from El Salvador sought residency for their children, ages 19 and 15, who had arrived illegally. 
"These two young men were being recruited by gangs and threatened, so they decided to leave. The oldest, who was 19, was sent back." Three or four days later, Horstman said, he "was killed because he had tried to run away."  
The paper hinted at a plan by McCain and Flake being brought up to handle refugee status in the home country.  When trying to see exactly what the plan would do, the focus seems to be on getting these illegal children out of here (still wrapping the language in xenophobia).  However, I did find some information that shows the Obama administration (this might cause it to fail since Obama supports a GOP idea) is considering such a move.
Kevin Appleby, director of Migration and Refugee Services at the United States Conference of Catholic Bishops, said the plan would be welcome, as long as it does not substitute for protections Central American children currently receive under American law. 
“This program would certainly be a formal acknowledgment by the administration that these children are refugees,” Appleby said. “That’s huge, because they have yet to utter that word.” 
When a similar plan was adopted in Haiti, as a way to keep people from taking to the high seas, he said, it was ultimately criticized because Haitians already in the United States did not receive help. 
“It ended up being counterproductive to the goal,” Appleby said. 
Stacie Blake, the director of government relations for the U.S. Committee for Refugees and Immigrants, an advocacy group, said the processing of potential refugees in Central America could be handled by the U.S. government or by the United Nations, which makes refugee determinations in many other countries. She said some of the people designated as refugees in Honduras could end up in countries other than the United States. 
“It’s a way to help folks avoid life-threatening escapes and journeys,” Blake said. “It’s a good idea. It’s a tested idea.”
Whatever happens in the future to try and get a better handle on the issue, let us not ignore treating the children that are here with some dignity and compassion.  Don't automatically assume that they are evil.  Maybe we could learn to be a little more like Jesus and let the children come to us.  Not to be ridiculed and seen as threats, not to be viewed as pawns, and not to be viewed as unbearable burdens and annoyances, but instead to look upon them as innocents and to reach out and provide a little relief in a difficult and harsh world. 

UPDATE: Rep. Kathy Tyler posts about South Dakota's need for immigrant labor and the complexity of immigration laws and the need to remember the children.

Friday, July 25, 2014

A SLO video for all the teachers out there

I former teacher posted this on Facebook about SLO.  It is a parody of "Let It Go," but before you groan and ignore another Frozen parody, you should listen.  I went through the SLO training about a week ago.  I know many other teachers have SLO training to come.  Enjoy:


Wednesday, July 23, 2014

Politicians and Plagiarism

It is just a few weeks until school starts, and a news story involving Democratic Senator John Walsh pops up reporting that he plagiarized his Master Thesis from U.S. Army War College.
Walsh submitted his thesis, titled "The Case for Democracy as a Long Term National Strategy," to earn his Master of Strategic Studies degree in 2007, nearly two years after he returned from Iraq and about a year before he became Montana's adjutant general overseeing the state's National Guard and Department of Military Affairs. 
The paper includes a series of unattributed passages taken from the writings of other scholars.
The first page borrows heavily from a 2003 Foreign Affairs piece written by Thomas Carothers, vice president for studies at the Carnegie Endowment for International Peace, and a 2009 book by Natan Sharansky with Ron Dermer called "The Case for Democracy: The Power of Freedom to Overcome Tyranny and Terror."
There are several other sections that were plagiarized throughout the paper.  The part that bothers me the most is that he is trying to use PTSD as an excuse:
Walsh told The Associated Press when he wrote the thesis, he had PTSD from his service in Iraq, was on medication and was dealing with the stress of a fellow veteran's recent suicide. 
"I don't want to blame my mistake on PTSD, but I do want to say it may have been a factor," the senator said. "My head was not in a place very conducive to a classroom and an academic environment."
Now, before you start with any partisan statements,  remember that politicians on both sides are responsible of this crime.  Conservative politician Rand Paul has been accused of plagiarism several different times.  It is also not specific to United States politicians.  Recently, several German politicians have been found to have committed plagiarism.  Even John McCain and Barack Obama have been accused of plagiarism.

Every it seems, I deal with plagiarism in my class despite severe warnings.  Students always act surprised when I tell them that they will be redoing their paper and receiving a significant grade deduction.  They claim that they didn't do it, despite the fact that they are using words they have never heard or I show them copies of the websites that they copied.  Despite that I catch students, I know that some are able to sneak it past me.

The reason usually for plagiarism is the student put of doing the assignment until the last minute and doesn't want to do the real work.  I think that Senator John Walsh should do a PSA on why plagiarism is wrong, redo the thesis paper (by himself without any staffer being able to assist him), take a 20% grade deduction and be stripped of any honors he may have received.  

