Congress Sends Tax Bill to the White House

Congress Sends Tax Bill to the White House

U.S. President Donald Trump speaks to the media after the Congressional Republican Leadership retreat at Camp David, Maryland, U.S., January 6, 2018. REUTERS/Yuri Gripas
YURI GRIPAS
By David Becker and Amanda Becker, Reuters

The Republican-controlled U.S. House of Representatives gave final approval on Wednesday to the biggest overhaul of the U.S. tax code in 30 years, sending a sweeping $1.5 trillion bill to President Donald Trump for his signature.

In sealing Trump’s first major legislative victory, Republicans steamrolled opposition from Democrats to pass a bill that slashes taxes for corporations and the wealthy while giving mixed, temporary tax relief to middle-class Americans.

The House approved the measure, 224-201, passing it for the second time in two days after a procedural foul-up forced another vote on Wednesday. The Senate had passed it 51-48 in the early hours of Wednesday.

Trump had emphasized a tax cut for middle-class Americans during his 2016 campaign. At the beginning of a Cabinet meeting on Wednesday, he said lowering the corporate tax rate from 35 percent to 21 percent was “probably the biggest factor in this plan.”

Trump planned a tax-related celebration with U.S. lawmakers at the White House in the afternoon but will not sign the legislation immediately. The timing of the signing was still up in the air.

After Trump repeatedly urged Republicans to get it to him to sign before the end of the year, White House economic adviser Gary Cohn said the timing of signing the bill depends on whether automatic spending cuts triggered by the legislation could be waived. If so, the president will sign it before the end of the year, he said.

The debt-financed legislation cuts the U.S. corporate income tax rate to 21 percent, gives other business owners a new 20 percent deduction on business income and reshapes how the government taxes multinational corporations along the lines the country’s largest businesses have recommended for years.

Millions of Americans would stop itemizing deductions under the bill, putting tax breaks that incentivize home ownership and charitable donations out of their reach, but also making tax returns somewhat simpler and shorter.

The bill keeps the present number of tax brackets but adjusts many of the rates and income levels for each one. The top tax rate for high earners is reduced. The estate tax on inheritances is changed so far fewer people will pay.

Once signed, taxpayers likely would see the first changes to their paycheck tax withholdings in February. Most households will not see the full effect of the tax plan on their income until they file their 2018 taxes in early 2019.

In two provisions added to secure needed Republican votes, the legislation also allows oil drilling in Alaska’s Arctic National Wildlife Refuge and repeals the key portion of the Obamacare health system that fined people who did not have healthcare insurance.

“We have essentially repealed Obamacare and we’ll come up with something that will be much better,” Trump said on Wednesday.

“Pillaging”

Democrats have called the tax legislation a giveaway to the wealthy that will widen the income gap between rich and poor, while adding $1.5 trillion over the next decade to the $20 trillion national debt, which Trump promised in 2016 he would eliminate as president.

“Today the Republicans take their victory lap for successfully pillaging the American middle class to benefit the powerful and the privileged,” said House Democratic leader Nancy Pelosi.

 few Republicans, whose party was once defined by its fiscal hawkishness, have protested the deficit-spending encompassed in the bill. But most of them have voted for it anyway, saying it would help businesses and individuals, while boosting an already expanding economy they see as not growing fast enough.

“We’ve had two quarters in a row of 3 percent growth,” Senate Republican leader Mitch McConnell said after the Senate vote. “The stock market is up. Optimism is high. Coupled with this tax reform, America is ready to start performing as it should have for a number of years.”

Despite Trump administration promises that the tax overhaul would focus on the middle class and not cut taxes for the rich, the nonpartisan Tax Policy Center, a think tank in Washington, estimated middle-income households would see an average tax cut of $900 next year under the bill, while the wealthiest 1 percent of Americans would see an average cut of $51,000.

The House was forced to vote again after the Senate parliamentarian ruled three minor provisions violated arcane Senate rules. To proceed, the Senate deleted the three provisions and then approved the bill.

