Tag Archives: Ronald Reagan

Congress, take back the wheel: NSA collection of phone numbers isn’t new

The news headlines are all aflutter this morning about the Guardian UK’s publication of a Foreign Intelligence Surveillance Court order requiring Verizon to turn over on an ongoing basis the metadata (phone numbers, time and length of calls, location, etc. — but no subscriber information) of all calls where at least one party was in the United States.

The practical impact of such a request is that the federal government has a record of every phone call made on the Verizon network, with enough information to identify who the caller is in at least 95% of the cases.  (Based on the metadata, it’s rather easy to figure out the identity of the caller.)

The court order in this case was signed by U.S. District Court Judge Roger Vinson, a Reagan appointee.

The sad reality, though, is that these programs that collect huge amounts of data aren’t new. They’ve just been largely ignored by the media — in both the Bush and Obama Administrations.  We know, for instance, that the federal government began similar activities shortly after 9/11 and the program in its current form has been ongoing since 2006.  The government’s ongoing efforts to keep such programs as secret as possible have thwarted attempts by the media and civil liberties groups to get to the bottom of the story.

What we see today is the result of a sad bipartisan abdication of responsibility by the United States Congress.  In the wake of 9/11, they passed the PATRIOT Act, which gave the executive branch broad powers to conduct such surveillance.  The PATRIOT Act passed Congress with broad bipartisan support in 2001 (Senate vote was 98-1, House vote was 357-66.), and was reauthorized in 2005, 2009, and 2011.

(As an aside, the powers in the PATRIOT Act were far broader than those requested by President Clinton in the wake of the Oklahoma City bombing.  Congressional Republicans were nearly universally opposed to Clinton’s plan and never let it out of committee.  Six years later, Republicans represented just two of the 67 Congressional “no” votes for the PATRIOT Act.)

Section 215 of the PATRIOT Act gives the federal government broad powers to ask for such information.  Unlike a traditional warrant where the standard is probable cause that the target was involved in a crime, the government only needs to show “reasonable grounds” that the requested information was “relevant to an authorized investigation . . . to obtain foreign intelligence information. . . or to protect against international terrorism or clandestine intelligence activities.”

Once the 2006 revelations of the first iteration of this data collection program came out, Congress did take action:  to make it perfectly clear that they saw the program as fully legal.  In 2007 and 2008, Congress passed bills that placed the program under the supervision of the Foreign Intelligence Surveillance Act, expanded its reach to cover purely domestic calls, and gave telecom companies retroactive immunity from damages resulting from the breach of privacy.  Reauthorized in 2011, these powers are now scheduled to sunset in 2017 if no Congressional action was taken.

After 9/11, a terrorism act of unprecedented boldness and effectiveness, it may have made some sense to give the executive branch the expansive powers of the PATRIOT Act to collect information to adequately respond to the Al-Qaeda threat.  Nearly 12 years later, though, we have a clearer picture of the threats we face and the tools we need to respond to them.  We also have gained perspective on what we may be giving up in order to secure the notion of security.

It’s time for Congress — politicians on both sides of the aisle need to work together on this one — to take back the wheel from the executive branch on these sorts of issues and craft some reasonable limits that prevent wholesale collection of data from individuals of the nature seen in this example.  This is Congress’s job, and we should expect them to get it done.

And while we’re at it, let’s not also forget who else has this data in question:  Verizon.  Now, there’s little we can do to prevent them from collecting said information other than not use their service or talk to someone who does, but what we can do is make sure that they — and other telecom companies — have to follow strict standards about how it is used.  Companies are using this information already, selling it to other companies and using it to market their own products to you.  Congress should be vigilant to make sure your data is not abused and your privacy not encroached upon.

10 Charts of 2012: History of U.S. Debt

Source:  Quartz.com

Source: Quartz.com

This chart, from Quartz.com, shows the historical debt-to-GDP ratio for the United States going back to 1790.  What’s interesting to note about the graph is how the historical trends in this ration changed during the Reagan years.  Prior to that point, we saw a fairly traditional pattern:  debt rose during wars and during economic downturns.  What made the Reagan years different was the fact that debt continued to increase even during the best of times in the 1980s.

About those “people who don’t pay taxes”

Republicans have spent a lot of time lately complaining about the sizable portion of Americans who now don’t pay federal individual income taxes.  Current estimates show that over 45% of taxpaying units have a zero or negative federal individual income tax liability, a percentage that has grown over time.

To them, they say, it’s a “skin in the game” problem.   Minnesota Rep. Michele Bachmann, for instance, recently said “We need to broaden the base so that everybody pays something, even if it’s a dollar. Everyone should pay something, because we all benefit.”

Let’s leave aside for the moment the fact that people who don’t pay federal individual income tax are still being taxed in substantial ways — including payroll tax and gas tax at the federal level (the individual income tax only represents 41% of federal revenue) — and look at just who these “nonpayers” actually are.  Are they “lucky duckies” as the Wall Street Journal like to call them?  And just how did they get to the point of paying no federal individual income tax?

Obviously, the key factor behind most of the folks who fall into the nonpayer category is their income.  Specifically, they don’t have a lot of it.  88% of nonpayers have household incomes of under $40,000.  Of the remaining 12%, almost half of them have incomes of over $100,000, including about 4,000 households with incomes over $1 million (that’s up 53% from 2007, even though the number of households with incomes at that level has fallen over that time).

There are other key attributes that tend to drive whether one is a nonpayer or not:  46% of nonpayers are elderly and 64% of nonpayers have dependent children.

So how did we get to this situation?  The short answer is that both parties have filled the tax code with targeted credits.  In the immediate WW-II period through the Nixon Administration, the percentage of nonpayers stayed pretty close to 20%.  The introduction of the Earned Income Tax Credit in 1975 spiked that percentage up slightly such that the percentages tracked closer to 25% until the late 1990s.

