The Tax Gap Gets Mentioned!!

Sen. John Breaux (D-LA) said that "instead of drilling for oil and gas, Exxon was drilling the tax code, looking for ways to find more and more tax shelters." Senator Grassley said that "what hit me the most was the moral fiber of the people involved," who he said displayed "unbridled greed and blatant disregard for the law of fairness." -- David Cay Johnston, Perfectly Legal, 2003

There is no law of fairness and moral fiber is irrelevant. Heck, morality is irrelevant and Grassley is a clueless dinosaur with way too much power. -- Germaine, 2021 

The net tax gap

Years ago I stumbled across the concept of a stealthy, quiet, never mentioned concept called the net tax gap. I remember it well. It was one of my milk curdling moments.  

But holy foschizzle! It was mentioned yesterday in passing on a business channel. Janet Yellen commented blandly that the current gap is running at $600 billion/year and she would take a look at it.

Translation: She will do nothing about it and could not care less.

Will miracles never cease? The tax gap is actually mentioned in public by someone with some real power. 

The net tax gap is a simple concept, but it is important. 

The magic math equation: The net tax gap = what is owed in taxes - what is paid in taxes. 

Translation into American: In non mathematical language, the gap is the difference between what is owed and what is paid.

So, if $1 trillion is owed to the US Treasury in taxes, but only $550 billion is paid, the net tax gap is $450 billion. That is $450 billion is what the US treasury is cheated out of and what us idiot honest taxpayers have to support in added federal debt financing. 

That's it. That's the whole shebang. My estimate (based on detailed IRS data and analysis for 2001 and 2006) put it at about $700 billion/year ± ~ $30 billion for 2021, while the last squeak the IRS made in public a few years ago was that it is only $400 billion/year at that time. I was more right than the IRS. The IRS was clearly lying about it due to threats from congress to really gut the agency if it didn't shut up and stopped bothering people about paying their taxes.

So there it is, tax cheats get to keep ~$400 billion/year (frightened IRS),  ~$600 billion/year (bland Yellin) or ~$700 billion/year (grumpy Germaine).

Fortunately for huge corporations, they buy and get lots of legal loopholes from sleazeballs in congress, so they don't have to cheat (as much). What a bunch of valiant patriots! HUZZAH!!

Yabut, waddabout the federal debt?

Glad you asked. Anyone in congress who complains about federal debt but blocks action on dealing with the tax gap, e.g., all most or republicans, is a liar. They do not care about the debt. They care about keeping politics corrupt and sleazy. They care far more about keeping tax cheats content and free to cheat than they do about stupid honest tax payers who do not cheat. 

That's two-party politics and business as usual. This sleaze and corruption has been going on for decades. The US Treasury has been cheated out of trillions, maybe about $10 trillion since 2000. That's almost a lot of money. Almost, but not enough to get congress jazzed about anything about it -- too many re-elections are at stake.

Hooray! I don't feel a thing.

Ouch

Sidney Powell's legal defense: 'Reasonable people' wouldn't believe her election fraud claims

 THIS IS JUST TOO RICH!

Lawyers for the Trump ally claim she was just sharing an opinion when she said the election was stolen using machines built to rig races for Hugo Chavez.

“No reasonable person would conclude that the statements were truly statements of fact,” Powell's attorneys said in a court filing defending her against a billion-dollar defamation lawsuit from Dominion Voting Systems, the manufacturer of the election equipment she claimed was involved in the conspiracy to steal the election.

“Plaintiffs themselves characterize the statements at issue as 'wild accusations' and 'outlandish claims,'" her lawyers wrote. "They are repeatedly labeled 'inherently improbable' and even 'impossible.' Such characterizations of the allegedly defamatory statements further support defendant’s position that reasonable people would not accept such statements as fact but view them only as claims that await testing by the courts through the adversary process."

While arguing that Powell's public statements and filings were clearly opinion, the filing also claims that she still believes them to be true.

Her lawyers argued that journalists are able to use the First Amendment to rely on sources they deem credible and that attorneys should be able to do the same. Powell credited sworn testimony when she tied Chávez, who died in 2013, to voting systems used in the 2020 election.

"Lawyers involved in fast-moving litigation concerning matters of transcendent public importance, who rely on sworn declarations, are entitled to no less protection," the filing said, arguing that journalists are only penalized if they know they are publishing false information.

