ATR Leads Coalition Letter Opposed to Short Sale Transparency and Market Fairness Act


Posted by Alex Hendrie on Tuesday, July 27th, 2021, 5:44 PM PERMALINK

ATR today led a coalition of conservative organizations in opposition to H.R. 4618, the Short Sale Transparency and Market Fairness Act. This legislation will impose unprecedented and unnecessary government overreach in financial markets that would harm retirees and the broader U.S. economy.

If enacted into law, H.R. 4518 would expand reporting mandates under Section 13(f) of the Securities Exchange Act to require monthly reporting of investments held by investors and asset managers, including derivatives, security-based swaps, and other financial instruments that provide immense value to millions of Americans, including through public pensions and charities. The bill would sharply increase the frequency of filings from quarterly to monthly, while reducing the time to prepare filings from 45 days after the end of a quarter to 10 days after the end of the month.

Instead of meddling in the markets with unprecedented, unnecessary, and harmful mandates, Congress should work to reduce regulatory burdens on investors, retirees, and pensioners.

The full letter can be found here.

 


Report: U.S. Energy Sector Supports Millions of Jobs That Would Be Threatened By Dem Tax Hikes

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Posted by Isabelle Morales on Tuesday, July 27th, 2021, 4:00 PM PERMALINK

The oil and gas industry is a driver of every other sector in the U.S. economy and supports millions of high-paying American jobs, according to a new study prepared by PricewaterhouseCoopers (PwC). This study shows why Americans should be alarmed at efforts by President Biden and Congressional Democrats to raise taxes on oil and gas businesses through the repeal of various tax provisions, including the deduction for intangible drilling costs (IDCs).

IDCs allow independent producers to immediately deduct business expenses related to drilling such as labor, site preparation, repairs, and survey work. The deduction for IDCs is consistent with immediate expensing offered to all business investments.  

If this provision is repealed, it could have significant, negative economic impacts in several states. As the study notes, the onshore upstream oil and gas sector, which relies on the deduction for IDCs, contributes 3.2 million jobs across the economy, including 690,500 direct jobs.  

In certain states, the economy depends heavily on these onshore projects, including in West Virginia, Texas, and Oklahoma:  

  • In West Virginia, there are 39,000 onshore supported jobs, accounting for 4.5% of the state’s total employment.  
  • In Louisiana, there are 153,000 onshore supported jobs, accounting for 7.0% of the state’s total employment.
  • In New Mexico, there are 72,000 onshore supported jobs, accounting for 6.5% of the state’s total employment.  
  • In North Dakota, there are 58,000 onshore supported jobs, accounting for 10.0% of the state’s total employment.  
  • In Oklahoma, there are 257,000 onshore supported jobs, accounting for 11.0% of the state’s total employment.  
  • In Texas, there are 1,549,000 onshore supported jobs, accounting for 8.6% of the state’s total employment.  

 

Investing in these drilling projects is risky. After all, drilling a well does not guarantee that oil and gas will be found. IDCs enable American producers to continue exploring even after unsuccessful endeavors. As Energy Tax Facts explains, “Removing this 100-year-old tax provision from the code would not only strip away roughly 25 percent of the capital available for independent producers to continue looking for new oil and natural gas, but also diminish the many economic benefits created by those activities.” 

If the IDC deduction is eliminated, as President Biden has proposed, many of the jobs the PwC study highlights could be eliminated. As noted in a 2014 study by Wood Mackenzie consulting, repealing the immediate deduction for IDCs would cost 265,000 jobs in the long-term.  

More broadly, the PwC study notes that the oil and gas industry supports 11.3 million total American jobs across all 50 states and accounts for nearly 8 percent of GDP.

These jobs are high paying. In 2017, these jobs paid an average salary of $102,000, 85 percent higher than the average private sector salary. 

Democrat members of Congress whose districts rely on this industry should stand with their workers and reject efforts to raise taxes on American manufacturing. For example, Democratic members of Congress from Texas represent numerous districts where the oil and gas industry employs thousands of Americans: 

  • Texas District 7: Rep. Lizzie Fletcher - 
    • 43,760 Direct Jobs, 152,080 Total Jobs, 19.8% of Jobs in District 
    • 33.3% of District’s Total Labor Income 
       
  • Texas District 15: Rep. Vicente Gonzalez –  
    • 11,840 Direct Jobs, 47,860 Total Jobs, 11.6% of Jobs in District 
    • 14.9% of District’s Total Labor Income 
       
  • Texas District 28: Rep. Henry Cuellar - 
    • 15,020 Direct Jobs, 48,660 Total Jobs, 13.8% of Jobs in District 
    • 20.0% of District’s Total Labor Income 
       
  • Texas District 29: Rep. Sylvia Garcia -  
    • 11,320 Direct Jobs, 53,760 Total Jobs, 15.3% of Jobs in District 
    • 24.6% of District’s Total Labor Income 
       
