Recent White House Study on Taxes Shows the Wealthy Pay a Lower Rate Than Everybody Else
A decade ago, in an essay for The New York Times, Warren Buffett disclosed that he had paid nearly $7 million in federal taxes in 2010. “That sounds like a lot of money,” he wrote. “But what I paid was only 17.4 percent of my taxable income — and that’s actually a lower percentage than was paid by any of the other 20 people in our office. Their tax burdens ranged from 33 percent to 41 percent and averaged 36 percent.”
The words “taxable income” are doing a lot of work in that sentence.
Buffett owns a substantial number of shares in Berkshire Hathaway, the fabulously successful holding company he founded decades ago. As the company’s shares have soared nearly every year, his wealth has grown by billions. Under the U.S. tax code, none of that is taxed until he sells shares at a profit.
A little math shows that Buffett’s 17.4% rate meant he reported roughly $40.2 million in income in a year where Forbes said his wealth grew by $3 billion. His revelation made it possible to compare how much he was paying the government to the increase in the size of his fortune.
No one did so, and Buffett became something of a folk hero for calling for any increase in taxes.
When we obtained access to a trove of tax data on the richest Americans, it quickly became clear to our reporters that Buffett’s comparison of his own tax rate to his employees’ vastly understates the inequity of our tax system. Buffett is far from unique; the documents showed that the amount of money people like Michael Bloomberg, Jeff Bezos or Elon Musk reported to the IRS as income was infinitesimal when measured against their annual gains in wealth.
And so the first story in our “Secret IRS Files” series set out a new concept that makes more sense in our 21st century Gilded Age; we called it “the true tax rate.” We compared the annual taxes paid by the ultrarich to their wealth gains to give readers a sense of how the system really works.
From 2014 to 2018, we pointed out, Buffett paid $125 million in federal taxes. As he said, that sounds like a lot. But according to Forbes, his riches rose $24.3 billion during that period, making his true tax rate 0.1%. In a detailed written response, Buffett defended his practices but did not directly address ProPublica’s true tax rate calculation.
When we published this story, howls of rage rang out from the freewheeling corners of Twitter to the ornate offices on Wall Street. Some of the most irate critics wrote to me directly and demanded to know whether I was so @#$!@ stupid that I didn’t understand the meaning of the word “income tax.”
“This story, sadly, reeks with ‘class envy,’” one angry reader wrote. “If this was intended to get clicks, you made your money.” We’re a nonprofit and our revenue from advertising adds almost nothing to our annual budget, but I understand this reader’s larger point, which we noted in the story: The ultrarich are doing only what the current tax code invites them to do.
The debate intensified, and the White House-backed proposals on taxes advanced by congressional Democrats largely followed the traditional approach of raising rates on income. A separate bill introduced by Sens. Elizabeth Warren and Bernie Sanders to impose a 3% tax on all wealth above $1 billion is seen as having little chance of passing.
The reluctance to embrace a wealth tax is deeply rooted. The biggest donors to both parties would be hit hard by such a law. And as we pointed out in our initial story, the complexities of taxing wealth are not trivial. Several countries have tried and struggled to figure out a fair way to tax stock gains. Does an entrepreneur whose stock skyrockets in one year, and pays a big tax, deserve a rebate if his company’s shares plummet the next year?
All of that said, we took note when White House economists issued a study that used publicly available data to estimate “the average Federal individual income tax rate paid by the 400 wealthiest American families’ in recent years, determined using a more comprehensive measure of income.” Their methodology was similar to ours, and their findings — that those families gained $1.8 trillion from 2010 to 2018 and paid 8.2% in taxes — are in line with what we found in the tax data.
The authors say their findings are evidence in support of President Joe Biden’s plan for tweaking the existing system; the words “wealth tax” are not mentioned. They point to the administration’s proposal to impose higher tax rates on stock dividends and on capital gains, the profit an investor reaps when selling a stock whose value has risen.
(The Biden administration has proposed getting rid of a provision in the tax code that shields heirs who inherit stock from paying capital gains tax on the growth in value that occurred before the shares were transferred.)
None of the proposed changes come close to addressing the biggest hole in the system, which is that an ultrarich person can live comfortably off gains in wealth while never selling a single share. As our initial story pointed out, the Buffetts and Bezos of the world can borrow against the value of their considerable holdings and live comfortably without selling stock or receiving any income from dividends, which new companies like Tesla and Amazon don’t pay.
The strategy, known as “buy, borrow and die,” allows the wealthy to amass fast fortunes, pay no taxes on those gains and pass on much of the wealth to their descendants.
Herb and Marion Sandler, the founders of ProPublica, made it clear from the outset that they hoped our journalism would spur real-world change. They were not particularly interested in stories whose biggest effect was that they had “started a conversation.”
We still measure our success by tangible effects. But over the years, we have seen that the road to impact on very complex issues can begin by changing the conversation.
Lawmakers have said that some of the most egregious tax loopholes we’ve exposed, notably multibillion-dollar Roth IRA accounts, will be scrutinized as Congress takes up tax legislation in coming months.
There’s no telling where the larger conversation about taxing wealth will lead. As the White House paper suggests, a new way of thinking about equality and taxation has taken center stage. Whether that ultimately results in change remains very much an open question.
As Congress launched a historic bailout to keep businesses afloat at the outset of the pandemic, government officials stressed that the loans were for mom-and-pop operations that didn’t have another easily available lifeline.
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“This was a program designed for small businesses,” then-Treasury Secretary Steven Mnuchin said, as companies like Shake Shack and Potbelly made headlines for grabbing millions from the newly created Paycheck Protection Program. “It was not a program that was designed for public companies that had liquidity.”
House Minority Leader Kevin McCarthy was even clearer. “We will go after those big companies that cheat the system,” he told Fox News that spring.
But the tough talk hasn’t translated into action. Instead, a ProPublica review has found, the government gave out generous loans to companies that may not have needed them. And it has often forgiven the loans, despite having said that publicly traded companies would be unlikely to merit such generous treatment.
Take Lazydays Holdings, a publicly traded collection of RV dealerships that got a nearly $9 million loan. The company had $31 million in cash on hand at the end of 2019, and then prospered as Americans turned to RVs for socially distanced vacations. Lazydays’ stock price has shot up more than 500% during the pandemic. (Lazydays did not respond to requests for comment.) The government has forgiven nearly all of it, allowing Lazydays to keep the money.
The ProPublica analysis of Securities and Exchange Commission filings found at least 120 publicly traded companies that received loans of more than $500,000, grew their revenues last year and have been allowed to keep the money.
In addition, at least 30 companies announced plans to go public after receiving their loans, bringing in truckloads of investor cash that they often used to pay off other debts — but not the ones they owed to the federal government, all of which were forgiven.
Overall, ProPublica found at least $250 million that went to publicly traded companies with growing revenues and that has already been forgiven by the government. That’s just a sliver of the $800 billion PPP program. But it’s also almost certainly a significant undercount of the amount of taxpayer dollars that went to well-heeled companies. The count, for instance, doesn’t include any of the billions of dollars that went to firms backed by giant private equity funds. Their finances are not publicly disclosed.
The government had no rules requiring companies to pay back loans if it turned out they didn’t need the money.
Instead, the government had one modest requirement particularly relevant to publicly traded companies: It made all applicants for loans attest that pandemic-related uncertainty made the loan “necessary.” And it warned in a follow-up advisory that having access to cash elsewhere — as public companies usually do via investors — would make it difficult to take that pledge in good faith.
But the government has rarely followed up. The Small Business Administration, which oversees the PPP, discarded a questionnaire it had begun sending companies to quiz them on their financial situations.
In response to questions from ProPublica, the SBA said that it is examining all forgiveness applications to make sure they comply with the rules. “We are continuously aware of our role in the stewardship of federal funds to ensure the integrity of our programs, and we have rigorous processes in place to ensure appropriate oversight of loans of all sizes,” spokesperson Christalyn Solomon said.
But the SBA declined to provide evidence of how it is evaluating whether public applicants were honest when they said their loans were “necessary.” Experts say that’s because lawmakers offered no specifics on what they meant by “necessary” from the outset, leaving the program’s administrators with no objective basis on which to demand repayment.
“Congress needed to say to the SBA, ‘This is what constitutes need,’” said Liz Hempowicz, director of public policy at the nonprofit Project on Government Oversight. “If you have access to excess capital in any form, that absolutely should’ve been baked into the program from the beginning.”
By many metrics, the federal government’s response to the pandemic succeeded in alleviating the worst effects of the most abrupt pause in economic activity America has ever experienced. Unlike most safety net programs, it did so by erring on the side of generosity. The government’s supplemental unemployment insurance and stimulus checks were enough to actually lower poverty last year.
The same philosophy applied to relief for businesses. The government kept the PPP application simple to encourage companies to participate, and banks were paid to move the loans along without asking many questions. While the program was built on the chassis of the SBA’s standard loan program, it dispensed with many of its rules, such as a requirement that applicants demonstrate they couldn’t obtain reasonably priced credit elsewhere.
In the first round of the bailout, which was quickly depleted, companies did not have to prove that they had actually been impacted by COVID-19.
Instead, the application required them to certify that “current economic uncertainty makes this loan request necessary to support the ongoing operations of the applicant.” Facing confusion from corporate lawyers who said the language was vague, the SBA released further guidance in late April 2020.
The clarification specifically warned public companies that they probably wouldn’t meet the threshold. “Borrowers must make this certification in good faith, taking into account their current business activity and their ability to access other sources of liquidity,” the agency wrote. “It is unlikely that a public company with substantial market value and access to capital markets will be able to make the required certification in good faith.”
That admonition had some effect. According to a study forthcoming in the Review of Corporate Finance Studies, half of all public companies qualified for the loans, but only 42% of those eligible chose to take them. That compared to 87% of all eligible private companies. (The PPP generally excluded companies with more than 500 employees.) On average, the 812 public firms that took loans had less cash and more debt than those that didn’t borrow. The public companies collectively borrowed $2.2 billion, but 13.5% of them repaid their loans, mostly soon after the SBA’s April guidance.
But because Congress didn’t impose any actual requirements to return the money, many companies didn’t. Some even shrugged off congressional pressure to do so.
In May 2020, a House oversight subcommittee sent letters asking five large public companies to return their $10 million loans. One of them did. The other four refused, and they eventually all receivedforgiveness (with one asking for slightly less than the whole amount).
They included a contractor for the U.S. Postal Service called EVO Transportation and Energy Services, which hasn’t filed financial reports for all of 2020 after discovering problems with its 2019 disclosures.
The company didn’t respond to a request for comment.
The SBA began processing forgiveness applications after the first round of PPP loans was exhausted in August 2020. It decided that all borrowers of less than $2 million would automatically be “deemed” truthful in their pledges that their loans were necessary.
For those who borrowed more, it issued a nine-page “loan necessity questionnaire” that asked about the recipient’s ownership structure, cash on hand pre-pandemic, revenues during the time when the loan was supposed to be used and access to other capital.
That didn’t go over well.
Last December, a construction industry trade group sued, saying the SBA questionnaire violated the original guidance that implied forgiveness would be determined by what companies knew at the time they applied, without regard to what happened later. In July, the agency stopped using the questionnaire, saying that the form was burdensome for borrowers and a drain on auditing resources.
Without companies’ answers, the SBA has developed a machine-learning algorithm that flags loans for signs of potential fraud, such as payroll numbers that don’t add up. As of last month, agency data showed, investigators had reviewed 65,000 loans, 8,000 of which, totaling $2.7 billion, were referred for further analysis. Of those, only 300 loans were for more than $2 million.
The agency declined to say how many forgiveness applications have been rejected after going through this process, or how, without using the discontinued questionnaire, it has evaluated whether the loans were necessary.
The Securities and Exchange Commission also issued inquiries to some companies about their representations to investors, but a spokesperson declined to say whether any enforcement actions had been taken as a result.
A former finance manager at one company that received millions in PPP money and hasn’t paid it back said that he’d hoped the government would more closely examine his employer’s finances.
“I remember that questionnaire coming out, and we were thinking, ‘This might not get forgiven,’ because our cash position was a lot better at the end of the year,” the employee said. Since the questionnaire has been thrown out, he figures, companies that didn’t need the cash will end up keeping it. “The only reason to give it back is public sentiment. At that point, it’s free money.”
Waste is inevitable in any economic rescue mission. But some of it is avoidable. Experts say Congress could have created a threshold of financial health at which PPP loans would have to be repaid — without denying the lifeline many firms needed.
“We’re talking about a ridiculously low interest rate,” Hempowicz said. “There is a benefit either way, especially for bigger companies, to have received these loans, even if they aren’t then converted into grants.”
All PPP loans were forgivable if the cash was mostly spent on payroll. If a company was still seeing steady business, it could use that freed-up income for other priorities, like paying off debt and buying other companies.
That’s the happy outcome for many companies that performed well in 2020, often profiting from the very pandemic that they said put them in the position of needing a taxpayer bailout.
A chain of powersports dealers called RideNow collectively received $19 million, despite nearly tripling its net income from 2019 to 2020 as interest in motorbikes and all-terrain vehicles skyrocketed. In March 2021, the publicly traded online motorcycle sales platform RumbleOn announced it would acquire RideNow to create what it called the “only omnichannel customer experience in powersports and the largest publicly traded powersports dealership platform.” RideNow’s loans were fully forgiven in June, and RumbleOn’s forgiveness application for its original $5.1 million loan is pending.
Other examples abound. Acme United Corporation saw its sales increase 15% in 2020 because of strong demand for first-aid supplies. Its $3.5 million loan was fully forgiven. So was the $2.7 million borrowed by Conifer Holdings, an insurance company that attributed revenue growth to lower claims by businesses that were temporarily shuttered but maintained their policies — which explicitly did not cover business interruption due to infectious diseases. And the ammunition manufacturer Ammo Inc. kept $1 million after seeing its revenues triple to $62.5 million in 2020, fueled by increased consumer demand for bullets. None of those companies returned requests for comment.
Public companies aren’t the only borrowers that took more than they likely needed. Securities and Exchange Commission filings are also a window into privately held companies that have raised money in the public markets or later listed themselves on an exchange.
The venture-capital-backed person-to-person lending marketplace Prosper files earnings statements because it sells its loans to investors. The company had $64 million in unrestricted cash on hand at the end of 2019, but it still suspended its 401(k) match and cut salaries above $100,000 across the board in early 2020 — a collective reduction in compensation almost equal to the $8.4 million PPP loan it received. The pay cut also applied to the C-suite, but they had already received up to 10% base salary bumps in March 2020, so it hurt less.
In November, the company instituted a retroactive two-year bonus plan for executives — potentially totaling $3 million for five people.
Prosper did not respond to a request for comment, and its forgiveness request is still pending.
Some companies did pay the money back. At least 27 companies decided to do so while in the process of going public, since the sale of stock often generates large amounts of cash.
Luminar Technologies, an autonomous driving technology startup, gave back its $7.8 million before its Nasdaq debut.
“We decided to return the PPP loan as soon as we realized we didn’t need it anymore,” said Anthony Cooke, Luminar’s vice president for policy and regulation. “We decided to apply for a PPP loan because it gave us the flexibility to withstand uncertain times while protecting our employees. We were able to protect employees, grow our business and take it public in 2020, and we repaid our PPP loan as soon as it was feasible.”
Other companies kept the taxpayer money, even while paying off other debts.
That’s what another company in the autonomous driving business did. A Ford-backed designer of sensors called Velodyne Lidar got $10 million in government money, which a spokesperson said was “used to support our employees during a time of uncertainty.”
The company went public in September of last year, giving it $222 million in cash. The government forgave Velodyne’s loan this June.
Battery-powered bus maker Proterra got $10 million. Its revenues increased last year, and it went public this year. The company decided to keep the money, which spokesperson Shane Levy said “supported our ability to maintain a full workforce as we’ve navigated the uncertainty caused by the COVID-19 pandemic.” A Volkswagen- and UPS-backed self-driving truck company called TuSimple kept its $4.1 million after going public in a deal that generated about $1 billion; a spokesperson didn’t respond to a request for comment.
Several companies hadn’t yet had any income at all — they had been funded by investors through their entire existence, suggesting that they probably had access to other credit.
