“How many more insurrections have to happen before we hold Facebook to account?” one group asked after whistleblower Frances Haugen said the corporation is unwilling to confront hate speech and disinformation.
Following whistleblower Frances Haugen’s Sunday night allegation that Facebook’s refusal to combat dangerous lies and hateful content on its platforms is driven by profit, social media experts denounced the corporation for embracing a business model that encourages violence and endangers democracy—and urged the federal government to take action.
Haugen, who copied a “trove of private Facebook research” before she resigned from the social media company in May, toldCBS‘s Scott Pelley during a “60 Minutes” interview that the tech giant took some steps to limit misinformation ahead of the 2020 election because it understood that then-President Donald Trump’s incessant lies about voter fraud posed a serious threat. Many of the safety measures that Facebook implemented, however, were temporary, she added.
“As soon as the election was over,” Haugen said, “they turned them back off or they changed the settings back to what they were before to prioritize growth over safety. And that really feels like a betrayal of democracy to me.”
Facebook officials claim that some of the anti-misinformation systems remained in place, but in the interregnum between Election Day and President Joe Biden’s inauguration, far-right extremists used the social networking site to organize the deadly January 6 coup attempt—something acknowledged by an internal task force’s report on Facebook’s failure to neutralize “Stop the Steal” activity on its platforms.
There is, according to Haugen, a simple explanation for why executives at the company refuse to do more to mitigate harmful social media behavior: “Facebook has realized that if they change the algorithm to be safer, people will spend less time on the site, they’ll click on less ads, they’ll make less money,” she said.
“The thing I saw at Facebook over and over again was there were conflicts of interest between what was good for the public and what was good for Facebook,” Haugen told Pelley. “And Facebook, over and over again, chose to optimize for its own interests, like making more money.”
Haugen—who first revealed her identity on Sunday after having secretly shared internal documents with federal regulators, reported on in the Wall Street Journal‘s series, “The Facebook Files”—also said the corporation is lying to the public about how effective it is at curbing hate speech and disinformation, arguing that “Facebook has demonstrated it cannot operate independently.”
In the wake of Haugen’s bombshell interview, social media experts condemned Facebook for prioritizing “profits above all else.”
“Facebook runs on a hate-and-lie-for-profit business model that amplifies all sorts of toxicity on its platforms,” Jessica J. González, co-CEO of Free Press, said Monday in a statement. “Thanks to this brave whistleblower, we now have further proof that Facebook’s executives—all the way up to CEO Mark Zuckerberg and COO Sheryl Sandberg—routinely chose profits over public safety.”
González, co-founder of Ya Basta Facebook and the Change the Terms coalition, added that Facebook executives “designed the company’s algorithms to put engagement, growth, and profits above all else, even allowing lies about the 2020 election results to spread to millions in advance of the white-nationalist assault on the U.S. Capitol.”
Longtime critics of Facebook argued that the “new revelations” about the company demand immediate federal intervention.
“How many more insurrections have to happen before we hold Facebook to account?” the Real Facebook Oversight Board, a coalition of civil rights leaders and academics, asked in a statement released after Haugen’s interview aired. “The system is blinking red, and without real, meaningful, independent, and robust oversight and investigation of Facebook, more lives will be lost.”
“The goal,” added the group, “is no longer to save Facebook—Facebook is beyond hope. The goal now is to save democracy.”
Free Press summarized the Journal‘s key findings on Facebook, which we now know stem from internal documents provided by Haugen:
Facebook exempted high-profile users from some or all of its rules; Instagram is harmful to millions of young users; Facebook’s 2018 algorithm change promotes objectionable or harmful content; Facebook’s tools were used to sow doubt about Covid-19 vaccines; and globally, Facebook is used to incite violence against ethnic minorities and facilitat[e] action against political dissent.
Shireen Mitchell, founder of Stop Online Violence Against Women, praised Haugen for exposing Facebook’s “amplification and use of hate to keep users on the platform engaged.”
Facebook has “weaponized… data in harmful ways against users,” Mitchell continued, and failed to consider the negative effects of “hate-filled rhetoric” even after the Myanmar military used Facebook to launch a genocide in 2018.
González argued that Haugen “turned evidence of this gross negligence over to the government at great personal risk, and now we need the government to respond with decisive action to hold the company responsible for protecting public safety.”
“The government must demand full transparency on how Facebook collects, processes, and shares our data, and enact civil rights and privacy policies to protect the public from Facebook’s toxic business model,” said González.
“Facebook must also act swiftly to remedy the harms it is continuing to inflict on the public at large,” she added. “It must end special protections for powerful politicians, ban white supremacists and dangerous conspiracy theorists, and institute wholesale changes to strengthen content moderation in English and other languages—and we need this all now.”
According to Carole Cadwalladr, a journalist at The Guardian and co-founder of the Real Facebook Oversight Board, “Facebook is a rogue state, lying to regulators, investors, and its own oversight board.”
“What we are seeing today is a market failure with profound, devastating global consequences,” she said. “Executives and board members must be held to account. There is evidence to suggest that their behavior was not just immoral but also criminal.”
Shoshana Zuboff, professor emeritus at Harvard Business School and author of The Age of Surveillance Capitalism, argued that “even as we feel outrage toward Mr. Zuckerberg and his corporation, the cause of this crisis is not a single company, not even one as powerful as Facebook.”
“The cause is the economic institution of surveillance capitalism,” said Zuboff. “The economic logic of these systems, the data operations that feed them, and the markets that support them are not limited to Facebook.”
“The imperatives of surveillance economics determine the engineering of these operations—their products, objectives, and financial incentives—along with those of the other tech empires, their extensive ecosystems, and thousands of companies in diverse sectors far from Silicon Valley,” she continued. “The damage already done is intolerable. The damage that most certainly lies ahead is unthinkable.”
Zuboff added that the only “durable solution to this crisis” is to “undertake the work of interrupting and outlawing the dangerous operations of surveillance capitalism and its predictable social harms that assault human autonomy, splinter society, and undermine democracy.”
Haugen is scheduled to testify on Tuesday at a Senate subcommittee hearing on “Protecting Kids Online.”
Originally published on Common Dreams by KENNY STANCIL and republished under a Creative Commons license (CC BY-NC-ND 3.0).
Frances Haugen said the company’s leaders know how to make their platforms safer, “but won’t make the necessary changes because they have put their astronomical profits before people.
Two days after a bombshell “60 Minutes” interview in which she accused Facebook of knowingly failing to stop the spread of dangerous lies andhateful content, whistleblower Frances Haugen testified Tuesday before U.S. senators, imploring Congress to hold the company and its CEO accountable for the many harms they cause.
Haugen—a former Facebook product manager—told the senators she went to work at the social media giant because she believed in its “potential to bring out the best in us.”
“But I’m here today because I believe Facebook’s products harm children, stoke division, and weaken our democracy,” she said during her opening testimony. “The company’s leadership knows how to make Facebook and Instagram safer, but won’t make the necessary changes because they have put their astronomical profits before people.”
“The documents I have provided to Congress prove that Facebook has repeatedly misled the public about what its own research reveals about the safety of children, the efficacy of its artificial intelligence systems, and its role in spreading divisive and extreme messages,” she continued. “I came forward because I believe that every human being deserves the dignity of truth.”
