Stan Shapiro's blog en There's no Fiscal Cliff; It's An Income Cliff <p>While the national focus is on a make-believe deficit “crisis”, Philadelphia is facing an all too real income crisis. Too many families, including many with at least one full time worker, simply can’t meet their basic needs.</p> <p>Of course our entire State includes huge numbers of struggling families, 840,000 families to be exact, including 2.3 million individuals, according to a <a href="">recent study by Pathways PA</a>. But Philly is tops in “income inadequacy” with 42% of our entire population not able to meet basic needs such as housing, child care, food, health care and taxes. Yes, the poor and the marginally poor do pay taxes.</p> <p>During the Presidential campaign, the problems of these folks, and the cities like Philadelphia that are home to so many of them, fell off the cliff. Instead another cliff engendered all the conversation, and continues to, the so-called “fiscal cliff.” </p> <p>The fiscal cliff is what we’re all supposed to fall off of if Congress doesn’t act on tax and budget policies by midnight on December 31. At that point all the Bush tax cuts will expire and massive budget cuts will take place. All of this because both parties have been laser-focused for two years on the need to cut deficits, and to that end have created their very own emergency to force themselves to act.</p> <p>But as Paul Krugman repeatedly points out, there is <a href="">no deficit crisis</a>. We need no spending cuts (except in the bloated Defense Department budget.) We are told that deficits are threatening to create uncontrollable inflation and sky high interest rates. But the reality is that as deficits have grown, interest rates and inflation have fallen. The only real deficit is the income deficit.</p> <p><a href="">read more</a></p> budgets fiscal cliff Mon, 19 Nov 2012 16:34:49 +0000 Stan Shapiro 8550 at Scary Holloween Extra: Ryan and his Budget could Win . . . along with that Romney Guy <p>Bottom line to this too long essay: we’ve all got to get out and work as hard for Obama as we did in 2008. Or maybe harder because the Republicans are crazier. Here are some ways how:</p> <p>1) First the Obama campaign is organizing door-to-door canvasses throughout our area. To find the ones nearest to you, <a href="!/?source=staginglocation-gt-hp-PA ">go here</a>. </p> <p>2) One of the few good things about <em>Citizens’ United</em> is that it allows unions to collaborate with community folks to do joint work. Presto! Workers’ Voice was created and it's canvassing swing and apathetic voters in the City’s swingiest area, the great Northeast, in the final days. On Saturday the canvass will jump off at 9 AM. On Tuesday there will be three shifts, 9, 12 and 3. Each of those shifts will gather at the Sprinkle Fitters Union, 14002 McNulty Rd. You can just show up, or you can contact either of the following with questions or to let them know you’re coming:</p> <p>Liz McElroy, 267-455-8191, <a href=""></a>.<br /> Nick Alpers, 215-518-8760, <a href=""></a></p> <p>3) Workers’ Voice also has a calling tool that you can use to call your Facebook friends. You can find that <a href="">here.</a> </p> <p>4) Fight for Philly is also organizing weekend canvasses, in the Spring Garden area of the City. To sign up with them, <a href="">click here.</a> </p> <p><a href="">read more</a></p> budget election ryan Fri, 02 Nov 2012 20:42:56 +0000 Stan Shapiro 8544 at Ballot Questions . . . Be Ready to Vote BEFORE You Enter the Booth <p>Along with the headline races for President, Senate, Attorney General, Auditor General, and Treasurer, there will be questions on this year’s ballot in Philadelphia. I recommend that you vote as follows:</p> <p>Question 1) Yes<br /> Question 2) No<br /> Question 3) Yes<br /> Question 4) Yes</p> <p>Let me say that none of these are a slam dunk. One can make a decent case for a thumbs up or down on each of them. But I urge this: please make up your mind BEFORE you enter the polling place, especially if you vote during the busy hours in the morning or evening. WE NEED EVERYONE TO VOTE IF OBAMA AND OTHER DEMOCRATS ARE TO WIN. If there are huge lines caused by people reading and analyzing the text of these ballot questions in the booth, the main effect may be to defeat Democrats by causing voters on line to get tired and go home. That would be a tragically unintended consequence of having these issues on this year’s ballot. Council should have delayed all of them.</p> <p>On to my views. You can get the Committee of Seventy’s <a href="">here</a>. </p> <p><strong>Question 1:</strong></p> <p>Shall The Philadelphia Home Rule Charter be amended to allow for the establishment of an independent rate-making body for fixing and regulating water and sewer rates and charges and to prescribe open and transparent processes and procedures for fixing and regulating said rates and charges?</p> <p><strong>Yes.