Thursday, April 11, 2013

The Company That Ran The ‘Cruise From Hell’ Pays Almost No Income Tax

Carnival’s “cruise from hell” — during which the ship lost power off the Yucatan peninsula and was stuck for days, leaving passengers no recourse to relieving themselves in plastic bags — finally ended last night as the crippled boat was tugged into port. “It was horrible. Horrible,” one passenger said. “The bathroom facilities were horrible and we could not flush toilets. No electricity and our rooms were in total darkness.”

Carnival will be refunding money to the passengers of the ill-fated cruise and offering them a free trip in the future. (“This is my first and last cruise. So if anyone wants my free cruise, look me up,” one passenger said.) But one entity to which Carnival has not been giving any money is the national treasury — as the New York Times’ David Leonhardt reported, the company has paid just a 1.1 percent rate on 11.3 billion in profits over the last five years:

The Carnival Corporation wouldn’t have much of a business without help from various branches of the government. The United States Coast Guard keeps the seas safe for Carnival’s cruise ships. Customs officers make it possible for Carnival cruises to travel to other countries. State and local governments have built roads and bridges leading up to the ports where Carnival’s ships dock.

But Carnival’s biggest government benefit of all may be the price it pays for many of those services. Over the last five years, the company has paid total corporate taxes — federal, state, local and foreign — equal to only 1.1 percent of its cumulative $11.3 billion in profits. Thanks to an obscure loophole in the tax code, Carnival can legally avoid most taxes.

Carnival uses a tax loophole that allows companies incorporated overseas to avoid U.S. taxes, even if the bulk of their operations are based in the states. Between 2008 and 2011, 26 major corporations in the U.S. managed to pay no income tax, despite making $205 billion in pre-tax profits. (HT: Teamster Nation)


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Marco Rubio's authentic conservatism

By Christopher Malone, associate professor and chairman, Department of Political Science, Pace University, New York City - 02/15/13 02:00 PM ET

Eager to change face of the party and the trajectory of electoral politics, Republicans put 41 year-old Florida Senator Marco Rubio in the daunting position of offering the rebuttal to Tuesday’s State of the Union address by President Obama. Dry mouths and water bottles aside, real questions about the future of the Republican Party persisted: what brand of conservatism would Rubio illuminate, (how) does it differ from what we’ve heard in the recent past, and will it prove successful?  

In many ways, the substance of the Rubio speech was completely in line with mainstream Republican dogma. America as an exceptional nation. An unshakeable belief in free enterprise. A nod to the value of life “at every stage.” Fewer taxes. Less spending. Less debt. Less government. Where Rubio and Republicans seek to grow the economy, President Obama and Democrats simply want to grow government.

All very typical and expected themes and contrasts. At the same time, the speech had a decidedly sharper target than we’ve seen by the Republican Party in the past. Rubio uttered the phrase “working class” or “middle class” seventeen times in a speech that ran less than fifteen minutes. In every way imaginable, Rubio sought to drill down on one indelible point. Obama would have you believe that an activist federal government fosters expansion of the middle class. But as Rubio put it, “More government isn’t going to help you get ahead, it’s going to hold you back.”

To be sure, this was not a speech about the makers and the takers, the 47%, self-deportation, or class warfare. In fact, the only reference to the rich was when Rubio concluded: “So Mr. President, I don't oppose your plans because I want to protect the rich. I oppose your plans because I want to protect my neighbors.”

Imagine Mitt Romney or John McCain uttering that line. They would first have to decide which neighbors of the 14 homes they own between the two of them they were talking about.

It is here that Rubio offered what may be a new emerging branding of the Republican Party. I’ll call it "Authentic Conservatism".

In the 1950s, William F. Buckley set out to show that conservatives had brains – something that Paul Ryan and Bobby Jindal have revived recently. Jindal doesn’t want his to be the “stupid party,” certainly a dig at the anti-intellectualism fostered by the likes of Sarah Palin and her supporters.