  • Texas District 32: Rep. Colin Allred –  
    • 19,620 Direct Jobs, 99,110 Total Jobs, 14.1% of Jobs in District 
    • 24.7% of District’s Total Labor Income 
       
  • Texas District 33: Rep. Marc Veasey – 
    • 7,000 Direct Jobs, 44,720 Total Jobs, 8.3% of Jobs in District 
    • 10.1% of District’s Total Labor Income 

 

For decades, progressive Democrats and activist groups have undertaken a coordinated attack on reliable sources of energy produced in the United States, including oil and natural gas, through schemes like cap-and-trade, bans on hydraulic fracturing, the Green New Deal, and tax hikes all aimed at “keeping it in the ground.” These kinds of schemes are a direct threat to millions of high-paying manufacturing jobs, which the Left has claimed to be a champion of. 

Photo Credit: Lorie Shaull


Seven-Bill Spending Package Packed Full of Wasteful Spending 

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Posted by Isabelle Morales on Tuesday, July 27th, 2021, 3:40 PM PERMALINK

The House of Representatives will this week vote on the “bloatedbus” appropriations bills, H.R. 4502, which provides appropriations for 7 of the 12 agencies covered by the annual appropriation acts: Labor/HHS/Education, Agriculture, Energy/Water, Financial Services, Interior/Environment, Military Construction/VA, and Transportation/HUD. 

This bill is packed full of wasteful spending and should be rejected by members of Congress.

The bill promises “thousands” of new jobs through lavish spending on “clean energy,” provides funding to the corrupt and dysfunctional IRS, creates a Civilian Climate Corp, expands federal involvement in housing, and includes millions of dollars’ worth of earmarks.  

Ideally, each appropriation for an agency would be a separate bill, allowing for more scrutiny and helping ensure lawmakers’ ability to know exactly what they’re voting on. Instead, funding for agencies is often grouped together, creating “must-pass” legislation with unexplored, wasteful spending.  

Within this high-price bill are pieces of the leftist agenda that, perhaps, are too unpopular to pass through higher profile legislation.  

Below are just a few wasteful, harmful parts of this appropriations package. 

This bill would spend exorbitantly on projects to combat climate change, with a false promise of “thousands of jobs.” 

H.R. 4502 would spend billions of dollars on “creating good-paying American jobs through investments in renewable energy.”  

Investments and subsidies for “clean energy” are not new. In fact, for over 30 years the government has been holding these industries afloat, shielding them from the reality of the marketplace. This, ultimately, could actually be a reason why the alternative energy industry still has not been able to be competitive with fossil fuels. This industry is dependent on the government, and therefore is comfortable with slow, costly “progress.” Meanwhile, taxpayers foot the bill. 

Further, the promise of American jobs through renewable energy has also fallen flat. Many of the “clean energy” job number estimates are inflated to include “jobs tied to energy efficiency,” like “positions in the heating, ventilation and air conditioning industry, as well as fields like advanced building materials and efficient lighting.” This ridiculous category makes up 77 percent of “clean energy jobs” in the “Clean Energy Trust and Environmental Entrepreneurs” estimate.  

In general, Americans should be skeptical of any claim that the government can create jobs.  

If President Biden were really concerned with high-paying manufacturing jobs, he’d be less bent on destroying jobs in the oil and gas industry, which employs millions of Americans and pays a salary 85 percent higher than the average private sector salary. 

This bill would increase funding for the IRS.  

The IRS has a long history of dysfunction, corruption, and lackluster privacy protection. Before funneling money into a broke agency, Congress should reform the IRS.  

Specifically, the bill includes $13.6 billion for the IRS, an increase of $1.7 billion above the FY 2021 enacted level. About $5.8 billion of this funding will go towards enforcement, ultimately fueling the IRS to unleash its wrath on the American people.  

Contrary to Democrats’ claims, new IRS enforcement will fall on American families and small businesses, not the “rich.” The wealthy and large corporations already have armies of lawyers and accountants that ensure they legally take advantage of the plethora of credits and deductions offered by the tax code. In this way, the IRS will revert back to collecting money from easier targets: small businesses and middle-class families.  

The bill creates a Civilian Climate Corps.

The creation of a uniformed Civilian Climate Corps is a make-work program for progressive climate activists who will be tasked with the vague mission of “advancing environmental justice."

According to an Appropriations Committee report on the environmental funding sections of the bill, “The Departments of Interior and Agriculture are directed to provide a written plan, within 90 days of enactment of this Act, for how CCC funding will be used, along with a breakdown of funding and a list of existing programs or partners.”

