Friday, February 27, 2015

LNG exports

Six Democrats and six Republicans have introduced a bill in the senate to expand the US facilities to increase exports of natural gas. Because of fracking the US now has an oversupply of natural gas and can now export. This means more high paying jobs here while maintaining low prices. It means that Europe will not have to be so dependent on Russia and can stand up to Putin. It means replacing coal and oil with natural gas and that reduces air pollution and helps to solve the problem of climate change. The government has been reluctant to issue the necessary permits to allow construction of liquefying plants and equipment and this law will change that. Construction of one such plant is underway in Louisiana and expected to cost 4 billion dollars. Better late than never!

Thursday, February 26, 2015

Balance of power

The congress is trying to reign in The Presidents power by threatening to withhold funds and that is the way the constitution is designed to balance power between the branches but it will not be used because it is political suicide to shut down the government. The other alternative is to impeach and that is also political suicide so the power remains in the hands of the president whoever he may be. The recent fight over The Presidents offer to 5 million undocumented immigrants is a good example of this power. The President said on 22 different occasions that he does not have the power to offer this to these immigrants. “America is a nation of laws, which means I, as the President, am obligated to enforce the law. I don't have a choice about that. With respect to the notion that I can just suspend deportations through executive order, that’s just not the case - The President is a constitutional lawyer who knows that laws are passed by congress and implemented by the president. Here is a quote from him saying he is changing the law. “Now, you’re absolutely right that there have been significant numbers of deportations. That’s true. But what you are not paying attention to is the fact that I just took an action to change the law. One of the outcomes of the fighting between political parties is that the congress is no longer on an equal plane with the president as outlined in the constitution. The balance of power between the branches is threatened.

Wednesday, February 25, 2015

War

Article 1, Section 8 of the constitution says congress has the power to declare war. President Obama has been conducting military operations in the Middle East but now realizes that ISIS is a threat to the United States and wants something official from the congress to continue these operations. He says he does not want to use enduring offensive ground combat operations and wants all operations to cease in three years. This is reminiscent of Obama when he named our mission , Operation Inherent Resolve. Former Secretary of State and Chairmen of the Joint Chiefs said of war: As Powell said in an April 1, 2009 interview on The Rachel Maddow Show, the Doctrine denotes the exhausting of all "political, economic, and diplomatic means", which, only if those means prove to be futile, should a nation resort to military force. Powell has expanded upon the Doctrine, asserting that when a nation is engaging in war, every resource and tool should be used to achieve decisive force against the enemy, minimizing U.S. casualties and ending the conflict quickly by forcing the weaker force to capitulate. There is a profound disconnect between these two views of what war is and this must be resolved before congress can declare war.

Sunday, February 15, 2015

Muslim culture

Defenders of Islam assert that the beheadings do not represent their religion and most in the West agree but looking at the normal behavior in Muslim countries reveals many practices which seem to treat women as second class citizens. Islamic laws and cultural customs impact various stages of a Muslim women's life, including her education, employment opportunities, rights to inheritance, female circumcision, dress, age of marriage, freedom to consent to marriage, marriage contract, mahr, permissibility of birth control, divorce, sex outside or before marriage, her ability to receive justice in case of sex crimes, property rights independent of her husband, and when salat(prayers) are mandatory for her.[4][5][6] Polygyny is allowed to men under Islam, but not widespread; in some Islamic countries, such as Iran, a woman's husband may enter into temporary marriages in addition to permanent marriage.[7][8] Islam forbids Muslim women from marrying a non-Muslim. These are some of the things that are called to attention when observing Muslim countries. Talking about the extremist just diverts attention away from what happens in everyday activities. Even something as basic as allowing a man to have four wives calls into question the concept of equal rights. It is time to shine the light of modernity on these cultural activities and not be blinded by excesses.

Saturday, February 14, 2015

Buying votes

The question of why people do not feel the improvement in the economy keeps coming up. The stock market is up, housing has bottomed out and the stated unemployment rate is down to 5.6% so why are people still in the doldrums. The answer is the labor participation rate and wages. The percent of eligible people working is 62.9 and this is the lowest since 1979. In addition wages for middle and low income Americans have been stagnate. The government has been handing out benefits to these middle groups but what they really want is a job and that has to come from the private sector. One of the economic arguments for handing out money is that it will stir up the economy but the same argument can be made for reducing taxes. What is the difference between handing out a billion dollars in benefits and reducing taxes by a billion dollars? In the first case the government gets to control the spending and in the second case the individual gets control. When the government controls the spending it helps them control the voting which in turn leads to more spending which leads to more votes. This is the path the country seems to be on and will likely continue unless some changes are made. Here are quote from a couple of very smart people. “Once the people find they can vote themselves money, that will herald the end of the Republic.” – Benjamin Franklin “The American Republic will endure until the day Congress discovers that it can bribe the public with the public's money.” ― Alexis de Tocqueville

