House Republicans on the Appropriations Committee today voted to cut funding for the Commodity Futures Trading Commission, the regulator charged with overseeing Wall Street derivatives and commodities trading. The Obama administration has asked for $300 million for the agency for fiscal year 2013, but the GOP only approved $180 million, which is less than the $205 million that the agency received last year.

This funding cut would come just as the CFTC is attempting to implement huge portions of the Dodd-Frank financial reform law, including a new regulatory regime for derivatives, the complex financial instruments that were at the heart of the financial crisis. And Rep. Spencer Bachus (R-AL), chairman of the House Financial Services Committee, acknowledged today that the CFTC, along with the Securities and Exchange Commission, do not have the budgets to keep up with the tasks they’ve been given:

Let me say that there is agreement, I think, among all the panel that your agencies are all functioning under an increased workload, a greatly increased workload, and that you are facing many challenges with not only the economy, but with adopting new rules and increased supervision. And that you are functioning under a budgetary restraint, particularly, I think, the SEC and the CFTC. Your workload has greatly increased and your budget doesn’t reflect this.

Watch it:

Bachus, who has said that Washington’s role should be to “serve the banks,” has led the charge to cut funding for Wall Street regulators, backed up by Senate Minority Leader Mitch McConnell (R-KY), who believes America is better off the less money regulators have.

CFTC Chairman Gary Gensler has said that the result of the House’s effort will be “to effectively put the interests of Wall Street ahead of those of the American public.” Rep. Barny Frank (D-MA) has added, “At a time when JPMorgan Chase has reported the loss of $3 billion or more in the derivatives markets, the Republicans are refusing to appropriate a small percentage of that amount to provide the protections we need against a return to financial chaos.”

During an interview that aired today on CBS’ This Morning, Senate Minority Leader Mitch McConnell (R-KY) incorrectly cited the amount of taxes paid by the richest 10 percent of taxpayers, in an attempt to argue that the tax code is already “extraordinarily progressive.” McConnell also said that the tax code is “a mess” because so many Americans make too little income to have any federal income tax liability:

Almost 70 percent of the federal revenue is provided by the top 10 percent of taxpayers now. Between 45 percent and 50 percent of Americans pay no income tax at all. We have an extraordinarily progressive tax code already. It is a mess and needs to be revisited again.

Watch it:

On the numbers, McConnell is simply wrong. According to the Congressional Budget Office, the richest 20 percent of taxpayers — not 10 percent — pay about 70 percent of federal taxes. Taking into account more regressive state and local taxes, the richest 10 percent pay less than 50 percent of total revenue.

McConnell is also engaging in a favorite argument of conservatives, using the total share of federal income taxes paid by the rich to seemingly argue that low-income Americans do not pay enough taxes. But the reason so many Americans do not have federal income tax liability is that they simply don’t make enough money.

Once payroll taxes are taken into account, less than a quarter of Americans pay no federal taxes, and many of those are the elderly, students, or unemployed. And as this chart shows, Americans’ taxes are largely in line with their share of income:

Raising taxes on the poor is consistently the one tax increase to which Republicans are open, even as they remain totally unconcerned with the tens of thousands of wealthy households that pay no federal income tax.

Sen. Jeff Sessions (R-AL) is advancing an amendment to the 2012 farm bill that will cut $11 billion over ten years from the food stamp program. Senate Majority Leader Harry Reid (D-NV) agreed to bring the measure up for a vote, along with an amendment from Sen. Kirstin Gillibrand (D-NY) that may “restore some of the lost funding” that is in the underlying bill.

Sessions claims that the cuts would prevent fraud in the program. As he put it during a June 7th floor speech:

We also have to ask: Is the benefit going to the right people? Is the money being expended wisely? Is it helping people become independent? Is it encouraging people to look for ways to be productive and be responsible for their families? Or does it create dependency on a series of government programs?

There are a number of reasons for the arresting trend of growth in this program. While the poor economy has undeniably increased the number of people on food stamps, this alone cannot explain the extraordinary growth in the program. … [T]he way the system is arranged—with states administering the program but the feds paying for it—states have an incentive to see their food stamp budgets swell, not shrink. That means overlooking a dramatic amount of fraud and abuse.