Facebook whistleblower Frances Haugen: "I saw Facebook repeatedly encounter conflicts between its own profits and our safety. Facebook consistently resolved its conflicts in favor of its own profits."
“I saw Facebook repeatedly encounter conflicts between its own profits and our safety,” Haugen added. “Facebook consistently resolved its conflicts in favor of its own profits.”
“In some cases, this dangerous online talk has led to actual violence that harms and even kills people,” she said.
Addressing Monday’s worldwide Facebook outage, Haugen said that “for more than five hours, Facebook wasn’t used to deepen divides, destabilize democracies, and make young girls and women feel bad about their bodies.”
“It also means that millions of small businesses weren’t able to reach potential customers, and countless photos of new babies weren’t joyously celebrated by family and friends around the world,” she added. “I believe in the potential of Facebook. We can have social media we enjoy that connects us without tearing apart our democracy, putting our children in danger, and sowing ethnic violence around the world. We can do better.”
Doing better will require Congress to act, because Facebook “won’t solve this crisis without your help,” Haugen told the senators, echoing experts and activists who continue to call for breaking up tech giants, banning the surveillance capitalist business model, and protecting rights and democracy online.
She added that “there is nobody currently holding Zuckerberg accountable but himself,” referring to Facebook co-founder and CEO Mark Zuckerberg.
Sen. Richard Blumenthal (D-Conn.)—chair of the Senate Consumer Protection, Product Safety, and Data Security Subcommittee—called on Zuckerberg to testify before the panel.
“Mark Zuckerberg ought to be looking at himself in the mirror today and yet rather than taking responsibility, and showing leadership, Mr. Zuckerberg is going sailing,” he said.
Frances Haugen strongly shakes her head in agreement as Richard Blumenthal says "Mark Zuckerberg ought to be looking at himself in the mirror" and "Zuckerberg, you need to come before this committee." pic.twitter.com/QC0B6zK9tW
“Big Tech now faces a Big Tobacco, jaw-dropping moment of truth. It is documented proof that Facebook knows its products can be addictive and toxic to children,” Blumenthal continued.
“The damage to self-interest and self-worth inflicted by Facebook today will haunt a generation,” he added. “Feelings of inadequacy and insecurity, rejection, and self-hatred will impact this generation for years to come. Our children are the ones who are victims.”
Originally published on Common Dreams by BRETT WILKINSand republished under Creative Commons (CC BY-NC-ND 3.0).
Above: Photo Collage /Lynxotic / Original Image by ICIJ
“This is the Panama Papers on steroids.”
In what’s being called the “biggest-ever leak of offshore data,” a cache of nearly 12 million documents published Sunday laid bare the hidden wealth, secret dealings, and corruption of hundreds of world leaders, billionaires, public officials, celebrities, and others.
The bombshell revelations—known as the Pandora Papers—were published by the International Consortium of Investigative Journalists (ICIJ) and include private emails, secret contracts, and other records obtained during a two-year investigation involving more than 600 journalists in 117 countries and territories.
“This is the Panama Papers on steroids,” said ICIJ director Gerard Ryle, referring to the 2016 exposé of the tax-evading secrets of the super-rich. “It’s broader, richer, and has more detail.”
NEW: #PandoraPapers reveals the inner workings of a shadow economy that benefits the wealthy and well-connected at the expense of everyone else.
Brought to you by ICIJ and 600+ journalists, the largest collaboration in journalism history. 🧵 https://t.co/qXMuUcqPc4
More than 100 billionaires feature in the leaked data, as well as celebrities, rock stars, and business leaders. Many use shell companies to hold luxury items such as property and yachts, as well as incognito bank accounts. There is even art ranging from looted Cambodian antiquities to paintings by Picasso and murals by Banksy.
“There’s never been anything on this scale and it shows the reality of what offshore companies can offer to help people hide dodgy cash or avoid tax,” said ICIJ’s Fergus Shiel, who added that the people in the files “are using those offshore accounts, those offshore trusts, to buy hundreds of millions of dollars of property in other countries, and to enrich their own families, at the expense of their citizens.”
The leaked documents reveal how some of the world’s wealthiest people avert the financial consequences of their misdeeds by using offshore entities. Dozens of current and former world leaders feature prominently in the files, including Russian President Vladimir Putin, Jordanian King Abdullah II, and former British Prime Minister Tony Blair.
While most of the richest Americans do not appear in the files, The Washington Postreports that “perhaps the most troubling revelations for the United States… center on its expanding complicity in the offshore economy.”
Why so few US names in Pandora Papers? Largely because US is itself a spectacularly corrupt tax haven. “Financial experts said the uber-rich in the United States tend to pay such low tax rates that they have less incentive to seek offshore havens.” https://t.co/YaUH86VBEE
Chuck Collins, author of The Wealth Hoarders: How https://bookshop.org/a/565/9781509543496Billionaires Pay Millions to Hide Trillions, and co-editor of Inequality.org at the Institute for Policy Studies, said in a statement that “the U.S. has become the weak link in stopping global crime and wealth hiding.”
“States like South Dakota and Delaware have morphed their laws to attract billions, sometimes illicitly obtained, from around the world,” he said. “We in the U.S. should be embarrassed that we’ve become a magnet for kleptocratic funds.”
Collins added that the Pandora Papers show “it is time for U.S. lawmakers to shut down the hidden wealth system that allows for such aggressive tax avoidance and the sequestering of wealth.”
ICIJ said Sunday that the “publication of Pandora Papers stories comes at a critical moment in a global debate over the fairness of the international tax system, the role of Western professionals in the shadow economy, and the failure of governments to stanch the flow of dirty money into hidden companies and trusts,” and that the documents “are expected to yield new revelations for years to come.”
Originally published on Common Dreams by BRETT WILKINS and republished under a Creative Commons license (CC BY-NC-ND 3.0).
A huge but little-known industry has cropped up around monetizing people’s movements
Companies that you likely have never heard of are hawking access to the location history on your mobile phone. An estimated $12 billion market, the location data industry has many players: collectors, aggregators, marketplaces, and location intelligence firms, all of which boast about the scale and precision of the data that they’ve amassed.
Location firm Near describes itself as “The World’s Largest Dataset of People’s Behavior in the Real-World,” with data representing “1.6B people across 44 countries.” Mobilewalla boasts “40+ Countries, 1.9B+ Devices, 50B Mobile Signals Daily, 5+ Years of Data.” X-Mode’s website claims its data covers “25%+ of the Adult U.S. population monthly.”
In an effort to shed light on this little-monitored industry, The Markup has identified 47 companies that harvest, sell, or trade in mobile phone location data. While hardly comprehensive, the list begins to paint a picture of the interconnected players that do everything from providing code to app developers to monetize user data to offering analytics from “1.9 billion devices” and access to datasets on hundreds of millions of people. Six companies claimed more than a billion devices in their data, and at least four claimed their data was the “most accurate” in the industry.
The Location Data Industry: Collectors, Buyers, Sellers, and Aggregators
The Markup identified 47 players in the location data industry
“There isn’t a lot of transparency and there is a really, really complex shadowy web of interactions between these companies that’s hard to untangle,” Justin Sherman, a cyber policy fellow at the Duke Tech Policy Lab, said. “They operate on the fact that the general public and people in Washington and other regulatory centers aren’t paying attention to what they’re doing.”
A Catholic news outlet also used location data from a data vendor to out a priest who had frequented gay bars, though it’s still unknown what company sold that information.