In the 1960s, Barry Goldwater set out to show that conservatives had a conscience. Perhaps they needed ideas and ideology, but what mattered more to Goldwater was an inner integrity that, as he put it sees “the whole man.”

In the 1970s, Richard Nixon, drawing on past experience with Dwight Eisenhower, set out to prove that conservatives had a heart – an idea most certainly revived by George W. Bush in the late 1990s with his emphasis on “compassionate conservatism.”

Then came Ronald Reagan in the 1980s. Reagan is seen by conservatives as a transformative figure because, for them, he embodied all of these strands of conservatism. By standing his ground, Reagan showed he had integrity. With the humility in his smile, the shake of his head, and a joke on his lips, Uncle Ronnie showed he had heart. And despite attempts by the left to paint him as the know-nothing former actor, the Gipper had intellect.

What Rubio offered the Republican Party in his SOTU rebuttal was not any or all of these things, but something different: the son of two working class Latino immigrants who lives in the same neighborhood he grew up in, who inherited nothing but the opportunity his parents and America afforded him, and who can potentially connect voters through that biography to a Republican message that has been seen as overly harsh, out of touch, and outdated.

In a word, he has offered conservatism a lifeline through authenticity.

It is the closest the Republican Party has come to an identity politics which has been both the strength and the weakness of the Democratic Party since the 1960s.

The need for authentic conservatism is clear. When asked which candidate cares about people like me, 81% chose Barack Obama in the 2012 election. Rubio’s emergence reflects that disparity. Yes, he may help with the Republicans’ Latino problem – that is a big maybe. But his identity politics goes even further. He is one of us. He is real. This is something Republicans have not had in a leader of color ever.

We should be clear: this is not a policy makeover. Authentic conservatism involves nothing more than a retooling of the message delivered by the authentic messenger. It remains to be seen if Authentic Conservatism can bridge the wide demographic divide Republicans face in the years ahead.

Malone is associate professor and chairman of the Department of Political Science at Pace University in New York City.

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President Obama Announces Presidential Delegation to the Inauguration of Her Excellency Park Geun-hye, President-elect of the Republic of Korea on February 25, 2013

The White House

Office of the Press Secretary

President Barack Obama today announced the designation of a Presidential Delegation to Seoul, Korea to attend the Inauguration of Her Excellency Park Geun-hye, President-elect of the Republic of Korea on February 25, 2013.

The Honorable Tom Donilon, Assistant to the President and National Security Advisor, will lead the delegation.

Members of the Presidential Delegation:

The Honorable Sung Kim, U.S. Ambassador to the Republic of Korea

General James D. Thurman, Commander of the United Nations Command, Republic of Korea- U.S. Combined Forces Command and United States Forces Korea

The Honorable Daniel Russel, Special Assistant to the President and Senior Director for Asian Affairs, NSS

Extending Middle Class Tax Cuts

President Obama Welcomes Italian President Napolitano

The two leaders discussed the world economy and President Obama's plan to pursue a U.S.-European Union free trade agreement, which was mentioned in his State of the Union address earlier this week.

Here’s a quick glimpse at what happened this week on WhiteHouse.gov.

Cecilia Muñoz, Director of the White House Domestic Policy Council, answers questions from the public about immigration reform and President Obama's State of the Union Address in an “Open for Questions” session moderated by Elianne Ramos from LATISM.

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Intermission

The bridge is yours.

-Will the PS4 controller get rid of thumbsticks?

-Hannibal will start airing on NBC on April 4, for those Mads Mikkelsen fans amongst us.

-SXSW just added more films by ladies.

-They’re going to try to make a show about the business development of the Sunset Strip.

-I liked The Host, but I’m not sure I’m compelled by the special effects and action sequences here. This looks…not great, right?


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No, Chicago Isn’t Proof That Gun Regulation Doesn’t Work

Hadiya Pendleton, a 15-year old Chicagoan recently killed by gunfire.

