Corporate Tax Cuts Since 2002 Cost PA $4.2B Annually

By Stephen Herzenberg, Diana Polson, and Marc Stier Closing Delaware loophole, instituting worldwide combined reporting would level the playing field for small businesses and generate over $700 million a year to invest in PA communities This paper focuses on the details of one part of this story: the cuts in corporate taxes in Pennsylvania since 2002 that have reduced revenues by what is now $4.2 billion per year and have created a tax system that is among the most unfair in the country.   Pennsylvania’s tax–cutting, shaped by the corporate-sponsored narrative, has taken a variety of forms. Under both Republican and Democratic governors, we have entirely eliminated one of our two major taxes on corporations, the Capital Stock and Franchise Tax (CSFT). We have also allowed businesses to lower their reported profits subject to the largest remaining corporate tax—the Corporate Net Income (CNI) tax. And we have continued to give multi-state corporations free rein to cook their books and exploit corporate tax loopholes to their reported income subject to the CNI. The result is that 73% of corporations that do business in Pennsylvania… Continue reading

Trump’s Nihilism and How to Defeat It

I wrote the first four paragraphs on Facebook on August 3, 2016. Trump’s Nihilism The Trump campaign reminds me that a central element of fascism and its appeal is the embrace of nihilism. One way to understand nihilism is as the denial that there is any meaning or truth or purpose beyond our will. Nihilism both describes the “philosophy” of Trump’s political practice—it’s utter disregard for any norms of conduct and any standards of argument and evidence—and his appeal to the people in America who have seem to lost their sense of purpose and connection to one another or ideals beyond themselves.  Trump’s pursuit of power for its own sake answers to that loss of purpose as does his willingness to create chaos. As Nietzsche put it, “man would rather will nothingness than not will.” Trump’s readiness to break up NATO; his lack of concern about causing a collapse in… Continue reading

Yes, the U.S. Constitution could be improved. The process in this Pa. House resolution isn’t a path forward

Originally published by the PA Capital-Star on December 18, 2019. On Monday, the House State Government Committee passed a resolution asking Congress to call a constitutional convention, pursuant to Article V of the U.S. Constitution. It’s not hard to understand the temptation to support this resolution. We live at a time of political division in Pennsylvania and in our country as a whole. We are all tempted to think about whether some change in our constitution might help us resolve our difficulties. It’s useful to start thinking about these issues. However, as a political scientist who has thought long and hard about our constitution, my own ideas on the matter are not terribly fixed, simply because the question is so difficult and the considerations that should weigh on us in examining changes in a constitution that has served us so well require the time for serious thought and substantial debate. But… Continue reading

Why We Have to Fight, Part 2

It appears my post on the importance of not backing down from a strong progressive program has been controversial. Good—it was meant to be. There were a lot of good arguments made in response and I want to draw on some of them as I deepen the case for a bold progressive Democratic campaign in 2020. We live in a moment in our politics that is radically different than what many of us have experienced. So it’s no accident that it’s by and large younger people who can see what many of their elders cannot see.  Still the period in which we live is not without historical precedent. Indeed if you look back at the history of our country there have been periods like our own in-between a number of periods, like the one we boomers grew up in. For most of my life, as for most of the life… Continue reading

Why We Have to Fight, Part 1

I’m seeing lots of posts from folks on the center-left about how people in rural PA or Michigan or Tennessee or Texas don’t like some part of the Sanders or Warren agenda.  It’s one thing to worry about the electoral consequences of these proposals. I will address that question another time. But I’m concerned that people who should be on our side are overstating the electoral problems in part because they think it’s somehow illegitimate for us to put forward ideas that aren’t embraced by almost everyone.  This is a long-standing problem among liberals. There is a strand of liberalism that is afraid of political power and will do everything it can to avoid exercising it. This same strand of thought makes it hard for liberals to bear disagreement.  That strand is connected to another that vastly overestimates the power of argument-—as opposed to numbers and organizing—in politics.  Robert Frost… Continue reading

Some Questions About the Warren Plan for M4A

This is the second of two post on the Warren plan to finance Medicare for All. The first dealt with why I think the time is ripe for M4A and especially for Warren’s version of it. This second post is about some questions that have been raised about Warren’s plan from the left. The Warren plan calls on businesses that have 50 or more employees and provide health insurance to them to pay a the federal government roughly 98% of what they pay for that insurance. A critique of the plan in Jacobin said that businesses would be able to escape from this requirement by reclassifying employees as independent contractors or by breaking themselves down into units with 49 or fewer employees. The whole question of reclassifying employees as independent contractor is not a new issue. There already are many incentives to do that. There are also business incentives to not… Continue reading

The Warren Plan and the Prospects for Medicare for All

I’ve been ambivalentabout the politics and policy of single-payer for a long time. That’s for three reasons First, while I by and large don’t think that a more left-wing program will hurt Democrats in the general election—just the opposite is true—there are certain ways it can hurt. The first is if we put forward plans that require tax increases on the working and middle classes. I do think that ultimately some of those tax increases will be necessary and that the benefits received in return for them will be greater than the costs of the tax increases. But it is a fundamental rule of politics that people are more agitated by what they are losing than what they are gaining. And talking about tax increases for future benefits is hard to explain and hard to defend especially because most Americans are not terribly well-informed about politics and public policy and… Continue reading

Please No Entry Level Politicians

The most foolish idea in politics: an utterly inexperienced person can be effective in high office because he or she can hire “talented, experienced people to guide them.” Here’s the problem: There are always “talented, experienced” people willing to give advice. But (1) half of them aren’t really all that talented and their experience comes from working with and following others who are genuinely talented and experienced. And (2) all those folks disagree in the advice they give. So if you are going to be president or some other high level position you better have some capacity to choose between different advisors and the advice they give. And you can’t do that if you don’t, yourself, have sufficient talent and experience in poiltics. And you need both. The examples are legion, starting with the current occumpant of the White House. But they are all around us and include two of… Continue reading

Why We Remember the Holocaust

Originally published in the Jewish Exponent, July 4, 2019 The point of remembering the Holocaust is not to say that it was an utterly distinctive event in human history. Every historical event is distinctive in some ways, but systematic genocide of a people has, sadly, been found at many times and places in human history. The point of remembering the Holocaust is not to give Jews a claim on the attention or sympathy of others. The point of remembering the Holocaust is certainly not to assert that our sins have been redeemed by our suffering or that of others. The point of remembering the Holocaust is to ensure that it never happens again to anyone and any group. We live at an extremely dangerous time. Some of us see parallels between the Trump movement and the fascism of the 1930s. And we see parallels between concentration camps in which immigrants are being held and… Continue reading

Pizza and the Minimum Wage

Originally posted at Penn-Live on April 09, 2019 Spend a little time talking to Republican (and some Democratic) legislators about raising the minimum wage, and they will eventually tell you about their friend who owns a pizza shop and opposes an increase. This is the story the pizza shop owners appear to tell our legislators: If the minimum wage goes up by 2/3rds from $7.25 to $12.00 an hour, I’d have to raise the price of my 12-inch pizza by 2/3rds from $9.49 to $15.75. No one will buy a pizza for $15.74 and I’ll go out of business.” We decided to test this claim in two ways. Every state surrounding Pennsylvania has raised its minimum wage, and two have raised it substantially. The minimum wage in New York is $11.10, 53% more than in Pennsylvania. In Maryland it is $10.10, 39% more. If the pizza shop owners who talk… Continue reading