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Economy

Trio Of Democrats Introduce Legislation To Tax Financial Transactions

Photo via @slarson83

A trio of Democratic lawmakers today introduced legislation to institute a small tax on financial transactions, a proposal that would reduce volatility in financial markets and raise substantial revenue for the federal government. Under the plan from Sens. Tom Harkin (D-IA) and Sheldon Whitehouse (D-RI) and Rep. Peter DeFazio (D-OR), financial trades would be subject to a 0.03 percent tax, which they say would raise approximately $352 billion in revenue over the next decade.

Such a tax would slow down high-frequency trading that poses a threat to the health of financial markets while also incentivizing investment that drives economic growth. Opponents argue that the tax would slow down growth, but DeFazio told ThinkProgress last year that those claims are unfounded. “For 50 years we had a tax that was about seven times larger than this when the country was seeing the greatest growth in its history, post-World War II,” he said. “So we’ve proven this will not have a detrimental impact on growth. In fact, it perhaps is beneficial to growth. It’s not necessarily beneficial to salaries of hedge fund managers on Wall Street.”

“This commonsense proposal will raise billions in new revenue to get rid of the sequester or reduce the deficit while also discouraging the kind of reckless high-volume trading that contributed to the financial crash in 2008,” Whitehouse said.

11 European countries recently announced that they will institute a financial transactions tax, and Britain, which taxes stock and bond trades but does not tax more complex trades involving derivatives and swaps, is open to expanding its tax as well, Labour Party MP Chris Leslie said last week. “I don’t see any evidence that there would be a negative effect on economic growth,” Leslie said. “In fact, quite the opposite.”

Harkin and DeFazio have introduced the transactions tax in the past, but it has not received support from Treasury or President Obama. Many consumer groups and business and financial leaders, however, have offered support for the tax. “A modest financial transaction tax of less than 1 percent would serve as a remarkably efficient tool to achieve needed reform,” John Fullerton, a former director at JP Morgan Chase, wrote in 2011.

Climate Progress

Over 10,000 Americans Tell Congress To Stop Pushing Us Over The Climate Cliff

by Brad Johnson

“If our country goes over the fiscal cliff, we will be able to climb back up. But if our planet goes over the climate cliff, we will plunge into an abyss of impacts that we cannot reverse.”

With these words, Rep. Ed Markey (D-MA) exposed the essential absurdity of the “fiscal cliff” debate in a Washington, DC address last week. Over 10,000 Americans have spoken out in agreement, calling on Washington to turn to the looming climate cliff.

The leaders of the “fiscal cliff” debate claim their stances are based on their sober-minded obligations to our children and grandchildren, even as they shirk their true responsibility to confront the fossil fuel industry, whose rogue behavior threatens the very existence of future generations.

During his debates with Mitt Romney, President Barack Obama argued that “reducing the deficit” is a “moral obligation to the next generation.” House Speaker John Boehner told the National Religious Broadcasters that “leaving our debt on its unsustainable and immoral path” will “truly cause pain and suffering.”

Some leaders in Washington are speaking out against the absurdity of climate silence during the fiscal debate. Watch Markey’s remarks:

In a Senate floor speech last week, Senate Budget Committee member Sheldon Whitehouse (D-RI) juxtaposed the moral rhetoric of his Republican colleagues around the stimulus, health care, and the debt with their continued refusal to even acknowledge climate change:

Read more

Justice

What Everyone Should Know About The DISCLOSE Act Of 2012

Sen. Mitch McConnell (R-KY)

A day after 43 Senate Republicans unanimously voted to block the DISCLOSE Act from receiving an up-or-down vote, Democrats will try again for cloture at 3pm on Tuesday.

The measure, which lawmakers drafted in response to the Supreme Court’s 2010 Citizens United ruling, “would require independent groups to disclose the names of contributors who give more than $10,000 to independent groups for use in political campaigns.” Here is what you should know about the measure:

1) It’s all about disclosure. The bill’s sole purpose would be to require outside groups who can currently spend unlimited sums of money on “independent expenditure” ads attacking and supporting presidential and other candidates to identify who is paying for the ads. Under current law, a 501(c)(4) tax-exempt group like Karl Rove’s Crossroads GPS can spend millions of dollars on attack ads without citizens ever knowing who is paying for them. Under the DISCLOSE Act, if a group spends more than $10,000 on political ads in an election cycle, it would have to identify the donors funding the efforts.