Many firms promise that privacy is at the center of their businesses and that they’re careful to never sell information that can be traced back to a person. But researchers studying anonymized location data have shown just how misleading that claim can be.
The truth is, it’s hard to know all the ways in which your movements are being tracked and traded. Companies often reveal little about what apps serve as the sources of data they collect, what exactly that data consists of, and how far it travels. To piece together a picture of the ecosystem, The Markup reviewed the websites and marketing language of each of the 47 companies we identified as operating in the location data industry, as well as any information they revealed about how the data got to them. (See our methodology here.)
How the Data Leaves Your Phone
Most times, the location data pipeline starts off in your hands, when an app sends a notification asking for permission to access your location data.
Apps have all kinds of reasons for using your location. Map apps need to know where you are in order to give you directions to where you’re going. A weather, waves, or wind app checks your location to give you relevant meteorological information. A video streaming app checks where you are to ensure you’re in a country where it’s licensed to stream certain shows.
But unbeknownst to most users, some of those apps sell or share location data about their users with companies that analyze the data and sell their insights, like Advan Research. Other companies, like Adsquare, buy or obtain location data from apps for the purpose of aggregating it with other data sources. Companies like real estate firms, hedge funds and retail businesses might then turn and use the data for their own advertising, analytics, investment strategy, or marketing purposes.
Serge Egelman, a researcher at UC Berkeley’s International Computer Science Institute and CTO of AppCensus, who has researched sensitive data permissions on mobile apps, said it’s hard to tell which apps on your phone simply use the data for their own functional purposes and which ones release your data into the economic ether.
“When the app asks for location, in the moment, because maybe you click the button to find stuff near you and you get a permission dialog, you might reasonably infer that ‘Oh, that’s to service that request to provide that functionality,’ but there’s no guarantee of that,” Egelman said. “And there’s certainly usually never a disclosure that says that the data is going to be limited to that purpose.”
Companies that trade in this data are reluctant to share which apps they get data from.
Companies like Adsquare and Cuebiq told The Markup that they don’t publicly disclose what apps they get location data from to keep a competitive advantage but maintained that their process of obtaining location data was transparent and with clear consent from app users.
“It is all extremely transparent,” said Bill Daddi, a spokesperson for Cuebiq.
He added that consumers must know what the apps are doing with their data because so few consent to share it. “The opt-in rates clearly confirm that the users are fully aware of what is happening because the opt-in rates can be as low as less than 20%, depending on the app,” Daddi said in an email.
Yiannis Tsiounis, the CEO of the location analytics firm Advan Research, said his company buys from location data aggregators, who collect the data from thousands of apps—but would not say which ones. Tsiounis said the apps he works with do explicitly say that they share location data with third parties somewhere in the privacy policies, though he acknowledged that most people don’t read privacy policies.
“There’s only so much you can squeeze into the notification message. You get one line, right? So you can’t say all of that in the notification message,” Tsiounis said. “You only get to explain to the user, ‘I need your location data for X, Y, and Z.’ What you have to do is, there has to be a link to the privacy policy.”
Only one company spokesperson, Foursquare’s Ashley Dawkins, actually named any specific apps—Foursquare’s own products, like Swarm, CityGuide, and Rewards—as sources for its location data trove.
But Foursquare also produces a free software development kit (SDK)—a set of prebuilt tools developers can use in their own apps—that can potentially track location through any app that uses it. Foursquare’s Pilgrim SDK is used in apps like GasBuddy, a service that compares prices at nearby gas stations, Flipp, a shopping app for coupons, and Checkout 51, another location-based discount app.
GasBuddy, Flipp, and Checkout 51 didn’t respond to requests for comment.
A search on Mighty Signal, a site that analyzes and tracks SDKs in apps, found Foursquare’s Pilgrim SDK in 26 Android apps.
While not every app with Foursquare’s SDK sends location data back to the company, the privacy policies for Flipp, Checkout 51, and GasBuddy all disclose that they share location data with the company.
Foursquare’s method of obtaining location data through an embedded SDK is a common practice. Of the 47 companies that The Markup identified, 12 of them advertised SDKs to app developers that could send them location data in exchange for money or services.
Placer.ai says in its marketing that it does foot traffic analysis and that its SDK is installed in more than 500 apps and has insights on more than 20 million devices.
“We partner with mobile apps providing location services and receive anonymized aggregated data. Very critically, all data is anonymized and stripped of personal identifiers before it reaches us,” Ethan Chernofsky, Placer.ai’s vice president of marketing, said in an email.
Into the Location Data Marketplace
Once a person’s location data has been collected from an app and it has entered the location data marketplace, it can be sold over and over again, from the data providers to an aggregator that resells data from multiple sources. It could end up in the hands of a “location intelligence” firm that uses the raw data to analyze foot traffic for retail shopping areas and the demographics associated with its visitors. Or with a hedge fund that wants insights on how many people are going to a certain store.
“There are the data aggregators that collect the data from multiple applications and sell in bulk. And then there are analytics companies which buy data either from aggregators or from applications and perform the analytics,” said Tsiounis of Advan Research. “And everybody sells to everybody else.”
Some data marketplaces are part of well-known companies, like Amazon’s AWS Data Exchange, or Oracle’s Data Marketplace, which sell all types of data, not just location data. Oracle boasts its listing as the “world’s largest third-party data marketplace” for targeted advertising, while Amazon claims to “make it easy to find, subscribe to, and use third-party data in the cloud.” Both marketplaces feature listings for several of the location data companies that we examined.
Amazon spokesperson Claude Shy said that data providers have to explain how they gain consent for data and how they monitor people using the data they purchase.
“Only qualified data providers will have access to the AWS Data Exchange. Potential data providers are put through a rigorous application process,” Shy said.
Oracle declined to comment.
Other companies, like Narrative, say they are simply connecting data buyers and sellers by providing a platform. Narrative’s website, for instance, lists location data providers like SafeGraph and Complementics among its 17 providers with more than two billion mobile advertising IDs to buy from.
But Narrative CEO Nick Jordan said the company doesn’t even look at the data itself.
“There’s a number of companies that are using our platform to acquire and/or monetize geolocation data, but we actually don’t have any rights to the data,” he said. “We’re not buying it, we’re not selling it.”
To give a sense of how massive the industry is, Amass Insights has 320 location data providers listed on its directory, Jordan Hauer, the company’s CEO, said. While the company doesn’t directly collect or sell any of the data, hedge funds will pay it to guide them through the myriad of location data companies, he said.
“The most inefficient part of the whole process is actually not delivering the data,” Hauer said. “It’s actually finding what you’re looking for and making sure that it’s compliant, making sure that it has value and that it is exactly what the provider says it is.”
Oh, the Places Your Data Will Go
There are a whole slew of potential buyers for location data: investors looking for intel on market trends or what their competitors are up to, political campaigns, stores keeping tabs on customers, and law enforcement agencies, among others.
Fast food restaurants and other businesses have been known to buy location data for advertising purposes down to a person’s steps. For example, in 2018, Burger King ran a promotion in which, if a customer’s phone was within 600 feet of a McDonalds, the Burger King app would let the user buy a Whopper for one cent.
Of the location data firms The Markup examined, the offerings are diverse.
https://bookshop.org/a/565/9781479837243
Advan Research, for instance, uses historical location data to tell its customers, largely retail businesses or their private equity firm owners, where their visitors came from, and makes guesses about their income, race, and interests based on where they’ve been.