Though the minibus is scant on details, progressive proposals for the CCC offer a glimpse of the waste that is likely to occur. The 21st Century Civilian Conservation Corps Act introduced by House Democrats calls for at least 80 percent of CCC funding to be used for employment, leaving less than 20 percent to be used for actual conservation and climate-related efforts. Additionally, Democrats want CCC employees to receive taxpayer-funding housing, clothing, food, and transportation—all in addition to their actual salaries.

This bill significantly expands the federal government’s involvement in affordable and public housing.  

Instead of deregulating and empowering the housing market to drive down costs, this bill seeks to distort housing markets through more spending on “affordable” and public housing. 

Specifically, this bill includes funding for more than 125,000 new housing vouchers and the creation of 4,000 new housing units. The bill would also fund public housing by $8.64 billion.  

This “Housing First” approach by Democrats fundamentally ignores many of the causes of high housing prices and could contribute to the problem itself. In fact, regulations, zoning policy, and market distortions are some of the driving factors in higher rent prices.  

This bill contains hundreds of millions of dollars in earmarks. 

Earmarks are provisions inserted by members of Congress into large spending bills directing funds to be spent on specific projects or programs. Before their ban, funds would often be directed towards specific congressional districts, pressuring members into voting for legislation they wouldn't normally vote for. Congressional Democrats recently brought earmarks back, restoring this currency of corruption.  

This practice facilitates the passage of unpopular, costly legislation filled with giveaways to lawmakers. It pushes members of Congress to vote not on the merits of the legislation, but because a small portion of the legislation would benefit their home district, a donor of theirs, or even themselves.  

This spending package contains a lot of these earmarks, especially for colleges and universities. Specifically, $272 million in funding would go towards pet projects at 228 colleges and universities. 

Lawmakers should reject this “bloatedbus” and instead demand responsible and reasonable federal spending.  

Photo Credit: John Brighenti


Fighting Governor Wolf’s Unilateral Cap-and-Trade Tax on Pennsylvania Families

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Posted by Dennis Hull on Tuesday, July 27th, 2021, 1:20 PM PERMALINK

Boasting 20% of the country’s total natural gas production, gas drives Pennsylvania’s economy. It has also driven the state’s emissions down as much as states in the Regional Greenhouse Gas Initiative (RGGI).

But thanks to unilateral action by Governor Tom Wolf to join the destructive cap and trade program, the state will risk losing its competitive advantage in natural gas production while imposing a $3.5 billion carbon tax on its residents.

The Regional Greenhouse Gas Initiative (RGGI) requires power plants to pay a fee to the state for each ton of carbon dioxide they emit, thereby purchasing a carbon “allowance” from the state. Fuels like coal will suffer disproportionately under the program with their above-average carbon emissions. Over the years, the number of allowances will shrink, leading to an increase in prices for the allowances that Governor Wolf hopes will motivate companies to close fossil fuel plants and eventually transition to wind and solar.

With these stringent new levies on fuel production, electric consumers and workers in Pennsylvania will bear the brunt of the costs. According to the Power PA Jobs Alliance, as more than two-thirds of the state’s power generation is made less competitive or uncompetitive by the program, Pennsylvania will lose more than 8,000 jobs and $2.87 billion in total economic impact. That includes a loss of $539 million in employee compensation and, with resultant lower wages and a weaker economy, a loss of $34.2 million in state and local taxes.

Electric bills will inevitably rise for Pennsylvania families as companies try to recoup billions in new taxes. Since 2009, the average monthly electric bill in Pennsylvania has increased by more than 17%, from around $98 to $115 in 2019. But with an estimated $3.5 billion in carbon tax collection over the next 9 years, a Penn State analysis expects the average household electric bill to rise by $43 every year. That is a burden which many low-income Pennsylvania residents will struggle to afford.

The Republican-controlled legislature is strongly against participation in RGGI, with several Democrats joining them in their opposition. By signing off on the program without the consent of the legislature, Governor Wolf ignores a critical component of the Pennsylvania constitution: that only the Pennsylvania General Assembly may levy new taxes. In fact, every other state that joined RGGI did so with the approval of their respective state legislatures.

Moreover, Pennsylvania law requires physical, public hearings in regions impacted by new regulations like RGGI. Yet just 10 hearings, all of them virtual, were hurriedly scheduled over a five-day period in December. Not one was held in one of the many communities that will suffer from the impending power plant closures as a result of joining RGGI.

Natural gas and fossil fuel production more broadly have been an economic boon to Pennsylvania. But carbon emissions in the state have also dropped dramatically as union workers built more than a dozen major natural gas extraction plants. Over the last 10 years, more than $14 billion has been invested in new production facilities. Increased rates of extraction of natural gas – by far the cleanest fossil fuel – has led to a 30% reduction in carbon emissions in Pennsylvania, in addition to making the state the number 2 natural gas producer in the country. It’s no surprise that more than a dozen labor unions, including the Pennsylvania AFL-CIO, oppose joining the RGGI.