Friday afternoon, President Obama will speak on gun violence prevention in Chicago. Charles C.W. Cooke, writing for National Review, previews the conservative spin, arguing that because Chicago has a high murder rate and relatively strict gun laws, it “defies belief” that the President would defend gun regulations there.

But Cooke and the other conservatives who will invariably make this argument today are wrong. Chicago’s gun laws aren’t the cause of the recent uptick in violence, nor does it prove that gun regulations are ineffectual. If anything, it underscores the need for tighter federal laws.

Most significantly, it is important to understand that Chicago is not an island. Although Chicago has historically had strict gun laws, laws in the surrounding parts of Illinois were much laxer — enabling middlemen to supply the criminals in Chicago with guns they purchased elsewhere. Forty three percent of the guns seized by law enforcement in Chicago were originally purchased in other parts of Illinois. And even if the state had stricter gun laws, Illinois is not an island either. The remaining fifty seven percent of Chicago guns all came from out of state, most significantly from nearby Indiana and distant Mississippi — neither of which are known for their strict gun laws.

It’s also important to put Chicago’s very recent increase in gun violence in perspective. Data from the University of Chicago Crime Lab’s Harold Pollack shows that this uptick, while certainly worrying, isn’t anything like a return to the historic peaks during America’s crime wave. Pollack notes that “Chicago ranks 79th on Neighborhood Scout’s list of the 100 most dangerous places to live in America…the idea that Chicago faces a unique or unprecedented rise in homicides is incorrect. Our problems are all too familiar and chronic throughout much of urban America.” Chicago, following the national trend, has experienced a significant downturn in homicides in the past decade and a half:

Chicago had an outright ban on handguns from 1982 until 2010, when the Supreme Court declared it unconstitutional. So there’s no reason to believe that strict regulations on gun ownership were responsible for a spike in gun homicides in 2012, two years after Chicago was forced to loosen its gun laws. Moreover, there’s simply no credible evidence that wider gun ownership or looser gun laws reduce crime.

So why did Chicago’s homicide rate increase in 2012? Pollack says “there’s no simple answer.” But he points to three factors are particularly important: escalating gang conflict as a consequence of police crackdowns and shifting gang territory, outdated law enforcement practices, and — yes — access to guns.

According to Pollack, access to guns significantly increase the risk that a conflict between two gang members escalates to homicide, as weapons designed to kill people (shockingly) make it easier to kill people. Chicago’s streets are flooded with guns: it has roughly six times as many guns as New York City per capita, despite its restrictive laws. So if gang conflict escalates, and the gangs have easy access to guns, the homicide rate should rise. This explanation fits with the fact that 87 percent of Chicago homicides in 2012 were gun-related. New York, by contrast, did not experience a surge in homicides in 2012.

The guns that fueled this fire came from a small number of individuals bringing guns into the city. A study of Chicago’s gun market (which, incidentally, concluded that tight enforcement of Chicago’s gun ban and restrictions significantly disrupted illegal gun markets) found that most of guns in high-crime neighborhoods entered through a small, tight network of suppliers and middlemen: “Gun suppliers report that 60-80% of their sales are negotiated through brokers (we assume the 80% figure) and by our own estimates gun suppliers account for around half of all gun sales in the GB community.” Because most criminals weren’t comfortable going out of their neighborhoods to buy guns, and Chicago had no gun stores in the city, they relied on this network to get them guns from outside of Chicago.

As explained above, the fact that suppliers could acquire guns so easily is a byproduct of the state’s lax laws. Illinois does not license or regulate gun dealers, require gun registration, limit the number of guns that can be sold at one time, or require background checks on private sales that aren’t conducted at gun shows. Chicago law doesn’t fill in all of these gaps. As a consequence, crooked firearm retailers have very little problem distributing their guns to dealers and police have fewer tools to deal with intermediaries who sell guns privately without background checks.