Most admired

Cary Grant was a famous actor and was considered worldly, sophisticated, debonair and a dashing sex symbol. He once remarked that everyone wants to be Cary Grant….I want to be Cary Grant. I bring this up because there is a company that rates well known people by how trustworthy they are and the top ten on the list are actors. This is a sad commentary on today’s culture when a fictitious person is considered more trustworthy than an actual person. It reminds of people who think that soap operas are real and send gifts to the characters portrayed in the show. This company is in the news because Brian Williams was number 28th on the list and after the lie he told on national TV he dropped to 865th. There is one group of people, that lying does not seem to adversely affect and that is, politicians, which is also sad. We don’t seem to mind when they lie because we expect them to lie and then we vote for them.

New benefits

There is a lot of controversy regarding President Obama’s changes toward undocumented immigrants and how they report earnings. Under current law they are issued an ITIN (individual taxpayer identification number) and they file taxes using that number. They are not eligible for tax credits. With the new rules they will be issued a social security number and will qualify for these benefits. Here is an example based on a tax return I just finished this week. A single mom age 23 with a 3 year old child. The Grandma babysits so this lady can work and she earned $13,600 last year and paid no federal or state income tax. Because she has a social security number she qualified for $3,305 from the earned income credit (EIC) and $1,000 from the child tax credit plus $1,040 from the MN working family credit. People who now have an ITIN will qualify for these benefits and will be allowed to refile the last three years and get these benefits. In this example this amounts to a windfall benefit of $21.360. These benefits are for single parents with one child who earn less than $44,000 per year. Having this SS number will qualify these individuals for disability benefits, retirement benefits and survivor benefits under the social security program. In addition there are a number of benefits under public assistance that now become available. These changes will provide benefits to low income people and will be paid for by either collecting more from higher earners or debt financing.

Friday, February 13, 2015

College Walker

Former Governor of Vermont, Dr. Howard Dean said yesterday that Scott Walker was not qualified to be president because he did not graduate from college. Many people will see that as asset for Walker and will not confuse formal education with intelligence. When a person decides to run for president all sorts of things will be reported and if he rises in the polls there will be many more. It happens to all presidential candidates and most people will just ignore

Student loans

The President has refined his student loan forgiveness program. Students will pay 10% of the income above the poverty level for 20 years and then the rest is forgiven. If you work for the government or a non-profit the rest is forgiven after 10 years. A person working for the government making $40,000 per year will have payment so low that in ten years what is owed is more than the total loan because of negative amortization and the whole amount if forgiven. Many people will receive a form 1099 C from the government and the amount of debt cancelled will then be taxed to them as ordinary income in the year received. There are certain groups that will not have to pay tax on this income primarily those who choose to work for the government. Some consider this just one more way to divide the country. Public service loan forgiveness, teacher loan forgiveness, law school loan repayment assistance programs and the National Health Service Corps Loan Repayment Program are not taxable.

Wednesday, February 11, 2015

Putin

As the situation in The Ukraine worsens the world doesn’t want to know about it. Russia says their troops are not there and the Europeans don’t want to respond and the US is concentrating on ISIS. Putin’s plan closely follows Hitler’s prior to WW 2. He first took Crimea and now a part of Ukraine. Once he establishes his presence in The Ukraine, he can begin to hassle the Baltic States who are part of NATO. NATO (the North Atlantic Treaty Organization) is a defensive group designed to protect small European countries from Russia. If any of those countries are openly attacked the United States by treaty must come to their rescue and the key word here is “openly”. Putin is too smart for that, so he will move close to their borders and use covert means to destabilize their governments. He can use the Russian Mafia and this will deter foreign investors to invest in these countries. This will adversely affect their banking systems as well and their overall economy. As these countries experience financial failure it will weaken the NATO alliance which is his long term objective. All the while this is going on Putin will continue to participate in Peace talks much like Iran does as they pursue their nuclear goals.

Tuesday, February 10, 2015

Swiss leaks

These past few years as hackers gained more attention with their destructive activities, I suggested that they do something worthwhile like looking into secret Swiss Bank accounts. Well Holy Crow, today in the news there is a story called, “Swiss Leaks”, and it offers an insight into some of these accounts. celebrities. uA 37-year-old computer security specialist named HervĂ© Falciani stole the huge cache of data in 2007 and gave it to the French government. It's now being used to go after tax cheats all over the world. 60 Minutes, working with a group called the International Consortium of Investigative Journalists, obtained the leaked files. They show the bank did business with a collection of international outlaws: tax dodgers, arms dealers and drug smugglers -- offering a rare glimpse into the highly secretive world of Swiss banking. I wonder why it has taken so many years for this information to come out and will the names of these people be released to the general public?