2) The Supreme Court backed disclosure. In his 5-4 majority opinion in the Citzens United v. FEC case, Justice Anthony Kennedy wrote “disclosure is a less restrictive alternative to more comprehensive regulations of speech.” By an 8-1 majority, every Justice but Clarence Thomas agreed that Congress had acted properly when it required that donors be identified for political ads that do not expressly advocate for or against a candidate. But, while these indirect ads come with disclosure, Congress did not anticipate that Citizens United would allow outside groups’s ads to directly tell voters to support or oppose candidates, leaving a major loophole.

3) Republicans used to support disclosure. When Congress considered the McCain-Feingold campaign finance reform law in the early 2000s, opponents consistently argued that complete disclosure, rather than regulation, was the best campaign finance law. Senate Republican Leader Mitch McConnell (R-KY), who now dismisses disclosure as government-supported “harassment and intimidation,” once endorsed the concept and asked “why would a little disclosure be better than a lot of disclosure?” Fourteen current Senate Republicans who now oppose the DISCLOSE Act voted in 2000 for similar disclosure for 527 committees, the forerunner to these 501(c)(4) outside spending groups. And even Sen. John McCain (R-AZ), who this March warned the lack of disclosure for independent spending would lead to “huge scandals” still joined with the Republicans to stop the bill in 2010 and yesterday.

4) Republicans are moving the goal posts on disclosure. The 2010 version of the bill included an array of provisions aimed at mitigating problems created by Citizens United, including restrictions on foreign-owned corporations’ ads and government contractors. Republicans like McConnell criticized that version as “117 pages of stealth negotiations in which Democrats pick winners and losers, either through outright prohibitions or restrictions so complex that they end up achieving the same result.” This year, sponsor Sen. Sheldon Whitehouse (D-RI) is offering just a 20-page bill that contains solely the disclosure provisions, in hopes that Republicans would be more open to supporting it. None have.

Update

Senate Republicans again blocked consideration on the DISCLOSE Act. The 53-45 vote this afternoon fell seven votes short of the required 60 needed to overcome the GOP filibuster.

NEWS FLASH

John McCain Abandons Campaign Finance Issue Again | Two years after being the deciding vote to preserve a filibuster and kill the DISCLOSE Act — a bill which would have allowed citizens to know what corporations and wealthy donors are paying for the “independent expenditure” attack ads enabled by the 5-4 Citizens United ruling — Sen. John McCain (R-AZ) continues to obstruct the campaign finance reform movement he once championed, opposing a scaled-down campaign finance disclosure bill. After telling The Hill in May that he was in discussions with Sen. Sheldon Whitehouse (D-RI), the lead sponsor of the DISCLOSE 2012 bill, and would support a bill that addressed “the issue of union contributions as well as other outside contributions,” McCain has refused to sign onto the bill. While McCain continues to make the argument that the bill somehow favors labor unions, the only mention of unions in the text of the bill is a line noting that local and local affiliates of national and international unions would be treated the same was subsidiaries of large corporations would be.

Justice

Sen. Whitehouse Blames ‘Preposterous’ Citizens United Decision On Lack Of Justices Who Ever Ran For Election

Justice Sandra Day O'Connor is the last former elected official to serve on the Supreme Court

WASHINGTON, DC — The conservative justices justified their decision in Citizens United that corporations and wealthy individuals can spend unlimited money to influence elections because they believe that “independent expenditures, including those made by corporations, do not give rise to corruption or the appearance of corruption.” They are part of a very small minority who believes this. Only 15 percent of the country believes that unlimited spending does not lead to corruption, less than the 19 percent who believe in “spells or witchcraft.”

In an exclusive interview with ThinkProgress yesterday, Sen. Sheldon Whitehouse (D-RI) argued that the five conservatives responsible for Citizens United would never have made such an error in judgment if they had actually had first-hand knowledge of how elections work:

Unfortunately you had the five right-wing judges, none of whom have ever run for any office ever and have zero political experience between the five of them, offering opinions about what money can do in elections . . . . So clearly the finding of fact in Citizens United that unlimited corporate spending cannot either increase the risk of corruption or increase the appearance to the public that there’s corruption is ludicrous. . . . .

The President asked me who I thought, you know, what were the characteristics of somebody that should be appointed to the Court, and I said I think it should be somebody who has some actual political experience out there so that they are not operating in this political arena with absolutely no knowledge. Even if they wanted to come to the result that Citizens United came to, I think those judges would have had a hard time getting there if they’d had actual practical political experience because they would have known what a preposterous finding they were making.

Watch it:

The current Supreme Court includes eight former U.S. Court of Appeals judges and one former law school dean. Four of the five current justices responsible for Citizens United served as political appointees in Republican administrations. The justices who decided Brown v. Board of Education, by contrast, included one former governor, three former U.S. senators, and one former state lawmaker.