A pre-revenue electric vehicle maker called Faraday Future got $9.2 million. This past July, it launched a public offering that generated $1 billion; its loan forgiveness request is still pending. A spokesperson told ProPublica that the investor proceeds will be “budgeted to produce vehicles,” not to pay back taxpayers. Space launch services company Astra took $4.9 million in government money. As it applied for forgiveness in June, it told investors that COVID-19 “has not materially affected our future growth outlook” and that it had seen “some signs of positive effects for its long-term business prospects and partnerships as a result of the pandemic.” Astra’s Nasdaq debut in July generated $463 million, and its PPP loan was forgiven last month. A spokesperson didn’t respond to a request for comment.
Another category of large PPP recipients consisted of clinical and early commercial-stage medical device and pharmaceutical companies, which are heavily investor-backed and which sometimes profited from COVID-related activity. A biotech company called PolarityTE, which makes regenerative tissue products, cut staff by 47% in 2020 and raised revenues by 79% by serving as a COVID-19 testing lab. It received $3.6 million, which was forgiven; the company didn’t respond to a request for comment.
Anything having to do with residential real estate also did well.
Fast-growing homebuilder Dream Finders Homes saw 52% earnings growth in 2020, which it attributed in part to pandemic-induced migration to suburban developments. It went public in January 2021, generating $134 million, and was granted full forgiveness on its $7.2 million loan. The company didn’t respond to a request for comment.
The home improvement services platform Porch told investors that spiking home sales in late 2020 helped it rebound from a spring business dip. It applied for forgiveness for its $8.1 million PPP loan in December, the same month it debuted on Nasdaq. With $122 million of the proceeds from its IPO, it bought four other companies; it hasn’t paid back the PPP loan, which was forgiven in June. A spokesperson declined to comment.
Finally, the type of companies that arranged the capital for all these public offerings and funding rounds — investment advisory firms — also dipped into the PPP.
Cohen & Company, a financial services firm with $2.8 billion under management, got $2.2 million. The firm saw dramatically higher income last year. Nearly all of its loan was forgiven. Another asset manager and investment banking firm, JMP Group, had $3.8 million forgiven despite having $50 million in cash at the end of 2019 and 15% revenue growth in 2020. Neither firm responded to a request for comment.
Some investment advisory firms may have used inflated claims. One study found that at least 6% of the $590 million granted to those firms was more than they could have justified given their payroll, which has to be reported to the SEC.
Writing laws is often a balancing act. One approach draws bright lines that lay out exactly what’s required, which companies often figure out a way to game. The other leaves rules more vague, relying on the regulated party to abide by the program’s intent. That eases the process for beneficiaries who really need help, but runs the risk the others will also benefit.
The PPP leaned toward the latter approach. It told companies that they probably shouldn’t apply if they had other resources at their disposal, but gave them a window to do so if they wanted. In order to make that work, there would need to be a credible threat of enforcement, or at least public shaming if they took advantage of funds meant for the truly disadvantaged.
Erik Gordon, a professor at the University of Michigan’s Ross School of Business, said the SBA should have held public companies to a higher standard of need and then audited them to ensure they’d been truthful.
“If I ran the SBA, I would say, ‘You certified that this loan request was necessary — walk us through that. You had this much cash, or you had this much loan facility open or you had no trouble raising this money,’” Gordon said.
Of course, if you don’t want public companies to apply, you could just bar them from applying. That’s what Congress did when it created a second round of the PPP in December 2020. That time around, companies were also required to demonstrate that their revenues had declined substantially in at least one quarter in order to qualify.
Sam Rosen, a finance professor at Temple University who co-authored the study on public firm participation in the PPP, said it isn’t that complicated. “If we were in a similar situation in the future, do we want public firms to have access to this?” he said. “I think it’s just about being clear up front.”
Conviction of Steven Donziger, said one critic, “perfectly encapsulates how corporate power has twisted the U.S. justice system to protect corporate interests and punish their enemies.”
Environmental justice advocates and other progressives on Friday condemned a federal judge’s decision Friday to sentence human rights lawyer Steven Donziger to six months in prison—following more than two years of house arrest related to a lawsuit he filed decades ago against oil giant Chevron.
The sentence, delivered by U.S. District Judge Loretta Preska in New York City, represents “an international outrage,” tweeted journalist Emma Vigeland following its announcement.
Donziger’s sentence came a day after the United Nations Working Group on Arbitrary Detention said it was “appalled” by the U.S. legal system’s treatment of the former environmental lawyer and demanded the U.S. government “remedy the situation of Mr. Steven Donziger without delay and bring it in conformity with the relevant international norms” by immediately releasing him.
Donziger represented a group of farmers and Indigenous people in the Lago Agrio region of Ecuador in the 1990s in a lawsuit against Texaco—since acquired by Chevron—in which the company was accused of contaminating soil and water with its “deliberate dumping of billions of gallons of cancer-causing waste into the Amazon.”
An Ecuadorian court awarded the plaintiffs a $9.5 billion judgment in 2011—a decision upheld by multiple courts in Ecuador—only to have a U.S. judge reject the ruling, accusing Donziger of bribery and evidence tampering. Chevron also countersued Donziger in 2011.
In 2019, U.S. District Judge Lewis A. Kaplan of the Southern District of New York—a former corporate lawyer with investments in Chevron—held Donziger in contempt of court after he refused to disclose privileged information about his clients to the fossil fuel industry. Kaplan placed Donziger under house arrest, where he has remained under strict court monitoring for 787 days.
In addition to Kaplan’s own connections to Chevron, the judge appointed private attorneys to prosecute the case, including one who had worked for a firm that represented the oil giant.
Preska, who found Donziger guilty of the contempt charges in July, is a leader of the right-wing Federalist Society, which counts Chevron among its financial backers.
“As I face sentencing on Day 787 of house arrest, never forget what this case is really about,” tweeted Donziger on Friday morning, as he awaited the sentencing. “Chevron caused a mass industrial poisoning in the Amazon that crushed the lives of Indigenous peoples. Six courts and 28 appellate judges found the company guilty.”
Donziger indicated Friday afternoon that he plans to appeal the sentence.
“Stay strong,” he tweeted along with a photo from a rally attended by his supporters Friday.
BREAKING: Flouting the U.N. decision ordering my release, Judge Preska sentenced me to 6 months in prison. Still on house arrest until the appeals court rules on my motion for release pending appeal. Picture is from rally this morning.
350.org co-founder and author Bill McKibben said on social media that Donziger “deserves our thanks and support” for “daring to point out that Big Oil had poisoned the rainforest.”Rick Claypool, research director for Public Citizen, tweeted that Donziger’s case “perfectly encapsulates how corporate power has twisted the U.S. justice system to protect corporate interests and punish their enemies”—noting that as Donziger is ordered to prison for six months, members of the Sackler family recently won immunity from opioid lawsuits targeting their private company, Purdue Pharma.
“This ruling was done to deter ANYONE from crossing corporate special interests,” said progressive former congressional candidate Jen Perelman.
Originally published on Common Dreams by JULIA CONLEY and republished under a Creative Commons License (CC BY-NC-ND 3.0).
More Than Half of America’s 100 Richest People Exploit Special Trusts to Avoid Estate Taxes
It’s well known, at least among tax lawyers and accountants for the ultrawealthy: The estate tax can be easily avoided by exploiting a loophole unwittingly created by Congress three decades ago. By using special trusts, a rarefied group of Americans has taken advantage of this loophole, reducing government revenues and fueling inequality.
There is no way for the public to know who uses these special trusts aside from when they’ve been disclosed in lawsuits or securities filings. There’s also been no way to quantify just how much in estate tax has been lost to them, though, in 2013, the lawyer who pioneered the use of the most common one — known as the grantor retained annuity trust, or GRAT — estimated they may have cost the U.S. Treasury about $100 billion over the prior 13 years.
As Congress considers cracking down on GRATs and other trusts to help fund President Joe Biden’s domestic agenda, a new analysis by ProPublica based on a trove of tax information about thousands of the wealthiest Americans sheds light on just how widespread the use of special trusts to dodge the estate tax has become.
More than half of the nation’s 100 richest individuals have used GRATs and other trusts to avoid estate tax, the analysis shows. Among them: former Democratic presidential candidate Michael Bloomberg; Leonard Lauder, the son of cosmetics magnate Estée Lauder; Stephen Schwarzman, a founder of the private equity firm Blackstone; Charles Koch and his late brother, David, the industrialists who have underwritten libertarian causes and funded lobbying efforts to roll back the estate tax; and Laurene Powell Jobs, the widow of Apple founder Steve Jobs. (Powell Jobs’ Emerson Collective is among ProPublica’s largest donors.)
More than a century ago amid soaring inequality and the rise of stratospherically wealthy families such as the Mellons and Rockefellers, Congress created the estate tax as a way to raise money and clip the fortunes of the rich at death. Lawmakers later added a gift tax as a means of stopping wealthy people from passing their fortunes on to their children and grandchildren before death. Nowadays, 99.9% of Americans never have to worry about these taxes. They only hit individuals passing more than $11.7 million, or couples giving more than $23.4 million, to their heirs. The federal government imposes a roughly 40% levy on amounts above those figures before that wealth is passed on to heirs.
For her part, Powell Jobs has decried as “dangerous for a society” the early 20th century fortunes of the Mellons, Rockefellers and others. “I’m not interested in legacy wealth buildings, and my children know that,” she told The New York Times last year. “Steve wasn’t interested in that. If I live long enough, it ends with me.”
Nonetheless, after the death of her husband in 2011, Powell Jobs used a series of GRATs to pass on around a half a billion dollars, estate-tax-free, to her children, friends and other family, according to the tax records and interviews with her longtime attorney. By using the GRATs, she avoided at least $200 million in estate and gift taxes.
Her attorney, Larry Sonsini, said Powell Jobs did this so that her children would have cash to pay estate taxes when she dies and they inherit “nostalgic and hard assets,” such as real estate, art and a yacht. (At 260 feet, Venus is among the larger pleasure ships in the world.) Without the $500 million or so passed through the trusts, he said, Powell Jobs’ heirs would have to sell stock that she intends to give to charity to pay her estate tax bill.
Sonsini said Powell Jobs, whose fortune is pegged at $21 billion by Forbes, has already given billions away to charity and paid $2.5 billion in state and federal taxes between 2012 and 2020. “When you look at an estate that may be worth multiple billions, and all the rest is going to charity, and you put it in perspective, what is the problem we’re worried about here?” Sonsini asked. “This is not about creating dynasty wealth for these kids.”
In a written statement, Powell Jobs said she supports “reforms that make the tax code more fair. Through my work at Emerson Collective and philanthropic commitments, I have dedicated my life and assets to the pursuit of a more just and equitable society.”
Others whose special trusts ProPublica identified, including Bloomberg and the Kochs, declined to comment on why they’d set up the trusts or their estate-tax implications. Representatives for Lauder didn’t respond to requests to accept questions on his behalf. Schwarzman’s spokesperson wrote that he is “one of the largest individual taxpayers in the country and fully complies with all tax rules.”
A typical GRAT entails putting assets, like stocks, in a trust that ultimately benefits a person’s heirs. The trust pays back an amount equal to what the trust’s creator put in plus a modest amount of interest. But any gains on the investments above that amount flow to the heirs free of gift or estate taxes. So if a person puts $100 million worth of stock in a GRAT and the stock rises in value to $130 million, their heirs would receive about $30 million tax-free.
In 1990, Congress accidentally created GRATs when it closed another estate tax loophole that was popular at the time. The IRS challenged the maneuver but lost in court.
“I don’t blame the taxpayers who are doing it,” said Daniel Hemel, a professor at the University of Chicago Law School. “Congress has virtually invited them to do it. I blame Congress for creating the monster and then failing to stop the monster once it became clear how much of the tax base the GRAT monster would eat up.”
Users of the trusts extend well beyond the top of the Forbes rankings, ProPublica’s analysis of the confidential IRS files show. Erik Prince, founder of the military contractor Blackwater and himself heir to an auto parts fortune, used the shelter. Fashion designer Calvin Klein has used them, as have “Saturday Night Live” creator Lorne Michaels and media mogul Oprah Winfrey.
“We have paid all taxes due,” a spokesperson for Winfrey said. A representative of Klein did not accept questions from ProPublica or respond to messages. A spokesman for Michaels declined to comment.
Prince also did not answer questions. “Hey if you publish private information about me I’ll be sure to return the favor,” he wrote. “Go ahead and fuck off.”
The GRAT has become so ubiquitous in recent decades that high-end tax lawyers consider it a plain vanilla strategy. “This is an off-the-shelf solution,” said Michael Kosnitzky, co-leader of the private wealth practice at law firm Pillsbury Winthrop Shaw Pittman. “Almost every wealthy person should have one.”
ProPublica’s tally almost certainly undercounts the number of Forbes 100 members who use shelters to avoid estate taxes. ProPublica counted only those people whose tax records or public filings explicitly mention GRATs or other trusts commonly used to dodge gift and estate taxes. But a wealthy person can call their trusts whatever they want, leaving plenty of trusts outside of ProPublica’s count.
This month, the House and Senate are hammering out proposals to raise revenue to help pay for the Biden administration’s plans to expand the social safety net. The legislative blueprint released by House Ways and Means Committee Chairman Richard Neal, D-Mass., would defang GRATs and other trusts, which would still be legal but no longer be as useful for estate tax avoidance. If the provision makes it into law, “it would put a major dent in GRATs,” said Bob Lord, an Arizona attorney who specializes in trusts and estates.
Senate Budget Committee Chairman Bernie Sanders, I-Vt., has proposed going further in undercutting estate tax avoidance tools. But the prospect of any reform is uncertain, as Democrats on Capitol Hill struggle to find the votes to pass the package of spending and tax changes.
GRATs are commonly described by tax lawyers as a “heads I win, tails we tie” proposition. If the investment placed in the GRAT soars in value, that increase passes to an heir without being subject to future estate tax. If the investment doesn’t go up, the wealthy person can simply try again and again until they succeed, leading many users to have multiple GRATs going at a time.
For example, Herb Simon, founder of the country’s biggest shopping mall empire and owner of the Indiana Pacers, was one of the most prolific GRAT creators in records reviewed by ProPublica. Since 2000, he has hatched dozens of the trusts, often more than one a year. In an interview with The Indianapolis Star in 2017, the octogenarian Simon said, “It’s always a big tax problem” for the next generation when someone dies, “but we’ve worked that tax problem. We won’t have a problem with that.”
A spokesperson for Simon didn’t respond to questions for this article.
Mentions of these trusts have periodically surfaced in the press after being disclosed in securities filings, as was the case with trusts held by Facebook co-founders Mark Zuckerberg and Dustin Moskovitz and Chief Operating Officer Sheryl Sandberg. In 2013, Bloomberg News published a groundbreaking series on GRATs, mining securities filings and other records to reveal how the mega-rich, including casino magnate Sheldon Adelson and such families as Walmart’s Waltons, had perfected the use of the device.
ProPublica’s data shows that Michael Bloomberg, the majority owner of the company that bears his name and No. 13 on Forbes’ list of the wealthiest Americans, is himself a heavy user of GRATs. Over the course of a dozen years, he repeatedly cycled pieces of his private company in and out of the trusts — often opening multiple GRATs in one year. During that time, hundreds of millions of dollars in income flowed through Bloomberg’s GRATs, giving him opportunities to shield parts of his fortune for his heirs.
ProPublica described the transactions (but not the name of the person engaging in them) to Lord, the trusts and estates attorney. The GRAT is “the perfect loophole to avoid estate and gift tax in this situation,” said Lord, who is also tax counsel for Americans for Tax Fairness and an advocate for estate tax reform.
When Bloomberg ran for president in 2020, he vowed to shore up the estate tax. “Owners of the biggest estates are expert at gaming the system to reduce what they owe,” a campaign fact sheet for his tax plan said. Bloomberg vowed to “lower the estate-tax threshold, so that more estates are taxed,” and to “shut down multiple estate-tax avoidance schemes.” His fact sheet offered few details as to how he would do that, and it didn’t mention GRATs.
The legislation Congress is now considering to curtail GRATs would leave open other options for estate tax avoidance, including a cousin to the GRAT known as a charitable lead annuity trust, or CLAT, which contributes to charity while passing gains from stocks and other assets on to heirs. And the legislation would grandfather in existing trusts, meaning that those who have already established trusts would be able to continue to use them to avoid paying estate taxes.
That has set off a predictable push by tax lawyers to get their clients to create tax-sheltering trusts before any new legislation takes effect.
