Category Archives: Ethics

First emoluments clause case gets a hearing in court

Our Twitter-troll-in-chief successfully manufactured a grand distraction of the media this past week by engaging in outrageus behavior with his “Gold Star family” scandal to stop them from reporting on subjects he does not want them to cover.

A subject the media failed to cover this past week while distracted by bright shiny objects was the first court hearing in one of the first emoluments clause cases filed against Donald Trump for his profiting off of his position as president.

Dahlia Lithwick reports, Would $1 Million in Hot Dogs Violate the Emoluments Clause?

In a federal courthouse in Manhattan on Wednesday morning, lawyers for the Department of Justice tried to persuade Federal District Judge George B. Daniels to toss the civil lawsuit accusing the president of violating the Constitution by accepting foreign money while in office. Perhaps the high point of the morning came when a Trump lawyer conceded that if the president were to accept $1 million in hot dogs purchased from an imaginary Trump hot dog business as a gift to sign a foreign treaty, he would probably run afoul of the most obscure constitutional provision you’ve never heard of. Metaphor, meet the president of the United States.

You may recall that back in November everyone was casting about trying to find a name for the phenomenon wherein a presidential candidate who promises to release his tax returns if elected and declines to do so, then promises to divest himself of his foreign business interests from which he would profit as president and fails to do so, and then stands next to a tower of empty folders and tells us ethics rules don’t apply to the White House and he doesn’t care if you’re mad about that. You may also recall that this was around the time the word emoluments became something other than that stuff you use to keep your skin smooth and supple.

The Foreign Emoluments Clause can be found in Article I, Section 9 of the U.S. Constitution, and it bars anyone holding an “office” from accepting presents or emoluments from “any King, Prince or Foreign State” without “the consent of Congress.” (The Constitution actually has three separate emoluments clauses, but only the foreign and domestic clauses came up in oral arguments on Wednesday.) In the simplest possible terms, the Emoluments Clause prohibits government officials from accepting gifts or payments from foreign governments. Here’s the sticky bit: We don’t have a lot of doctrine in this area because it’s never been litigated, chiefly because most presidents haven’t wanted to look like they were cashing in on the office with club fees, Chinese trademarks, and jacked-up hotel drink prices. But this president doesn’t care about any of that.

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Kansas is a cautionary tale for Arizona, and America

In 2012, Koch-bot governor Sam Brownback led a radical Tea-Publican legislature to enact the “Kansas experiment” out of blind faith in trickle-down economics. They enacted “a tax cut that eliminated state income taxes entirely for pass-through entities — such as sole proprietorships and limited liability partnerships — which are taxed at the owner’s individual income tax rate. The law also lowered individual income tax rates, cutting the top rate to 4.9 percent from 6.4 percent.” Kansas Tried a Tax Plan Similar to Trump’s. It Failed.

The tax package reduced state revenue by nearly $700 million a year, a drop of about 8 percent, from 2013 through 2016, according to the Kansas Legislative Research Department, forcing officials to shorten school calendars, delay highway repairs and reduce aid to the poor. Research suggests the package did not stimulate the economy, certainly not enough to pay for the tax cut. This year, legislators passed a bill to largely rescind the law, saying it had not worked as intended.

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[C]ongressional Republicans and President Trump are trying to take the experiment with pass-through preferences national, beyond Wichita and Topeka to cities with residents who measure incomes in seven, eight or nine figures.

The Republican tax rewrite unveiled this month aims to jump-start economic growth in part by establishing a 25 percent tax rate on small businesses and other firms that operate as pass-through entities, a cut from the top rate of 39.6 percent that such business owners pay now.

But the abandoned experiment in Kansas points to how a carve-out intended to help raise growth and create jobs instead created an incentive for residents, particularly high earners, to avoid paying state income taxes by changing how they got paid.

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So how’s that trickle-down working out for Arizona?

The Arizona Capitol Times (subscription required) reports that Arizona Legislature’s budget analysts predict 2018 shortfall:

The Arizona Legislature’s budget analysts last Thursday predicted a budget shortfall that could top $100 million in the current and coming year as the impact of corporate tax cuts continues to overwhelm increases in sales, insurance premium and personal income tax collections.

Whaaa? You mean tax cuts don’t pay for themselves and are revenue neutral? (sarcasm).

Chief budget analyst Richard Stavneak told economists and state officials who make up the Legislature’s Finance Advisory Committee that the shortfall will hit $104 million. That’s out of an expected $10 billion in spending for the budget year that begins next July 1. A panel of state lawmakers also attended the meeting.

Excluded from that projection is $90 million in current spending that is labeled one-time but appears to be an ongoing commitment by the Legislature and Gov. Doug Ducey, Stavneak said. That puts the expected shortfall next year close to $200 million if that spending isn’t cut. The revenue picture could also brighten, but signals are mixed, he said.

Phased-in corporate tax cuts enacted under former Gov. Jan Brewer in 2011 have cut more than $600 million in yearly revenue since 2014. Rep. Don Shooter, R-Yuma, said it may be time to revisit the corporate tax cuts and predicted a budget battle next year.