“For example, we know that the average income in this neighborhood by census data is $50,000. But then there are two devices—one went to Dollar General, McDonald’s, and Walmart, and the other went to a BMW dealer and Tiffany’s … so they probably make more money,” Advan Research’s Tsiounis said.
Others combine the location data they obtain with other pieces of data gathered from your online activities. Complementics, which boasts data on “more than a billion mobile device IDs,” offers location data in tandem with cross-device data for mobile ad targeting.
The prices can be steep.
Outlogic (formerly known as X-Mode) offers a license for a location dataset titled “Cyber Security Location data” on Datarade for $240,000 per year. The listing says “Outlogic’s accurate and granular location data is collected directly from a mobile device’s GPS.”
At the moment, there are few if any rules limiting who can buy your data.
Sherman, of the Duke Tech Policy Lab, published a report in August finding that data brokers were advertising location information on people based on their political beliefs, as well as data on U.S. government employees and military personnel.
“There is virtually nothing in U.S. law preventing an American company from selling data on two million service members, let’s say, to some Russian company that’s just a front for the Russian government,” Sherman said.
Existing privacy laws in the U.S., like California’s Consumer Privacy Act, do not limit who can purchase data, though California residents can request that their data not be “sold”—which can be a tricky definition. Instead, the law focuses on allowing people to opt out of sharing their location in the first place.
The European Union’s General Data Protection Regulation has stricter requirements for notifying users when their data is being processed or transferred.
But Ashkan Soltani, a privacy expert and former chief technologist for the Federal Trade Commission, said it’s unrealistic to expect customers to hunt down companies and insist they delete their personal data.
“We know in practice that consumers don’t take action,” he said. “It’s incredibly taxing to opt out of hundreds of data brokers you’ve never even heard of.”
Companies like Apple and Google, who control access to the app stores, are in the best position to control the location data market, AppCensus’s Egelman said.
“The real danger is the app gets booted from the Google Play store or the iOS app store,” he said.” As a result, your company loses money.”
Researchers found, however, that the companies’ SDKs were still making their way into Google’s app store.
Apple didn’t respond to a request for comment.
“The Google Play team is always working to strengthen privacy protections through both product and policy improvements. When we find apps or SDK providers that violate our policies, we take action,” Google spokesperson Scott Westover said in an email.
Digital privacy has been a key policy issue for U.S. senator Ron Wyden, a Democrat from Oregon, who told The Markup that the big app stores needed to do more.
“This is the right move by Google, but they and Apple need to do more than play whack-a-mole with apps that sell Americans’ location information. These companies need a real plan to protect users’ privacy and safety from these malicious apps,” Wyden said in an email.
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).
Stephanie Grisham’s new book exposes everything she knows about the Trumps after extensive time working in the White House. Reporters with galley proofs are exposing and releasing details that paint a sordid and alarming picture of the time, even beyond past, admittedly shocking revelations.
Grisham served multiple roles during Trump’s solo term, including as aide to former First Lady Melania Trump, as Chief of Staff, in addition to an aide to Trump as his White House Press Secretary and Communications Director.
Many of the most recent revelations focus on the former First Lady.
Reports from those who got a sneak peak at excerpts from the upcoming book, say during the 2020 election race, Melania did not stay up for results by her husband’s side, but instead spent most of the night…. asleep.
“I knew by now how much sleep meant to her,” Grisham writes, “but still, I couldn’t imagine being asleep at a time like that. Maybe she thought that someone would wake her up if Trump won.”
(Obviously he didn’t win). Although only a small little nugget of gossip, it solidifies what many have felt about the ex-FLOTUS, as her infamous green jacket implied, she really doesn’t care.
It seems like Melania Trump DOES care about her outward reputation as both unflattering images of author Grisham were leaked to press along with a statement issued by her camp about the upcoming book:
“The intent behind this book is obvious. It is an attempt to redeem herself after a poor performance as press secretary, failed personal relationships, and unprofessional behavior in the White House. Through mistruth and betrayal, she seeks to gain relevance and money at the expense of Mrs. Trump.”
Bokeh into a corner; the coming of age for smartphone photography
Much has been said about the new camera system, and in particular, the top end iPhone 13 Pro and Pro Max versions. Cinematic mode is one new feature that has generated a lot of interest, some admiration and some confusion.
Apple marketing has not helped to clarify – the emphasis with the name and all the marketing materials and ads are jumping into the claim that this is a high-end pro replacement for prime lenses and a human focus puller. And you should make professional movies with it.
This is a valid idea, to a point, and it’s a fantastic accomplishment to have a cinematic mode at all, especially in your pocket. And, perhaps, the limitation at HD video and no 4k capability will be overcome, either in software or with the iPhone 14.
But, in reality, none of that matters. In reality this mode was absolutely necessary, with or without the autofocus “robot-focus-puller” trick.
Including the telephoto camera made the cinematic effect absolutely mandatory
So taking a small step back for a moment, let’s look at the big changes in the iPhone 13 Pro cameras compared to the iPhone 11 Pro and iPhone 12 Pro. The big change was the ultra-wide camera / lens combo along with the 3X 77mm telephoto camera / lens. In total making 6x optical zoom range possible.
It’s the 77mm that is the huge move. Why? Well, if you are a photographer and have ever worked with a prime or zoom lens of 77mm or above you will be aware of a couple of things. The size, length and weight of the lens is massive. And to duplicate that in a tiny camera module as part of a three camera array on an iPhone presents a pretty big challenge.
Obviously the size limitation makes it impossible for a “real” 77mm lens to be strapped to the back of an iPhone. And, even if the magnification was possible, what about the “look” and the quality of the image?
And what constitutes, in photographic tradition, the beauty and style that makes a long lens like a 77mm artistically desirable? Because just having the ability to get a closer view or shot of an subject without moving the camera closer is a small and relatively insignificant part of the challenge.
Bokeh because it’s beautiful and highlights the subject (often a human or animal) in the video or photo.
Now, to be clear, we are really talking about video recording, not just photos. Because the portrait mode on iPhone has been around, and improving, for years, and cinematic mode is creating similar effect and adding a new level for video.
Adding a 77mm lens, however, if it was not getting the bokeh effect in the video recording, would have been a disappointment of monumental proportions for photographers and would not have been an option.
And, good news folks, the bokeh in cinematic mode when using the 77mm lens is very usable and takes the cinematic style potential into a creative realm that is “Pro”, with or without the focus pulling tricks, and / or the panning or dolly shots with a moving camera.
Both the addition of “portrait mode” backgrounds for FaceTime video, which is a look that has become standard for YouTube videographers, and, more impressively and more importantly, the ability to shift through the lens “kit” as a feature film director would, using different focal lengths (like swapping out prime lenses on a feature film shoot) is a game changer.
However, none of this would be even remotely possible if the switch from a virtual 26mm wide angle prime lens to a virtual 77mm prime did not have some emulation of the unique qualities such as depth or field and, above all, bokeh that shifted as well.
And, thankfully this works the way a director or DP would want – not the same, of course, as a rig that has lenses that cost as much as a dozen iPhone 13 Pro Maxes, but one that is unique and able to produce beautiful, soulful and human effects that are a computationally assisted approximation. That look, or at least something with a similar feel, is akin to what has inspired generations of filmmakers to love what a 77mm or 85mm or even a 100mm (my personal favorite) does for a human subject in the wild.