By unilaterally joining the RGGI, Governor Wolf is overstepping his authority and imposing a repressive new tax burden on Pennsylvania families. Instead of having any significant impact on climate change, this move will simply encourage electricity generation, jobs, and capital investment to shift to unregulated, neighboring states like West Virginia and Ohio. In the meantime, Pennsylvanians will struggle with increasingly higher bills and lower growth.

Photo Credit: ReAl

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An Open Internet is Critical for the Cuban People

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Posted by Noah Vehafric on Tuesday, July 27th, 2021, 11:41 AM PERMALINK

The communist regime of Cuba is using their control of the internet to stifle dissent and contain protests. The United States has the technology and resources to circumvent this censorship. The Biden Administration says it will sanction Cuba. A condition of lifting any sanctions must include an open internet for the Cuban People.

The internet in Cuba is provided by ETECSA, a state-owned enterprise. They have limited access during these recent protests. Encrypted messaging services like WhatsApp, Signal, and Telegram were being blocked from citizens accessing it. At one point there was a total blackout of internet and telephone service.

This an insidious pattern of internet control is right out of Chinese playbook, where their far-reaching “Great Firewall” has restricted the information that the Chinese people can see for decades. In fact, it might be likely that China is directly supporting Cuba’s censorship effort.

Cuban internet is built on equipment sold by Huawei, ZTE, and TP-Link. This is equipment that has since been banned in the United States. It has also been observed that ETECSA’s login portal was written by Chinese developers as well as utilizing Chinese written web filtering software.

This command and control of the internet is antithetical to the American principles of collaboration and the free exchange of ideas that built the internet. Last week Florida governor Ron DeSantis, Senator Marco Rubio and FCC Commissioner Brendan Carr all called on President Biden to greenlight American efforts to ensure internet connectivity in Cuba.

Helping Cubans access the internet isn’s some abstract principle. There are simple solutions to be done here. Right now 1.4 million Cubans are using a U.S. created software called “Psiphon” that uses virtual private networks (VPNs) and HTTP proxy technology to circumvent government censorship measures.

The U.S. can also get the internet to Cuba using balloons (yes, balloons) to send mobile cell sites up into the atmosphere. These solar-powered sites can serve thousands of users and last up to 5 months at a time. Internet could also be provided to Cubans via satellite as Senator Marco Rubio points out in his open letter to President Biden.

This is an issue the administration cannot faulter on. Protestors and journalists have been arrested or attacked. “This isn’t about politics is about saving lives” musician Pitbull said. Allowing this censorship and preventing these acts from being shown to the world deprives the Cuban people the ability to present evidence of the abuse they face from their government.

American enterprises are quite capable of delivering internet to Cuba, the lukewarm response the Whitehouse has given so far needs to turn into an action. “This is a moment in history we cannot let pass. Increasingly, dictators around the world are shutting down internet connections when people are yearning for freedom” said FCC Commissioner Brendan Carr.

As we work in our own country to give everyone access to the internet, this is an opportunity to show how much we value connectivity and demonstrate to the world that the internet will not be a tool of control to be used by authoritarian governments around the world.

 

Photo Credit: Yerson Olivares

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Clock Expires on Dangerous New York “Anti-Trust” Expansion, For This Year…

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Posted by Sheridan Nolen on Monday, July 26th, 2021, 3:49 PM PERMALINK

Late this session the Twenty-First Century Anti-Trust Act (SB 933), passed the New York State Senate 43-20 on June 7, but avoided a vote in the Assembly. It did not make it over the finish line, but it made progress after its initial version was drafted in 2020.    

The wide-ranging bill would broaden the scope of conduct subject to antitrust enforcement, increase the penalties imposed on individuals and corporations found to violate the law, and incentivize class action lawsuits. If enacted, these changes would dramatically increase the liability exposure of corporations. While purportedly aimed at Amazon and Google, these policies punish success for any business in any industry.

What makes this mess of a policy especially dangerous is that it would set a de facto standard for the rest of the country. Any company that keeps doing business in New York would have to bend over backwards to comply with the new rules, and appease state regulators, impacting their operations beyond just New York. 

Under the proposed “dominance” rule, a company is presumed dominant if they have 40% of the market as a seller, or 30% as a buyer – so their competitors would control most of the market, yet that company would be considered “dominant.”  

Under U.S. law a company is considered a monopoly if they have controlled two-thirds of a market for an extended period of time, and that position is unlikely to change. Its conduct is not considered anticompetitive unless it can be shown to harm consumers.   

New York’s bill also says evidence of a dominant position includes “unilateral power to set wages,” or contractual provisions that restrict workers from moving from their current employer to a competitor. Companies would have to notify the state if they planned a merger or acquisition exceeding $8 million as well.   