This is a national problem. Illinois laws, loose as they are, are the eight-strictest in the nation. Broader data suggest that 50 percent of all crime guns come from one percent of dealers. Since illegal guns can travel across state boundaries, federal legislation targeting crooked dealers, traffickers, straw purchasers, and private sales without background checks is the best way to address gun violence in cities like Chicago. Which is exactly what the President is going to Chicago to stump for.


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Former Rep. Jackson Jr. expected to plead guilty to campaign violations

Former Rep. Jesse Jackson Jr. (D-Ill.) is expected to plead guilty to illegally spending $750,000 worth of campaign funds, according to multiple reports.

Jackson could go public with the plea deal as early as Friday.

Jackson, who resigned from Congress in December, could face as much as 57 months in jail for making personal purchases with the campaign funds. Those purchases include an expensive Rolex watch, memorabilia previously owned by a number of celebrities, furnishings for his home and fur coats.

Jackson has reportedly been in talks with federal investigators over a plea agreement to reduce his jail time.

He is also expected to have to pay a fine as part of the agreement.

Jackson currently faces multiple charges, including giving false statements to federal officials and conspiracy.

Former Chicago Alderwoman Sandi Jackson (D-Ill.), Jackson's wife, is also expected to plead guilty to tax violations. She resigned from office in January citing "health matters." 

The former congressman, prior to resigning from Congress, admitted that he was receiving treatment for severe bipolar disorder and cited his ongoing battle with depression as a reason for stepping down from Congress.

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Jackson Jr. charged with illegal use of campaign funds

Former Rep. Jesse Jackson Jr. (D-Ill.) on Friday was formally charged with illegally spending campaign funds.

Jackson was charged with spending about $750,000 of campaign funds on personal purchases, making false statements and wire and mail fraud. Jackson and prosecutors have reportedly agreed to a plea deal that includes less than five years in prison.

Jackson pleaded guilty to a felony count of misusing campaign funds. Under the agreement with prosecutors, a federal judge will decide Jackson's punishment, which ranges from probation to five years imprisonment, according to CBS News.

Jackson said in a statement that there was no excuse for his conduct.

"Over the course of my life I have come to realize that none of us are immune from our share of shortcomings and human frailties," Jackson said in a statement according to the Chicago Tribune. "Still I offer no excuses for my conduct and I fully accept my responsibility for the improper decisions and mistakes I have made. To that end I want to offer my sincerest apologies to my family, my friends and all of my supporters for my errors in judgment and while my journey is not yet complete, it is my hope that I am remembered for the things that I did right."

Previous reports said Jackson could face as much as much as 57 months in jail for making personal purchases with the campaign funds. Those purchases include an expensive Rolex watch, memorabilia previously owned by a Michael Jackson, Malcolm X and Bruce Lee, furnishings for his home and fur coats. The indictment against Jackson orders him to forfeit the memorabilia, which is valued at roughly $60,000. He must also give up the mik coats.

According to the indictment, Jackson and a co-conspirator spent about $582,772 of money on personal purchases through campaign-issued credit cards.

Jackson has reportedly been in talks with federal investigators over a plea agreement to reduce his jail time.

He is also expected to have to pay a fine as part of the agreement.

Jackson currently faces multiple charges, including giving false statements to federal officials and conspiracy.

Former Chicago Alderwoman Sandi Jackson (D-Ill.), Jackson's wife, is also expected to plead guilty to tax violations. She resigned from office in January citing "health matters."

The former congressman, prior to resigning from Congress, admitted that he was receiving treatment for severe bipolar disorder and cited his battle with depression as a reason for stepping down from Congress.

Read the indictment below.

-— Updated at 4:47 p.m.

Indictment charges against Jesse Jackson Jr. by

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Obamacare Sticker Shock: It Gets Worse

“Already, the Affordable Care Act is helping to slow the growth of health-care costs,” President Obama boasted during his State of the Union address. Apart from the fact that the statement is untrue, the line will be a real howler next year, especially for the young people who so enthusiastically supported him.