Porter Wright, a law firm that offers estate planning services, told existing and potential clients it was “critical” to evaluate opportunities because “the window may close very soon. There are important and time sensitive issues which could substantially impact the amount of wealth you are able to transfer free of estate and gift tax to future generations.”
Originally published on ProPublica by Jeff Ernsthausen, James Bandler, Justin Elliott and Patricia Callahan and republished under Creative Commons.
“Ever notice how ‘deficit hawks’ vote for record-high defense spending, yet claim bills that help people and challenge lobbyists are ‘too much?'” asked Rep. Alexandria Ocasio-Cortez.
Sen. Joe Manchin on Thursday derided his own party’s plan to spend $3.5 trillion over the next decade to combat the climate crisis, invest in child care, and expand Medicare as “fiscal insanity.”
“All this operatic moaning about $3.5 trillion is ridiculous hypocrisy. Manchin has casually voted for nearly three times that for defense spending.”
But progressive lawmakers and commentators were quick to point out that Manchin (D-W.Va.)—along with other conservative Democrats who are currently standing in the way of Democrats’ reconciliation package—have had no problem greenlighting the Pentagon’s increasingly bloated budget year after year after year.
“Ever notice how ‘deficit hawks’ vote for record-high defense spending, yet claim bills that help people and challenge lobbyists are ‘too much?'” Rep. Alexandria Ocasio-Cortez (D-N.Y.) asked in a tweet Thursday evening.
“All this operatic moaning about $3.5 trillion is ridiculous hypocrisy. Manchin has casually voted for nearly three times that for defense spending”
Noting that the reconciliation package includes yearly spending of $350 billion while the proposed military budget for Fiscal Year 2022 is $770 billion, the New York Democrat wrote: “Guess which got rubber stamped and which gets deemed a ‘spending problem.'”
Last week, the House of Representatives passed the $770 billion military policy bill—which includes $740 billion for the Pentagon alone–by a vote of 316-113, with just 38 Democrats voting no. The Senate is expected to pass its version of the National Defense Authorization Act in the coming days.
In a column published late Thursday, The Week‘s Ryan Cooper observed that Manchin “voted for every single one of the military budgets over the last decade—in 2011, 2012, 2013, 2014, 2015, 2016, 2017, 2018, 2019, and 2020.”
“He voted for all $9.1 trillion,” Cooper wrote. “While he occasionally complained about wasteful military programs and asked for an audit of the Pentagon, these quibbles were never enough to get him to vote differently. He helped inflate the already-bloated war budget and regularly boasted about thus ‘supporting’ the troops. This year, he did it again.”
“So on one level, all this operatic moaning about $3.5 trillion is ridiculous hypocrisy,” Cooper continued. “Manchin has casually voted for nearly three times that for defense spending—money that killed hundreds of thousands of people and turned half the Middle East into a smoking crater. A modest fraction of that total to help parents pay their bills, give seniors dental coverage, fight climate change, and so forth is not some intolerable burden on the economy.”
West Virginia activists in kayaks presented that critique directly to Manchin on Thursday as the Democratic senator listened from his yacht:
In ongoing talks over the reconciliation package, Manchin is pushing for a top-line spending level of $1.5 trillion. That figure is at least $2 trillion less over 10 years than Democrats’ current plan, which would spend $3.5 trillion over the next decade.
As Win Without War executive director Stephen Miles noted Thursday, Manchin’s preferred $1.5 trillion number is “less than we’ll spend at the Pentagon over the next two years.”
“And Manchin’s talking about a DECADE of spending across the entire rest of the government,” Miles wrote on Twitter. “During that time we’ll spend somewhere north of $8 trillion, possibly closer to $10 trillion. Just. at. the. Pentagon.”
Originally published on Common Dreams by JAKE JOHNSON and republished under a Creative Commons license (CC BY-NC-ND 3.0).
“We continue to bankroll the very fossil fuel companies responsible for the climate crisis, then wonder why our planet is on fire.”
A new report released Wednesday identifies $86 billion worth of offshore tax loopholes that a dozen U.S.-based oil and gas companies exploit each year as part of a “tax bonanza,” a finding that comes as climate justice advocates push Congress to eliminate subsidies to the fossil fuel industry.
“Our government cannot continue to bankroll climate destruction,” Friends of the Earth tweeted Wednesday.
NEW REPORT: Exxon Mobil currently relies on a tax loophole worth nearly one BILLION dollars. Enough is enough — time to gut all $121 billion in fossil fuel subsidies. Our government cannot continue to bankroll climate destruction.#EndFossilFuelSubsidieshttps://t.co/1gdN6oEgQt
The report (pdf), compiled by Friends of the Earth, Oxfam America, and BailoutWatch, reveals the consequences of “two esoteric provisions in the tax code worth tens of billions of dollars to Big Oil’s multinational majors,” including ExxonMobil, Chevron, ConocoPhillips, and other polluters most responsible for the climate emergency.
As a result of the GOP’s 2017 tax law, corporations that drill overseas benefit from special treatment under the Global Intangible Low-Tax (GILTI) framework, which covers Foreign Oil and Gas Extraction Income (FOGEI).
The Treasury Department estimates that repealing the Trump-era exemption for FOGEI would raise $84.8 billion in revenue from just 12 companies that are currently eligible for the carveout, the report notes.
“It is unfortunate but not surprising that the handful of companies benefitting from these loopholes are lobbying to protect their special treatment.” —Chrive Kuveke, BailoutWatch
Another corporate handout, the so-called dual capacity loophole, is “a longstanding gimmick” wherein fossil fuel giants “artificially inflat[e] their foreign tax bills” to evade U.S. taxes.
Although they are permitted to claim tax credits for taxes paid to foreign governments, U.S. companies are not allowed to do so for non-tax payments such as royalties.
“In practice, however, the categories often are commingled—particularly when companies make a single combined payment including both taxes and fees,” the report explains. “A foreign country may even try to disguise non-tax payments as a tax, knowing that in many cases a multinational company may receive a foreign tax credit from its home country. Existing regulation gives dual capacity taxpayers vast latitude to assert what portions of their payments are taxes eligible to offset U.S. tax bills.”
Eliminating the dual capacity loophole would raise at least an additional $1.4 billion, according to the Biden administration, while the Joint Committee on Taxation puts the figure somewhere between $5.6 billion and $13.1 billion. The report points out that “the estimates vary so widely in part because we have precious little visibility into Big Oil’s payments to governments—and that’s just how the companies want it.”
“As Democrats propose closing loopholes to help cover the cost of their $3.5 trillion reconciliation package,” the report states, “these obscure subsidies present a rare chance to act on climate, fund infrastructure, and promote tax fairness in a single stroke.”
While the House Ways and Means Committee’s markup of the Build Back Better Act includes a tax reform proposal that would reverse the FOGEI carveout and the dual capacity loophole, it would leave intact at least $35 billion in federal subsidies for domestic fossil fuel production—despite President Joe Biden’s call to phase out polluter giveaways over a decade.
House Democrats’ failure to stop showering Big Oil with public money—a move supported by a majority of people in the U.S. and many, though not all, Democratic lawmakers—has drawn progressives’ ire.
“The House bill made a decent start by targeting Big Oil’s international tax loopholes, but it went nowhere near far enough,” Lukas Ross, Climate and Energy Justice program manager at Friends of the Earth, said Wednesday in a statement.
Senate Majority Leader Chuck Schumer (D-N.Y.) “needs to lead on climate and ensure that all $121 billion in fossil fuel subsidies are repealed in the final package,” Ross added.
According to Daniel Mulé, policy lead for Oxfam’s Extractive Industries Tax and Transparency project, “U.S. Big Oil companies like Exxon and Chevron have fought tooth and nail to keep the payments they make to governments around the world a secret, while paying lip service to the global movement for payment transparency.”
“This secrecy,” said Mulé, “has a potential tax impact in the U.S. as well, as it makes it all the more difficult to discern if U.S. oil and gas companies are illegitimately inflating their foreign tax credits.”
The report draws attention to several legislative proposals that would do away with subsidies for domestic fossil fuel production as well as tax exemptions for foreign extraction, including:
The No Tax Breaks for Outsourcing Act from Sens. Chris Van Hollen (D-Md.), Sheldon Whitehouse (D-R.I.), and Dick Durbin (D-Ill.), and Rep. Lloyd Doggett (D-Texas);
The Corporate Tax Dodging Prevention Act from Sens. Van Hollen, Sanders, Whitehouse, Kirsten Gillibrand (D-N.Y.), and Jack Reed (D-R.I.), and Reps. Jimmy Gomez (D-Calif.) and Jan Schakowski (D-Ill.);
The End Oil and Gas Tax Subsidies Act from Reps. Earl Blumenauer (D-Ore.), Sean Casten (D-Ill.), Donald McEachin (D-Va.), and Katie Porter (D-Calif.).
The report was released the same day members of the Congressional Progressive Caucus urged House leaders to include a repeal of domestic fossil fuel subsidies in the Democrats’ Build Back Better Act.
“Instead of creating jobs,” the progressive lawmakers wrote, the subsidies “widen the profit margin of fossil fuel companies.”
We continue to bankroll the very fossil fuel companies responsible for the climate crisis, then wonder why our planet is on fire.
Thank you to the reps calling for an end to Big Oil’s $86 billion in offshore tax loopholes — as well as their $35 billion in domestic handouts! pic.twitter.com/hY0EVsOMK4
The report emphasizes that fossil fuel champions—including the Exxon lobbyist who was caught on camera discussing how the company benefits from offshore tax loopholes and intends to further undermine climate action—are fighting hard to preserve billions of dollars in taxpayer-funded handouts.
“Big Oil isn’t going quietly,” said Chrive Kuveke, an analyst at BailoutWatch. “Since Biden became president, it is unfortunate but not surprising that the handful of companies benefitting from these loopholes are lobbying to protect their special treatment.”
Photo by Extinction Rebellion NYC / Twitter @XR_NYC
At least 40 climate activists were arrested Friday at the New York City offices of JPMorgan Chase, Citibank, and Bank of America, organizers said, as campaigners across the United States demanded financial institutions stop supporting the destruction of the planet.
“People are in denial about the mess we’re in,” said Kerith Creo of Extinction Rebellion (XR) NYC. “We’re sending a message loud and clear that the little action that politicians and greenwashing CEOs have taken so far does not begin to deal with the magnitude of this crisis.”
The protest actions included delivering 150,000 petition signatures as part of the Stop the Money Pipeline (STMP) coalition‘s “Deadline Glasgow: Defund Climate Chaos” campaign to pressure banks ahead of COP 26, a United Nations summit set to start on October 31.
Despite financial institutions’ net-zero emissions by 2050 pledges, the petition highlights, “they are providing loans, insurance, and billions in investment capital to corporations expanding the fossil fuel industry and deforesting the Amazon and other tropical forests―companies that are guilty of human rights abuses and violations of Indigenous sovereignty.”
The petition calls out some specific projects—such as Line 3—and urges banks, insurers, asset managers, and the Biden administration to “end their support for companies engaged in climate destruction and human rights abuses” before the two-week U.N. summit in Scotland.
@XR_NYC is staging a boat outside @Chase HQ, who is the biggest fossil fuel funder in the world.
They poured $317 billion poured into fossil fuels since the 2015 Paris Agreement. Who pays the price for Hurricane Ida? We do.https://t.co/1pZUyDyRLD
The upcoming negotiations in Glasgow “are the most important international climate talks since the Paris agreement was signed in 2015,” STMP said in a statement Friday. “It is also supposed to be ‘the climate finance COP.'”
In New York City, climate activists set up a boat outside the office of JPMorgan Chase, urging the bank to “stop the greenwashing,” and draped a banner that read “#1 Funder of Climate Death” over the building’s entrance.
At Bank of America’s Manhattan office, “half a dozen women blockaded the entrance and a seventh woman sat in a hammock supported by a large tripod on the sidewalk,” according to XR. Outside Citibank’s building, “activists set up a camp on the lawn near the entrance and put up a tripod to which they locked themselves down.”
And thank you to these activists at @Citibank HQ this morning for also risking arrest to bring attention to the SECOND worst fossil fuel funder @XR_NYChttps://t.co/4bLjmuPgff
“We’ve reached the breaking point,” said Christina See of XR NYC. “We need our government leaders to take action immediately. The New York City area saw over 40 deaths due to record breaking floods just a few weeks ago. The climate crisis is here, now.”
The remnants of Hurricane Ida—which initially made landfall in Louisiana on the anniversary of Hurricane Katrina—caused fatal flooding across the Northeast, sparking warnings from not only climate activists but also political leaders about what the future holds.
While touring damage in New York and New Jersey, President Joe Biden said that “we got to listen to the scientists and the economists and the national security experts. They all tell us this is code red; the nation and the world are in peril. And that’s not hyperbole. That is a fact.”
Climate campaigners responded to Biden’s comments by urging him to declare a national climate emergency and stop all fossil fuel projects, highlighting his refusal to block the Line 3 tar sands pipeline opposed by Indigenous leaders and environmentalists in Minnesota.
The protests came as the U.S. president held a climate meeting with leaders of major economies and confirmed a new global pledge to reduce methane pollution at least 30% by 2030. Biden’s event followed his leadership summit in April, during which he pledged to cut the nation’s overall planet-heating emissions in half within this decade.
Activists on Friday “shut down 4th Avenue in downtown Seattle, and disrupted business at the Canadian Consulate, Chase, and Bank of America,” according to the Washington city’s arm of 350.org.
STMP explained that “they’re targeting the world’s biggest financers of climate chaos, as well as the Canadian government, who bought the troubled Trans Mountain oil pipeline in 2018.”
The demonstrations in New York City, Seattle, and beyond came as a new U.N. analysis revealed that recent emissions reduction pledges governments have made in anticipation of COP 26 are nowhere near ambitious enough to meet the Paris agreement’s 1.5°C target.
According the new report, the world is on track for 2.7°C or warming by 2100—a revelation that prompted U.N. Secretary-General António Guterres to warn that a failure to meet the Paris temperature goal “will be measured in the massive loss of lives and livelihoods.”
Ahead of a national vote this month, Citizen Browser data shows that posts promoting the AfD party appeared more than three times as often as rivals’
Earlier this month, Germany’s far-right nationalist political party Alternative für Deutschland, or the AfD, posted on Facebook. Widespread support for Sharia law among Muslims in Afghanistan, the group claimed, illustrated the danger “wenn sich Massen von Afghanen auf den Weg nach Deutschland und Europa machen” (“when masses of Afghans make their way to Germany and Europe”).
The post was soon shared by thousands of users and commented on by thousands more. It was one of many posts by AfD-related pages over the past couple of months that railed against immigration or, another popular topic, disparaged COVID-19 restrictions as unnecessary.
Despite its modest size in Germany, the AfD has been remarkably successful on Facebook. Data obtained through The Markup’s Citizen Browser project, in partnership with Germany’s Süddeutsche Zeitung, shows how the AfD has gained tremendous traction on Facebook in the run-up to a historically contentious national election to replace Angela Merkel, the long-serving chancellor, later this month.
The Citizen Browser project, which collects data from a diverse panel of 473 German Facebook users, shows the party and its supporters have peppered Facebook with pages promoting its ideology, with posts on those pages appearing in our panelists’ news feeds at least three times as often as those from any rival party.
Fewer unique panelists had posts from AfD-related pages appear in their news feeds than posts from the sister parties of the Christian Democratic Union of Germany (CDU) and the Christian Social Union in Bavaria (CDU/CSU), which led in this count, and from Bündnis 90/Die Grünen (Alliance 90/The Greens). But the data shows AfD deeply engaged with its core audience: The users who did see content from the AfD tended to see it repeatedly, and the AfD was especially good at reaching its own supporters.
Citizen Browser captures up to 50 posts from a panelist’s Facebook news feed one to three times a day. The Markup catalogued every time a post from a page named for a German political party appeared in our panelists’ feeds over the past two months, from July 20 to Sept. 16, 2021. We included any pages that mentioned “AfD” or one of its political rivals (“SPD,” “CDU,” or “FDP,” for example) in its name. We did not determine whether the page was officially sanctioned by the party itself. We removed any pages meant to disparage a party.
Posts from more than 200 different pages promoting the AfD party—the most pages of any party we looked at—appeared in our panelists’ feeds. While the quantity of pages promoting the center-left Social Democratic Party, the SPD, followed closely behind with 175 pages, posts from AfD pages appeared four times as often in our panelists’ news feeds. Our panelists were shown posts from the AfD more than 3,200 times, while they were shown SPD posts only about 760 times.