Evidence is not limited to these factors, so actions could be brought based on actions not covered in the bill. This leaves the definition of “dominance” unclear. It could have state courts looking to European courts for guidance on how to implement the standard – dragging down U.S. economic growth to the weak growth of Europe. 

The many companies that fall afoul of this broad new standard would face harsh penalties, jacked up fines, and lawsuits.  

Violations would be a class C felony with a fine of up to $100,000 or imprisonment of up to 15 years. The federal maximum sentence for an individual is 10 years. Corporate offenses would be subject to fines of up to $100 million, current statute allows for fines up to only $1 million. Criminal offenses by individuals would be punishable by up to 15 years in prison—an increase from 4 years under existing New York law, and substantially greater than the federal maximum of 10 years. Corporate offenses would be subject to fines of up to $100 million, versus a current maximum penalty of $1 million.

On top of crushing job creators with fines and prison, the legislation would invite a feeding frenzy for trial lawyers. 

There would be a significantly broader range of offenses as compared to existing state and federal law, making New York courts a haven for contingency-fee-driven antitrust litigation. In other words, individual citizens would be incentivized to bring class-action lawsuits against companies who allegedly abused their “dominant” position.  

Supporters of the legislation, like the Teamsters union, praise the legislation for addressing abuses by companies with dominant positions. Opponents, are arguing that it will drive business out of the state and punishes success. Lev Ginsburg, senior director of government affairs for The Business Council of New York State said: “We are essentially punishing success and we are prohibiting all kinds of ordinary pro-competitive conduct.” 

New York State is home to 10% of the Fortune 500. This legislation would make their success illegal. 

If companies cease operations in New York, residents will lose jobs and economic opportunity. The state would likely lose tax revenue, as well. If the companies stay the rest of the nation will be held hostage by greedy New York regulators. 

This is a disaster of a bill that must be defeated for the good of consumers in New York, and across the country. 

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User Beware: Chinese Government Stockpiling Private Business Data

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Posted by Katie McAuliffe on Monday, July 26th, 2021, 1:50 PM PERMALINK

The increasing list of Chinese companies, particularly in the tech space, being reined in by the Chinese government should have US officials worried about more than just investing. It is now crystal clear that Chinese businesses must comply in all matters with the Communist Party: business leaders will be muzzled, data privacy is non-existent, and foreign owners’ have no property rights.   

After Chinese ride hailing company Didi’s tumultuous IPO, US senators called for SEC investigations as to whether Didi mislead the public, but the more revealing story remains the lengths to which China will go to exercise control over its companies and the data they keep.   

Chinese ride-hailing company, Didi, raised $4.4 billion by listing its shares on the New York Stock Exchange on June 30th, marking the biggest US IPO by a Chinese company since 2014. Shortly thereafter, on July 2nd and 4th, the Cyberspace Administration of China (CAC) rolled out orders to remove Didi from app stores and announced an on-sight probe that would also involve police, tax authorities, the market competition regulator, and regulators for natural resources and transport. This is the first time a government cloaked in secrecy publicly announced an investigation involving staff based within a company.  

By the following Wednesday, Didi's market value tumbled to $57 billion, down from nearly $70 billion on its first day of trading, prompting the senators’ calls for investigation.  

The CAC almost immediately announced similar investigations that also included blocking new user sign-ups into truck-hailing app Full Truck Alliance and recruiting app Boss Zhipin, both of which listed on the NYSE in June. No details publicly provided; the CAC only cited suspected violations of China’s national security and cyber security laws.  

While Didi may not operate in the United States it operates on a scale similar to Huawei internationally. In May 2021 testimony to the US-China Economic and Security Review Commission, Dr. R Evan Ellis of the US Army War College said “Didi’s advance in [Latin America], combined with the financial, positional, and other information collected on its clients, also presents a largely unrealized intelligence risk in the region on a scale similar to that presented by Huawei.”  

Didi’s privacy policies in Latin American (Argentina, Colombia, Chile, Mexico, Panama, PeruDominican Republic, Costa Rica, and Ecuador) state that personal data will be stored in the US—or any other part of the world where there is an entity controlled by Didi aka China. In other nations with close ties to America like BrazilJapanSouth AfricaAustralia and New Zealand, Didi’s privacy policy is minimal or non-existent. Mexican authorities have already called into question Didi data transfers with China and how that could affect their elected officials and foreign diplomats, as have Argentinian news organizations.  

China’s Measures on Automobile Data Security clarify that “important data” for the purposes of ride-hailing platforms, like Didi, include data on the flow of people and traffic in sensitive areas; data on aggregate traffic volume and flows; and any other data that Didi might collect that the government comes to determine is relevant to national security.  

That means all data stored by any Chinese company can and will be transferred to the Chinese government should the request be made.   