It is now possible to produce images that have the convenience of an iPhone and the creative mix of styles that could previously only be found in a full professional kit with multiple prime lenses, and that is something that will change and impact the quality and style of everything we watch, particularly in production areas where million dollar kits are not an option.
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).
In any particular month, on any given streaming platform, besides the “endless” searching to find something you want to watch, there usually is one, or at best two, new incoming movies or TV shows “worthy” of watching.
This month may prove different, since, with the entertainment industry and movie production in full swing, there are buckets of better movies and shows to watch (and this state of affairs will potentially be the case for the remainder of the year).
We’ve broken down some Must Watch Movies and TV shows on each platform with and an overview:
Netflix
Whether its Jack Gyllenhall in the remake of the 2018 “The Guilty“, Andy McDowell is the limited series “Maid” or the prequel to Zack Snyder’s “Army of the Dead” – “Army of Thieves” there is plenty of content to keep us nice and entertained this month. Netflix is the power hitter this month as far as watch-worthy streaming content.
Several widely popular Netflix shows also have new seasons coming our way. First is “On My Block” with, sadly the 4th and final season. And then “You” based on the YA novel and in my opinion is probably the best of the Netflix shows to grace the platform this month. Next is “Locke and Key” and “The Baby-Sitters Club” both coming in season 2.
The Guilty – October 1:
The Maid – October 1:
On My Block – Season 4 – October 4:
YOU -Season 3 – October 15:
https://youtu.be/xAN1ThhTWsE
Army of Thieves – October 29:
HBO
Streamers get to take advantage of all Warner Bros 2021 films that gives subscribers the chance to watch theatrical releases the same day (for up to 31 days) on their HBO Max accounts.
For October there are 2 must watch movies, the highly anticipated “Dune” and “The Many Saints of Newark“. For TV Shows, the third season of the dysfunctional Roy family returns in “Succession“.
The Many Saints of Newark – October 1:
Dune – October 22:
Succession -Season 3 – October 17:
Apple TV+
This streaming platform is bringing us Sci-Fi and extraterrestrial extravaganza. The long awaiting adaption of Isaac Asimov in “Foundation” is available to watch. In addition. On October 22nd (when the first 3 episodes will be released), sci-fi fans can experience “Invasion” what it would be like to live through an alien invasion. Joy!
Foundation – Weekly Episodes – available now:
Invasion – Weekly episodes starting October 22:
Amazon Prime
Since October is obviously the month to bring on the season of spookiness, Amazon Prime has made it a priority is bringing some new horror content to the platform. The biggest original series that it will bring is the latest reboot to the classic ’97 slasher movie “I Know What you Did Last Summer”.
Also starting on October 1st – “Welcome to the Blumhouse” features a total of 4 horror features: “Bingo Hell” and “Black as Night” and then a week later on October 8, an additional two horror indies ” Madres” and “The Manor”.
If you aren’t in the mood for anything ‘scary’ and rather a music fan, specifically a Bieleber – his documentary is also available on Amazon Prime
I Know What You Did Last Summer (Reboot) – October 15:
Welcome to the Blumhouse: (Black as Night and Bingo Hell -October 1 & The Manor and Madres – October 8):
Remake of the Danish Award winning hit will surely translate to big-time US success
Back in 2018, during the Sundance film festival, Jack Gyllenhaal watched a Danish film “Den Skyldige” (The Guilty). Immediately after experiencing the psychological thriller he knew it could be a hit in English.
The actor then quickly acquired the rights, and now he stars in the remake of “The Guilty“, which will get its premiere on Netflix October 1st, 2021.
During the time that production was initially set to begin for the film, suddenly covid-19 happened, and, as we all know, that put a halt to productions across the entertainment industry.
Yet this film, if it follows the original, is almost uniquely perfect for filming during a pandemic. The movie is primarily centered around one man in one location (everyone else is mainly heard over the phone) – thus the movie was ultimately produced by way of social distance, FaceTime and zoom chats by director and producers. (which is not to say he, at least, phoned-it-in, by any means).
Gyllenhaal plays a demoted police office that now works as a 911 dispatch operator named Joe Bayler. He receives a call from someone in danger, but throughout the call, which takes place in a single morning, nothing is as it seems.
Check out the trailer for the original 2018 version with English sub-titles, of course. The 2021 version set for the Netflix streaming platform does not, as of yet, have a trailer available. Aside from Gyllenhall, additional cast will mainly be comprised of voice performances by the likes of: Ethan Hawke, Peter Sarsgaard, Riley Keough, Paul Dano, Byron Bowers, Da’Vine Joy Randolph, David Castaneda, Christina Vidal, Adrian Martinez. Bill Burr, Beau Knapp, and Edi Patterson.
Last Chance to watch on Netflix- Calling all Trekkies:
As what happens each and every month, the streaming platform needs more space for all the new incoming content and in order to do so Netflix needs to purge some titles out of its library. Midnight pacific time these titles will vanish.
The show Star Trek has been around for over 50 years. This might be some startling news if you have relied on Netflix to get your fix for the series. Three of the franchise series along with the 2009 movie are leaving. The TV show series had been streaming on the platform ever since 2011 and now, it seems its time on the platform has come to an end (possible forever).
Sci-Fi fans have all day today up until midnight to binge out on all things Star Trek: Star Trek the Movie, Star Trek: Enterprise (Seasons 1-4), Star Trek (Seasons 1-3) and Star Trek: Voyager (Seasons 1-7).
Don’t fret, Paramount+ currently holds the full library for all the Star Trek so there is still an option to stream, however that means it is very unlikely the title will return to the Netflix platform.
Or rather, if you are feeling nostalgic, there are additional classics that will be gone including the “Austin Powers” series: Goldmember, International Man of Mystery, The Spy Who Shagged Me, and The Karate Kid I and II.
Strek Trek:
Star Trek -Enterprise:
https://youtu.be/mdxynXpRyBw
Star Trek – Voyager:
https://youtu.be/KPCCEyvLaOo
In addition to all the Star Trek series about to disappear there are film “sequel groups” such as Kung Fu Panda 1 & 2, three Austin Powers movies: Austin Powers in Goldmember, Austin Powers: International Man of Mystery, Austin Powers: The Spy Who Shagged Me, Karate Kid and Karate Kid II & III as well as Movies like Boogie Nights and The Pianist! Full list below.
List of Titles Leaving Netflix this Thursday at Midnight:
Air Force One Austin Powers in Goldmember Austin Powers: International Man of Mystery Austin Powers: The Spy Who Shagged Me Boogie Nights Cradle 2 the Grave Evil, Season 1 Fools Rush In Insidious The Karate Kid The Karate Kid Part II The Karate Kid Part III Kung Fu Panda Kung Fu Panda 2 No Strings Attached The Pianist Prom Night The Queen Star Trek Star Trek: Enterprise, Seasons 1-4 Star Trek, Seasons 1-3 Star Trek: Voyager, Seasons 1-7 The Unicorn, Season 1 Why Do Fools Fall in Love
In what has become a monthly Netflix ritual, some great films have just hours left for you to stream them
As is customary when each month comes to a close Netflix is saying “out with the old, in with the new”. There are many new and exciting titles premiering in the Fall months, including October, before that though, the streaming platform is giving viewers a last call to watch some classic movies.