The other major political party in Germany, the center-right Christian democratic political alliance, or the CDU/CSU, fared slightly better. Posts by pages related to those parties appeared in panelists’ news feeds around 850 times. But the AfD’s posts still appeared more than three times as often.
The AfD’s dominance of our panelists’ news feeds is especially stark considering the makeup of our Citizen Browser panel in Germany. Our panel consists of more people who identified themselves as SPD and CDU/CSU supporters—62 and 82, respectively—than the 44 who identified themselves as AfD supporters.
Those who did report aligning with the far-right party had an average of 55 posts from AfD-related pages appear in their news feeds in the eight weeks of data we examined. By comparison, supporters of the CDU/CSU had an average of just six CDU- or CSU-affiliated posts appear in their feeds.
“Given its very limited number of participants, data from The Markup’s ‘Citizen Browser’ is simply not an accurate reflection of the content people see on Facebook,” Facebook spokesperson Basak Tezcan said in an emailed statement. “We actively reduce the distribution of content that is sensational, misleading, or are found to be false by our independent fact-checking partners. Our approach goes beyond addressing the issue post-by-post, so when Pages or Groups repeatedly share this kind of content, we reduce the distribution of all the posts from those Pages and Groups.”
The AfD did not respond to a request for comment.
Our analysis has limitations. Citizen Browser tracks a small percentage of Facebook users in Germany compared to the tens of millions of Germans on the platform and is unlikely to perfectly mirror what Facebook shows all of its users in Germany. On Sept. 1, Facebook introduced a new interface that affected captures for 3 percent of the panel across all parties. Some captures for this small subgroup of panelists could not be included in this study.
But the panelists represent a diverse set of party affiliations across the political spectrum in the country, from AfD supporters to centrists to far more liberal users.
And AfD’s savvy on Facebook has been documented in past elections.
The AfD’s Rise on Social Media
The AfD launched in 2013, initially as a conservative party harnessing skepticism of the European Union. Though it failed to reach the vote threshold for representation in the German Bundestag in the federal election that year, the group’s facility with social media quickly became evident.
“Directly in their beginning, in 2013, they began to install a very strong network of interconnected Facebook accounts for nearly all local branches of the party,” said Isabelle Borucki, an interim professor at the University of Siegen who studies German political parties online. The AfD operates on many platforms, but Borucki said it was clear the party “understood especially how this network works.”
It isn’t just Facebook where the AfD has performed well, either. This year, a report from Süddeutsche Zeitung and AlgorithmWatch that relied on data from hundreds of users showed how Facebook-owned Instagram seemed to favor right-wing content, with posts from the AfD tending to appear higher up in users’ feeds.
While it’s difficult to say how social media popularity translates to votes, many observers have attributed the AfD’s growth, at least partially, to its social media strategy.
“They managed to use social media to explode and find people and citizens that weren’t interested in politics before,” said Juan Carlos Medina Serrano, a Ph.D. student at the Technical University of Munich who has studied the AfD’s use of social media and is now heading data operations for Germany’s Christian Social Union party.
In past elections, researchers and journalists have tried to measure how well the AfD has reached users on Facebook compared to other political parties. Like The Markup, they also found that the AfD has been able to use Facebook to find a large online audience.
After the 2017 national election, a Washington Post analysis noted that AfD posts had been shared more than 800,000 times that year, far outpacing all other major parties put together.
In 2019, one report found that AfD posts on Facebook accounted for about 85 percent of shared content from German political parties, according to Der Spiegel. A researcher told the outlet at the time that the AfD had become “the country’s first Facebook party.”
Facebook has highlighted its efforts to combat misinformation in past German elections. In 2017, after the last German federal election, the company said it had removed tens of thousands of suspicious accounts to clamp down on the spread of false information.
Facebook also announced earlier this month that it had removed a network of pages associated with Germany’s anti-lockdown Querdenken movement that promoted violent content and health misinformation. The movement is not directly aligned with a political party, although it shares its COVID-skeptical perspective with the AfD.
This month’s vote may present new challenges for the social network. In June, Politico reported that there had been a spike in election-related misinformation as far-right social media users appeared to be laying the groundwork to make claims of election fraud after the vote.
What’s Driving the AfD’s Success on Facebook?
Experts point to several factors that have contributed to the AfD’s Facebook presence.
As the Citizen Browser data shows, the AfD and its supporters tend to run more active pages in general than their rivals, setting up relatively small, localized pages that garner support across the country.
The AfD, researchers say, also relies more on sensational, aggravating content, which is a perspective Facebook rewards with greater reach. “They trigger anger, fear—I would say anarchic or basic emotions,” Borucki said. “Those trigger people and affect people more than bare facts.” One recent AfD post found in our dataset bemoaning “climate hysteria,” for example, led to more than 5,000 “angry” reactions on Facebook.
This strategy seems to be catching on with other political groups. The Wall Street Journal reported last week that some European parties had shifted policy positions to align with what performs well on Facebook, including more negative content.
The CDU didn’t respond to The Markup’s requests for comment, and the SPD declined to comment.
Like many conservative politicians in the United States, the AfD has been eager to court voters skeptical of COVID-19 restrictions and vaccines, leaning into a populist stance against preventative COVID-19 measures.
Facebook says it attempts to automatically tag any content related to COVID-19 with a flag sending users to reliable information. The Citizen Browser data shows that, of the posts shown to our panelists, posts from the AfD were by far the most likely to be tagged by Facebook as being related to COVID-19. Our panelists were shown AfD posts tagged by Facebook for being COVID-related more than 250 times. In contrast, our panelists were shown posts from the SPD with tags related to COVID-19 fewer than 15 times, and this was the second most tagged in our dataset.
Many of the AfD posts inveigh against lockdown measures and suggest that the vaccines may not be as effective as health officials claim. A post about infections spread in a club that required proof of vaccination, for example, called vaccine-related restrictions quatsch, or nonsense.
The group’s posts remain popular, but it’s also not clear whether those posts are leading to new votes. The party is projected to end up in fourth or fifth place in the upcoming election.
Since the 2017 election, Medina Serrano said, the AfD’s explosive growth on Facebook seems to have leveled off. Now, he said, the party has gone from a strategy of looking to pull in new voters to one of cementing its base in German politics through Facebook.
“It’s more about maintaining the base than growing—it’s already capped, in my opinion,” Medina Serrano said. “But we’ll see the results on election night.”
“The climate crisis has not disappeared,” said Swedish activist Greta Thunberg. “It’s the opposite—it’s even more urgent now than it was before.”
Young people by the hundreds of thousands took to the streets across the globe on Friday to deliver a resounding message to world leaders: The climate crisis is getting worse, and only radical action will be enough to avert catastrophe and secure a just, sustainable future for all.
“As emissions and inequalities increase, we rise up and demand climate justice.”
From Pakistan to Italy to Germany to the Philippines, the worldwide “Uproot the System” actions marked the largest climate demonstrations since the coronavirus pandemic forced campaigners to take their protests online last year. Climate activists in developing countries—where access to vaccines is limited due to artificial supply constraints and hoarding by rich nations—were still forced to limit the size of their demonstrations Friday as a public health precaution.
“Last time it was digital and nobody was paying attention to us,” Yusuf Baluch, a 17-year-old activist from the Pakistani province of Balochistan, toldReuters. “In the global north, people are getting vaccinated so they might be out in huge quantities. But in the global south, we are still limited.”
The Global Climate Strike continues! Balochistan is predominantly agriculture-based. They have been affected by drought due to climate change and the problems faced by people are increasing alarmingly.
Above: Photo Collage / Great Thunberg – via Instagram / Lynxotic
Swedish activist Greta Thunberg, whose solitary sit-down strike outside her home country’s parliament in 2018 helped spark the global Fridays for Future movement, said that “it has been a very strange year and a half with this pandemic.”
“But of course, the climate crisis has not disappeared. It’s the opposite—it’s even more urgent now than it was before,” said Thunberg, who on Friday joined a large demonstration in Berlin, which was hammered by massive, climate-linked floods in July.
Watch Thunberg’s full speech in front of the Reichstag building:
Organizers said that more than 1400 climate strikes are set to take place in at least 70 countries Friday, with hundreds of thousands expected to attend demonstrations in Germany alone.
“As emissions and inequalities increase, we rise up and demand climate justice,” saidBerlin-based climate activist Luisa Neubauer.
The latest youth-led global action kicked off just weeks ahead of the pivotal COP26 climate summit in Glasgow, which many civil society organizations want to be postponed over fears that inequities in coronavirus vaccine access could prevent delegates from developing nations—those most vulnerable to the climate crisis—from attending.
Equalizing global vaccine distribution is one of the six demands that climate campaigners are aiming to put before world leaders during Friday’s mass demonstrations. The full list is as follows:
The Global North needs to cut emissions drastically by divesting from fossil fuels and ending its extraction, burning, and use. We need concrete plans and detailed annual carbon budgets with roadmaps and milestones to ensure we get to net-zero with justice and equity in the time needed to address climate change.
The colonizers of the north have a climate debt to pay for their disproportionate amount of historic emissions and that starts with the increase of climate finance to implement anti-racist climate reparations, the cancellation of debts especially for damage caused by extreme weather events, and providing adaptation funds that serve the communities.
Work towards a genuinely global recovery from Covid-19 by ensuring equitable vaccine distribution worldwide and suspending intellectual property restrictions on Covid-19 technologies. This is an essential step towards a global, green, and just recovery.
Recognize the tangibility of the climate crisis as a risk to human safety and secure the rights of climate refugees in international law.
Recognize the invaluable impact of biodiversity on indigenous communities’ lives and culture, and commit to make ecocide an international punishable crime.
Stop the violence and criminalization against indigenous peoples, small farmers, small fisherfolk, and other environmental and land defenders. Support the work they do. Respect and listen to our defenders.
The worldwide demonstrations came a week after the United Nations warned that even if the 191 parties to the Paris Agreement meet their current climate targets, global greenhouse gas emissions will still rise 16% by 2030 compared to 2010 levels. The U.N. also estimated that the planet is on track for 2.7°C of warming by the end of the century, a level of heating that experts say would be cataclysmic—particularly for developing nations.
At the U.N. General Assembly in New York this week, the leaders of vulnerable countries pushed wealthy nations—the largest contributors to the climate emergency—to stop shirking their responsibilities to confront the planetary crisis.
“We simply have no higher ground to cede,” Marshall Islands President David Kabua said Wednesday. “The world simply cannot delay climate ambition any further.”
Participants in Friday’s global action pointedly amplified that message. Valentina Ruas, a Brazilian activist, toldThe Guardian that “the global north should be developing climate policies that have at their core climate justice and accountability to the most affected people and areas.”
“Instead,” she added, “they continue to exploit vulnerable communities and recklessly extract fossil fuel, while bragging about their insignificant emission reduction plans.”
The tweak, which targets the code in accessibility features for visually impaired users, drew ire from researchers and those who monitor the platform
Facebook has begun rolling out an update that is interfering with watchdogs monitoring the platform.
The Markup has found evidence that Facebook is adding changes to its website code that foils automated data collection of news feed posts—a technique that groups like NYU’s Ad Observatory, The Markup, and other researchers and journalists use to audit what’s happening on the platform on a large scale.
The changes, which attach junk code to HTML features meant to improve accessibility for visually impaired users, also impact browser-based ad blocking services on the platform. The new code risks damaging the user experience for people who are visually impaired, a group that has struggled to use the platform in the past.
The updates add superfluous text to news feed posts in the form of ARIA tags, an element of HTML code that is not rendered visually by a standard web browser but is used by screen reader software to map the structure and read aloud the contents of a page. Such code is also used by organizations like NYU’s Ad Observatory to identify sponsored posts on the platform and weed them out for further scrutiny.
“We constantly make code changes across our services, but we did not make any code changes to block these research projects,” Lindy Wagner, communications manager at Facebook, said in an email to The Markup.
Following the changes, the Citizen Browser project experienced a drop in data collection rates from early September, prompting the investigation that uncovered these changes to the code. At around the same time, users of certain ad blockers noticed a decrease in their effectiveness.
Laura Edelson, a Ph.D. candidate in computer science at NYU’s Tandon School of Engineering and founder of the Ad Observatory project, expressed dismay at Facebook’s latest move impacting data collection. The website update had at first caused a sharp drop in the amount of data collected by the Ad Observatory, she said, but a fix was found that allowed the team to collect data at normal levels.
“I think it’s unfortunate that Facebook is continuing to fight with researchers rather than work with them,” she said.
Facebook has used similar tweaks to attempt to frustrate researchers and ad blockers in the past, often with the result of making the platform less accessible to visually impaired users.
In 2019, the company made changes to obfuscate its code in a way that blocked ad collection efforts by ProPublica, Mozilla, and British ad transparency group WhoTargetsMe. And in 2020, Quartz reported that visually impaired users had been unable to hear a legible label distinguishing between sponsored and nonsponsored posts for the previous two years because the platform had added numerous junk characters to the text to reduce the efficiency of ad blocking software.
In its latest update, Facebook seems to have implemented the code in a way that prevents screen readers from reading the new tags. As the update has not yet been rolled out to all users, it’s unclear what, if any, impact the change may have on visually impaired users. In at least one circumstance, a developer from The Markup who was testing the new code found that the Microsoft Narrator screen reader read aloud a string of junk characters as an unintelligible word when accessing the site through the Google Chrome browser.
“Our accessibility features largely appear to be working as normal, however we are investigating the claim,” Facebook’s Wagner said.
Jared Smith, associate director of accessibility research and training nonprofit WebAIM, expressed concerns about the code in Facebook’s web update after reviewing it for The Markup.
According to Smith, the new updates break many basic rules of accessibility design. Rather than presenting a clear and simplified structure, he said, the accessibility code was hugely complex, potentially heralding problems down the road.
“When you see thousands and thousands of patterns of ARIA attributes—code that could be used for accessibility but doesn’t seem to support accessibility—it poses a scenario where things could jump the rails and really negatively impact accessibility,” said Smith.
“We’ve seen misuse of technologies like this for things like search engine optimization, but this is on an entirely different scale,” he added.
In July 2020, a blog post from the Facebook engineering team trumpeted an extensive rebuild of the site that was apparently made with accessibility in mind. This included requirements for Facebook developers to use a code linting plugin (similar to a spelling autocorrect) that would highlight violations of ARIA standards.
“I suspect that the Facebook team implementing these apparent anti-transparency mechanisms does not realize that there are potential accessibility consequences to what they’re doing,” said Blake E. Reid, a professor at the University of Colorado Law School who focuses on accessibility and technology policy.
Sen. Ron Wyden, who has been critical of the company in the past, told The Markup in an emailed statement that Facebook’s latest move showed a disregard for visually impaired users.
“It is contemptible that Facebook would misuse accessibility features for users with disabilities just to foil legitimate research and journalism,” he said.
Facebook has long claimed that it wants to share data with researchers, Edelson said, but in practice numerous social scientists have faced obstacles when trying to work with the platform.
In August of this year, Facebook disabled the accounts of NYU Ad Observatory researchers for alleged violations of its terms of service with the researchers’ own ad collector. (At the time, The Markup’s senior executives published a press release critical of Facebook’s actions.)
And reporting by The New York Times brought to light the fact that Facebook had given incomplete data to misinformation researchers from the high profile Social Science One research group, potentially undermining the findings of years of academic studies. The error was first uncovered by a university professor who found discrepancies between numbers in the Social Science One data and Facebook’s recently published Widely Viewed Content Report.
“At what point does the research community stop thinking of Facebook as a positive actor in this space?” Edelson said.
House Bill Would Blow Up the Massive IRAs of the Superwealthy
Legislation currently making its way through Congress would take a sledgehammer to the massive individual retirement accounts built up tax-free by a select group of the ultrawealthy.
The proposal, which is part of the infrastructure and tax package advancing in the House, targets the jaw-dropping IRAs accumulated by multimillionaires and billionaires such as tech investor Peter Thiel, which were first reported by ProPublica earlier this year. Those accounts — Thiel’s alone was worth $5 billion in 2019 — have allowed some super-wealthy Americans to turn their Roth IRAs, tools meant to incentivize middle-class retirement saving, into supersized tax shelters.