This is a serious risk to the US, our allies, and Americans abroad, especially American diplomats who might unwittingly be using these applications. Trip information includes locations, trip times and passenger information that can reveal private meetings and daily schedules linked directly to an individual’s financial data. Data gathered from trip information that is not anonymized and pooled in aggregate can paint a vivid picture of an individual or group’s habits and possible future patterns.   

While, Senators Marco Rubio (R-Fl.), Chris Van Hollen (D-Md.), Masha Blackburn (R-Tenn.), and John Kennedy (R-La.)  are right to question the IPO process, we should look even more carefully at the data stewardship of Chinese companies.  

China is not hiding their intentions either. State-run media are backing up the government’s actions saying “an internet giant absolutely cannot have a better command than the state of the super-database that is Chinese people’s personal data."    

This is not to say the US should in engage in full-scale data localization tactics. Cross border data flows remain important for general commerce and for a fully functioning internet, but as China continues to disrupt the playing field and becomes increasingly aggressive on data collection and localization, our elected officials should remain on guard.  

 

Photo Credit: Jordan Harrison

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Democrats Peddle Fake News to Repeal Trump Tax Cuts

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Posted by Regina Kelley on Monday, July 26th, 2021, 12:08 PM PERMALINK

President Joe Biden and congressional Democrats claim that the 2017 Trump Tax Cuts and Jobs Act (TCJA) was a giveaway to the rich. Not only do they want to reverse the tax cuts, but they are also proposing trillions of dollars in tax increases. In order to rewrite history and pave the way for tax hikes, Democrats have repeatedly lied about the GOP tax cuts by claiming that the wealthy saw significant tax cuts and the middle class saw little or no benefit. 

House Speaker Nancy Pelosi (D-Calif.) has described the TCJA as a “tax scam” that went to the wealthiest people in the country, while President Biden has claimed the vast majority of the bill went to the top one-tenth of one percent of wage earners.

In reality, the TCJA grew the pre-COVID economy and cut taxes for the middle class and small businesses. The TCJA expanded the child tax credit from $1,000 to $2,000, and doubled the standard deduction to $24,000 for married couples filing jointly, and $12,000 for single filers. Businesses across the country provided their workers with bonuses, wage raises, increased 401(k) matches and more employee benefit programs. 

Under the legislation, a family of four with a median income of $73,000 saw a $2,000 tax cut, a 60 percent reduction in federal income tax. Similarly, a single parent with one child making $41,000 saw a $1,300 tax cut.

In 2018, Americans with incomes between $50,000 and $100,000 saw their tax liability drop by twice as much as Americans with income above $1 million: 

  • Americans with adjusted gross income (AGI) of $50,000 to $74,999 saw a 13.2 percent reduction in average tax liabilities between 2017 and 2018. 
  • Americans with AGI of between $75,000 and $99,999 saw a 13.6 percent reduction in average federal tax liability between 2017 and 2018. 
  • Americans with AGI of $1 million or above saw a 5.8 percent reduction in average federal tax liability between 2017 and 2018, less than half the tax cut seen by Americans with AGI between $50,000 and $100,000. 

 

While the middle-class saw their liability drop, the top one percent ended up paying a higher percentage of all income taxes after the TCJA’s passage. In 2018, the top one percent paid 40 percent of all income taxes; before the TCJA was enacted, they paid 38 percent of all income taxes. 

The Trump tax cuts also grew the economy leading to a record low poverty rate, low unemployment, increased jobs and wages, and more economic opportunity. After the TCJA, the unemployment hit a record 50 -year low with the lowest ever recorded unemployment rate for Hispanics and African Americans. There were 1.4 million more jobs than people unemployed in 2019 and wages increased by 6.8 percent in one year, as opposed to just a 5 percent growth over Obama’s presidency. 

Even left leaning media outlets have (eventually) acknowledged the tax cuts benefited middle class families. The Washington Post fact-checker gave Biden’s claim that the middle class did not see a tax cut its rating of four Pinocchios. The New York Times characterized the false perception that the middle class saw no benefit from the tax cuts as a “sustained and misleading effort by liberal opponents.”

Despite Democrats’ rhetoric, Republicans delivered savings to the American middle-class when they passed the tax cuts. Ironically, President Biden and congressional Democrats’ plan would actually result in middle-class Americans paying more in taxes. 

 

Photo Credit: Bill Clark/Pool via AP


Coalition Warns Against Broadband Proposals

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Posted by Katie McAuliffe on Friday, July 23rd, 2021, 3:52 PM PERMALINK

Americans for Tax Reform led a coalition with other center-right organizations flagging concerning developments in the infrastructure bill negotiations. Price controls and rate regulation; dramatic expansion of executive brand and agency authority; and government-controlled internet should never be on the table.