Tuesday, July 22, 2014

A Reminder That the GOP Celebrates in Taking Healthcare Away From People

The GOP is still trying to kill Obamacare since they can't to it through electing officials, since they have already lost in the Supreme Court, but they won't stop.  A recent 2-1 ruling from the D.C. Circuit Court  (2 very conservative justices), ruled against the subsidy portion for states that use the federal exchange.  The South Dakota GOP immediately jumped on the ruling to link the ACA to Rick Weiland.  Posted on South Dakota War College:
“President Obama and his loyal foot soldier Rick Weiland were given an emphatic ‘no’ today by the D.C. Court of Appeals on their failed Obamacare law,” said Dick Wadhams, spokesman for the South Dakota Republican Party. “The court ruled on what the Obamacare law actually says, not what President Obama and Rick Weiland say it says....”
 “The current Obama-Weiland health care law is bad enough but Weiland actually wants Obamacare on steroids,” Wadhams said. “Weiland would dramatically expand Medicare and make that federal health care program for seniors available to everyone. Weiland’s Medicare/Obamacare expansion proposal would destroy Medicare as we know it for seniors.”
It will be interesting to hear what the GOP will say when the ruling is reversed.  It seems that the two judges wanted to ignore precedent and ignore the whole context of the law (2,000 pages) based on one line.
The Fourth Circuit in Virginia upheld the subsidies—indicating the government had the better argument, but regardless applying the longstanding rule that when a statute is not clear, courts defer to the agency administering the statute (in this case, the IRS). The D.C. Circuit, however, ruled the other way, reading one provision of this massive and complex federal law out of context. That opinion not only misinterprets the statute—with enormous practical consequences—but also does a deep disservice to conservative jurists and lawyers who have spent the last 30 years arguing that text-based interpretation is sophisticated, not literalistic, and serves democracy....
It is true, as the plaintiffs argued, that a single provision of the statute provides that subsidies shall be available to exchanges established by states, and that that provision does not also mention the federal government.But it is also emphatically true that the rest of the statutory text makes quite clear that the subsidies were also intended on federal exchanges. Another provision of the statute requires reporting to the IRS of subsidies doled out on federal and state exchanges alike—and that provision expressly mentions the federal exchanges. The statute also, in several other places, mentions state exchanges in ways that clearly are intended to refer to exchanges operated by the states or exchanges operated by the federal government for the states.

So the realistic probability of this argument continuing is actually slim.  It does serve as a reminder that the South Dakota GOP and Mike Rounds looks forward to increasing the number of people that are uninsured.  (Remember that Daugaard is hoping to use the ACA foe health insurance for state employees.)  We are reminded that the ACA is working to lower uninsured rates the United States.  That South Dakotans of all ages are benefiting from the law.
·         92,000 uninsured South Dakotans will have new health insurance options through Medicaid or private health plans in the Marketplace. 
·         In the first ten months of 2013, 8,200 seniors and people with disabilities have saved on average $714 on prescription medications as the health care law closes Medicare’s so-called “donut hole.” 
·         9,000 young adults have gained health insurance because they can now stay on their parents’ health plans until age 26.
Here is a new headline for Mike Rounds and the SDGOP:  MIKE ROUNDS CELEBRATES IN THOUSANDS OF SOUTH DAKOTANS LOSING HEALTH INSURANCE!!!! 

Americans for Prosperity Here for Rounds Or the Minimum Wage

The Koch Brothers have decided that South Dakota is not anti-worker enough for their tastes and have decided to open an office in Sioux Falls.  This has caused the Senate candidates to start discussing concern (as reported on South Dakota Public Radio) over the influence they might have on the election.  Weiland called for candidates to back away from outside influence and raised the biggest concern:
"Their approach to politics is pretty straight-up. If you have a big enough checkbook, you can literally buy yourself a government," Weiland says. "And if they follow their usual pattern here in South Dakota, they could spend literally millions of dollars on this Senate seat."
Pressler and Howie also have concerns, but don't think a calling to prevent outside money from influencing South Dakota politics is going to work:
Independent candidate Gordon Howie says he believes outside money is bad for the campaign, but he’s not going to make a declaration. He says money from outside the state already influences South Dakota politics. 
"For me to be presumptive enough to think that, by me just calling for big money to stay away, that they’re going to listen to me, are we kidding ourselves? Big money has a real interest in this South Dakota Senate seat," Howie says. 
I agree with Pressler and Howie.  Rounds obviously is not concerned, but there will be no way to keep out outside money from trying to buy the election.  The only problem is I think the Koch brothers will be more focused on fighting minimum wage than helping Mike Rounds maintain his crony capitalism support for big oil, EB-5, and other business friendly practices.  I think they will be major players in fighting minimum wage initiative.