Because the House and Senate must approve the same legislation before Trump can sign it into law, the Senate’s late Tuesday vote sent the bill back to the House.

Democrats complained the bill was a product of a hurried, often secretive process that ignored them and much of the Republican rank-and-file. No public hearings were held and numerous narrow amendments favored by lobbyists were added late in the process, tilting the package more toward businesses and the wealthy.

U.S. House Speaker Paul Ryan defended the bill in television interviews on Wednesday morning, saying support would grow for after it passes and Americans felt relief.

“I think minds are going to change,” Ryan said on ABC’s “Good Morning America” program.

Reporting by David Morgan and Amanda Becker; Additional reporting by Richard Cowan, Roberta Rampton, Gina Chon and Susan Heavey; Editing by Jeffrey Benkoe and Bill Trott.

Commerce IG Accused of Whistleblower Retaliation Suddenly Quits

Flickr/sciencedemocrats
By Brianna Ehley, The Fiscal Times

Embattled Commerce Department Inspector General Todd Zinser, who has been accused of misconduct and retaliation against whistleblowers, just announced that he is stepping down after seven years at the agency. 

In an internal email to his staff, Zinser said he would be leaving his watchdog post to “pursue opportunities outside of government service,” GovExec first reported.

Zinser, the top watchdog in charge of keeping tabs on the Commerce Department, has been under intense scrutiny for nearly a year amid allegations of whistleblower retaliation and improperly hiring a woman with whom he was said to be romantically involved.

Related: Corruption in Commerce Dept? Lawmakers Want Him Out

For months, Rep. Eddie Bernice Johnson (D-TX) and two independent watchdog groups, have been calling on President Obama to fire Zinser over the alleged misconduct, which has been the subject of at least one federal probe by the White House Office of Special Council.

The White House has not responded to comment on whether Zinser was asked to leave.

A bipartisan group of lawmakers have been probing into multiple allegations brought by whistleblowers against Zinser for the better part of a year.

“The Committee has uncovered evidence questioning whether the Commerce IG’s office is functioning with integrity. We must determine if these allegations are true and if so, they are the result of systemic issues that may require legislative action,” the lawmakers wrote in a letter published last year.

Related: Why This Government Watchdog Needs Watching 

In one instance, the IG reportedly failed to discipline two employees in his office who intimidated potential whistleblowers.

Another whistleblower told the committee that the IG improperly hired his “girlfriend” for a senior role in the office, which had an annual salary of $150,000 plus bonuses. Zinser maintained that he and the woman were not romantically involved and defended her employment. 

He told the Council of Inspectors General for Integrity and Efficiency (CIGIE) that she was hired solely “on business necessity.”

There is currently a Government Accountability Office investigation into Zinser’s office conduct that is expected to be published in the coming months. 

Zinser previously served as the Transportation Department’s acting inspector general and deputy inspector general.

6.6M Homes at Risk of Hurricane Damage This Year. Here’s Which States They’re In

REUTERS
By Beth Braverman

As hurricane season gets underway, real estate analytics firm CoreLogic is warning that there are more than 6.6 million U.S. homes at risk of being hit by a storm surge. That could lead to as much at $1.5 trillion in damage.

The homes are in 19 states and the District of Columbia along the Atlantic and Gulf Coasts. Six states account for more than three-quarters of all at-risk homes, with Florida having the most (2.5 million), followed by Louisiana (760,000), New York (465,000), New Jersey (446,148), Texas (441,304) and Virginia (420,052).

Related: How Climate Change Costs Could Soar to the Billions

“The number of hurricanes each year is less important than the location of where the next hurricane will come ashore,” CoreLogic’s senior hazard risk analyst said in a statement. “It only takes one hurricane that pushes storm surge into a major metropolitan area for the damage to tally in the billions of dollars. With new home construction, and any amount of sea-level rise, the number of homes at risk of storm surge damage will continue to increase.” 