But the fraud rate is only 1 percent in the food stamps program and overall error rates have plunged in recent years, hitting an all-time low in 2010, according to the Center on Budget and Policy Priorities.

According to a study from the U.S. Department of Agriculture, food stamps reduced the poverty rate by 8 percent in 2009 and “lifted the average poor person’s income up about six percent closer to the [federal poverty] line.” In 2010, the program kept more than 5 million Americans from falling below the poverty line and reduced the number of children living in extreme poverty — defined as less than $2 per day, before government aid — by half in 2011.

JP Morgan Chase CEO Jamie Dimon testified on Capitol Hill today for the second time in two weeks, appearing before the House Financial Services Committee to discuss the trading debacle that has cost his bank billions of dollars. Before the hearing, Bloomberg News pointed to a new study showing that JP Morgan Chase receives a $14 billion annual subsidy from the U.S. government. This subsidy is due to JP Morgan’s reputation as a too-big-to-fail bank, which lets it borrow money at lower rates than other, less systemically risky banks:

JPMorgan receives a government subsidy worth about $14 billion a year, according to research published by the International Monetary Fund and our own analysis of bank balance sheets. The money helps the bank pay big salaries and bonuses. [...]

In a recent paper, two economists — Kenichi Ueda of the IMF and Beatrice Weder Di Mauro of the University of Mainz — estimated that as of 2009 the expectation of government support was shaving about 0.8 percentage point off large banks’ borrowing costs. That’s up from 0.6 percentage point in 2007, before the financial crisis prompted a global round of bank bailouts.

To estimate the dollar value of the subsidy in the U.S., we multiplied it by the debt and deposits of 18 of the country’s largest banks, including JPMorgan, Bank of America Corp. and Citigroup Inc. The result: about $76 billion a year. The number is roughly equivalent to the banks’ total profits over the past 12 months, or more than the federal government spends every year on education.

JPMorgan’s share of the subsidy is $14 billion a year, or about 77 percent of its net income for the past four quarters. In other words, U.S. taxpayers helped foot the bill for the multibillion-dollar trading loss that is the focus of today’s hearing.

At the last hearing, the Senate all but groveled at Dimon’s feet, and today’s questioning was not much better. But Rep. Brad Sherman (D-CA) did ask Dimon about the Bloomberg study. Dimon denied that his bank receives a funding advantage due to its size, saying that the bank is “probably pretty much like everybody else.” Watch it:

As Bloomberg’s editors put it, “when Dimon pushes back against [regulations like] capital requirements or the Volcker rule, it’s worth remembering that he’s pushing for a form of corporate welfare that, left unchecked, could lead to a crisis too big for the government to contain.” Yet that’s precisely what he did today.

Our guest blogger is Michael Linden, Director for Tax and Budget Policy at the Center for American Progress Action Fund.

2012 GOP presidential nominee Mitt Romney is trying to deceive you, and it looks like he’s getting away with it. He’s outlined a tax plan that would deliver massive tax cuts to the rich, but claims it won’t explode the deficit. He’s promised to implement a broad reform of the tax code, but won’t name even a single special tax break provision he would change.

Finally, he wants you to think he won’t skew the tax code even more heavily in favor of the super-rich, but he hangs that promise on a meaningless statistic. On CBS’ Face the Nation this past weekend, Romney said:

I want to keep the progressivity of the code. One of the absolute requirements of any tax reform that I have in mind is that people who are the high end, whether you call them the 1 percent, 2 percent, half a percent, the people at the high end will still pay the same share of the tax burden they’re paying now. I’m not looking for a tax cut for the very wealthiest.

Watch it:

The trick here is that share of taxes paid is a useless measure of tax progressivity, and promising that the rich will pay the same “share of the tax burden they’re paying now” doesn’t mean that Romney won’t give the rich a huge tax cut.