The Koch Brothers plan for a major spending spree across the nation to influence politics the way they think all of us should live.

The Koch brothers’ main political arm intends to spend more than $125 million this year on an aggressive ground, air and data operation benefiting conservatives, according to a memo distributed to major donors and sources familiar with the group. 
The projected budget for Americans for Prosperity would be unprecedented for a private political group in a midterm, and would likely rival even the spending of the Republican and Democratic parties’ congressional campaign arms.
The Koch Brothers view a minimum wage as a major barrier to allowing businesses to take advantage of human beings to make sure that they can make more money.  They feel all regulations on businesses are evil and wrong.

The point of it, Koch said, is that he believes prosperity grows where economic freedom is greatest, where government intervention in business affairs is kept to a minimum. He hopes his ideas will help the country grow, he said. In his interview he emphasized several times that he believes his ideas on economics will help disadvantaged people. Government regulations – including the minimum wage law – tend to hold everyone back, he said.
This is the same guy that thinks if you are living on $34,000 a year, you should be thankful.   You are one of the richest people in the world!  You are one the 1%!

The video, available on YouTube, starts by saying that if you earn more than $34,000, “you are one of the wealthiest 1 percent in the world.” Koch, one of the richest men in the world, acknowledged that assertion might be pounced upon.
The only way to cut through the upcoming AFP disinformation campaign is to fight back with activity and providing real facts.  It is wrong that any single individuals can have so much influence on a campaign.  The difference is that critical thinking people can overcome the money the Koch Brothers will be throwing against the Minimum Wage campaign and Rick Weiland. 

Read more here: http://www.kansas.com/2013/07/09/2881836/charles-koch-launching-wichita.html#storylink=cpy


Monday, July 21, 2014

GOP-More Proof of No Need To Worry About Teacher Shortages

The back to school specials can only signal one thing: Christmas specials will be starting in about 4 weeks.  It also means that parents are eagerly looking forward to send their children back to school and the teachers that are starting to worry about getting everything ready in time for the start of the new year.  That is if there will be a teacher at the school for the teacher.

Leo Kallis posts several tweets reflecting concern of superintendents all over South Dakota worried about find the best applicant to teach your child.  They are some scary statements.  Superintendents from small schools and big school, from East River and West River, from elementary level concerns to high school staffing concern are voicing huge red flags about the state of the teaching profession in our state.  

A few of the tweets include:
-RC Supt. @tmitchell212 said one elementary in his district has had 5 offers declined by teacher applicants because of salary.
-DeGroot [from Brookings] said he has to "convince" applicants to take a job. Added that applicants used to be giddy to be hired.  
-Timber Lake Superintendent Jarod Larson said all teaching positions are "hard to fill" not just certain academic areas.  
The problem is compounded by the fact that more people are getting out of the teaching profession altogether.  A report on NPR stated:
"Roughly half a million U.S. teachers either move or leave the profession each year," reads a new report from theAlliance for Excellent Education, an advocacy group. And this kind of turnover comes at a steep cost, not only to students but to districts: up to $2.2 billion a year. 
It is clear that something has to be done.  I know that this may come as a shock to basically no one except several member of the South Dakota GOP.  Remember that in January of this year a special education committee reported that there is a teacher shortage crisis in our fair state.
According to a resolution approved on a 10-4 vote by the interim education funding formula study committee, “teachers are in short supply in this state, and that school districts of all sizes are now struggling to retain qualified teachers and to fill teacher vacancies.”  
The resolution suggests the Legislature explore tuition-reimbursement programs, other programs or policies “that could help attract more good people into the teaching profession in South Dakota and to keep the good teachers that are already here.” 
The resolution points out that teacher salaries are higher in neighboring states and some teachers are leaving South Dakota for those jobs. 
The resolution also argues that “fewer and fewer” college students are seeking education degrees with plans to become teachers. 
Ernie Otten and Isaac Latterell, District 6 members of the South Dakota Legislature, voted against the resolution.  They chose to ignore a clear study that was done and that also had no specific mandates included in a resolution to say "Hey, teachers will be just fine."  Isaac Latterell never made his reasoning clear behind his vote (because why bother with the little people of his district that he likes to visit when it is time for re-election).  Ernie Otten's reasoning was very troublesome.  He didn't want to be put in the corner in the future when someone might ask for more money.  To put it another way: This is going to be really hard and might require me to do something to find funds or be clever to deal with a real problem facing the people of South Dakota.

It is time to start realizing the fact that something must be done.  We need to stop treating teachers as villains and support them.  The South Dakota legislature can make a positive impact towards restoring faith in our teachers.  It will require courage.  It will require out of the box thinking.  It will require people who are not afraid to embrace the problem.  It will require someone other than Ernie Otten and Isaac Latterell.