The large list of films and series going out and becoming unavailable is a long one. As of Thursday, September 30th at midnight PT (so dramatic!) no less than 24 items will cease to be available to stream on the Platform.
While some films might be available on other platforms, and they might one day return to Netflix, it is often the case that they switch to a pay-to-pay status during the time that Netflix removes them from its catalog.
In addition to the movies about to disappear there are film “sequel groups” such as Kung Fu Panda 1 & 2, three Austin Powers movies: Austin Powers in Goldmember, Austin Powers: International Man of Mystery, Austin Powers: The Spy Who Shagged Me, Karate Kid and Karate Kid II & III as well as Star Trek Seasons 1-3, Star Trek: Enterprise Seasons 1-4 and Star Trek Voyager Seasons 1-7!
While many of these big-time sequel franchises are so well known that you might have already seen them all, the two films that we are featuring, though huge hits in the day, are unique & special and, if you have not seen them or want to revisit, we highly recommend that you go for it now, before Netflix retires them indefinitely.
These “double-view” films are great enough to see again…
Watch “Boogie Nights” one of Paul Thomas Anderson’s classics. This movie stars Mark Wahlberg, Burt Reynolds, Heather Graham, Julianne Moore and John C. Reilly.
Or the Oscar-winning drama “The Pianist” directed by Roman Polanski. Adrien Brody stars as Wladyslaw Szpillman, a Jewish pianist that was confined to the Warsaw Ghetto and later forced into hiding as the Nazi’s invaded Poland.
Leaving Netflix this Thursday at Midnight:
Air Force One Austin Powers in Goldmember Austin Powers: International Man of Mystery Austin Powers: The Spy Who Shagged Me Boogie Nights Cradle 2 the Grave Evil, Season 1 Fools Rush In Insidious The Karate Kid The Karate Kid Part II The Karate Kid Part III Kung Fu Panda Kung Fu Panda 2 No Strings Attached The Pianist Prom Night The Queen Star Trek Star Trek: Enterprise, Seasons 1-4 Star Trek, Seasons 1-3 Star Trek: Voyager, Seasons 1-7 The Unicorn, Season 1 Why Do Fools Fall in Love
“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.”
Bond jump should have been seen coming, yet the reaction is nevertheless a big rush to the exits
In what some are calling a Taper Tantrum, the markets dropped with a sense of purpose today, with little bounce after the close in the futures market. With Fed rate hikes now a certainty, inflation concerns real, and bond yields spiking today, there were plenty of things to point to as catalysts.
This could be, and this is extremely likely regardless of what endless permanent-bull commentators would have you believe, the start of a tough two months, with late September and October being known as a very dangerous time in markets, especially whey they exhibit pre-crash signs and warnings.
Insane valuations that have preceded past September / October disasters are back
It’s unbelievable that the fall of 2008, when the financial crisis came to a head with the Lehman Brothers collapse, was 13 years ago, and the prior peak in November 2007 was a full 14 years.
I guess we can observe that we now have the iPhone 13, with the iPhone “1” which was just called “iPhone” at the time, has been marking the time with yearly iterations, not always named in sequence:
iPhone: June 29, 2007
iPhone 3G: July 11, 2008
iPhone 3GS: June 19, 2009
iPhone 4: June 24, 2010
iPhone 4S: October 14, 2011
iPhone 5: September 21, 2012
iPhone 5S & 5C: September 20, 2013
iPhone 6 & 6 Plus: September 19, 2014
iPhone 6S & 6S Plus: September 19, 2015
iPhone 7 & 7 Plus: September 16, 2016
iPhone 8 & 8 Plus: September 22, 2017
iPhone XS, XS Max: September 21, 2018
iPhone 11, Pro, Pro Max: September 20, 2019
iPhone 12, Mini, Pro, Pro Max: October 23, 2020
iPhone 13, Mini, Pro, Pro Max, September 24, 2021
And during all these years, for the most part the artificially inflated Fed “bubble of everything” has continued.
Here is a disturbing chart, courtesy of Elliott wave International at Elliottwave.com:
This behavior, seen across nearly all markets since extreme measures were taken to respond when the March 2020 pandemic crash occurred, has been building to a crescendo. And today was a tiny pin-prick that could augur ill for October.
What this has led to, naturally, is an overvaluation beyond anything seen in modern times, perhaps 500 years. The previous all-time-peak for overvalued stocks (S&P) was in March 2000. August 2021 is far beyond that peak and likely will stand as the most overvalued moment for decades.
Unless, that is, somehow the insane valuations are pushed even higher. Which is unlikely, but not impossible, given the state of delusional euphoria that pervades the financial markets.
Many 2021 characteristics, such as the Crypto, NFT frenzy will be seen in a similar light to the tech stocks in 2000 or Real estate in 2007
There’s a sense that it is normal for bored apes NFTs to experience a multimillion dollar bidding wars, or for crypto alt coins with dog mascots to explode 10,000% or more during this, possibly final phase, of what has been called the “everything bubble”.
And why not? If you bought and held almost anything in March 2009 or again at the bottom of the crash on March 16, 2020, then you have seen nearly continuous gains that you’d be eager to risk on, well, anything.
And if you were 10 years old in the year 2000, you’d not have known about NASDAQ drops that take around 13 years to regain what was lost after a 1 year bear market, so why worry?
Perhaps the Fed and the markets seemingly infinite ability to expand and inflate will go on for years. Or the next bear, possibly the one that already kicked off today, and will accelerate into October, is one to take seriously.
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.”
Above: Photo Collage / Lynxotic / J. Flavia / Unsplash
Ear related! 2nd best and more are also interesting
With so many new features on the iPhone 13 Pro models, and with so many of them made possible by iOS 15, the A15 bionic chip, the 16-core Neural Engine, which performs up to 15.8 trillion operations per second, and power features like Cinematic Mode and Smart HDR 4, machine learning and other hard to explain facets of the overall experiential upgrade, sound playback (and recording) are often barely mentioned, it seems.
Ever since there was the biggest Apple success story near the turn of the century there has been a special relationship between the fruit company and music / sound. I’m talking, of course, about the iPod.
Long before the iPhone was even a rumor, the iPod was a huge success, taking over the mp3 player market and, with the iTunes store for music downloads, launching the software and services division, for all practical purposes.
It’s hard to imagine now, but there was doubt that Apple could make it in the competitive cell phone market, with behemoths like Nokia and Blackberry so well established. It was the iPod’s success that made it seem plausible.
There was one thing that the iPod never had, however; speakers. And even the recent iPhones, with speakers for voice and music, if you didn’t use your AirPods for that, had speaker and sound quality that was not on the quality level of the larger iPads.
With a much larger area to hide speakers, the iPad was always an obvious choice for watching movies and listening “out loud” via the built in speaker system. With an iPad pro that could be pretty spectacular with a relatively full frequency spectrum and, more recently via software upgrades, spatial audio.
With iPhone 13 Pro models the audio barrier has finally been shattered
In a tiny, nearly forgotten passage at the very end of a list of new specs and enhancements in the iPhone 13 line, Apple adds one more thing; a stereo speaker at the top where the notch is located and a second stereo speaker at the bottom next to the Lightning port.
What it doesn’t mention is the improvement in the sound quality. Like so many features in the newer generation of devices and software, this unassuming, seemingly simple statement is just the tip of the iceberg and does not divulge what’s really going on.