The District of Columbia has the lowest number of properties at risk (3,700), followed by New Hampshire (12,400) and Maine (22,500

State Table (Ranked by Number of Homes at Risk)

Rank

State

Extreme

Very High

High

Moderate

Low*

Total

1

Florida

793,204

461,632

524,923

352,102

377,951

2,509,812

2

Louisiana

97,760

104,059

337,495

138,762

82,196

760,272

3

New York

127,325

114,876

131,039

91,294

N/A

464,534

4

New Jersey

116,581

178,668

73,303

77,596

N/A

446,148

5

Texas

45,800

70,894

112,189

116,168

96,253

441,304

6

Virginia

94,260

115,770

98,463

84,015

27,544

420,052

7

South Carolina

107,443

57,327

65,885

46,799

30,961

308,415

8

North Carolina

73,463

51,927

48,595

40,155

37,347

251,487

9

Massachusetts

31,420

65,279

74,413

49,325

N/A

220,437

10

Maryland

47,990

39,966

27,591

28,975

N/A

144,522

11

Georgia

41,970

52,281

28,852

19,190

8,465

150,758

12

Pennsylvania

1,467

45,776

37,983

32,426

N/A

117,652

13

Mississippi

14,809

20,643

29,387

27,507

10,588

102,934

14

Connecticut

25,292

23,656

22,230

26,529

N/A

97,707

15

Alabama

7,403

12,707

10,182

13,749

14,086

58,127

16

Delaware

11,523

10,854

13,528

13,811

N/A

49,716

17

Rhode Island

6,595

5,988

6,720

7,187

N/A

26,490

18

Maine

5,159

2,753

7,368

7,211

N/A

22,491

19

New Hampshire

2,514

3,470

4,234

2,272

N/A

12,490

20

District of Columbia

N/A**

N/A**

545

3,123

N/A

3,668

Total

1,651,978

1,438,526

1,654,925

1,178,196

685,391

6,609,016


* The "Low" risk category is based on Category 5 hurricanes, which are not likely along the northeastern Atlantic coast. States in that area have N/A designated for the Low category due to the extremely low probability of a Category 5 storm affecting that area.
** Washington, D.C. has no Atlantic coastal properties, but can be affected by larger hurricanes that push storm surge into the Potomac River. Category 1 and 2 storms will likely not generate sufficient storm surge to affect properties in Washington, D.C. 

Jamie Dimon Is Now a Billionaire

REUTERS/Yuri Gripas
By Robert Frank

The vast majority of the billionaires in the U.S. made their money in one of two ways—they started a company, or they inherited their fortune or business.

But Jamie Dimon, chairman and CEO of JPMorgan Chase, has shown another path to riches. As a corporate manager, he may have amassed enough stock and boosted the share price enough to join the 10-figure club.

According to Bloomberg, Dimon is now worth $1.1 billion. His stake in JPMorgan through shares and options is worth $485 million and he also has real estate valued at $32 million. In addition, he has wealth from "an investment portfolio seeded by proceeds" from his previous stint at Citigroup

Related: America’s Highest Paid CEO: It’s Not Who You Think

While highly unusual, Dimon isn't the first billionaire professional manager or executive who gained his wealth from stock in a company he didn't found or take public. The first manager-billionaire in the U.S. was believed to be Roberto Goizueta, CEO of Coca-Cola during the 1980s and 1990s. During his tenure, Coca-Cola's stock jumped more than 70-fold and Goizueta had stock and options totaling more than $1 billion.

More recently, the billionaire managers have been from finance. James Cayne, the colorful CEO and chairman of Bear Stearns became a billionaire on paper—before Bear Stearns collapsed during the financial crisis.

Richard Fuld, CEO of Lehman Brothers, also became a paper billionaire in 2007—before the investment bank became the largest bankruptcy in U.S. history in 2008.