"She believed the allegations then and she believes them now," the filing says.

https://www.nbcnews.com/politics/donald-trump/sidney-powell-s-legal-defense-reasonable-people-wouldn-t-believe-n1261809

Are Some Rural Areas in Unavoidable Economic Decline?

In 2103, the New York Times published an article, The Russia Left Behind: A journey through a heartland on the slow road to ruin. The article noted that there were hundreds of towns shrinking into villages and villages decaying into forest. That was intentional Soviet Union policy. The Soviets cut off support during efficiency drives in the 1960s and ’70s. Towns and villages were categorized as “promising” or “unpromising.” The unpromising ones were cut off from support and left to shrink or revert to primeval forests with roving packs of wolves.

In 2017, the New York Times published a related article, Russia’s Villages, and Their Way of Life, Are ‘Melting Away’, indicating that Russia's rural population is declining. Many small towns and villages are simply going extinct in terms of people living there. After restrictions on movement relaxed after the fall of the Soviet Union, many young people fled resource-starved parts of the countryside for big cities. Researchers estimated that out of 8,300 villages in 1910, 2,000 no longer have permanent residents.

The National Review published an article by Kevin Williamson that ferociously attacked the allegedly self-inflicted misery, immorality and self-deceit about life in rural areas slowly dying from lack of economic activity. Williamson's article pointed to the immorality of belief in T****'s 2016 campaign promises because they masked reality:

It is immoral because it perpetuates a lie: that the white working class that finds itself attracted to Trump has been victimized by outside forces. It hasn’t. The white middle class may like the idea of Trump as a giant pulsing humanoid middle finger held up in the face of the Cathedral, they may sing hymns to Trump the destroyer and whisper darkly about “globalists” and — odious, stupid term — “the Establishment,” but nobody did this to them. They failed themselves. 

If you spend time in hardscrabble, white upstate New York, or eastern Kentucky, or my own native West Texas, and you take an honest look at the welfare dependency, the drug and alcohol addiction, the family anarchy — which is to say, the whelping of human children with all the respect and wisdom of a stray dog — you will come to an awful realization. It wasn’t Beijing. It wasn’t even Washington, as bad as Washington can be. It wasn’t immigrants from Mexico, excessive and problematic as our current immigration levels are. It wasn’t any of that. 

Nothing happened to them. There wasn’t some awful disaster. There wasn’t a war or a famine or a plague or a foreign occupation. Even the economic changes of the past few decades do very little to explain the dysfunction and negligence — and the incomprehensible malice — of poor white America. So the gypsum business in Garbutt ain’t what it used to be. There is more to life in the 21st century than wallboard and cheap sentimentality about how the Man closed the factories down. 

The truth about these dysfunctional, downscale communities is that they deserve to die. Economically, they are negative assets. Morally, they are indefensible. Forget all your cheap theatrical Bruce Springsteen crap. Forget your sanctimony about struggling Rust Belt factory towns and your conspiracy theories about the wily Orientals stealing our jobs. Forget your goddamned gypsum, and, if he has a problem with that, forget Ed Burke, too. The white American underclass is in thrall to a vicious, selfish culture whose main products are misery and used heroin needles. Donald Trump’s speeches make them feel good. So does OxyContin. What they need isn’t analgesics, literal or political. They need real opportunity, which means that they need real change, which means that they need U-Haul. 

If you want to live, get out of Garbutt.

In 2018, the New York Times published an article, The Hard Truths of Trying to ‘Save’ the Rural Economy, that asked if economic rural decline is inevitable. The NYT wrote: "There are 60 million people, almost one in five Americans, living on farms, in hamlets and in small towns across the landscape. For the last quarter century the story of these places has been one of relentless economic decline. ... the United States has grown by 75 million people since 1990, but this has mostly occurred in cities and suburbs. Rural areas have lost some 3 million people. Since the 1990s, problems such as crime and opioid abuse, once associated with urban areas, are increasingly rural phenomena."

It may be that unfavorable economic trends make it impossible to sustain many rural populations in the US and elsewhere. Rural decline is underway in Canada. Agriculture continues to automate, so that is probably not a major source of rural job growth.