The Supreme Court will have the opportunity to correct its error in Citizens United, however, in a pending case challenging Montana’s longstanding ban on corporate influence over elections. Sen. Whitehouse joined Sen. John McCain (R-AZ) in a brief urging the justices to “revisit Citizens United‘s finding that vast independent expenditures do not give rise to corruption or the appearance of corruption” if they agree to hear the Montana case.

Justice

Sen. Whitehouse: ‘Yep, I Do’ Think Filibuster Reform Is Going To Happen

Sen. Sheldon Whitehouse (D-RI)

Sen. Sheldon Whitehouse (D-RI)

WASHINGTON, DC — Earlier this month, Senate Majority Leader Harry Reid (D-NV) admitted that a bloc of mostly junior senators who supported eliminating or significantly reforming the filibuster were “right” and “the rest of us were wrong,” when the Senate failed to pass filibuster reform last year. In an exclusive interview with ThinkProgress yesterday, Sen. Sheldon Whitehouse (D-RI) predicted that rules reform will happen in the wake of Reid’s admission:

QUESTION: Majority Leader Reid just came out in favor of filibuster reform after he had, um, not been so keen to it the last time we had an opportunity. I know that that’s an area where you’ve done a little bit of work. Do you think that [filibuster reform] is likely to happen when we get the window?

WHITEHOUSE: Yep, I do. . . . I think that the major targets will be the double filibuster, filibustering both the motion to proceed to the bill and then the bill itself. That would be one target. I think the other major target of filibuster reform will be changing the rules of the filibuster so that the filibustering minority actually has to spend time on the floor defending its filibuster, rather than, right now, it’s the majority trying to get to 60 that has to be ready to fend off quorum calls and have all the Senators ready — and only one senator needs to be around from the minority side to defend the filibuster.

Watch it:

The “window” my question refers to is a brief, constitutionally required period every two years shortly after newly-elected senators are sworn in. During this short window, the Senate can alter the filibuster rules or even eliminate the filibuster altogether with just 51 votes. Normally, 67 votes are required to change the Senate’s rules.

As ThinkProgress previously explained, Senate Democrats may not have a choice when the next window opens next January, assuming that Democrats maintain control of the Senate and the White House. Longtime Sen. Richard Lugar (R-IN) was recently defeated in the GOP Senate primary by a candidate who objected to Lugar’s votes for Supreme Court Justices Sotomayor and Kagan. In light of this precedent, it is likely that the few Senate Republicans who were unwilling to obstruct these two nominees will see the Tea Party in their rear view mirror during the next confirmation fight, and will fear being Lugared. If Senate Democrats do not take their next opportunity to pass filibuster reform, the consequence could be a complete inability to fill Supreme Court vacancies.

Justice

Senate Democrats File New Bill To Require Disclosure Of Independent Expenditure Funders

Sen. Sheldon Whitehouse (D-RI)

Sen. Sheldon Whitehouse (D-RI)

Justice Anthony Kennedy’s controversial 5-4 majority opinion in the 2010 Citizens United v. Federal Election Commission case specifically endorsed the idea of campaign finance disclosure. “Disclosure is the less-restrictive alternative to more comprehensive speech regulations,” he wrote, adding that they ensure voters are informed enough about who is speaking to fully assess the content of the political message. But with a bitterly divided Federal Election Commission unable to issue regulations to enforce those principles, many political organizations have kept secret the names of the individuals and corporations funding their advertisements.

In 2010, a bill to expand disclosure passed the Democratic-controlled house of representatives, but failed by a single vote in the Senate as Republicans unified to filibuster the measure. That bill — the Democracy Is Strengthened by Casting Light On Spending in Elections (DISCLOSE) Act also contained provisions restricting
government contractors and foreign companies from political advertising.

Today, Sen. Sheldon Whitehouse (D-RI) and some of his Democratic colleagues unveiled a new attempt — the DISCLOSE Act of 2012 — focusing just on disclosure provisions. According to a fact sheet provided by Whitehouse’s office, the bill would require the following:

Any covered organization that spends $10,000 or more on campaign-related disbursements during an election cycle [must] file a disclosure report with the Federal Election Commission within 24 hours, and [must] file a new report for each additional $10,000 or more that is spent, detailing the amount and nature of each expenditure over $1,000 and the names of all of its donors who gave $10,000 or more.

Covered organizations include super PACs and tax-exempt 501(c)(4) organizations. Additionally, the ads would have to list the top donors behind the message.

With outside groups spending millions and hugely unpopular, Sen. Chuck Schumer (D-NY) says Democrats are hopeful that even in a more Republican congress, the bill might attract bipartisan support. The Senate’s rules committee, which Schumer chairs, will begin considering the bill at a hearing next week.