To see why, just look back at recent history. In the ten years preceding the Great Recession, the share of federal taxes paid by the richest 1 percent went up by almost 25 percent. Does that mean they suffered a huge tax increase? Not even a little. Why not? Because, over the same period, their share of total income went up by more than 30 percent! In other words, their share of income rose faster than their share of taxes. Which means they actually got a big tax cut.

Or take an even simpler example. What if Mitt Romney’s plan was for the richest 1 percent to pay just $1 a year in taxes, and eliminate taxes for everyone else? Why sure, the share of taxes paid by the rich would soar to 100 percent, but I’m pretty confident that still qualifies as a massive tax cut for the very wealthiest.

Read more

WASHINGTON, D.C. — Congressional Republicans don’t “really care” about extending the Bush tax cuts for the middle class, but are willing to “go to the mat to protect” tax cuts for the wealthy, Minnesota Rep. Keith Ellison (D) told ThinkProgress today at the Take Back The American Dream Conference.

The Bush tax cuts expire at the end of the year, and Democrats have proposed extending the cuts for the middle class while letting those for the wealthiest Americans expire. Republicans, however, have demanded a full extension of all the tax cuts. That Republicans are willing to block a tax cut for the middle class to preserve one for the rich is proof that the tax cuts for the middle class are “a lower priority” for the GOP, Ellison said:

ELLISON: I don’t think that the Republicans really care about the tax burden of the middle class. I think they care about the tax burden on really rich people because that’s who’s in the position to donate to them, donate to the PACs, to hire them after they leave Congress, that kind of stuff.

So I think their goal, I think they would rather have — I think the high income tax cuts, the oil and gas subsides, the jet subsidies, all of that stuff, I think that’s what they’re going to go to mat to protect. I think they’re embarrassed by being willing to trade off the middle class tax cuts, but it is something they have as a lower priority than the rich folks’ tax cuts. I think they’ve proven that, haven’t they? I mean, they’ve said over and over again that’s where they’re at.

Watch it:

Ellison has been an outspoken critic of Republican tax policy since coming to Congress. He opposed the original extension of the Bush tax cuts for the wealthy in 2010, when he told ThinkProgress it was “patently absurd and ridiculous” that the GOP could support the tax cuts while arguing at the same time that the nation had too much debt.

Steven Perlberg contributed to this report.

Title IX, which was enacted 40 years ago this week, ensures that publicly funded schools give similar opportunities to all students regardless of sex. The law is widely credited with boosting women’s participation in sports, which as economists Betsey Stevenson and Justin Wolfers note in Bloomberg Views today, has boosted incomes and education levels for women:

High school athletics confer substantial economic benefits that last throughout participants’ lives. When one compares people with similar educational opportunities, family backgrounds, measures of intelligence and self-esteem, the annual wages of former athletes are, on average, 7 percent higher than nonathletes. Similarly, athletes get almost half a year more education than nonathletes. The gains occur equally for girls and boys. [...]

In those states where Title IX led to the greatest expansion in female sports, the post-Title IX generation of women enjoyed more education, employment and higher wages than their pre-Title IX forebears. They were also more likely to enter previously male-dominated professions such as law, accounting and even sports.

This chart shows the increase in women’s participation in sports since the law was passed:

Fears that the law would hurt men, meanwhile, have turned out to be unwarranted. But still, women today earn only 77 cents for every dollar earned by men, a disparity that exists even in highly-paid, highly-educated professions. On average, women hit their peak wages at the age of 39, while men see their pay continue to rise for another decade.

Despite this persistent problem, Senate Republicans filibustered the Paycheck Fairness Act earlier this month, which would have strengthened important protections for women against pay discrimination.

As ThinkProgress reported yesterday, a group of Catholic nuns has kicked off a nine-state bus tour to protest cuts to the social safety net that were included in the House Republican budget. The nuns will be visiting the offices of ten Republican lawmakers, stopping yesterday the office of Rep. Steve King (R-IA). Here are photos of the event from the Des Moines Register:

When asked for comment on the visit, King’s office responded with an email that “did not say anything specifically about the nuns,” according to the Associated Press. The nuns will be visiting the office of House Budget Committee Chairman Paul Ryan (R-WI) today.