You can read the letter below or click HERE for a full version:

July 23, 2021

RE: Broadband Infrastructure Spending

Dear Senators:

We write to you today over some concerning developments in the bipartisan infrastructure negotiations on broadband. We are guided by the principles of limited government and believe that the flaws in the infrastructure framework go well beyond the issues discussed here. Nonetheless, our present aim is to advocate specifically against proposals that would enact price controls, dramatically expand agency authority, and prioritize government-controlled internet. 

The infrastructure plan should not include rate regulation of broadband services. Congress should not authorize any federal or governmental body to set the price of any broadband offering. Even steps that open the door to rate regulation of broadband services will prove harmful in the long run.  

Nor should Congress continue to abdicate its oversight responsibilities to executive branch agencies like the National Telecommunications and Information Administration. Giving NTIA unchecked authority to modify or waive requirements, renders all guardrails placed by Congress meaningless. There must be oversight of the programs to ensure that taxpayer dollars go toward connecting more Americans to broadband as opposed to wasteful pet projects. 

Historically, attempts by NTIA to close the digital divide through discretionary grants have failed, leading to wasteful overbuilds, corruption, and improper expenditures. The American Recovery and Reinvestment Act of 2009 created the $4 billion Broadband Technology Opportunities Program (BTOP) grant program administered by NTIA. From 2009, when BTOP was instituted, to 2017, at least one-third of all the reports made by the Inspector General for the Department of Commerce were related to the BTOP program, and census data showed that the BTOP program had no positive effect on broadband adoption. And this was with only $4 billion in taxpayer dollars. We cannot afford to make the same mistake with much greater sums.

Legislation must be clear and not create ambiguities that are left to the whims of regulators. While “digital redlining” is unacceptable, the FCC should not be allowed to define the term however it sees fit and promulgate any regulations it thinks will solve problems—real or imagined. Doing so would give the agency carte blanche to regulate and micromanage broadband in any way it desires. This would be an egregious expansion of FCC authority. Moreover, definitions and regulations could change whenever party control of the agency changes, leading to a back-and-forth that creates uncertainty for consumers and businesses. 

Legitimate desire to ensure that low-income Americans have access to broadband infrastructure should not be used as a smokescreen to codify aspects of the recent Executive Order on Competition, which should not be included in any bipartisan infrastructure agreement. Republicans fought hard to support the FCC’s Restoring Internet Freedom Order. Any legislating on the functions and deployment of Internet technologies must move as a standalone bill through regular order with committee review. These questions are far too important to shoehorn into a massive bill without rigorous debate.   

Any funding for broadband buildout must target locations without any broadband connection first, and this should be determined by the Congressionally mandated FCC broadband maps. Congress has oversight over the FCC and the FCC has already conducted several reverse auctions. Reverse auctions get the most out of each taxpayer dollar towards closing the digital divide. Areas where there is already a commitment from a carrier to build out a network, should not be considered for grants, and the NTIA should not be able to override the FCC’s map to redefine “unserved” and subsidize duplicative builds.  

Government-controlled Internet should not be prioritized in any grant program. With few exceptions, government-owned networks (GONs) have been abject failures. For example, KentuckyWired is a 3,000-mile GON that was sold to taxpayers as a $350 million project that would be complete by spring of 2016. Those projections could not have been more wrong.   More than five years past the supposed completion date, fiber construction for KentuckyWired is still “in progress” in some parts of the state and a report from the state auditor has concluded that taxpayers will end up wasting a whopping $1.5 billion on this redundant “government owned network” over its 30-year life. NTIA should certainly not encourage these failures to be replicated.

We appreciate your work to help close the digital divide and agree that access to reliable internet is a priority, however we should not use this need to serve as a cover for unnecessary

government expansion. Please feel free to reach out to any of the undersigned organizations or individuals should you have questions or comments. 

Regards,

Grover G. Norquist
President
Americans for Tax Reform
 
Jennifer Huddleston*
Director of Technology & Innovation Policy
American Action Forum
 
Phil Kerpen
President
American Commitment
 
Krisztina Pusok, Ph. D.
Director
American Consumer Institute
Center for Citizen Research
 
Brent Wm. Gardner
Chief Government Affairs Officer
Americans for Prosperity
 
Jeffrey Mazzella
President
Center for Individual Freedom
 
Andrew F. Quinlan
President
Center for Freedom and Prosperity
 
Jessica Melugin
Director Center for Technology and Innovation
Competitive Enterprise Institute
 