Like many of his Republican colleagues, Senate Minority Leader Mitch McConnell (R-KY) has indicated many times that he believes campaign finance disclosure — not limits — is the best way to ensure a just political system. With this new DISCLOSE Act, they will once again be forced to show whether they actually believe it.

Economy

Buffett Rule Sponsor Slams GOP For Telling Buffett To ‘Write A Check And Shut Up’

Billionaire Warren Buffett’s call to raise taxes on the wealthiest Americans has led to a predictable response from Republicans, who think Buffet should just “write a check” if he wants to pay more in taxes. Senate Minority Leader Mitch McConnell (R-KY) has repeatedly urged Buffett to do so, and last week, New Jersey Gov. Chris Christie (R) went farther, calling on Buffett to “write a check and shut up.”

Sen. Sheldon Whitehouse (D-RI), who introduced legislation containing a version of the Buffett Rule, slammed Republicans like Christie and McConnell today, saying that their “write a check” defense the tax code makes taxes “optional” for the wealthy, allowing them to “decide whether or not” they have to pay taxes:

WALDRON: Chris Christie, Mitch McConnell, a couple of the others have criticized Warren Buffett over the last couple weeks and said, you know, if he’s so disappointed he should just write a check.

WHITEHOUSE: You gotta love this idea that if you’re rich enough, the tax code becomes optional for you and you decide whether or not you’re going to write a check. You’re in a special category of people who doesn’t actually have to pay taxes, they just kind of get to if they feel like it. Let’s just say I haven’t heard them say that about working families.

Watch it:

Republicans like McConnell and Christie have done their part to make taxes on the wealthy as optional as possible. Despite the fact that the wealthiest Americans have seen their tax rates plummet even as their income rises, McConnell and his Republican colleagues have fought attempts to end the Bush tax cuts for the wealthy or to close loopholes that primarily benefit the rich. Christie, for his part, recently released a tax plan that would give 40 percent of its benefits to New Jersey’s richest one percent.

Buffett, meanwhile, has offered to write a check — as soon as Republicans do too. In January, he told Time Magazine he’d match any voluntary contribution made by Republicans. “I’ll even go three-to-one for McConnell,” Buffett said. So far, he has had to match only one Republican.

NEWS FLASH

Climate Hawk Senators Remind Washington Of Climate Crisis | In an hour-long discussion, Sen. Bernie Sanders (I-VT), Sen. Al Franken (D-MN), Sen. Tom Udall (D-NM), and Sen. Sheldon Whitehouse (D-RI) rebuked the Senate for ignoring the climate crisis. The “planetary crisis of global warming” is “not getting the serious debate and discussion it needs here in the Senate,” Sanders began. Watch:

Update

Read an annotated transcript of Sen. Sanders’ closing remarks, courtesy of 350.org:
Read more

Economy

Sen. Whitehouse To Introduce ‘Buffett Rule’ Bill To Raise Taxes On Millionaires

President Obama renewed his call for raising taxes on the wealthiest Americans to help reduce the deficit during his State of the Union speech, a proposal that became known in 2011 as the “Buffett Rule” after Obama mentioned that Warren Buffett paid a lower tax rate than his secretary last year.

Obama’s State of the Union speech offered the first concrete details about the oft-mentioned idea, as he called for a 30 percent minimum tax rate for millionaires. And according to the Washington Post’s Greg Sargent, Sen. Sheldon Whitehouse (D-RI) will introduce a bill this week that could make the Buffett Rule law:

Today, Senator Sheldon Whitehouse will unveil a new proposal — first reported on this blog — to bring the tax rate of millionaires paying less than middle class taxpayers up to 30 percent. While we don’t know if the Dem leadership will act on this particular proposal, the “Buffett Rule” will get some sort of Senate vote. Republicans are all but certain to oppose it, perhaps unanimously.

Whitehouse told reporters today that he plans to introduce the bill Wednesday, after it is scored by the Joint Committee on Taxation. As Sargent noted, Senate Republicans are likely to rule out the proposal unanimously. Republicans have, indeed, gone a long way to protect the low tax rates of the wealthiest Americans. They insisted on a one-year extension of the budget-busting high-end Bush tax cuts in December 2010 and their intransigence on taxes repeatedly took the government to the brink of shutdown and default in 2011, even costing the U.S. its first credit downgrade.

Up until now, Congress has tried to reduce the deficit through spending cuts alone, many of them to programs that disproportionately affect the poor and middle class. The one tax hike the GOP has supported, meanwhile, would primarily affect working class Americans. Whitehouse’s legislation, however, gives Congress a chance to ask the rich, who have benefited from falling tax rates even as their incomes have skyrocketed, to share in the sacrifice.

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