The proposed reform, put forward by House Ways and Means Chairman Richard Neal, D-Mass., would effectively cap the total amount someone could hold in a Roth at $20 million and compel the holders of the giant accounts to withdraw anything over that limit. Separately, individuals would have to add up the balances of their retirement accounts — including Roths, traditional IRAs, 401(k)s and 403(b)s — and every year withdraw half of any amount over $10 million. The provisions would only apply to individuals with taxable income of over $400,000 or couples making over $450,000.
The reform wouldn’t affect the overwhelming majority of Americans, whose retirement savings (if they have any) are far more modest — the average Roth was worth just $39,108 at the end of 2018.
“Incentives in our tax code that help Americans save for retirement were never intended to enable a tax shelter for the ultra-wealthy,” Neal said earlier this year. “We must shut down these practices.”
Should the bill pass, it could have profound implications for PayPal founder Thiel, whose gargantuan Roth stunned lawmakers, spurring Neal to vow a crackdown. Thiel wouldn’t owe any tax up front and no early withdrawal penalties would apply, but he’d be required to move billions out of the tax-advantaged account. And any gains on investments made with that money would no longer be sheltered from taxes, potentially creating hundreds of millions of dollars in future tax liabilities.
Above: “I’ll Take Your Questions” book on inside secrets of the Trump final days, by Stephanie Grisham for aide to both Trump and Melania
The great appeal of the Roth IRA is that once money is inside it, any income generated — such as capital gains from selling a stock, investment interest or dividends — is tax-free, as long as the holder waits until he or she is 59 and a half to withdraw it. (Thiel hits that mark in 2027.) In a traditional IRA, by contrast, money that’s withdrawn counts as income and is taxed.
The IRA reforms are part of a slate of proposals designed to eliminate loopholes and boost tax rates on rich individuals and corporations.
Several of the changes address revelations contained in The Secret IRS Files, a series of ProPublica stories published this year that are exploring the ways the very richest Americans avoid paying taxes. Usually such efforts remain secret, but ProPublica has obtained a trove of tax records covering thousands of the country’s richest people. The records reveal not only the diverse array of tax-avoidance techniques used by the rich, but also that some of the very richest have consistently found ways to avoid taking income, so they pay little or no taxes, even as their wealth multiplied to historic levels.
The current House plan falls short of President Joe Biden’s more ambitious proposals to combat wealth inequality through the tax code. But experts say it would significantly increase the taxes paid by high-income Americans. Among other things, it would all but eliminate a major deduction created by President Donald Trump’s 2017 tax law that, as ProPublica recently reported, showered massive tax breaks on some of the richest families in the country.
Given the stakes for a small group of wealthy and powerful Americans, it’s unclear whether the IRA proposal, along with the rest of the package, will become law. It must pass the House and make it through the Senate, where it will likely need the votes of all 50 Democratic senators to pass. Capitol Hill staffers say the bill remains fluid and provisions could still be cut, added or modified.
For now, however, the proposal has alarmed those who stand to lose the most. Three tax lawyers told ProPublica that clients with giant IRAs have reached out to them, worried about the potential reforms. Already a lawyer and an accountant are offering a paid webinar that pitches strategies to help owners of large IRAs get around the proposed rules.
A spokesman for Thiel didn’t respond to a request for comment.
The tax proposals have drawn opposition from Republicans on Capitol Hill. “This is very bad news for the U.S. economy,” said Ways and Means Committee ranking member Rep. Kevin Brady, R-Texas, in an interview this week.
A budget analyst at the anti-tax Heritage Foundation specifically criticized the IRA reform proposals as “stifling retirement savings and decreasing the economy-wide investment in future productivity.”
Neal announced his plans to curb the size of mega IRAs in July following ProPublica’s story revealing how Thiel and other billionaires had amassed giant retirement accounts using techniques largely unavailable to most taxpayers. Other wealthy investors with giant retirement accounts included financier Michael Milken, Warren Buffett and executives from investment giant Bain Capital.
Neal joined his Senate counterpart, Ron Wyden, D-Ore., who had been pushing for reform of mega IRAs for years without much support from his peers.
With a multibillion-dollar tax-free account on the line, a wealthy investor might try to keep his income below the $400,000 threshold set by the proposal. In Thiel’s case, it’s not clear if that would be possible, given that he’s long reported tens of millions of dollars on his tax returns from capital gains, interest and dividends on investments he holds outside of his Roth IRA. And even if he has to withdraw billions from his Roth, he will never have to pay taxes on years of growth inside the account.
ProPublica has previously reported that several billionaires have had very little taxable income in certain years, including Jeff Bezos and Elon Musk. Musk did not respond to questions for that story and Bezos’ representatives would not designate someone to accept questions related to that story.
The proposal would also add restrictions in areas that congressional investigators have said are ripe for abuse by the wealthy: The owners of IRAs would be barred from using the accounts to either purchase certain nonpublic investments or buy stakes in companies in which they are an officer.
Thiel launched his Roth IRA by purchasing so-called founder’s shares of PayPal in 1999 when he was chairman and CEO of the company, according to tax records and a financial statement Thiel included in his application for residency in New Zealand. Securities and Exchange Commission records show he bought 1.7 million shares for $1,700, or a tenth of a penny per share. (The maximum contribution to a Roth that year was $2,000.) PayPal later told the SEC the shares were sold “below market value.”
The practice has become popular among the founders of Silicon Valley companies, who tuck shares of their startups into IRAs, often after buying them at bargain prices. This can sidestep IRA contribution limits and generate massive tax-free growth if the value of their companies explodes.
The proposal would also shut down the so-called backdoor Roth. ProPublica found that billionaires like Buffett had taken advantage of a maneuver, known as a conversion, that allows the wealthy to sidestep existing income caps to create a Roth IRA. In a conversion, the owner of a traditional IRA can transform it into a Roth by paying one-time tax on the money. Once the account is converted into a Roth, no additional income taxes are ever due. The new provision would bar conversions for individuals with income over $400,000, though the ban would not go into effect until 2031 for budgetary reasons. (Buffett previously didn’t respond to questions about his IRA.)
The proposal also has implications for the holders of giant traditional IRAs, who could suddenly owe a hefty tax bill. Money withdrawn from a traditional IRA counts as taxable income. Milken, the 1980s junk bond king who went to prison for fraud and was later pardoned by Trump, had traditional IRAs valued at $509 million at the end of 2018, according to tax records. If the law passed, Milken could face a tax bill of roughly $100 million, depending on the current size of his account. A spokesperson for Milken declined to comment.
Separately, another part of the bill would tackle the generous business income deductions granted by Trump’s 2017 tax law.
As ProPublica previously reported, the drafting of the deduction was marked by last-minute changes and a rush of lobbying dollars from corporations and the superrich. The result of its passage, confidential tax records show, was a windfall for billionaires such as media mogul Michael Bloomberg, packaging tycoons Dick and Liz Uihlein, and the Bechtel family, owners of a global engineering and construction firm.
Bloomberg received a deduction of roughly $183 million in 2018 alone as a result of the provision, while the Uihleins netted around $118 million.
Under the House proposal, the deduction would be capped at $400,000 for an individual and $500,000 for a couple, virtually wiping it out for the very rich. If such a cap had been in place in 2018, for example, the Uihleins would have gotten a deduction worth just $500,000 instead of $118 million. A competing Senate proposal unveiled by Wyden in July would go even further. A spokesperson for the Uihleins declined to comment on the proposed reforms.
On a broader level, the House plan would spell a significant tax hike on Americans earning more than $400,000, raising their individual income tax rates as well as bumping up the corporate tax rate, the first such hikes in a decade.
But despite the proposal’s ambition, critics say it misses a rare opportunity to capture the massive untaxed wealth of some of the richest individuals in history, including Bezos and Musk, who have often found ways to keep their income low.
As ProPublica reported, they and other billionaires have managed to pay little to no taxes in the past. Some have done so by pursuing the so-called buy, borrow, die strategy. By holding on to his Tesla stock but borrowing money to finance his lifestyle, Musk, for example, can avoid income that is taxable under current law. If he sticks to this strategy till death, the income tax liability on his fortune will evaporate for his heirs.
Some Democrats and policymakers had aspired to even bolder tax code changes that would have targeted the stratospheric increases in the ultrawealthy’s riches. One idea, championed by Sens. Elizabeth Warren, D-Mass., and Bernie Sanders, I-Vt., would be to levy a so-called wealth tax on billionaires’ overall holdings. Another, pushed by Wyden, would tax the annual gains billionaires logged, even if they hadn’t sold the assets. Both ideas foundered, with concerted opposition from billionaires and skittishness from Democratic centrists. Some critics point out that wealth taxes have often failed in other countries. And many policymakers believe it would be too logistically difficult to measure assets properly and enforce such a sweeping rule on gains.
Originally published on ProPublica by Justin Elliott, Patricia Callahan and James Bandler and republished under Creative Commons.
Extreme Weather Accelerates in Frequency and Destructive Power
Ida hit Louisiana with extreme force, causing damage and mayhem, and leaving hundreds of thousands without power earlier this week. The remnants of that destruction have now moved Northeast. Next, Hurricane Larry is expected to become a major storm by Friday according to the National Hurricane Center.
Effects of Hurricane Ida unloaded in the New York City metro area, creating, unprecedented extreme rainfall. So much so that for the first time ever, a “flash flood emergency” was initiated and both New York Mayor Bill de Blasio and New Jersey Governor Phil Murphy declared states of emergency starting late Wednesday.
“This is a PARTICULARLY DANGEROUS SITUATION. SEEK HIGHER GROUND NOW!,” the National Weather Service wrote. And example of the extreme nature of the deluge comes via the stat that Central Park got more rain in one hour than it normally would in the entire month of September. More than 2.5 times the previous highest count even, which was tallied just recently.
Parts of New York City and the Tri-State, covering a population of where near 9 million people reside have been affected. Roads flooded, transforming the paths to looks more like raging rivers and rendering subways, cars, and basements of homes useless.
At least 9 people have been reported dead as a result of storm.
Images posted throughout social media overnight showed the insane amount of watering surging over roads as public transportations attempt to navigate and cars get stuck in the water. Even a frightening video of tornado happening in real time in Mullica Hill, New Jersey.
All too familiar the Elephant in the room needs acknowledgment
Although barely mentioned in the midst of chaos and people desperately trying to get to work on Thursday, climate change is giving a kind of early warning signal via extreme weather evens like this, as well as influencing the severity of the massive drought worsening daily in the west, immense wildfires and natural disasters that are being seen with unprecedented frequency and intensity.
If there was ever a wake up call to change and respond with speed and action, this is it.
On twitter there was a thread that likened the photos and videos to the prescient sci-fi film “The Day After Tomorrow” which depicted an ice-age occurring as a result of climate change, and also had scenes of massive flooding (due to the sea level rising which is currently happening, day by day).
The comparison is a stark one, with the Hollywood generated special effects stills not nearly as chilling as the current reality showed in photos being shared and tweeted.
There’s an all too familiar thread building here – larger more intense and devastating events that many keep saying are a coincidence or “random”. I think any child can see (@gretathunberg ?) that there is zero chance anymore that coincidence plays any more that a minuscule role in these tragedies growing, expanding and increasing exponentially.
Unfortunately, we can expect more of the same, no only here in this country, as mentioned above with Larry queuing up of shore, but around the world with extreme and dangerous droughts, heatwaves, polar vortex episodes, floods, deadly wildfires and more becoming the “norm”.
The time to recognize the origin of these mounting calamities has passed, but any proactive, powerful response by governments and industry has barely begun. Perhaps the images and tragedies now being documented and shared (such as below) can help to harden our resolve to see that a change, toward the drastic measures required to combat this climate emergency will finally begin in earnest.
Queens Boulevard in Maspeth/Corona is a literal river at the moment. Bus fully flooded driving through, multiple cars stuck in the water. Absolutely insane. pic.twitter.com/LuSL9uWCEl
The Caldor Fire had burned 204,390 acres and 20%-contained
The raging Caldor Fire that has already forced thousands of people to evacuate, is now becoming a critical threat to the popular tourist location, South Lake Tahoe. Reports of more than 34,000 structures are at risk.
There are approximately 4,000 firefighters and 1,000 California National Guard members that are helping to fight off the growing fires.
A spokesperson for California Governor’s Office of Emergency Services told CNN that over 53,000 people have been placed under evacuation orders.
The fire has already burned more than 300 square miles and destroyed hundred of residential structures. The city is facing wind gusts blowing at 35 miles per hour and stronger which continues to help the fire spread further down into the Tahoe basin.
Devastating Wildfires – continued reminders of the Climate Crisis
Greta Thunberg, the vocal climate crisis activist retweeted the below the video of the fires in California. There is so much confusion over the question of exactly which of the many, many “extreme weather events” as they are now called, are directly attributable to climate change, global warming and Co2 in the atmosphere.
This is, for Greta Thunberg and anyone reading this with an ounce of sense, a moot point. The larger overarching point is that the threat of total world destruction as a result of buying fossil fuel and other human impacts on the environment has been long settled as a very dangerous and rapidly worsening reality.
Splitting hairs by constantly questioning alternative origins for extreme events, that clearly are increasing in their number and severity, is a kind of “climate denial-lite” that is as ridiculous as it is dangerous. Ultimately it is the perspective of those like Greta, that must be adopted and understood by the millions (billions), before it is too late. Only then, when the threat is faced head on, is there a chance we might prevent a rapid slide into oblivion.
Thunberg tweeted this week “Wildfires, floods, droughts, heatwaves and other (un)natural disasters rage all over the world. Many now ask “What will it take for people in power to act?”. Well, it will many things, but above all it will take: massive pressure from media and massive pressure from the public.”
President Donald Trump’s ban on the visa lottery was ruled to be illegal, but the government says it can’t help hundreds of Afghans who won it for at least another year.
Fakhruddin Akbari is allowing his full name to be published because he is certain he is going to die. Akbari, his wife and his 3-year-old daughter fled their home in Kabul, Afghanistan, two weeks ago. They’ve been hiding with friends in the city, living on bread and water.
He should be among the lucky ones.
Instead, Akbari fears the very thing he was hoping would be his salvation will now make him a target.
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Two years ago, Akbari won a rare spot in the United States’ “visa lottery.” He was chosen at random from a pool of 23 million to get the chance to apply for one of 55,000 visas to immigrate to the U.S. The U.S. was supposed to have finished his case by last fall. The instructions when he registered promised as much. Either he would be safely en route to the U.S., or he would lose his chance and move on.
But with the final U.S. evacuation from Afghanistan just days away — and as Thursday’s bombings have added even more chaos at Kabul’s airport — Akbari has almost certainly lost his chance to get out.
He has already burned the letters of commendation his relatives received for their work with American contractors or allied militaries. The Taliban already know, he says, that he’s part of a pro-American family. His neighbors have told him they’ve been visited by strangers asking about him.
A March 2020 ban signed by President Donald Trump, citing a need to protect the American economy, prevented Akbari and visa lottery winners from entering the U.S. In response to a lawsuit by immigration lawyers, a federal judge ruled earlier this month that the government has to move ahead on processing thousands of last year’s lottery winners. But the U.S. has told the judge it can’t even start until fall 2022 at the earliest.
Several hundred Afghans are in the group. They may be the unluckiest winners in the visa lottery’s 30-year history.
The State Department did not respond to a request for comment before publication.
The lottery isn’t open to everyone. Winners must come from a country that hasn’t had much recent immigration to the U.S. Applicants for the visas must also submit biometric information, pass an interview and medical screening, and complete several security checks.
Nouman, an Afghan lottery winner who asked that his full name not be used over fear of the Taliban, spent months tracking down police documents from the Chinese town where he’d worked for a few years, to prove he had a clean record.
Those requirements are still far less restrictive than other ways to legally immigrate to the U.S., which generally require being closely related to a citizen or green-card holder or having a job offer from an American company. In Afghanistan, interest in the lottery is so great that Nouman said it took him two days to successfully log onto the swamped website where lottery results were posted.
But unlike other visas, diversity visas — the type lottery winners become eligible to receive — are on a tight and unvarying schedule.
Lottery winners are notified in the early summer. After submitting their full application, they can only be interviewed at the nearest U.S. consulate once the federal fiscal year begins on Oct. 1. Then the whole process has to be completed within a year. Eligibility for the visa doesn’t roll over.
Usually, most of the annual 55,000 visas have been handed out by that time. But last year, two things happened. First, in mid-March, consulates around the world shut down because of the pandemic. Two weeks later, Trump declared that letting in immigrants would hamper the recovery of the economy, and he signed the order barring most types of immigrants — including diversity visa holders.