Matthew Kandrach
President
Consumer Action for a Strong Economy
 
Yaël Ossowski
Deputy Director
Consumer Choice Center
 
Roslyn Layton, PhD
Founder
China Tech Threat
 
Ashley Baker
Director of Public Policy
The Committee for Justice
 
Tom Schatz
President
Council for Citizens Against Government Waste
 
Katie McAuliffe
Executive Director
Digital Liberty
 
Annette Thompson Meeks
CEO
Freedom Foundation of Minnesota
 
Adam Brandon
President
FreedomWorks
 
George Landrith
President
Frontiers of Freedom
 
Garrett Bess
Vice President
Heritage Action for America
 
Carrie Lukas
President
Independent Women's Forum
 
Heather Higgins
CEO
Independent Women's Voice
 
Tom Giovanetti
President
Institute for Policy Innovation
 
Ted Bolema
Executive Director
Institute for the Study of Economic Growth
 
Seton Motley
President
Less Government
 
Zach Graves
Head of Policy
Lincoln Network
 
Matthew Gagnon
Chief Executive Officer
Maine Policy Institute
 
Matthew Nicaud
Tech Policy Specialist
Mississippi Center for Public Policy
 
Brandon Arnold
Executive Vice President
National Taxpayers Union
 
Tom Hebert
Executive Director
Open Competition Center
 
Ellen Weaver
President & CEO
Palmetto Promise Institute
 
Eric Peterson
Director
Pelican Center for Technology and Innovation
 
Lorenzo Montanari
Executive Director
Property Rights Alliance
 
Jeffrey Westling
Resident Fellow, Technology & Innovation Policy
R Street Institute
 
James L. Martin
Founder/Chairman
60 Plus Association
 
Saulius “Saul” Anuzis
President
60 Plus Association
 
David Williams
President
Taxpayers Protection Alliance
 

Dann Mead Smith
President
Washington Policy enter

* individual signer; organization listed for identification purposes only

 

Photo Credit: Denny Müller

More from Americans for Tax Reform


ATR Partners on International Tax Burden Index, USA Ranks Second-Best

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Posted by Rowan Saydlowski on Friday, July 23rd, 2021, 3:45 PM PERMALINK

Americans for Tax Reform Foundation partnered with the Paris-based free-market think tank Institut Économique Molinari for the publication of the first edition of "The Tax Burden of Global Workers: A Comparative Index," published by James Rogers and Nicolas Marques of the Institut Économique Molinari.

In the index, South Africa and the United States had the lowest tax burdens, while European Union member states took the bottom 25 spots in the 34-country ranking. The 34 countries studied represent 58.2% of the global economy. The annual study calculates a "tax liberation day" for each country, indicating how many days' worth of work compensation is extracted from workers by their governments each year. The amount of taxes extracted were calculated as a combination of income taxes and social security contributions by both the employee and employer for an average worker in each country.

The governments of three countries (Austria, France, and Belgium) were found to extract more money than the worker himself or herself receives; for example, in Austria, the government receives $1.35 for every $1.00 that the average worker receives in take-home pay, for a total real tax rate of 54.76%. Meanwhile, in the United States, the government only receives $0.41 for every $1.00 that the average worker takes home, for a total real tax rate of 27.11%.

According to the index, Austria and France share the latest tax liberation day (July 19th), while South Africa has the earliest day (March 7th). American workers can celebrate their tax liberation day on April 9th this year.

The study notes that this year the overall average "real tax rate" throughout Europe decreased as a result of small policy changes and pandemic relief measures, though different European countries saw differing effects. 2021's tax liberation days arrive earlier in 10 European countries, later in 8, and on the same day in 10 as compared to last year, according to the authors.

"We are excited to partner with the Institut Économique Molinari to analyze tax burdens from major countries around the world," said Grover Norquist, President of Americans for Tax Reform. "While the United States fortunately performed well in this ranking, U.S. officials must remain wary to not fall into the burdensome taxation trap implemented by many of their European allies. Lower tax rates allow workers to keep more of their own hard-earned money and provide an environment for innovation to thrive. We need to stop the $2.9 trillion USD tax increase proposed by the Biden-Harris Administration, otherwise we will end up with the same level of taxation burden as European Union workers."

"Expanding our research to include all continents reveals a sharp contrast between the European Union and the rest of the world when it comes to taxing the salaries of workers," said James Rogers, co-author of the study and Research Fellow at Institut Économique Molinari. "Workers outside of the EU, with the exceptions of tiny Malta and Cyprus, get to keep significantly more of their earnings. American workers celebrate their 'tax liberation day' earlier than any of their European counterparts and enjoy the third-highest take-home pay around the world––while the cost of hiring them, thanks to the relatively labor-friendly tax rates, is cheaper than in 10 European countries."

"Through 12 years of study, the correlation between payroll taxes and the unemployment rate is clear in many European Union countries," added Rogers. "Looking at the global picture, this is generally the case, with low-tax countries such as Australia, Ireland, the U.S. and the U.K. experiencing lower unemployment than the EU average."

The full study can be found here: https://www.institutmolinari.org/wp-content/uploads/sites/17/2021/07/tax_burden_on_global_workers2021.pdf


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