Since then, the tax code has been littered on a bipartisan basis with multiple credits that have, in part, caused the sharp increases we have seen in recent years.  The first step was the introduction of the Child Tax Credit in 1998, which gave a $400 tax credit for each dependent child on the return.  This credit was expanded in 1999, 2001, and 2003 (reaching its current level of $1,000).  In 2001, the child and dependent care credit was expanded, and in 2003, the new lowest tax bracket of 10% was established and taxpayers got a cut in capital gains and dividend taxes (this contributes greatly to the wealthy folks who fall into the nonpayer category).  In 2008, taxpayers received stimulus checks, and in 2009, the stimulus bill included the Making Work Pay Tax Credit (replaced in 2011 by a temporary payroll tax cut).

These provisions, building one upon the other and in combination with the weak economic conditions, have created the 45%-plus nonpayer rate we have seen in recent years.  Removing these tax credits would fully cut the number of nonpayers in half.

The real question, then, is where do we go from here?  Should we follow Republican logic to its conclusion, remove the credits, and raise taxes on 60 million lower-income Americans?

That’s where the question gets tougher.  Removing credits like these actually impact all Americans, and the middle class and wealthy would take the brunt of the damage.  Except for the earned income tax credit, all of the credits noted above provide greater benefits to the top three quintiles of Americans than they do the poorest in our society.  In total, the top 20% earn twice as much as a percentage of income (and far more than that in real terms) as the bottom 20% from these provisions.

As such, removing these credits — in and of themselves — is not a solution.  Not only would it take money out the pockets of those who can least afford it, but it would further squeeze middle-class families AND take substantial money away from the wealthy — the so-called “job creators” Republicans have been so anxious to protect.

The real answer to what we’re facing is a return to principles embraced on a bipartisan basis in 1986.  Simplify the tax code by removing all but the most essential credits and deductions.  Lower rates across this wider tax base.  Treat all income the same, regardless if it was earned through work, earned as a capital gain or dividend or inherited.

Such reform would accomplish goals that both parties have:  more people would be paying in, the tax code would be simpler (it shouldn’t be used as a backdoor way to handout money), and it can continue to be just as progressive (or even more so) than before.

Republicans driving the car over a cliff

When he was White House Chief of Staff, Rahm Emanuel famously said “Never allow a crisis to go to waste.”  Republicans in Washington D.C. have certainly learned that rule, and learned it well.  So much so that they are in the process of manufacturing a crisis in order to create the opportunity to get reforms they feel are necessary.

Let’s leave aside for the purposes of this post the sheer absurdity of the notion that after having passed a budget that increases the amount of the national debt over the debt ceiling that Congress then has to re-approve spending to that level.  What Congressional Republicans are doing right now is even more reckless than how Minnesota Republicans handled budget negotiations over the last few months.

President Obama has offered significant spending cuts and pared back his tax increases to the bare minimum.  In fact, what President Obama has offered as part of these negotiations is well to the right of Alan Simpson-Erskine Bowles Bipartisan Deficit Commission, the Senate  “Gang of Six”,  and the Alice Rivlin-Pete Domenici Deficit Commission.

President Obama has offered a plan that is almost 4:1 spending cuts to revenue increases.  The revenue increases consist of eliminating loopholes, subsidies, and deductions — many of which Republicans have supported in the past.  The tax code should not be used to pick winners and losers, but rather to ensure a level playing field and to provide the necessary resources for government to perform its functions.  They would be accompanied by a lowering of rates overall to make the changes generate far less revenue than they otherwise would.  This used to be a core Republican value.

Normal people would jump at such a deal — a chance for real entitlement reform ($650 billion in savings over the next 10 years), real cuts in discretionary spending ($1 trillion over the next 10 years, taking such spending back to pre-WWII levels), and rational tax reform that generates about 20% of the overall solution.

But today’s Republicans aren’t normal.  They are devoted to “no new tax” ideology at any cost.  They are willing to drive the car off the cliff as opposed to forcing their wealthy and corporate patrons — who have benefitted the most over the past decade while the labor market and median incomes for the rest of us have stagnated — to chip in just a little bit more.

If Congressional Republicans can’t come to an agreement on the debt ceiling and the country goes into default, they will effectively raise the taxes of every American through increased interest rates.  Our stock market will feel the impact of lost confidence of investors.  There could even be a run on the banks.  This is not a risk we should even be considering, but Republicans are still — even at this late date — still holding out for complete capitulation from the President.

We shouldn’t also fail to point the rank hypocrisy of many of the Congressional Republicans at the heart of this crisis today.  During the Bush Administration, these same leaders voted seven times to raise the debt ceiling — from $5.95 trillion to $11.315 trillion.  They also voted for policies that destroyed our financial future.  As the New York Times pointed out over the weekend, if you take out the impacts of the recession and only look at policy changes, what happened in the Bush Administration caused far more damage than anything that has happened under President Obama (even extending out the impacts of the Obama policy changes to 2017).  Note that the cost of the Bush tax cuts alone is more than all of the policy changes under President Obama combined.

It’s time to stop the false equivalency.  There is a very real difference between Democrats and Republicans — both in Washington D.C. and in St. Paul.  Democrats aren’t willing to put their partisan goals ahead of the well-being of the American people.  Republicans are seemingly content to “take hostages” — including the American economy — to fulfill their ideological goals.

Compromise isn’t a dirty word.  Compromise isn’t weakness.  Compromise is necessary in a divided government, and it’s time Republicans started getting back to doing the serious work of the people instead of being led around by their special interest groups.


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