When U.S. embassies and consulates began to reopen last summer, a State Department cable disclosed as part of the lawsuit shows they were instructed to handle diversity visas last, even if they met the narrow exemptions to the ban.
Giving someone a visa is legally distinct from letting them enter the U.S., and critics of Trump’s actions — including a group of lawyers who filed lawsuits over the bans — argued that even if the ban were legal, consulates could still prepare visas so that recipients could come after the ban was rescinded, which President Joe Biden did this February.
In early September last year, Judge Amit Mehta of the U.S. District Court for the District of Columbia agreed with the argument and ordered the government to make up for lost time, prioritizing diversity visa applicants ahead of everyone else for the last 26 days of the fiscal year.
The State Department’s bureaucracy took a few days to get into gear. Then it began a process that turned out to be far from efficient.
Officials compiled a spreadsheet of applicants who had joined the now-consolidated suit and were supposed to be prioritized, but it was riddled with misspelled names and incorrect case numbers. In a court declaration, a State Department official from a different office said the spreadsheet took “many queries” from his team to fix.
Once consulates and embassies got the correct names, they rushed appointments, often giving applicants little notice. The Kabul embassy wasn’t participating at all, so any Afghan appointments were set up in different countries — or continents.
At least three Afghan immigrants, including Nouman, were scheduled for interviews in Cameroon. All three were given one day’s notice to get there. (Nouman, at least, was able to get a later appointment in Islamabad, Pakistan.)
Many more weren’t given interviews at all. According to court filings, some State Department employees told applicants who called the office handling the cases that if they hadn’t officially joined the lawsuit, “you lost your chance” — which wasn’t true. When a COVID-19 outbreak hit the office and workers went remote, the help line shut down entirely.
When the fiscal year ended on Sept. 30, 2020, more than 40,000 of the 55,000 diversity visas were still unused — and several hundred Afghans were still waiting. Less than 20% of the Afghan lottery winners had gotten visas by the deadline.
That day, Mehta had ordered the State Department to reserve 9,505 slots, based on his estimate of how many diversity visas could have been processed if COVID-19 had existed but the ban didn’t. When the case finally concluded this month, he declared that the government would indeed have to process those visas.
That opinion came down on Aug. 17, two days after Kabul fell.
In a response filed to Mehta on Thursday, the government offered to start processing last year’s visas in October 2022. One reason given for the proposed delay was that processing older visas is “an unprecedented computing demand that will require the Department to implement wide-ranging hardware and software modifications.” Another was that processing diversity visas would take resources away from dealing with the crisis in Afghanistan.
It went unmentioned that some people are affected by both.
Lawyers for the affected immigrants made an emergency filing this week, with testimony from several Afghans worried that they would be targeted by the Taliban precisely because they had sought to immigrate to the U.S. They’re hoping the court will order expedited consideration for Afghan lottery winners.
The lawyers are moving to appeal for the court to order that Afghans get priority in the visa process. The plaintiffs’ lawyers had asked the government to consent to their filing the request. The government’s response — after several days of silence, delaying the filing — was to call it an “unnecessary distraction.”
In a meeting by phone on Monday, according to two people on the call, another government attorney complained that he’d been getting emails from applicants “all over the world” and blamed their lawyers for posting his address online. One of those emails was a desperate cry for help from Akbari. “We are totally hopeless and every knock of the door seems like a call to death for us,” Akbari wrote. “Please help us.”
In the time since sending that email, Akbari and his family have made two attempts to get to Kabul’s Hamid Karzai International Airport. The first time, he says, they were beaten back by the Taliban. The second time he was stopped by the United States. The Marines guarding the airport said they couldn’t enter. The reason? They did not have visas.
Originally published on ProPublica by Dara Lind via Creative Commons
“The stench of corruption wafting up from Louis DeJoy’s office is so thick seagulls are flying in from the Jersey Shore and circling overhead.”
A leading government ethics watchdog on Wednesday cheered a federal judge’s ruling ordering the United States Postal Service to hand over documents concerning potential conflicts of interest involving embattled Postmaster General Louis DeJoy.
U.S. District Judge John D. Bates on Tuesday granted Citizens for Responsibility and Ethics in Washington (CREW) a full summary judgment (pdf) and orderedthe United States Postal Service (USPS) to give the advocacy group seven documents it requested under the Freedom of Information Act (FOIA).
USPS claimed the documents were FOIA-exempt. According toLaw & Crime, “Four of the documents concerned a request for a certificate of divestiture from DeJoy and the remaining three concern his recusal from matters where he may have a conflict of interest.”
Over the past seven years, the USPS has reportedly paid approximately $286 million to XPO Logistics, DeJoy’s ex-employer, and has “ramped up its business” with the company since DeJoy’s appointment as postmaster general. After his appointment, DeJoy continued to hold financial interests in XPO totaling between $30 and $75 million. DeJoy also held a significant amount of stock in Amazon, a major USPS competitor.
Earlier this month, Common Dreamsreported on growing calls to fire DeJoy following the revelation by The Washington Post that USPS will pay XPO Logistics $120 million over the next five years. Rep. Gerry Connolly (D-Va.) responded to the Post report by calling DeJoy a “walking conflict of interest.”
Last Friday, a Postreport that DeJoy had purchased hundreds of thousands of dollars worth of publicly traded bonds from Brookfield Asset Management—where USPS Board of Governors Chair Ron Bloom is a managing partner—fueled further calls for DeJoy’s termination, with Connolly calling Bloom and the postmaster general “bandits” whose “conflicts of interest do nothing but harm the Postal Service and the American people.”
CREW communications director Jordan Libowitz called Bates’ order “a big win not just for CREW, but for transparency advocates everywhere.”
“DeJoy’s decision-making as postmaster general has raised some serious ethical questions—now we should finally get some answers,” Libowitz added.
Rep. Bill Pascrell (D-N.J.) on Monday sent President Joe Biden a letter urging him to sack everyone former President Donald Trump appointed to the USPS board. Pascrell welcomed the Tuesday court order and reiterated his call for Biden to fire Trump appointees and “show DeJoy the door now before it’s too late.”
DeJoy and six of the nine USPS governors, including Bloom, were appointed by Trump; the rest are Biden appointees.
In addition to the alleged conflicts of interest in connection with XPO Logistics and Brookfield Asset Management, CREW, in advocating DeJoy’s ouster, notes that:
DeJoy and his wife, a former U.S. ambassador to Canada, got their jobs after contributing $2 million to Trump’s campaign coffers;
DeJoy is the first person in decades to lead the USPS without any previous experience in the agency;
DeJoy is under federal investigation for allegedly operating a scheme where he asked employees of his former company to make campaign contributions, then arranged for bonus payments to reimburse the employees; and
DeJoy apparently violated federal criminal laws by commanding the USPS to make policy changes at the agency that would depress or delay voting by mail in the 2020 election.
“Bottom line: Louis DeJoy has overseen an attack on the Postal Service and on American democracy itself,” CREW tweeted Wednesday. “The USPS Board of Governors must fire him before it’s too late.”
“We’ve spent billions on war. Now, let’s spend to bring Afghans to safety.”
As the Biden administration faces criticism for not doing enough to assist those fleeing Afghanistan, an analysis released Monday showed that the roughly $19 billion the Pentagon budgeted for the U.S. occupation of the country in 2020 alone could cover initial resettlement costs for 1.2 million refugees.
“We have a duty to save lives—and to do so, we must welcome many, many more refugees as quickly as possible.”
—Rep. Cori Bush
Lindsay Koshgarian of the National Priorities Project estimated that the $18.6 billion the Pentagon allocated for its 2020 operations in Afghanistan—where the Taliban is in the process of retaking powerafter two decades of deadly U.S. occupation—could pay up-front refugee relocation costs of $15,148 for the more than “250,000 Afghans displaced since the end of May (and growing)” and “a significant chunk of the 3.5 million Afghans who were internally displaced as of July.”
“Refugees typically receive some assistance after their arrival, but even if we expanded to cover an additional four years of the approximately $4,600 in annualized social service aid that refugees typically receive, we could still resettle more than half a million people, for just one year’s worth of the cost of fighting,” Koshgarian noted. “We’d face even lower costs to help resettle Afghans in countries closer to home—all the more reason after 20 years of war to step up with some serious resources and get it done.”
“After twenty years,” she added, “we owe the Afghan people at least that much.”
Resettling 1.2 million Afghan refugees in the U.S. would cost less than one year of war in Afghanistan.
We've spent billions on war. Now, let's spend to bring Afghans to safety.
The analysis came as progressive lawmakers in the U.S. and global humanitarian organizations implored the Biden administration to open the U.S. to vulnerable Afghans attempting to escape a growing humanitarian crisis and Taliban rule. According to the United Nations Refugee Agency, 80% of those currently trying to flee Afghanistan are women and children.
In a speech on Monday, U.S. President Joe Biden said that “in the coming days, the U.S. military will provide assistance to move more [Special Immigrant Visa]-eligible Afghans and their families out of Afghanistan.” The Pentagon confirmedMonday that it is planning to house up to 22,000 Afghans at two U.S. bases—Fort Bliss in Texas and Fort McCoy in Wisconsin.
“We’re also expanding refugee access to cover other vulnerable Afghans who worked for our embassy: U.S. non-governmental agencies—or the U.S. non-governmental organizations; and Afghans who otherwise are at great risk; and U.S. news agencies,” the president added.
Following his remarks, Biden directed the U.S. State Department to use up to $500 million from the nation’s Emergency Refugee and Migration Assistance Fund to meet “unexpected urgent refugee and migration needs of refugees, victims of conflict, and other persons at risk as a result of the situation in Afghanistan, including applicants for Special Immigrant Visas.”
But critics have accused the Biden administration of failing to adequately plan for the rapid collapse of the Afghan government that followed the ongoing withdrawal of U.S. forces from the country—a still-deteriorating situation that has left countless people in limbo as they seek safety for themselves and their families.
In his speech Monday, Biden claimed the administration didn’t begin evacuating at-risk civilians sooner “because the Afghan government and its supporters discouraged us from organizing a mass exodus to avoid triggering, as they said, ‘a crisis of confidence.'”
Earlier this month, the U.S. State Department expanded eligibility for the Special Immigrant Visa (SIV) program, opening it to tens of thousands of Afghans who worked for U.S. government contractors, U.S.-based media outlets, and U.S.-based non-governmental organizations. The families of eligible Afghans also have access to the program, whose application process consists of an arduous 14 steps.
And as the Wall Street Journalobserved on Monday, the program excludes the poorest Afghans by design. “To claim refugee status,” the Journal noted, “the Afghans must enter through a third country and cover the costs of travel and lodging on their own—a hurdle that is nearly impossible to surmount under the current, chaotic circumstances.”
In a letter to Biden on Monday, the advocacy organization Refugees International called on the administration to “express its willingness initially to resettle up to 200,000 Afghan refugees, as part of an international responsibility-sharing effort to rescue and resettle Afghans at risk.”
“While most would be resettled from countries of asylum,” the group wrote, “a program ultimately could involve direct resettlement from Afghanistan, akin to the Orderly Departure program that resulted in the resettlement of many hundreds of thousands of Vietnamese directly from their country of origin.”
Rep. Cori Bush (D-Mo.), part of a chorus of progressive lawmakers pushing Biden to do more to welcome refugees—in addition to ending the interventionist foreign policy approach that creates such humanitarian crises—noted in a tweetMonday that the U.S. “welcomed 120,000 refugees in a single year” in the aftermath of the Vietnam War.
“Yet the United States has only taken in ~2,000 Afghan refugees thus far,” Bush wrote. “We have a duty to save lives—and to do so, we must welcome many, many more refugees as quickly as possible.”
This story was originally published by ProPublica.
ProPublica is a Pulitzer Prize-winning investigative newsroom. Sign up for The Big Story newsletter to receive stories like this one in your inbox.
In 2007, Jeff Bezos, then a multibillionaire and now the world’s richest man, did not pay a penny in federal income taxes. He achieved the feat again in 2011. In 2018, Tesla founder Elon Musk, the second-richest person in the world, also paid no federal income taxes.
Michael Bloomberg managed to do the same in recent years. Billionaire investor Carl Icahn did it twice. George Soros paid no federal income tax three years in a row.
ProPublica has obtained a vast trove of Internal Revenue Service data on the tax returns of thousands of the nation’s wealthiest people, covering more than 15 years. The data provides an unprecedented look inside the financial lives of America’s titans, including Warren Buffett, Bill Gates, Rupert Murdoch and Mark Zuckerberg. It shows not just their income and taxes, but also their investments, stock trades, gambling winnings and even the results of audits.
Taken together, it demolishes the cornerstone myth of the American tax system: that everyone pays their fair share and the richest Americans pay the most. The IRS records show that the wealthiest can — perfectly legally — pay income taxes that are only a tiny fraction of the hundreds of millions, if not billions, their fortunes grow each year.
Many Americans live paycheck to paycheck, amassing little wealth and paying the federal government a percentage of their income that rises if they earn more. In recent years, the median American household earned about $70,000 annually and paid 14% in federal taxes. The highest income tax rate, 37%, kicked in this year, for couples, on earnings above $628,300.
The confidential tax records obtained by ProPublica show that the ultrarich effectively sidestep this system.
America’s billionaires avail themselves of tax-avoidance strategies beyond the reach of ordinary people. Their wealth derives from the skyrocketing value of their assets, like stock and property. Those gains are not defined by U.S. laws as taxable income unless and until the billionaires sell.
To capture the financial reality of the richest Americans, ProPublica undertook an analysis that has never been done before. We compared how much in taxes the 25 richest Americans paid each year to how much Forbes estimated their wealth grew in that same time period.
We’re going to call this their true tax rate.
The results are stark. According to Forbes, those 25 people saw their worth rise a collective $401 billion from 2014 to 2018. They paid a total of $13.6 billion in federal income taxes in those five years, the IRS data shows. That’s a staggering sum, but it amounts to a true tax rate of only 3.4%.
It’s a completely different picture for middle-class Americans, for example, wage earners in their early 40s who have amassed a typical amount of wealth for people their age. From 2014 to 2018, such households saw their net worth expand by about $65,000 after taxes on average, mostly due to the rise in value of their homes. But because the vast bulk of their earnings were salaries, their tax bills were almost as much, nearly $62,000, over that five-year period.
No one among the 25 wealthiest avoided as much tax as Buffett, the grandfatherly centibillionaire. That’s perhaps surprising, given his public stance as an advocate of higher taxes for the rich. According to Forbes, his riches rose $24.3 billion between 2014 and 2018. Over those years, the data shows, Buffett reported paying $23.7 million in taxes.
That works out to a true tax rate of 0.1%, or less than 10 cents for every $100 he added to his wealth.
In the coming months, ProPublica will use the IRS data we have obtained to explore in detail how the ultrawealthy avoid taxes, exploit loopholes and escape scrutiny from federal auditors.
Experts have long understood the broad outlines of how little the wealthy are taxed in the United States, and many lay people have long suspected the same thing.
But few specifics about individuals ever emerge in public. Tax information is among the most zealously guarded secrets in the federal government. ProPublica has decided to reveal individual tax information of some of the wealthiest Americans because it is only by seeing specifics that the public can understand the realities of the country’s tax system.
Consider Bezos’ 2007, one of the years he paid zero in federal income taxes. Amazon’s stock more than doubled. Bezos’ fortune leapt $3.8 billion, according to Forbes, whose wealth estimates are widely cited. How did a person enjoying that sort of wealth explosion end up paying no income tax?
In that year, Bezos, who filed his taxes jointly with his then-wife, MacKenzie Scott, reported a paltry (for him) $46 million in income, largely from interest and dividend payments on outside investments. He was able to offset every penny he earned with losses from side investments and various deductions, like interest expenses on debts and the vague catchall category of “other expenses.”
In 2011, a year in which his wealth held roughly steady at $18 billion, Bezos filed a tax return reporting he lost money — his income that year was more than offset by investment losses. What’s more, because, according to the tax law, he made so little, he even claimed and received a $4,000 tax credit for his children.
His tax avoidance is even more striking if you examine 2006 to 2018, a period for which ProPublica has complete data. Bezos’ wealth increased by $127 billion, according to Forbes, but he reported a total of $6.5 billion in income. The $1.4 billion he paid in personal federal taxes is a massive number — yet it amounts to a 1.1% true tax rate on the rise in his fortune.