“It’s going to be a free-for-all. We’re back to the cutting, I don’t see any other way,” Shooter said. “It’s going to come down to who’s going to bleed the least, what’s going to be the least painful, I guess.”

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Rep. Martha McSally supports Trump’s tax cuts for Plutocrats plan

Our Representative Martha McSally continues to stand by her man Donald Trump, and has adopted his socioparthy for lying about taxes.

The Arizona Daily Star published a report that is no doubt stenography from a McSally press release, wherein the only “news” made is that McSally supports Trump’s tax plan (which is actually an outline that has not yet been written into a bill). McSally: Trump’s tax proposal would help local businesses, middle class:

U.S. Rep. Martha McSally signaled her support Tuesday for President Trump’s tax proposal, saying it represents a once-in-a-generation opportunity to simplify the country’s tax codes.

But … she stressed the proposal is still in the most nascent of stages as lawmakers wrestle with core concepts.

So once again McSally supports a bill not even knowing what is in it because the GOP leadership has only one issue that truly matters to it and to its campaign donors, massive tax cuts for their Plutocrat masters. “Let’s get thisfucking thing done!”

She outlined her goals for tax reform, saying she wants to help the middle class with tax cuts, help small businesses grow, simplify the entire tax code and reset the tax code so that the United States can compete globally for new and growing businesses.

Well, this may be her goals, but they are not the goals of the GOP leadership nor her man, Donald Trump. The tax proposals discussed to date would achieve none of McSally’s asserted goals. So by supporting this “nascent” bill that would not accomplish anything she claims to want, McSally’s actual goals must be something else, i.e., being a loyal servant to her Plutocrat masters who contribute big bucks to her campaign.

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Kabuki theater: budget vote-a-rama in the Senate today

The U.S. Senate is voting on the GOP’s budget resolution today, which is really not about the budget at all, but rather, rigging the procedural rules in the Senate so that the GOP can vote on its so-called “tax reform” (tax cuts for Plutocrats) bill at some point with a simple majority vote of 50 senators plus the Vice President, and bypass the Senate cloture rule of 60 votes to forestall a Democratic filibuster through adoption of reconciliation rules.

The Senate’s budget process allows votes on any politically charged issue during a so-called vote-a-rama session. This is  all Kabuki theater to get senators to take votes on amendments to be used in campaign ads against them later.

Roll Call reports, When the Budget Resolution Isn’t About the Budget:

When Sen. John McCain removed the suspense by announcing he would vote for the budget resolution moving through the Senate, the Arizona Republican made clear the ridiculousness of the exercise.

At the end of the day, we all know that the Senate budget resolution will not impact final appropriations,” he said in a statement. “To do that, Congress and the White House must negotiate a budget agreement that will lift the caps [sequestration] on defense spending and enable us to adequately fund the military.”

McCain said he was supporting the budget resolution because it includes instructions that provide the path forward for overhauling the federal income tax code without the risk of filibusters, rather than because of the funding levels it would provide.

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Strike three for Trump’s Muslim travel ban

Last week, the U.S. Supreme Court dismissed and remanded to the 4th Circuit Court of Appeals the legal challenge to President Trump’s March 6 executive order, i.e., the “Muslim travel ban.”  The court gave instructions to dismiss the case as moot – that is, no longer a live controversy, because the part of the ban challenged expired during the pendency of the appeal. The justices did not act on Trump v. Hawaii, the challenge that it had agreed to review along with the Fourth Circuit case last June. The Hawaii case challenges a provision of the March 6 order that is still in effect, but will expire later this month (this means that the justices could also dismiss this case). Justices end 4th Circuit travel-ban challenge (SCOTUSblog).

The Trump administration issued a third iteration of its travel ban during the pendency of these appeals at the Supreme Court.

The third iteration of the Trump administration’s Muslim travel ban took strike three looking yesterday (it is baseball playoffs season) in the U.S. District Court for Hawaii, again. Federal judge blocks Trump’s third travel ban:

A federal judge on Tuesday largely blocked the Trump administration from implementing the latest version of the president’s controversial travel ban, setting up yet another legal showdown on the extent of the executive branch’s powers when it comes to setting immigration policy.

The decision from U.S. District Judge Derrick K. Watson in Hawaii is sure to be appealed, but for now, it means that the administration cannot restrict the entry of travelers from six of the eight countries that officials said were unable or unwilling to provide information that the United States wanted to vet the countries’ citizens.

The latest ban was set to go fully into effect in the early hours of Wednesday, barring various types of travelers from Syria, Libya, Iran, Yemen, Chad, Somalia, North Korea and Venezuela. Watson’s order stops it, at least temporarily, with respect to all the countries except North Korea and Venezuela.

In a 40-page decision granting the state of Hawaii’s request for a temporary restraining order nationwide, Watson wrote that the latest ban “suffers from precisely the same maladies as its predecessor.”

Watson also wrote that the executive order “plainly discriminates based on nationality” in a way that is opposed to federal law and “the founding principles of this Nation.”

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