Once more a combination of all the recent software and hardware upgrades combine to produce an experience that goes beyond what you could expect with these tiny, nearly invisible, speakers.
First, the two stereo speaker sets are, sound wise, equal in quality. So when you are watching a movie in landscape mode there is a distinct stereo effect. This is enhanced by spatial audio and dolby atmos depending on your set up.
The actual experience is noticeably “iPad like” and in some ways even goes beyond. Having the phone relatively near you, due to its size, and listening to a high quality movie score, there’s a feeling that your phone has morphed into a personal theater – as long as you can let the sound out into your local environment.
Try “SharePlay”, once it’s live in iOS 15.1, or just manually sync with your partner, assuming you each have a new iPhone 13 (!) and you will get a glorious room filling surround experience from the 4x stereo output (8 speakers?!) into the room.
And the mysterious mics also hidden in multiple places, are also a big upgrade – the seem to switch roles for video, calls etc and maximize the audio quality in live recording situations.
Apple’s software and service bundles and ambitions are driving hardware and iOS upgrades
As jubilant as this may sound, there is also an ulterior motive lurking. Some of the audio features work best (or at all) with an Apple Music subscription. And having more subscriptions, Apple TV, Apple News, Apple Music, iCloud Extra Storage, along connected devices, with so many available, it becomes an ecosystem of plenty for Apple, already the largest company by market cap.
On the optimistic side there’s always Apple One Premiere, the top of the line for bundled services (see below) and looking more and more like a steal at $29.95 per month.
Perhaps, one day not to far away, there will be a Apple One Premiere plan that also includes all Apple devices and you just trade them in every two years (every year?) or maybe you never own them at all?
The way the upgrades in hardware, software and the rest are becoming more interdependent and how crazy it already is to upgrade various devices (assuming you have more than one or two) yearly or bi-annually it’s an interesting idea to try and imagine.
And with an Apple Car perhaps on the way (self driving and outfitted with all the rest of the tech and service bundles) this could be a whole-house, whole-office (will there still be offices?) all transport bundle too. Apple haters will be in trouble, and have to move to Google Island, but otherwise, hey, why not?
Apple One Premiere example package:
Speakers after tear down by iFixit:
credit: iFixit
Audio Playback
Audio formats supported: AAC‑LC, HE‑AAC, HE‑AAC v2, Protected AAC, MP3, Linear PCM, Apple Lossless, FLAC, Dolby Digital (AC‑3), Dolby Digital Plus (E‑AC‑3), Dolby Atmos, and Audible (formats 2, 3, 4, Audible Enhanced Audio, AAX, and AAX+)
Spatial audio playback
User‑configurable maximum volume limit
Video Playback
Video formats supported: HEVC, H.264, MPEG‑4 Part 2, and Motion JPEG
HDR with Dolby Vision, HDR10, and HLG
Up to 4K HDR AirPlay for mirroring, photos, and video out to Apple TV (2nd generation or later) or AirPlay 2–enabled smart TV
Video mirroring and video out support: Up to 1080p through Lightning Digital AV Adapter and Lightning to VGA Adapter (adapters sold separately)9
Upgrades for hard and software, though groundbreaking and exciting, do have limitations and problems
The new upgrades for iOS 15, iPad OS 15, mac OS 12 Monterey and the rest are in many ways amazing, feature filled wonders, as we’ve discussed at every opportunity. The multi-year transition to a more unified system across all apple devices is underway and we are big supporters of the benefits.
However, nothing is perfect, and particularly in the early days it is to be expected that glitches and strange twists and turns in the journey can disappoint and confuse along the way.
Below we’ve outlined a few.
Various less than perfect ideas and execution in the OS software
Some issues are not really issues at all but things that people just don’t like. One example is the move of the address bar on safari in iOS 15 to the bottom. Many people had trouble getting used to this so a button was added to move it back to the top.
Other glitches include a false warning that you are out of storage space. Others have reported a reduction in perceived (if not real) battery life. Although these are minor annoyances and will be fixed with future updates, such as iOS 15.1 due any minute now, they show that this bug hunting is, unfortunately part of the process of any upgrade, much less a huge and important one like iOS 15.
There are also specific limitations though that should be mentioned about the iPhone 13 Pro camera system.
This issues are less bugs or errors and just limitations that may, or may not, be improved at a later date.
The new high end Pro camera system for the iPhone 13 Pro series is a major upgrade that has so many features and new capabilities that it is hard to even list them all, let alone illuminate the multitude of options and enhancements that they create.
On the obvious down side, however, a few things have jumped out at users now that these phones are in the wild.
Cinematic mode only works (currently) in 1080p. This is a serious limitation, since the whole idea of “Pro” is 4k and above. Many even go so far as to say that 1080p aka HD is no longer the standard for video and even obsolete. While there are rumors that this could get a software upgrade, perhaps even before the next iPhone model next fall, but it is not at all clear if, or when, that might happen.
This limitation is a fairly serious one, since an entire project would have to be shot at 1080p HD rather than 4k to make any use at all of the beautiful and fascinating rack-focus effects available in cinematic mode.
Less and issue but often mentioned is the inability to shoot 4k slow motion footage.
The lack of slo-mo at any resolution above 1080p is also something that has surprised aficionados. There is an option for 1080p at 240 fps, but unless you are shooting ultra high speed action that is not a hugely useful setting.
It seems odd, since a large part of the limitation is likely the large amount of data required to make this happen at 4k but there is a silver-lining here that few have mentioned in recent articles decrying the lack of 4k slow-mo options.
Since the system is already capable of shooting 4k at 60fps, and a final project setting for editing could be 4k at 30 or even 24fps, the 4k 60fps could be seen as a double speed slo-mo setting for a 4k video projects shot at 30fps for standard and 60fps for footage to be slowed to 30fps for the 1/2 speed slo-mo effect.
In the feature film 35mm celluloid days this was a very common and useful way to get slow-mo without eating up tons of expensive film stock.
Also, shooting at 4k 60fps for a 4k 24fps project would yield a 1.5 ratio of frame rate, giving an even more extreme slow-mo effect. For most slow motion effects 1 to 1.5x speed in-camera for later playback at the project rate is more than adequate.
The 120fps rate, since the top frame rate at 4k is 60fps, is, indeed, double which, as stated above, standard.
Therefore, for all practical purposes, there is already a way to produce beautiful 4k slow motion effects in a 30fps or 24fps project and have those be in camera pristine slo-mo and not the less desirable edit-only EFX.
Summing up, even with glitches and minor disappointments, it’s a beautiful world and now we just have to shoot it
If no more serious glitches or known issues pop up during the transition from iOS 14 to iOS 15, and iPhone 12 Pro to iPhone 13 Pro, we can be satisfied that this is a monumental job well done by the gang at Apple.
Though there are a lot of shortcomings that we may perceive in the new world topping combo-pack; iPhone 13 Pro Max running iOS 15.1, these are when compared to far more costly and cumbersome alternatives, or simply, when compared to our wildest dreams. Those will have to wait a few years, in all likelihood.
Human greed is a powerful thing. When given a photographic system that even attempts to approximate a profession system based on prime and zoom lenses and accessories, there’s a tendency to want it all, right now!