Monday, February 9, 2015

Muslim women

My daughter is active in a group supporting a film called, “Honor Diaries” which is about the mistreatment of women in various cultures around the world. As I watch the recent uproar over The President’s remarks about Islam and Christianity, I see the reporting as missing an important difference. While most are aware of the beheadings and burning alive episodes many are not aware of the everyday activities of most of these groups. In many Muslim countries and a few Hindu areas a procedure called female genital mutilation is a common practice. In these same countries women are treated with such disrespect it borders on slavery. They have no voting rights, no property rights and forced marriage is an everyday thing. These are not acts carried out by some extremist groups but by mainstream Muslims. Two daughters of the new King of Saudi Arabia have been under house arrest for years for demanding rights for women. While recent atrocities have awakened the general public, most people are unaware of these acceptable cultural practices. It is time for these people to move up into the 21st century

Friday, February 6, 2015

Benefits for illegals

President Obama’s plan to offer amnesty to undocumented immigrants allows them to have social security cards, which in turn makes them eligible for child tax credit, child care credits and earned income credits. A person must be working to qualify for these tax credits. This means that a family of four with an income of $20,000 will receive another $10,000 in credits even though they pay no income tax. They also qualify for free health care under Obamacare. They also qualify for Energy Assistance Program to help pay for utilities, Family Investment Program offers both cash and food assistance, Head Start which is government day care for ages zero to five, free school breakfast and lunch, Special Milk Program, Nutrition for Women’s, Infants and Children, Weatherizing Assistance and Summer Food Service providing free food to children during summer time. This should help to answer the question as to how someone could live on minimum wage but it does nothing to provide jobs. I am all for these benefits but once again how they will be paid for must be explained. Both sides recognize that the president's actions will give a legal benefit to people who are afoul of the law. Undocumented immigrants granted deferred action will also get permanent Social Security cards, despite their temporary, quasi-legal status in the country.

College education

Governor Walker of our neighboring state of Wisconsin is coming under fire because he is cutting the University system budget by 13%. I don’t know how the universities will handle this but I do know that there are many courses on campus that are a waste of time and money for both the student and the college. Just google,” ridiculous college courses and/or majors” and you will get a sampling of what I mean. There are good arguments to be made to eliminate the general education courses and allow students to concentrate on their major. If they don’t know their major maybe they should work for a while and figure out what they want to do with their lives. Many students drop out before graduating and some say the reason is that they should not have gone to college in the first place. This idea that everyone should go to college right after high school combined with the availability of student loans has many in school who might be better off at work. This cut in funding may lead to evaluating the purpose of a university education.

Child torture

Sometimes I exaggerate to make a point and some years ago when it was popular to say that the United States should not intervene in other countries just because we don’t understand their culture, I made the following case. Suppose we saw on the news that some countries were tossing babies into the air and catching them on their bayonets, would we be justified in interfering? As wild as this accusation was, it has now come close to reality. The United Nations reports that children are tortured and sold as slaves. Some mentally challenged children are trained as suicide bombers and even reports that children are buried alive and some decapitated. In a report issued Wednesday in Geneva, the U.N. Committee on the Rights of the Child said it has received reports of "several cases of mass executions of boys, as well as reports of beheadings, crucifixions of children and burying children alive. Is there ever a time when civilized societies must step in! While the numbers are not as great, this is sounding as bad as the Nazi treatment of Jews and the world vowed not to let this happen again.

Thursday, February 5, 2015

Defeat or contain

In the seven months since the start of US bombing raids against ISIS the US and allies have carried out 16,000 airstrikes against ISIS. In the first five weeks of the Gulf War the US carried out 100,000 airstrikes. It appears the US policy is not to degrade and destroy as The President stated but rather to contain. I think what we are doing aptly fits the name assigned to this mission,” Operation Inherent Resolve”. Jordan’s King Abdulla was visiting the White House when one of his citizens was burned alive by ISIS and he cut short his visit and returned home. The next day he order the hanging of two convicted ISIS terrorist and today he launched massive air strikes against ISIS. A few months ago a US citizen was decapitated and President left the golf course to make a statement as to how terrible this was and less than ten minutes later was back on the course. On a news program last week President Obama said the US was doing all that it could to fight ISIS and yesterday after the murder of the Jordanian pilot he said we would redouble our efforts against ISIS.