The revelations provided by the IRS data come at a crucial moment. Wealth inequality has become one of the defining issues of our age. The president and Congress are considering the most ambitious tax increases in decades on those with high incomes. But the American tax conversation has been dominated by debate over incremental changes, such as whether the top tax rate should be 39.6% rather than 37%.
ProPublica’s data shows that while some wealthy Americans, such as hedge fund managers, would pay more taxes under the current Biden administration proposals, the vast majority of the top 25 would see little change.
ProPublica is not disclosing how it obtained the data, which was given to us in raw form, with no conditions or conclusions. ProPublica reporters spent months processing and analyzing the material to transform it into a usable database.
We then verified the information by comparing elements of it with dozens of already public tax details (in court documents, politicians’ financial disclosures and news stories) as well as by vetting it with individuals whose tax information is contained in the trove. Every person whose tax information is described in this story was asked to comment. Those who responded, including Buffett, Bloomberg and Icahn, all said they had paid the taxes they owed.
A spokesman for Soros said in a statement: “Between 2016 and 2018 George Soros lost money on his investments, therefore he did not owe federal income taxes in those years. Mr. Soros has long supported higher taxes for wealthy Americans.” Personal and corporate representatives of Bezos declined to receive detailed questions about the matter. ProPublica attempted to reach Scott through her divorce attorney, a personal representative and family members; she did not respond. Musk responded to an initial query with a lone punctuation mark: “?” After we sent detailed questions to him, he did not reply.
One of the billionaires mentioned in this article objected, arguing that publishing personal tax information is a violation of privacy. We have concluded that the public interest in knowing this information at this pivotal moment outweighs that legitimate concern.
The consequences of allowing the most prosperous to game the tax system have been profound. Federal budgets, apart from military spending, have been constrained for decades. Roads and bridges have crumbled, social services have withered and the solvency of Social Security and Medicare is perpetually in question.
There is an even more fundamental issue than which programs get funded or not: Taxes are a kind of collective sacrifice. No one loves giving their hard-earned money to the government. But the system works only as long as it’s perceived to be fair.
Our analysis of tax data for the 25 richest Americans quantifies just how unfair the system has become.
By the end of 2018, the 25 were worth $1.1 trillion.
For comparison, it would take 14.3 million ordinary American wage earners put together to equal that same amount of wealth.
The personal federal tax bill for the top 25 in 2018: $1.9 billion.
The bill for the wage earners: $143 billion.
The idea of a regular tax on income, much less on wealth, does not appear in the country’s founding documents. In fact, Article 1 of the U.S. Constitution explicitly prohibits “direct” taxes on citizens under most circumstances. This meant that for decades, the U.S. government mainly funded itself through “indirect” taxes: tariffs and levies on consumer goods like tobacco and alcohol.
With the costs of the Civil War looming, Congress imposed a national income tax in 1861. The wealthy helped force its repeal soon after the war ended. (Their pique could only have been exacerbated by the fact that the law required public disclosure. The annual income of the moguls of the day — $1.3 million for William Astor; $576,000 for Cornelius Vanderbilt — was listed in the pages of The New York Times in 1865.)
By the late 19th and early 20th century, wealth inequality was acute and the political climate was changing. The federal government began expanding, creating agencies to protect food, workers and more. It needed funding, but tariffs were pinching regular Americans more than the rich. The Supreme Court had rejected an 1894 law that would have created an income tax. So Congress moved to amend the Constitution. The 16th Amendment was ratified in 1913 and gave the government power “to lay and collect taxes on incomes, from whatever source derived.”
In the early years, the personal income tax worked as Congress intended, falling squarely on the richest. In 1918, only 15% of American families owed any tax. The top 1% paid 80% of the revenue raised, according to historian W. Elliot Brownlee.
But a question remained: What would count as income and what wouldn’t? In 1916, a woman named Myrtle Macomber received a dividend for her Standard Oil of California shares. She owed taxes, thanks to the new law. The dividend had not come in cash, however. It came in the form of an additional share for every two shares she already held. She paid the taxes and then brought a court challenge: Yes, she’d gotten a bit richer, but she hadn’t received any money. Therefore, she argued, she’d received no “income.”
Four years later, the Supreme Court agreed. In Eisner v. Macomber, the high court ruled that income derived only from proceeds. A person needed to sell an asset — stock, bond or building — and reap some money before it could be taxed.
Since then, the concept that income comes only from proceeds — when gains are “realized” — has been the bedrock of the U.S. tax system. Wages are taxed. Cash dividends are taxed. Gains from selling assets are taxed. But if a taxpayer hasn’t sold anything, there is no income and therefore no tax.
Contemporary critics of Macomber were plentiful and prescient. Cordell Hull, the congressman known as the “father” of the income tax, assailed the decision, according to scholar Marjorie Kornhauser. Hull predicted that tax avoidance would become common. The ruling opened a gaping loophole, Hull warned, allowing industrialists to build a company and borrow against the stock to pay living expenses. Anyone could “live upon the value” of their company stock “without selling it, and of course, without ever paying” tax, he said.
Hull’s prediction would reach full flower only decades later, spurred by a series of epochal economic, legal and cultural changes that began to gather momentum in the 1970s. Antitrust enforcers increasingly accepted mergers and stopped trying to break up huge corporations. For their part, companies came to obsess over the value of their stock to the exclusion of nearly everything else. That helped give rise in the last 40 years to a series of corporate monoliths — beginning with Microsoft and Oracle in the 1980s and 1990s and continuing to Amazon, Google, Facebook and Apple today — that often have concentrated ownership, high profit margins and rich share prices. The winner-take-all economy has created modern fortunes that by some measures eclipse those of John D. Rockefeller, J.P. Morgan and Andrew Carnegie.
In the here and now, the ultrawealthy use an array of techniques that aren’t available to those of lesser means to get around the tax system.
Certainly, there are illegal tax evaders among them, but it turns out billionaires don’t have to evade taxes exotically and illicitly — they can avoid them routinely and legally.
Most Americans have to work to live. When they do, they get paid — and they get taxed. The federal government considers almost every dollar workers earn to be “income,” and employers take taxes directly out of their paychecks.
The Bezoses of the world have no need to be paid a salary. Bezos’ Amazon wages have long been set at the middle-class level of around $80,000 a year.
For years, there’s been something of a competition among elite founder-CEOs to go even lower. Steve Jobs took $1 in salary when he returned to Apple in the 1990s. Facebook’s Zuckerberg, Oracle’s Larry Ellison and Google’s Larry Page have all done the same.
Yet this is not the self-effacing gesture it appears to be: Wages are taxed at a high rate. The top 25 wealthiest Americans reported $158 million in wages in 2018, according to the IRS data. That’s a mere 1.1% of what they listed on their tax forms as their total reported income. The rest mostly came from dividends and the sale of stock, bonds or other investments, which are taxed at lower rates than wages.
As Congressman Hull envisioned long ago, the ultrawealthy typically hold fast to shares in the companies they’ve founded. Many titans of the 21st century sit on mountains of what are known as unrealized gains, the total size of which fluctuates each day as stock prices rise and fall. Of the $4.25 trillion in wealth held by U.S. billionaires, some $2.7 trillion is unrealized, according to Emmanuel Saez and Gabriel Zucman, economists at the University of California, Berkeley.
Buffett has famously held onto his stock in the company he founded, Berkshire Hathaway, the conglomerate that owns Geico, Duracell and significant stakes in American Express and Coca-Cola. That has allowed Buffett to largely avoid transforming his wealth into income. From 2015 through 2018, he reported annual income ranging from $11.6 million to $25 million. That may seem like a lot, but Buffett ranks as roughly the world’s sixth-richest person — he’s worth $110 billion as of Forbes’ estimate in May 2021. At least 14,000 U.S. taxpayers in 2015 reported higher income than him, according to IRS data.
There’s also a second strategy Buffett relies on that minimizes income, and therefore, taxes. Berkshire does not pay a dividend, the sum (a piece of the profits, in theory) that many companies pay each quarter to those who own their stock. Buffett has always argued that it is better to use that money to find investments for Berkshire that will further boost the value of shares held by him and other investors. If Berkshire had offered anywhere close to the average dividend in recent years, Buffett would have received over $1 billion in dividend income and owed hundreds of millions in taxes each year.
Many Silicon Valley and infotech companies have emulated Buffett’s model, eschewing stock dividends, at least for a time. In the 1980s and 1990s, companies like Microsoft and Oracle offered shareholders rocketing growth and profits but did not pay dividends. Google, Facebook, Amazon and Tesla do not pay dividends.
In a detailed written response, Buffett defended his practices but did not directly address ProPublica’s true tax rate calculation. “I continue to believe that the tax code should be changed substantially,” he wrote, adding that he thought “huge dynastic wealth is not desirable for our society.”
The decision not to have Berkshire pay dividends has been supported by the vast majority of his shareholders. “I can’t think of any large public company with shareholders so united in their reinvestment beliefs,” he wrote. And he pointed out that Berkshire Hathaway pays significant corporate taxes, accounting for 1.5% of total U.S. corporate taxes in 2019 and 2020.
Buffett reiterated that he has begun giving his enormous fortune away and ultimately plans to donate 99.5% of it to charity. “I believe the money will be of more use to society if disbursed philanthropically than if it is used to slightly reduce an ever-increasing U.S. debt,” he wrote.
So how do megabillionaires pay their megabills while opting for $1 salaries and hanging onto their stock? According to public documents and experts, the answer for some is borrowing money — lots of it.
For regular people, borrowing money is often something done out of necessity, say for a car or a home. But for the ultrawealthy, it can be a way to access billions without producing income, and thus, income tax.
The tax math provides a clear incentive for this. If you own a company and take a huge salary, you’ll pay 37% in income tax on the bulk of it. Sell stock and you’ll pay 20% in capital gains tax — and lose some control over your company. But take out a loan, and these days you’ll pay a single-digit interest rate and no tax; since loans must be paid back, the IRS doesn’t consider them income. Banks typically require collateral, but the wealthy have plenty of that.
The vast majority of the ultrawealthy’s loans do not appear in the tax records obtained by ProPublica since they are generally not disclosed to the IRS. But occasionally, the loans are disclosed in securities filings. In 2014, for example, Oracle revealed that its CEO, Ellison, had a credit line secured by about $10 billion of his shares.
Last year Tesla reported that Musk had pledged some 92 million shares, which were worth about $57.7 billion as of May 29, 2021, as collateral for personal loans.
With the exception of one year when he exercised more than a billion dollars in stock options, Musk’s tax bills in no way reflect the fortune he has at his disposal. In 2015, he paid $68,000 in federal income tax. In 2017, it was $65,000, and in 2018 he paid no federal income tax. Between 2014 and 2018, he had a true tax rate of 3.27%.
The IRS records provide glimpses of other massive loans. In both 2016 and 2017, investor Carl Icahn, who ranks as the 40th-wealthiest American on the Forbes list, paid no federal income taxes despite reporting a total of $544 million in adjusted gross income (which the IRS defines as earnings minus items like student loan interest payments or alimony). Icahn had an outstanding loan of $1.2 billion with Bank of America among other loans, according to the IRS data. It was technically a mortgage because it was secured, at least in part, by Manhattan penthouse apartments and other properties.
Borrowing offers multiple benefits to Icahn: He gets huge tranches of cash to turbocharge his investment returns. Then he gets to deduct the interest from his taxes. In an interview, Icahn explained that he reports the profits and losses of his business empire on his personal taxes.
Icahn acknowledged that he is a “big borrower. I do borrow a lot of money.” Asked if he takes out loans also to lower his tax bill, Icahn said: “No, not at all. My borrowing is to win. I enjoy the competition. I enjoy winning.”
He said adjusted gross income was a misleading figure for him. After taking hundreds of millions in deductions for the interest on his loans, he registered tax losses for both years, he said. “I didn’t make money because, unfortunately for me, my interest was higher than my whole adjusted income.”
Asked whether it was appropriate that he had paid no income tax in certain years, Icahn said he was perplexed by the question. “There’s a reason it’s called income tax,” he said. “The reason is if, if you’re a poor person, a rich person, if you are Apple — if you have no income, you don’t pay taxes.” He added: “Do you think a rich person should pay taxes no matter what? I don’t think it’s germane. How can you ask me that question?”
Skeptics might question our analysis of how little the superrich pay in taxes. For one, they might argue that owners of companies get hit by corporate taxes. They also might counter that some billionaires cannot avoid income — and therefore taxes. And after death, the common understanding goes, there’s a final no-escape clause: the estate tax, which imposes a steep tax rate on sums over $11.7 million.
ProPublica found that none of these factors alter the fundamental picture.
Take corporate taxes. When companies pay them, economists say, these costs are passed on to the companies’ owners, workers or even consumers. Models differ, but they generally assume big stockholders shoulder the lion’s share.
For some of the nation’s wealthiest people, particularly Bezos and Musk, adding corporate taxes to the equation would hardly change anything at all. Other companies like Berkshire Hathaway and Walmart do pay more, which means that for people like Buffett and the Waltons, corporate tax could add significantly to their burden.
It is also true that some billionaires don’t avoid taxes by avoiding incomes. In 2018, nine of the 25 wealthiest Americans reported more than $500 million in income and three more than $1 billion.
In such cases, though, the data obtained by ProPublica shows billionaires have a palette of tax-avoidance options to offset their gains using credits, deductions (which can include charitable donations) or losses to lower or even zero out their tax bills. Some own sports teams that offer such lucrative write-offs that owners often end up paying far lower tax rates than their millionaire players. Others own commercial buildings that steadily rise in value but nevertheless can be used to throw off paper losses that offset income.
Michael Bloomberg, the 13th-richest American on the Forbes list, often reports high income because the profits of the private company he controls flow mainly to him.
In 2018, he reported income of $1.9 billion. When it came to his taxes, Bloomberg managed to slash his bill by using deductions made possible by tax cuts passed during the Trump administration, charitable donations of $968.3 million and credits for having paid foreign taxes. The end result was that he paid $70.7 million in income tax on that almost $2 billion in income. That amounts to just a 3.7% conventional income tax rate. Between 2014 and 2018, Bloomberg had a true tax rate of 1.30%.
In a statement, a spokesman for Bloomberg noted that as a candidate, Bloomberg had advocated for a variety of tax hikes on the wealthy. “Mike Bloomberg pays the maximum tax rate on all federal, state, local and international taxable income as prescribed by law,” the spokesman wrote. And he cited Bloomberg’s philanthropic giving, offering the calculation that “taken together, what Mike gives to charity and pays in taxes amounts to approximately 75% of his annual income.”
The statement also noted: “The release of a private citizen’s tax returns should raise real privacy concerns regardless of political affiliation or views on tax policy. In the United States no private citizen should fear the illegal release of their taxes. We intend to use all legal means at our disposal to determine which individual or government entity leaked these and ensure that they are held responsible.”
Ultimately, after decades of wealth accumulation, the estate tax is supposed to serve as a backstop, allowing authorities an opportunity to finally take a piece of giant fortunes before they pass to a new generation. But in reality, preparing for death is more like the last stage of tax avoidance for the ultrawealthy.
University of Southern California tax law professor Edward McCaffery has summarized the entire arc with the catchphrase “buy, borrow, die.”
The notion of dying as a tax benefit seems paradoxical. Normally when someone sells an asset, even a minute before they die, they owe 20% capital gains tax. But at death, that changes. Any capital gains till that moment are not taxed. This allows the ultrarich and their heirs to avoid paying billions in taxes. The “step-up in basis” is widely recognized by experts across the political spectrum as a flaw in the code.
Then comes the estate tax, which, at 40%, is among the highest in the federal code. This tax is supposed to give the government one last chance to get a piece of all those unrealized gains and other assets the wealthiest Americans accumulate over their lifetimes.
It’s clear, though, from aggregate IRS data, tax research and what little trickles into the public arena about estate planning of the wealthy that they can readily escape turning over almost half of the value of their estates. Many of the richest create foundations for philanthropic giving, which provide large charitable tax deductions during their lifetimes and bypass the estate tax when they die.
Wealth managers offer clients a range of opaque and complicated trusts that allow the wealthiest Americans to give large sums to their heirs without paying estate taxes. The IRS data obtained by ProPublica gives some insight into the ultrawealthy’s estate planning, showing hundreds of these trusts.
The result is that large fortunes can pass largely intact from one generation to the next. Of the 25 richest people in America today, about a quarter are heirs: three are Waltons, two are scions of the Mars candy fortune and one is the son of Estée Lauder.