The political ramifications aren't clear. Rural population loss suggests there could be a decline in republican party affiliation as urban areas tend to be more democratic and independent than rural areas. How to deal with economic decline is not clear either. 

Some evidence shows that urban areas tend to subsidize rural areas, although most conservatives vigorously dispute that. Regardless, rural economic decline seems to be real and it's a major source of social and political antagonism. This problem just might not be fixable by anyone. Economic trends have a way of going where economic forces make them go, politics and ideology be damned.

Political Extremism: Minds Stuck in a Rut

“All movements, however different in doctrine and aspiration, draw their early adherents from the same types of humanity; they all appeal to the same types of mind.” -- Eric Hoffer, The True Believer, 1951

A 2019 research paper, The Partisan Mind: Is Extreme Political Partisanship Related to Cognitive Inflexibility?, tries to dissect the basis for apparent cognitive differences between extremists or ideologues and others. Two hypotheses have been proposed to explain be rigid adherence to a political ideology. The ideological extremity hypothesis, posits that extreme liberals and conservatives are more cognitively rigid than moderates. According to this hypothesis, partisan political extremism arises from inflexible belief systems that capture the world in black-and-white terms that create the (usually false) appearance of certainty and simplicity. Consonant with this hypothesis, there is indirect evidence that left and right extremists are more dogmatically intolerant and more likely to feel superior about their beliefs.

The rigidity-of-the-right hypothesis, posits that conservatives perceive the world in a more inflexible and categorical way than liberals. Consonant empirical evidence reveals a relationship between political conservatism and psychological preferences for traditionalism, familiarity, and certainty. By contrast, that research indicates that liberalism is more tolerant and accepting of uncertainty and ambiguity.

The data this paper generated was interpreted to be generally in accord with the ideological extremity hypothesis. The data indicates that ideological extremism, not just extreme conservatism, correlates with extreme political partisanship, dogmatism and animosity. 

 

What is cognitive flexibility?

Cognitive flexibility is defined as the ability to adapt to novel or changing environments and a capacity to switch between modes of thinking. One group defined it as “the ability to flexibly switch perspectives, focus of attention, or response mappings”. Cognitive inflexibility is believed to be a state of mental stasis or a tendency of an individual to not change. That includes sometimes not changing bad behaviors despite bad consequences. That is sometimes observed in certain patients with compulsive disorder, drug addiction or frontal lobe damage. To investigate the relationship between inflexibility and political ideology, the research protocols here relied on three different, validated measures of cognitive flexibility.

The paper concludes with this summary of the results: "The present investigation sought to address the question: Does mental rigidity reflect one’s partisan intensity or political orientation? The results reveal that strong partisan intensity predicts reduced cognitive flexibility, regardless of the political party’s orientation and doctrine. .... To the best of our knowledge, these findings constitute the first direct objective testing of the ideological extremity hypothesis using behavioral assessments of cognitive flexibility rather than self-report questionnaires. The data here support the essential claim of the ideological extremity hypothesis: political extremists were more cognitively rigid than political moderates, across multiple tests of cognitive flexibility. These results suggest that the rigidity-of-the-right hypothesis may be incomplete, as it does not account for the presence of the 'rigidity-of-the-left.'"

In other words, extreme liberals could be in a similar or the same cognitive boat as extreme conservatives.

As usual, the authors caution that additional "studies should seek to replicate and expand these results, as well as explore ways in which the two hypotheses can be combined and empirically negotiated."

Political Thrillers

 My partner in crime Geri and I have started to watch old classics of late, especially as now with Covid not a lot of new material coming out.

On my Forum I talked about Alfred Hitchcock films, on here I want to talk about political thrillers.

WHAT EVER HAPPENED TO POLITICAL THRILLERS ANYWAYS?

Nowadays the films that pass for political thrillers seem dull compared to some of the classics (at least in my humble opinion).

Examples of what I am talking about:

 Seven Days in May (1964)

https://www.imdb.com/title/tt0058576/

Though the movie is about a General ready to overtake the US government parts are eerily similar to what happened recently via Trump.

