In Terms Of Politics, And Republican Priorities, It Both Makes Sense And It Doesn’t…
Here’s the part that seems to make sense: the new Trump/Republican tax law that passed last week pays for what it does mainly by putting more of a burden on upper middle class people in blue states. So cutting off deductibility of their charitable donations would seem to make perfect sense as part of that.
According to numbers from the IRS, the top 10 states with the highest average charitable contribution split between Trump and Clinton (Hillary also won Washington, D.C. which would be #2 if it was a state). The state with the #1 average charitable contribution per return was Utah (very likely for reasons we’ll examine in a sec.)
As we reported last week, about 20-million Americans (according to the Wall Street Journal), will no longer be able to deduct their charitable contributions. According to Giving USA, charitable donations were just shy of $400-billion last year. So in blue states, that’ll likely mean a lot less money for charities that oppose Trump’s actions.
Except…Here’s the part that doesn’t make sense:
By far the biggest recipients of charitable giving are religious organizations. Religious groups receive about 1/3 of all dollars going to charity, with contributions coming from nearly 50% of all households. That’s double the amount going to the next most popular category: Education. (And of course, some of the “education” dollars are going to religiously affiliated schools). So one would think Trump’s “evangelicals” might not be too pleased about the changes.
And neither might the Koch Brothers: Of course they make way more than enough money that they’ll still be able to write off their contributions to charity. Still, as we’ve mentioned before, while the Koch’s are evil, they do maintain a consistent set of beliefs, and that is that taxes (and regulations) should be lowered, in order to give people (and foundations) more freedom to spend their money as they see fit (vs. spending it on taxes to pay for government programs they often don’t agree with). And unlike Trump when he was a private citizen, the Koch’s do put their money where their mouths are: donating hundreds of millions of dollars to medical research, and the arts (as well as universities that teach their particular brand of radical Conservatism). Why does this matter? Since Steve Bannon’s departure, the Koch’s influence within the Trump White House has grown.
So we’re not convinced this part of the law is going to stay as is for very long. Or Congress will find workarounds to benefit religious groups while continuing to make life more difficult for the ACLU and Sierra Club Foundations of the world.
The Tax Bill “Story Of The Day”
This story from Bloomberg about homeowners rushing to pay next year’s real estate taxes this year. And steps high tax states and local governments are taking to make that easier. (It’s not entirely out of the goodness of their own hearts: it’s really good for states and municipalities to get paid ahead of time, because they then don’t have to worry about changing market conditions and how much they’re going to get when). As of next year, due to the Trump/Republican tax plan that just passed last week, state and local deductions on federal income tax returns will be capped at $10,000.
We’re presenting this mainly as a public service. Because if you can, and you’ve got the cash on hand, you should…
“I Thought That Trump Was Actually Driving People To Want To End The Chaos”
That quote coming from a fascinating Vox interview with Joe Trippi, a key figure in Democrat Doug Jones’ successful bid for an Alabama Senate seat (and a guy who’ll be very much in demand as next year’s midterm Congressional elections roll around).
While Trippi doesn’t outright dismiss Republican (and Trump suportee) Roy Moore’s dating underage girls scandal as a factor in the election, he points to the atmosphere Trump has created in Washington as a very relevant factor that’s getting overlooked.
Trippi says: “Even if you liked [Trump], you didn’t want more chaos in Washington than what he was already creating. And so I thought if we could appeal to that in Alabama, that would get us close”.
While Moore has not yet conceded, barring any last-minute funny business, Jones’ election is expected to be certified tomorrow.
Trump’s U.N. Budget Cut Threats Turn Out To Be A Bunch Of Hooey, Since He Was Going To Do It Anyway
Trump’s strongman message: don’t vote against the U.S. or risk losing foreign aid and U.N. funding in general, turned a lot of heads in the media, but not really at the U.N. As we reported, when it came time to vote on a resolution criticizing Trump’s intent to move the U.S. Embassy in Israel to Jerusalem, those threats were largely ignored or only half-acknowledged by U.N. members. And with good reason: they already knew Trump was going to reduce U.N. funding and U.S. foreign aid anyway.
Just one day later the U.S. announced it is cutting U.N. funding by $285-million. Thing is, that kind of thing doesn’t happen overnight (even with someone as impetuous as Trump). It’s also about in line with what the United Nations was expecting.
Cutting foreign aid however, will come with its own set of opportunities and perils. One might argue a lot of that money is better spent domestically on things like disaster relief, and education, and fighting the opioid epidemic. (Except there’s no guarantee it’d be earmarked for any of that).
Then again, cutting off aid further signals America’s willingness to abdicate its role as world leader, opening up opportunities for other countries. Mainly China, who realize foreign aid isn’t always money squandered: it’s an investment. That’s why China’s establishing military bases in Africa, and building schools and public transportation in the Caribbean… And it shows: according a report just out this morning from Bloomberg, China’s billionaires had the biggest earnings gain this year of any country, up 65%; adding $177-billion.
The Washington Post quotes a foreign policy expert at the ultra-conservative Cato Institute saying (not admiringly): “No one in the White House seems to understand how to use the carrots of international diplomacy. It’s all sticks.”
Editorial: Prez Is Really Pushing It With The Stock Market Talk
Trump bleated from time-to-time over what was generally a mercifully quiet holiday weekend. As we’ve discussed before, we think the new expanded character limit on Twitter is actually hurting Trump, because while his Tweets used to be tight, clever and full of fun abbreviations, they now appear more like paranoid ramblings. But that’s not really what we want to talk about today. It’s this:
As a former business journalist, had something approximating that blared as a headline across a mainstream newspaper or magazine, (because obviously something like that never before would’ve been uttered directly by a President), we all would’ve groaned and said “Well, that’s it for the bull market!” Because the strongest evidence of a market top has always, always been clamorous, unbridled predictions that it will go ever higher. Then again, the tax bill throws a lot of extra cash into the economy in the short term, and it’s gotta go somewhere. So who knows?…
Extreme U.S. Weather Continues Into Winter Months
The National Weather Service reports a record-breaking 5 1/4 feet of snow in Erie, Pennsylvania over the past 3 days alone, and it’s still snowing. That more than doubles the previous record, set in 2002.