Plenty of other finance chiefs have become billionaires—from hedge-funders to private-equity kings Steve Schwarzman and David Rubenstein. Citi founder Sandy Weill was a billionaire, but he created the company.

So while he may not be the first, Dimon may make history another way—by becoming the first manager-billionaire in finance to run a bank that thrives for decades after his leadership. 

This article originally appeared on CNBC.
Read more from CNBc.

CNBC Charts the top 100 firms
Shift from slaes to planning fuels fee-only business
Harvard Receives Laegest Ever Gift

Most Americans Think Our Morals Are Going To Hell

iStockphoto
By Millie Dent

Ask anyone about the state of moral values in the U.S. and you’re likely to get a response along the lines of, “we’re going to hell.”

Most Americans — 72 percent — are convinced that moral values in the U.S. are decaying, according to a new Gallup poll, and most people believe the current state of moral values isn’t all that great to begin with. Nearly half of those polled, 45 percent, called the state of moral values in the U.S. “poor,” while 34 percent said they are “only fair.”

Just 19 percent rated American morals as either “excellent” or “good,” and only 22 percent say the state of moral values is getting better.

Unsurprisingly perhaps, social conservatives have consistently been most likely to tell pollsters that the nation’s moral values are deteriorating, but the latest Gallup findings showed an uptick from 2014 to 2015 among social moderates and social liberals who believe moral values are regressing.

Related: How U.S. Morals Stack Up Against the World

Gallup also found that Americans’ views of the moral acceptability of a number of key issues has been shifting to the left since 2001. The largest shift was on gay or lesbian relations, with a 23 percentage point increase in the share of people who say that behavior is morally acceptable. The change coincides with a sharp increase in support for same-sex marriage. 

Sex between unmarried people has also become more acceptable, as has having babies outside of marriage. Polygamy and divorce are also now acceptable to a greater portion of the population than in 2001. On the other hand, the views of married men and women having an affair haven’t changed much, with just 8 percent of Americans saying it’s morally tolerable.

However, respondents to the poll about the current and future state of moral values weren’t necessarily responding with those charged social and political issues in mind. In many cases, Gallup suggests, their views of the moral direction of the country were rooted in something much more basic: “That is, their views have less to do with greater acceptance of same-sex marriage or having babies out of wedlock and other hot-button issues, and more to do with matters of basic civility and respect for each other,” Gallup’s Justin McCarthy wrote.

Clearly, the Golden Rule is still the bedrock of our moral code: Love thy neighbor as thyself.

Obama’s Approval Tanks Over the Economy and ISIS

By Eric Pianin

For a while, President Obama enjoyed a revival in popularity after years of public unease and displeasure with his stewardship of the economy and foreign policy. His approval rating jumped as high as 49 percent in mid-January, according to Gallup, and then tapered off a little amid renewed uncertainty about the economic recovery.

In the latest Washington Post/ABC News poll, however, 45 percent of Americans say they approve of Obama’s job performance, while 49 percent disapprove. That is his weakest rating in the survey since late 2014. The president effectively lost five points in approval since January and he hasn’t seen majority support since May 2013, according to survey analysis.

Obama Approval Ratings

Analysts blame the decline in the president’s approval on continued economic anxiety at home – despite a drop in the unemployment rate to 5.4 percent in April and other signs of economic revival – and the advance of ISIS and other Islamic extremists in Iraq and Syria. 

The condition of the economy consistently has topped the list of voters’ concerns heading into the 2016 campaign. The economic gains touted by the administration since the end of the Great Recession in June 2009 apparently haven’t been enough to calm fears, analysts say.

Seventy-three percent of those surveyed recently remain worried about the economy’s direction, and among them Obama’s approval drops to 35 percent, according to the survey. What’s more, Obama gets only a 31 percent approval rating specifically for handling the advance of ISIS militants, with 55 percent disapproving. Public approval of the president’s handling of the war against ISIS is 16 percentage points worse than his rating on handling the economy.