Another gem:

All the King's Men (1949)

https://www.imdb.com/title/tt0041113/?ref_=fn_al_tt_4

But one of my favorite all time, and still is, is:

Fail Safe (1964)

https://www.imdb.com/title/tt0058083/

Now, what constitutes a political thriller does vary from person to person, I found a sight that listed "Dr. Strangelove" as a political thriller (say what?) as well as listing "Lincoln" which is really a historical piece more than a thriller.

BUT COME PLAY ALONG ANYWAYS:

GOT any favorites among the genre? Any political thrillers you care to list for Geri and I to watch?

Maybe you know of a gem I have missed.

and Happy Monday to boot!

The Conservative Game: Owning the Libs and Crushing Democracy

Understanding what drives polarization and the breakdown of social comity appears to be of central importance to understanding the American drift into some form of harsh, demagogic dictatorship. A Politico article offers some possible insight that at least partly explains the mess. Politico writes:

For a political party whose membership skews older, it might be surprising that the spirit that most animates Republican politics today is best described with a phrase from the world of video games: “Owning the libs.”

Gamers borrowed the term from the nascent world of 1990s computer hacking, using it to describe their conquered opponents: “owned.” To “own the libs” does not require victory so much as a commitment to infuriating, flummoxing or otherwise distressing liberals with one’s awesomely uncompromising conservatism. And its pop-cultural roots and clipped snarkiness are perfectly aligned with a party that sees pouring fuel on the culture wars’ fire as its best shot at surviving an era of Democratic control.

But in a post-Trump America, to “own the libs” is less an identifiable act or set of policy goals than an ethos, a way of life, even a civic religion.

“‘Owning the libs’ is a way of asserting dignity,” says Helen Andrews, senior editor of The American Conservative. “‘The libs,’ as currently constituted, spend a lot of time denigrating and devaluing the dignity of Middle America and conservatives, so fighting back against that is healthy self-assertion; any self-respecting human being would… Stunts, TikTok videos, they energize people, that’s what they’re intended to do.”

“I can envision a time where [pro-Trump Florida Rep.] Matt Gaetz could pin a picture of [Democratic New York Rep.] Alexandria Ocasio-Cortez to his own crotch, and smash it with a ball-peen hammer, and he’ll think it’s a huge success if 100,000 liberals attack him as an idiot,” says Jonah Goldberg, editor-in-chief of the anti-Trump conservative outlet The Dispatch. “It’s a way of taking what the other side criticizes about you and making it into a badge of honor.”  

“It’s a spirit of rebellion against what people see as liberals who are overly sensitive, or are capable of being triggered, or hypocritical,” says Marshall Kosloff, co-host of the podcast “The Realignment,” which analyzes the shifting allegiances of and rise of populist politics. “It basically offers the party a way of resolving the contradictions within a realigning party, that increasingly is appealing to down-market white voters and certain working-class Black and Hispanic voters, but that also has a pretty plutocratic agenda at the policy level.” In other words: Owning the libs offers bread and circuses for the pro-Trump right while Republicans quietly pursue a traditional program of deregulation and tax cuts at the policy level.  

That’s led to predictable tensions, as the party’s diminishing cadre of wonky reformists lament a form of politics that seems more focused on racking up retweets and YouTube views than achieving policy goals. Even so, Trump-inspired stunt work is, for the moment, the Republican Party’s go-to political tool. “Owning the libs” is no longer the domain of its rowdy, ragged edges, it’s the party line, with the insufficiently combative seen as inherently suspect and outside the 45th president’s trusted circle of “fighters.”

Do liberals really spend too much time denigrating and devaluing the dignity of Middle America and conservatives? That complaint is not uncommon. Is it true? Do people, like me, who heavily criticize the ex-president and dark free speech cross a line from principled political opposition and rhetoric to mere partisan rudeness and hypocrisy? Or, is the republican complaint a propaganda ploy by elites to keep the rank and file riled up, deceived, manipulated and betrayed, all without their understanding of exactly what is going on and why?

“The John the Baptist to former President T****’s all-ownage-all-the-time 

messianic leadership: Rush Limbaugh

Limbaugh regularly filled the three daily hours of his program with invective against women, people of color, LGBTQ people and any number of other groups that didn’t include Rush Limbaugh. .... to his millions of devoted listeners, no remark was too inflammatory to be brushed aside in light of his peerless talent for owning the libs.”

Exactly who is denigrating and devaluing the dignity of who and what?