Of course, instead, what we get is an amazing extension of the iPhone photo tradition – taken up a bunch of notches at once. The computational enhancements are incredible and will only get better – in many cases without a new phone as they are based on AI and machine learning, which as the name implies, are continually improving while you sleep.
It is also the reason why real lenses and traditional DLSR cameras still have an important use and value.
The new system unveiled with the iPhone 13 pro is revolutionary precisely because of the potential for people to create new visual expressions and ways of communicating.
These photographic traditions and the efforts that were made in the design to emulate them are important and valuable. However, the future will benefit from the spontaneous and new ways that people will decide to use this evolving system and the current extensions of our eyes, ears and minds….
The cameras are at the center of what makes an iPhone 13 a Pro investment
Direct hands on experience with something as complex and interesting as the new iPhone 13 Pro Max is invaluable for a useful assessment. After a few days and also taking into account some observations of others I will attempt to shed light on the state of the art of iPhone as of September 2021.
Comparing this iteration of iPhone with the previous versions is meaningful for buying decisions, but it must also be compared based on what it can do for a professional that has a need for a higher grade of gadget.
Judging and comparing the machine as a whole is also necessary, since the cameras are not cameras at all be just one part of an integrated system of visual (and audio!) production tools.
Big changes that begat others and on the circle goes
The first thing I noticed, out of the box was the sheer size of the 13 Pro Max, particularly compared to the 11 Pro Max, which was my previous workhorse. From photos I had gathered that the three cameras stuck out more and, yet they do, so much so that it is almost comical.
If you brave the world sans case and put this monster in your the back pocket of your loose fitting jeans, the bulge from the cameras will feel like you are doing something crazy, as it is as if they are rubbing against anything they touch, continuously.
That’s not all about the physical size, though. Looking at the diameter of the three circles (lenses) they appear significantly larger. Believe me, they are. Since the 11 Pro max and the 12 Pro Max have the same size triple camera layout (spec upgrades notwithstanding) this is an immediate and obvious change.
Above: Photo / Lynxotic
The increased size and weight of the camera itself is noticeable, more than I expected. The screen appears far larger due to the new specs and it is a bit of a shock at first, but the level of quality is the biggest and most noticeable feature.
The design logic has an implied history that jumps out once you start to use the camera system.
The changes to the three cameras are significant. After two years of using the 2019 11 Pro Max the framing options, based on the three lenses is a complete new experience.
The ultra wide 13mm equivalent is a bit of a bold and crazy choice. If I was ordering a set of lenses for a music video shoot the ultra wide might go as far as 11mm (very wide!) but that is basically an EFX look and causes an almost fish-eye look.
The 13mm is literally as wide as you can get without getting into potential “clown” territory, which is fun but not usable for a non-EFX composition.
What is odd, in a way, is that the “main” lens at 26mm equivalent is still very wide meaning that the standard 40mm equivalent, which was always considered the closest to a neutral look, is absent here.
Similarly, the telephoto lens at a 77mm equivalent is exactly the same type of choice – once again in my kit this would have been a 100mm for a deep bokeh and a noticeable sweet spot that is ultra-flattering for close ups and head shots.
The 77mm, therefore, is a long enough lens to get the magnification and emulate the look of a telephoto style. But wait, no glass no bokeh.
Both the 13 Pro and 13 Pro Max have the same sensors, optics, stabilization and features. The three cameras in the Pro models span a 6x optical focal length range.
This is where the logic of the design and how the system works, as a whole, begins to get deep.
Once you have made the commitment to not only extend the range of the entire optical focal length range to 6x the differences between a glass & steel 77mm prime lens and a “cell phone camera” must be addressed.
The 77mm requires the bokeh and relatively narrow in-focus range of a “real” telephoto lens is the stylized creative uses that a full kit of prime lenses makes possible is to be achieved.
This is addressed with the already present portrait mode – with enhanced functionality made possible by the A15 chip, the machine learning, AI and neural network – in other words software and computational assists.
And for video, cinematic mode is an absolute must – since the same bokeh effect and stylized effects are needed and desired for video.
All of this does not include the macro effects that effectively extend the range into the nearly microscopic. This feature requires a whole article, which you can check out here.
Getting to a full photographic system in your pocket, and beyond.
Once the effects and artifacts of the 77mm style glass prime lens have been added to the mix, emulated things get more interesting.
Since the bokeh and artifacts in the cinematic mode for video are computational and not photographic, they are stored separately and can be altered after the fact, just like has been the case with portrait mode all along.
This is a big deal in one way, since it could never be conceived of with traditional lenses and cameras. It also, however, one more variable to consider when putting together a large batch of footage for a project. This adds a new layer of creative flexibility, and choices to contend with.
Further, since the long lens stylizations are a byproduct of and influenced by focus settings, that has to be in the mix also. That produced the need for the cinematic mode which you can think of as a slightly stoned robot focus puller. who is also a little bit psychic.
The first robot camera assistant is already in the box when your phone arrives
Let me explain…. A real life focus puller (doing rack focus settings) in real life would function roughly as follows:
A shot is planned that requires a focus pull from one subject to another – this could be a close shot of a face panning to another face, or a close up that refocuses from the foreground to the background, for example. The focus must also factor in any movement of the camera / dolly.
The two desired subject distances are measured (using a tape measure) and the focus settings noted. In complex shots this can be multiple focus settings and a particular speed of the “rack pull” from one to the next.
Often such complex focus / dolly set ups must be rehearsed multi times just for the focus puller – so that his error does not ruin a perfect take when, for example, the actors get their best performances.
So, in the robot world practice is also good – and a plan is almost essential, but the virtual focus puller will go with the flow, and try to anticipate and predict what you want him to focus on in real time as you shoot.
This is pretty incredible and also, much like autocorrect typing, sometimes very successful and sometimes comical in the outcome. What is tricky is how to get the robot puller to know what you are trying to have as a subject if it is not a persons head or face.
Also, if the action is fast or if you are shooting something that has no pre-determined outcome or script, like a political protest or a sporting event, you will get somewhat random results.
This makes the name apt, since cinematic also implies a movie with a plot and a script.
Conclusions and a few known limitations and caveats
Human greed is a powerful thing. When given a photographic system that even attempts to approximate a profession system based on prime and zoom lenses and accessories, there’s a tendency to want it all, right now!
Of course, instead, what we get is an amazing extension of the iPhone photo tradition – taken up a bunch of notches at once. The computational enhancements are incredible and will only get better – in many cases without a new phone as they are based on AI and machine learning, which as the name implies, are continually improving while you sleep.
There are specific limitations though that should be mentioned about the iPhone 13 Pro camera system.
Cinematic mode only works (currently) in 1080p. This is a serious limitation, since the whole idea of Pro is 4k and above. There are rumors that this could get a software upgrade during the year but it is not clear if or when that will happen.
Along with the lack of slo-mo at any resolution above 1080p there is a lot of disappointment in this issue. It is the reality of how difficult the computational “assist” really is to achieve that makes this a big step that is still in the future.
It is also the reason why real lenses and traditional DLSR cameras still have an important use and value.
The new system unveiled with the iPhone 13 pro is revolutionary precisely because of the potential for people to create new visual expressions and ways of communicating.
These photographic traditions and the efforts that were made in the design to emulate them are important and valuable. However, the future will benefit from the spontaneous and new ways that people will decide to use this evolving system and the current extensions of our eyes, ears and minds….
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