</strong> Right now water rates are proposed by the Water Commissioner, put through an arduous hearing process before a referee appointed by the Commissioner, and then approved or disapproved by the Commissioner. That’s a mockery of accepted due process standards that require the decision maker to be different than the proposer. This amendment would allow Council to establish a process ensuring that final water rate decisions be made by a neutral arbiter, much like electric rates are decided by the PUC. </p> <p><a href="">read more</a></p> Ballot Questions Presidential election 2012 Sun, 28 Oct 2012 22:50:19 +0000 Stan Shapiro 8542 at Making the Perfect the Enemy of the Best We Can Get in Presidential Politics 2012 <p>I would love Green Party candidate Jill Stein to be President since I agree with almost all her proposed policies and programs. I would also like myself to be President because I like <em>all</em> my proposed policies and programs. Here’s the problem. Jill Stein and I have an equal chance of being elected President. That chance, of course, would be zero. </p> <p>So why would anyone engage in the futile act of voting for Jill Stein, or no less usefully, writing in their own name for President? Five reasons are usually offered. </p> <p>First, of course, is the well-worn cliché that there is no difference between Romney and Obama; therefore there’s no reason to vote for either one of them. That is just patently false. Here are just a few obvious differences:</p> <p>• Obama would keep Obamacare, and Romney would repeal it. Romney’s win would mean that tens of millions of low wage workers who would otherwise have health insurance would not get it. Their only health care provider would be the emergency room. Many of them would die of diseases diagnosed too late for them to get the medical care that would save them. </p> <p>• Romney would voucherize Medicare, making it unaffordable for millions of seniors. He would also do everything in his power to privatize, i.e., destroy, social security;</p> <p>• Romney would raise taxes on working people, cut them for the rich;</p> <p>• Romney would appoint judges intent on repealing Roe v. Wade, and eliminating affirmative action; </p> <p>• Romney would attack the ability of unions to exist;</p> <p>• Romney budgets, if they follow the lead of his running mate and other House Republican leaders, would decimate food stamps, education funding, and federal aid to cities of all sorts;</p> <p>• Romney would make the EPA into something as fierce as a big slice of pumpkin pie.</p> <p><a href="">read more</a></p> Green Party Obama Romney Stein Wed, 17 Oct 2012 18:11:18 +0000 Stan Shapiro 8539 at Memo to Ripoffs, Swindlers, and Job Destroyers: Philly has a Tax Break for You!!! <p>Philadelphia now has a tax package in place that supposedly was a <a href="">major factor</a> in persuading Josh Kopelman to move his venture capital company, “First Round Capital” to Philly. It seems like FRC is a fine company. It funds brand new start-up businesses, and plans to provide incubator space for many of them in its new headquarters in University City. Patrick Kerkstra over at the Inky is <a href="">crowing over FRC’s move</a> and is all but saying “gotcha” to people like me who questioned the tax breaks that the City is giving them. </p> <p>Here’s the rub. Those same tax breaks are available to Bain Capital and Mitt Romney (if and when Mr. Empty Suit returns to full-time vulturing with the firm.) They’re also available to similar companies in the private equity industry, one which has over <a href="">$4 trillion of buying power</a> under its control without any tax help from us. So here’s the question: In order to get a First Round Capital, do we also need to exempt all these other private equity firms and their leaders from business taxes? Here’s the business model for many of them: buy up existing companies with money borrowed on their assets, pay huge management fees, sell off assets, dump workers. </p> <p><a href=" ">The New Yorker</a> gives an example of how this model played itself out in real life after Bain Capital acquired Armco Steel Company and reorganized it into “GS Industries”:<br /> <blockquote>[W]ithin two years of investing eight million dollars to create GS Industries and take a majority interest, Bain Capital had paid itself a special dividend of $36.1 million, financed by a big issue of debt. . . . G.S.I. subsequently struggled against domestic and foreign competitors. In 1999 it sought a federal loan guarantee, and in 2001 it entered bankruptcy protection. More than seven hundred workers lost their jobs, health insurance, and some of their retirement benefits. A federal agency had to put up $44 million to bail out the company’s pension plan. Even while G.S.I. was fighting for survival, Bain continued to extract management fees from it—about $900,000 a year, according to a recent Los Angeles Times story. “Bain partners think the profits they made are a sign of brilliance,” an official of the steel workers’ union who negotiated with G.S.I. told the paper. “It’s not brilliance. It’s lurking around the corner and mugging somebody.”</blockquote></p> <p>Sometimes jobs aren’t destroyed, they’re <a href="">just sent away</a>:<br /> <blockquote>The next step in many leveraged buyouts is outsourcing—closing plants and selling assets, using the returns to pay back the loans, and then contracting production out to low-wage factories in other countries, usually where repressive governments prevent workers from organizing their own unions. This is precisely what happened when Freescale Semiconductor was taken over in a 2006 leveraged buyout. In the first year after the buyout, Freescale was forced to pay $760 million in interest on the debt it assumed because of the LBO. In 2007, it laid off more than 2000 employees and outsourced a substantial amount of work, including 50 percent of its assembly, packaging, and testing. In the fall of 2007, Freescale announced plans to open a design center in China that would employ 100 engineers. </blockquote></p> <p>Most interesting about these stories is the point about that federal agency putting $44 million into GSI while its management was extracting $900,000 a year in fees. It’s interesting because it’s so typical. This industry thrives on government largesse. Indeed, the single largest source of capital to the leveraged buyout industry is government pension funds. Why is that? Well, apparently, it’s because governments are such good marks for the con-men that run the industry. By using a variety of <a href="">bogus methodologies</a> for calculating their returns, these companies feed the need of public pension managers to report strong growth in their funds. And as we’ve seen with governmental gullibility respecting <a href="">interest rate swaps</a>, City managers just can’t resist the pitches of anyone approaching them with a deal that seems too good to be true.