Amnesty

President Obama’s plan to offer amnesty to undocumented immigrants allows them to have social security cards, which in turn makes them eligible for child tax credit, child care credits and earned income credits. A person must be working to qualify for these tax credits. This means that a family of four with an income of $20,000 will receive another $10,000 in credits even though they pay no income tax. They also qualify for free health care under Obamacare. They also qualify for Energy Assistance Program to help pay for utilities, Family Investment Program offers both cash and food assistance, Head Start which is government day care for ages zero to five, free school breakfast and lunch, Special Milk Program, Nutrition for Women’s, Infants and Children, Weatherizing Assistance and Summer Food Service providing free food to children during summer time. This should help to answer the question as to how someone could live on minimum wage but it does nothing to provide jobs. I am all for these benefits but once again how they will be paid for must be explained. Both sides recognize that the president's actions will give a legal benefit to people who are afoul of the law. Undocumented immigrants granted deferred action will also get permanent Social Security cards, despite their temporary, quasi-legal status in the country.

Wednesday, February 4, 2015

Tax credit for illigals

People who are in the country illegally, euphemistically called undocumented immigrants, do not have a social security number but file income tax using an individual taxpayer identification number (ITIN). These people are not eligible for the child tax credit which is a government benefit that gives $1,000 to each child under the age of 17. This is a huge benefit to low income people because it pays even if you don’t owe any income tax. The President’s plan to offer amnesty to 5 million undocumented immigrants, who only have ITIN number, will now become eligible for this benefit and they will be able to go back three years and collect. This program is the one that Obama wants to increase to $3,000 per child and last year cost the government 57 billion dollars. This is a tremendous benefit to low income people and there is nothing wrong with helping but how this will be paid for should be explained. It will redistribute wealth but it will not create any jobs.

Unforced errors

In tennis there is a phrase, unforced errors. It means you voluntarily screwed up on your own with no help from your opponent. Republicans seemed to be afflicted with this malady. Recall the congressman who said if a woman is raped her body will automatically compensate and not allow her to get pregnant. Then a couple of high profile republicans said you don’t need to get the measles vaccine and now a congressman from North Carolina says employees in restaurants need not wash their hands after using the bathroom.

Tuesday, February 3, 2015

Obama ratings

President Obama’s approval ratings are back up to 50% and the administration says it is because the unemployment rate is down to 5.6%, and the deficit is cut from one trillion to one-half trillion. For the average citizen the unemployment rate is either zero or 100% meaning you either have job or you don’t. The average citizen has trouble differentiating between trillions and billions so the deficit has little meaning but when gas drops to two bucks everyone wakes up and takes notice. The gas price is why The Presidents ratings are up and while he was offering tax incentives for wind mills, solar panels and electric cars he was limiting the expansion of fracking on public lands and fracking is the reason gas prices are down.

Higher power

I passed a church today and there was a sign outside that read, you can’t be happy and selfish at the same time, and while I agree, this is an over simplification. Selfishness is generally considered a negative emotion but all emotions in and of themselves are neither negative nor positive. It is in how they are used that they take on morality. Many religious and or spiritual people believe in a higher power and they believe that if they live their lives according to the plan of this higher power they will have a happy life. They can also achieve some degree of happiness by following their own plan but it will not be as great as following the plan of the higher power. If you assume that people prefer the happiest life then by submitting themselves to this higher power they can reach the highest level of happiness in this life. Following this logic using the psychic energy of selfishness to reach the happiest life would lead one to follow the plan of the higher power.

Obama budget

For those not familiar with how our income tax system works allow me to explain one aspect. A tax deduction allows you to reduce your taxable income before you calculate your tax. A tax credit allows you to deduct directly from the tax you owe. Obviously a credit is far better than a deduction. One of the most widely used credits is the child tax credit not to be confused with child care credits. This credit is available to couples whose income is less than $110,000 and who have children under the age of 17. This benefit provides a credit of $1,000 per child and pays even if no tax is owed. It is a huge benefit for low income people and last year cost the government 57 billion dollars. President Obama is proposing that this benefit be raised to $3,000 per child and this would be most helpful to the lowest income families. It is not available to families without income, that is, you must be earning wages to qualify. This along with lowering the payroll tax, (social security) is one of the best ways to help low income families but the cost will be $114 billion dollars per year. In addition the President is proposing a 478 billion dollar public works program for things like bridges and highways. This would be paid for by a 14% tax on money held overseas by corporations and they would be forced to bring this money back into the country. Since there is 2 trillion in these accounts this would generate 238 billion in tax revenue and combined with another 240 billion from a gas tax would pay for the works programs. Infrastructure projects help the lower income people but the tax on gas would hurt the poor and low income people. The President is proposing raising the tax rate on capital gains and using that money for a middle class tax rebate and that will help but he plans to increase taxes on cigarettes and that will hurt. While plans like this will meet The Presidents goal of income re-distribution only the public works program will provide good jobs and those are all temporary.