Doug Holtz-Eakin, president of the American Action Forum, shows why. AAF conducted a survey of health-care insurers and found that premiums are going up for key groups as a result of the new health law — by a lot!

The survey studied individual examples in specific markets to show the impact of major Obamacare reforms.

The result? “The findings highlight the sticker shock in health care premiums that awaits the relatively young and healthy in both the small group and individual markets as the ACA is fully implemented. The survey finds cost of premiums for this group will increase by an average of 169 percent,” according to the AAF survey.

The survey asked insurers how the market reforms would affect policies for specific individuals and small groups in 2014 in Chicago, Phoenix, Atlanta, Austin, Milwaukee, and Albany. 

Milwaukee citizens will be hit hardest: The young and healthy can expect premium increases of 190 percent. The lowest premium increases in these big cities will be in Phoenix where young people will face a 157 percent premium increase.

Older, sicker people will see their premiums reduced as a result of the changes required by Obamacare, which limits how much insurers can use age and health status in calculating premiums. 

In Milwaukee, AAF found, older and less healthy people in the individual market will see average premium reductions of 15 percent. In Austin, premiums will be 32 percent lower for this group. The survey found that older and sicker individuals in all of these markets will see an average decrease in premium costs of just under 25 percent.

Many young people have lower incomes and therefore will be eligible for subsidized insurance to help offset the sticker shock. But they will still face higher deductibles, co-payments, and insurance premiums than they would absent the law. And taxpayers will be footing a much higher bill than if people had choices in a competitive market rather than insurance that is highly regulated by Washington bureaucrats.

According to a Politico article about the survey:

Robert Zirkelbach, spokesman for America’s Health Insurance Plans, said the report shows the wide variation of effects the law will have and illustrates the need to pay close attention to affordability.

“It’s important to go beyond simply looking at averages, because that will tell us what it’s going to mean for specific individuals and specific families,” he said.

He says the subsidies will be important to consumers but don’t change the underlying reality. “Subsidies don’t lower premiums any more that Pell Grants lower the cost of college tuition,” he said.

In any case, expect to hear more from Obamacare foes about its impact on premiums for some young, healthy people.

One of the goals of Obamacare is to draw many more young and healthy individuals into the insurance market. With prices like these, that is unlikely, even with subsidies. AAF provides more evidence of the failure of Obamacare in meeting its main goals of lowering costs and expanding coverage.


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Fox News: Obama Proposed ‘Free’ Preschool To Toddlers So They Can Vote For Him ‘In The Future’

In his State of the Union address, President Obama made the case for universal early childhood education — an idea that isn’t sitting well with conservatives.

On Friday, Fox Business host Stuart Varney and Fox News host Steve Doocy attacked preschool access as a government handout intended to extend “literally, the nanny state.” Varney echoed an argument used by former presidential candidate Mitt Romney that Obama won the election by giving “gifts” to women and minorities. Even though Obama cannot run for office a third time, the host warned the president is using preschool to entice a whole new generation of toddlers to support him when they’re eligible in 15 years:

VARNEY: Look what the president is doing here, it’s a repeat performance of his campaign, which is you raise taxes on the rich and you offer all kinds of free stuff to people who will vote for you in the future. Free preschool education for 4-year-olds, it’s free, here it is. Hand out the goodies.

Watch it:

In fact, preschool substantially reduces the likelihood that a child will later drop out of high school, become a teen parent, or be arrested for a violent crime. Studies have determined universal preschool programs generate roughly $7 in savings per child and increases human capital.

Varney and Doocy are hardly the only conservatives suspicious of preschool. Sen. Rick Santorum (R-PA) has called for ending childhood education programs because they “indoctrinate” children to make them dependent on government at an early age.

Other “gifts” Obama has been accused of using to influence voters are Obamacare, his DREAM directive, and partial college loan forgiveness.


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