In the past year and a half, hundreds of thousands of Americans have died from COVID-19, while millions were thrown out of work. But one of the bleakest periods in American history turned out to be one of the most lucrative for billionaires. They added $1.2 trillion to their fortunes from January 2020 to the end of April of this year, according to Forbes.
That windfall is among the many factors that have led the country to an inflection point, one that traces back to a half-century of growing wealth inequality and the financial crisis of 2008, which left many with lasting economic damage. American history is rich with such turns. There have been famous acts of tax resistance, like the Boston Tea Party, countered by less well-known efforts to have the rich pay more.
One such incident, over half a century ago, appeared as if it might spark great change. President Lyndon Johnson’s outgoing treasury secretary, Joseph Barr, shocked the nation when he revealed that 155 Americans making over $200,000 (about $1.6 million today) had paid no taxes. That group, he told the Senate, included 21 millionaires.
“We face now the possibility of a taxpayer revolt if we do not soon make major reforms in our income taxes,” Barr said. Members of Congress received more furious letters about the tax scofflaws that year than they did about the Vietnam War.
Congress did pass some reforms, but the long-term trend was a revolt in the opposite direction, which then accelerated with the election of Ronald Reagan in 1980. Since then, through a combination of political donations, lobbying, charitable giving and even direct bids for political office, the ultrawealthy have helped shape the debate about taxation in their favor.
One apparent exception: Buffett, who broke ranks with his billionaire cohort to call for higher taxes on the rich. In a famous New York Times op-ed in 2011, Buffett wrote, “My friends and I have been coddled long enough by a billionaire-friendly Congress. It’s time for our government to get serious about shared sacrifice.”
Buffett did something in that article that few Americans do: He publicly revealed how much he had paid in personal federal taxes the previous year ($6.9 million). Separately, Forbes estimated his fortune had risen $3 billion that year. Using that information, an observer could have calculated his true tax rate; it was 0.2%. But then, as now, the discussion that ensued on taxes was centered on the traditional income tax rate.
In 2011, President Barack Obama proposed legislation, known as the Buffett Rule. It would have raised income tax rates on people reporting over a million dollars a year. It didn’t pass. Even if it had, however, the Buffett Rule wouldn’t have raised Buffett’s taxes significantly. If you can avoid income, you can avoid taxes.
Today, just a few years after Republicans passed a massive tax cut that disproportionately benefited the wealthy, the country may be facing another swing of the pendulum, back toward a popular demand to raise taxes on the wealthy. In the face of growing inequality and with spending ambitions that rival those of Franklin D. Roosevelt or Johnson, the Biden administration has proposed a slate of changes. These include raising the tax rates on people making over $400,000 and bumping the top income tax rate from 37% to 39.6%, with a top rate for long-term capital gains to match that. The administration also wants to up the corporate tax rate and to increase the IRS’ budget.
Some Democrats have gone further, floating ideas that challenge the tax structure as it’s existed for the last century. Oregon Sen. Ron Wyden, the chairman of the Senate Finance Committee, has proposed taxing unrealized capital gains, a shot through the heart of Macomber. Sens. Elizabeth Warren and Bernie Sanders have proposed wealth taxes.
Aggressive new laws would likely inspire new, sophisticated avoidance techniques. A few countries, including Switzerland and Spain, have wealth taxes on a small scale. Several, most recently France, have abandoned them as unworkable. Opponents contend that they are complicated to administer, as it is hard to value assets, particularly of private companies and property.
What it would take for a fundamental overhaul of the U.S. tax system is not clear. But the IRS data obtained by ProPublica illuminates that all of these conversations have been taking place in a vacuum. Neither political leaders nor the public have ever had an accurate picture of how comprehensively the wealthiest Americans avoid paying taxes.
Buffett and his fellow billionaires have known this secret for a long time. As Buffett put it in 2011: “There’s been class warfare going on for the last 20 years, and my class has won.”
Look to the sky for a solar show that will create a stunning glow…
Stargazers and skywatchers are in for another treat, which come about two weeks after the lunar eclipse, also referred to as the “Super Flower Blood Moon”. Tonight and into Thursday, June 10th, an annular solar eclipse called “ring of fire” will be visible. Any discussion of all things lunar, blood moons and eclipses would certainly be congruent with a taste of the astrological perspective.
Unfortunately this time around, no parts of the United States will get to see the full eclipse, however some metropolitan areas like Toronto, Philadelphia and New York will be able to view a partial eclipse a little after the sunrise on Thursday morning.
Getting to see a partial eclipse looks kind of like the sun has a portion taken out of it. In total, this eclipse will last around 1 2/3 hrs (approximately 100 minutes) as it starts at sunrise in Ontario, Canada.
If you aren’t exactly clear on what a solar eclipse is, an annular eclipse occurs when the Moon is farthest from Earth. And because the Moon is far away it appears smaller. The Moon does not block the entire view of the Sun and thus creates the appearance of a ring around the Moon.
The word annular comes from the Latin word for ring. Since the Moon covers the sun’s center and what is left forms a ring, hence the name “ring of fire”.
If you are one of the lucky folks situated along the East Coast and Upper Midwest and want to catch a glimpse at the partial eclipse, it is strongly recommended to use solar eclipse glasses and to not look directly into the sun as it may cause permanent damage to your eyes.
Don’t fret if you aren’t able to experience the upcoming solar eclipse. This summer we have a couple more opportunities to gaze above. There is set to be a Supermoon June 24, a Meteor Shower on July 28, and the Blue Moon come August 22.
We have a couple years until the next total solar eclipse in the United States, in April 8, 2024, weather permitting.
Revelations already leaked into de-classified public domain are enough to shock and amaze
Now that UFO sightings, also known as UAP (“unidentified aerial phenomena”) encounters have become too numerous and too tangible to dismiss as “swamp gas” or “reflected light” or anything of the kind, the next step is for the Pentagon to reveal much more about what it already knows. And from all accounts; it’s a lot.
Recently, for example in the CBS “60 Minutes” segment that aired on Sunday, May 16th, 2021 the growing body of de-classified data and credible accounts from government, ex-government and military personnel has been thoroughly cataloged and competently explained, the the degree that it is possible to explain at all.
In an interview exchange between CBS correspondent Bill Whitaker and Lue Elizondo, who was in US military intelligence for 20 years and was part of “what The Pentagon called the Advanced Aerospace Threat Identification Program, or AATIP, the discussion turn to the amazing current state of publicly available information on UFO sightings by the military.
Lue Elizondo:
“The mission of AATIP was quite simple. It was to collect and analyze information involving anomalous aerial vehicles, what I guess in the vernacular you call them UFOs. We call them UAPs
Imagine a technology that can do 6-to-700 g-forces, that can fly at 13,000 miles an hour, that can evade radar and that can fly through air and water and possibly space. And oh, by the way, has no obvious signs of propulsion, no wings, no control surfaces and yet still can defy the natural effects of Earth’s gravity. That’s precisely what we’re seeing.
In some cases there are simple explanations for what people are witnessing. But there are some that, that are not. We’re not just simply jumping to a conclusion that’s saying, “Oh, that’s a UAP out there.” We’re going through our due diligence. Is it some sort of new type of cruise missile technology that China has developed? Is it some sort of high-altitude balloon that’s conducting reconnaissance? Ultimately when you have exhausted all those what ifs and you’re still left with the fact that this is in our airspace and it’s real, that’s when it becomes compelling, and that’s when it becomes problematic.”
A series of revelations that are building and increasing, not a scattered random sequence
The segment went on to interview two of the four pilots that were witnesses to an very close encounter with a UAP during a training mission with the USS Nimitz carrier strike group 100 miles southwest of San Diego, CA in 2004.
CBS News interviewed them, David Fravor, a graduate of the Top Gun naval flight school and commander of the F/A-18F squadron on the USS Nimitz; and flying at his wing, Lieutenant Alex Dietrich, who has never spoken publicly about the encounter:
“For a week, the advanced new radar on a nearby ship, the USS Princeton, had detected what operators called “multiple anomalous aerial vehicles” over the horizon, descending 80,000 feet in less than a second. On November 14, Fravor and Dietrich, each with a weapons systems officer in the backseat, were diverted to investigate. They found an area of roiling whitewater the size of a 737 in an otherwise calm, blue sea. “
The interview went on to describe in great detail the shockingly real and yet impossible to grasp behavior of the UAP and how hard it is to fathom the origin of something so advanced and so far beyond anything we can imagine as being possible to build by humans with current technological means.
‘Either or’ is a short list of what could explain the mysteries
According to various unnamed pilots, of the many that have had sometimes multiple highly corroborated and documented UAP encounters, there are three likely possible sources for these “anomalous aerial vehicles” origin:
secret U.S. technology,
an adversary’s spy vehicle
something otherworldly.
What no-one, outside the “UFO fringe element” has speculated to is the exact meaning and source of “something otherworldly” being involved, or a 4th possibility that this is the most advanced and elaborate hoax ever devised to create the illusion of an ultra sophisticated entity “watching” us.
This last completely speculative statement underscores just how unlikely it is, with this much evidence already uncovered, that this is any kind of “hoax” at all, and how that would be even more far fetched than #3 above, an “otherworldly” explanation.
Now that, since last August, AATIP has been reactivated by the Pentagon, and it’s now called the UAP task force, more information has likely been cataloged since service members now are encouraged to report any strange encounters.
In December 2020, while still head of the intelligence committee, Senator Marco Rubio, of all people, asked the director of national intelligence and the Pentagon to present Congress an unclassified report.
That report will be next major step in this building story. It is scheduled to be released to the Senate on June 1st, 2021.
A site in Syria was struck by the US military. The site was used by militia groups backed by Iran. This follows reported rocket attacks against American forces in the area, CNN reports, citing source as a “US official.
This was the first known military action since the inauguration of President Joe Biden. Though the site that was hit had no known direct involvement in the rocket attacks, but Shia militias operating in the area, and backed by Iran were believed to have used the facilities.
According to Pentagon spokesman John Kirby the stakes were carried out “at President Biden’s direction” and were not just authorized in response to recent attacks on American and coalition forces, but to deal with “ongoing threats to those personnel.”
Kirby said that Biden conducted the strikes after consulting with US allies, including coalition partners.
On Monday, State Department spokesman Ned Price said “We have stated before that we will hold Iran responsible for the actions of its proxies that attack Americans,” and that “many of these attacks have used Iranian made, Iranian supplied weapons.”
Statement from Pentagon press Secretary:
Pentagon statement on US air strikes against targets in eastern #Syria. The raid reportedly was carried out by US Air Force F-15E Strike Eagle aircraft. The statement was sent out at 1954 EST 25 Feb https://t.co/x4ueUseu3Npic.twitter.com/EbS2Yk9npJ
Never before seen footage of rover descended through the Martian atmosphere
Courtesy of NASA, now everyone can see firsthand how the Perseverance Mars Rover landed on the red planet. Launch in July of 2020 it reached it final destination on Thursday, February 18, 2021, at the landing site in Jezero Crater.
The video of the landing has already provided what were, undoubtedly, some of the most iconic visuals we have seen in the history of space exploration. Yet the Perseverance is only just getting started as its primary mission will be to search for signs of life (or rather to find out if remnants of past microbial life prove that it ever existed).
Jezero Crater / NASA
In a press conference, Michael Watkins the director of NASA’s Jet Propulsion Laboratory said:
“This is the first time we’ve been able to actually capture an event like the landing of a spacecraft on Mars,” he continued, “We will learn something by looking at the performance of the vehicle in these videos. But a lot of it is also to bring you along on our journey, our touchdown to Mars, and of course, our surface mission as well. These are really amazing videos.”
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In addition to the impressive photos that the cameras on the Mars rover has taken thus far, it also was equipped with two microphones that was able to capture the sounds of the wind blowing on the surface of Mars that you can listen to via soundcloud.
If four years of the Former Guy taught us anything, it’s that we have no time left for evil, soulless greed run amok
– Opinion & Analysis –
Recent attempts by politicians, beholden to the fossil fuel industry in Texas, to use the collapse of the energy infrastructure during the recent weather disaster as an opportunity to bash and trash wind and solar energy is an example of an unfortunate, banal and still common form of pure evil.
The deeper connections, easily seen lurking just beneath the surface, are rich and multilayered.
If this extreme weather disaster is one of many that are linked to climate change, a manifestation of dangers that climate scientists have been warning of for decades, the irony goes beyond just sick.
Wind and solar energy exist as an early and tentative positive step toward somehow stopping, or at least slowing down, the negative man-made climate change repercussions before it is too late.
The real reasons behind the Texas power grid collapse are related to traditional fossil fuel based energy sources and bad management of the energy infrastructure that can be traced back to an arrogant belief that Texas is better off without connections to the national system.
The local political response to this eminently preventable catastrophe was to bash and trash and blame the very technology that, ultimately, is part of a tentative start to actually begin to solve the bigger problem of man-made climate change.
…the time is gone to accept “two sides” to an argument that, by postponing any real solutions, will kill us all.
Just as the history of the internal combustion engine and the fossil fuel and auto industry’s attempts to prolong its near monopoly, using disinformation and other tactics for over 50 years was evil, the anti-sustainable energy politics in Texas today is just a continuation of that effort.
The time is gone to accept “two sides” to an argument that has one side trying, by attempting to postpone any real solutions, to kill us all, in the name of short term greed.
Under unique circumstances lending legitimacy to evil is too costly to condone
Looking at “both sides” of an issue is a practice based on a theory that “reasonable people” can disagree on diametrically opposed views. This idea is often suspended, however, by unreasonable people for their own reasons. That is sometimes called “war”.
Reasonable people, people, for example that understand climate science and want to prevent the total destruction of the earth and the extinction of all inhabitants, are often reluctant to suspend this idea of “good people on both sides” by their very nature as caring individuals.
“Now we need to understand that the “silence of one good man” can spell disaster for all good people. Each of us who remained passive as our impending disaster continued might have been the one “good man” who didn’t act, didn’t speak out, didn’t resist…
Now is a time when huge changes are going to be forced by an external and highly powerful and dangerous threats to our survival. The changes that are needed involve radically new ways of thinking and acting across many spheres of activity.
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New technologies, such as the aforementioned wind turbines and solar collectors, new forms of transportation, new ways of looking at other causes of, and remedies to, the excessive expulsion of carbon into the atmosphere will be absolutely required.
The truth is that for these new ways of thinking and acting to take over in human commerce the old ways must be cancelled. With extreme prejudice.
The past and those that want to go back to it are a lost cause, unfortunately
Many many “rich” people will be unhappy about this. And they will have politicians in their pocket that will gladly spread lies and disinformation to try and sustain the sick, evil gravy-train of polluting, carbon spewing systems as long as possible.
Sick and evil, not because those ways of surviving for humanity, burning fossil fuels and using them for a million different things that were a benefit in the short term, but because the short term is over.
The various arguments that somehow it is a good idea not to change and for the changes to slow down and not step on any toes as they gradually become “viable” have zero validity as of today (really as of 25 years ago but that’s water under the bridge).
Eventually the climate itself will kill them for their mistakes. Unfortunately it will also kill the rest of us if we allow them to continue to postpone positive change with lies and disinformation.
– D.L.
There must be an understanding among “reasonable” people, people who want to be part of an urgent crusade to save the world, literally, that points of view and the people who espouse them represent evil, plain and simple.
They will scream that reasonable people are “femi-nazis and “eco-terrorists” and say and do whatever it takes to protect what’s left of a deadly status quo. But they are wrong.
Eventually the climate itself will kill them for their mistakes. Unfortunately it will also kill the rest of us if we allow them to continue to postpone positive change with lies and disinformation.
“Every one of these people is the banality of evil personified. Every one of them became what Arendt called a “leaf blowing in the whirlwind of time.” Now every one of them bears responsibility for what could lie ahead.”
This change in thinking about how to respond to this kind of evil will be a more important factor in the survival of humanity than all the technological advances combined.
“World War III is a guerrilla information war with no division between military and civilian participation.” – Marshall McLuhan (1970), Culture is Our Business, p. 66.
–Marshall McLuhan
“Info-wars” were predicted as the battlefield of WWIII by Marshall McLuhan in 1970 and now we are in it and there must be an understanding of what is at stake.
When disinformation is used as a perennial weapon against positive, necessary change it is necessary to do more than disagree. It is necessary to expose the lies and, more importantly, the obvious sick and criminal motives for the lies. Over and over as often as necessary.