</p> <p>So here’s what we have, for the most part, in this industry: ripoffs, swindlers, and job destroyers. (I’m trying to be nice here.)</p> <p>Now if these companies come to Philly, that doesn’t mean they would destroy Philadelphia jobs. Who knows, they might actually add some management type jobs. But isn’t extending tax breaks to such companies the reverse of socially responsible investing? Do we want to be known as the go-to City for socially irresponsible investing?</p> <p>Of course it’s easy for the press to make anyone who suggests that we stop subsidizing evil into looking like silly, naïve, navel-gazers. Kerkstra and I had a long chat about how we might survive as a civilization without getting in bed with corporate pillagers before he wrote his piece. But the only comment he published from me was the wistful one in which I suggested that we be leaders in just saying no. That comment was turned into lovely softball to be served up to the City’s Commerce Director, who replied: "We don't get that luxury. We have to be competitive, and this is a baseline requirement for being competitive." </p> <p>Well, that’s not all I said, Mr. Commerce Director. I noted that we have a Mayor who happens to be the head of the National Conference of Mayors. He’s also a leader in the region, and perhaps a rising star in the national Democratic Party. Couldn’t our Mayor take the lead in proposing that cities and counties stop throwing their money around by engaging in the zero-sum game of corporate bribing? Wouldn’t it be worthwhile to figure out how to use the money that would be saved by all of us just saying no for things that would improve the livability of our towns and cities? That would start a race to the top, instead of the bottom. It would be a race in which no one loses, instead of the one we’re in, in which everyone – except the .000001 % - loses.</p> <p>But no, the conventional wisdom is that cities are helpless, they must pay and then pay again for companies that rip off everyone, from workers, to cities, to school districts, to pension funds. It’s all pretty shameful, not to mention very, very unimaginative and downright stupid.</p> Corporate Tax Breaks economic development Tue, 28 Aug 2012 16:33:48 +0000 Stan Shapiro 8527 at YOU can Prevent the Vote Stealing <p>You all know what's going on; the GOP is trying to take us all back to the 18th century, to have a country that literally is governed in the image of the founding fathers. Justice Scalia will fill in the details. To make it happen, they have to be sure the women, the people of color and the young, don't vote.</p> <p>You don't like that idea? Then you have to keep reading. . .</p> <p><strong>THINGS YOU CAN DO NOW TO HELP VOTERS VOTE</strong></p> <p>1. Transport voters with the necessary documentation to PennDOT to obtain a Non-Drivers License Photo ID Card, stay with them and help them through the process and transport them back. Volunteer trainings will be scheduled at the Coalition office at 310 W. Chelten Ave. Call the Coalition office to get more info: 215-848-1283. </p> <p>2. Volunteer with the Homeless Advocacy Project or the Senior Law Center (215-701-3201) clinics to help voters obtain birth certificates.</p> <p>3. Take calls from voters with questions about the birth certificate process or other aspects of Voter ID requirements. Contact either of the organizations above.</p> <p>4. Make calls to voters in your neighborhood to see if they have proper id. Jeff Garis of Pa. Voice is coordinating a calling blitz from 8/12-8/25 at least. Contact him at <a href=""></a> or 215-694-4783. </p> <p>5. Contact the NAACP to help: 8/22 (today) from 3-7 pm at a high volume location to assist with voter registration and educate about Voter ID. There will be a team leader to assist you. There will be other dates and times to do this; let Gloria Gilman (215-568-4990; <a href=""></a>) know what you’d like and she’ll connect with the NAACP to try to set up a group or contact them directly. Locations include Broad and Olney, Bridge & Pratt; Market East; FernRock; Frankford Transportation Center; 69th Street Terminal. NAACP coordinator is John Jordan:; 215-715-5681.</p> <p>6. Canvas door to door (put on door hangers with needed info to targeted neighborhoods where it is believed that there are a lot of people without proper id); phone bank; do data entry; do packet assembly: daily. Shifts in morning, afternoon, evening, weekends daily. Call the Coalition office: 215-848-1283 or go there at 310 West Chelten Ave. It’s near the Chelten Avenue station on the Chestnut Hill line, and if you’re driving, there is free parking.</p> <p>7. Get trained about Voter ID issues by the Coalition office and agree to do one or more speaking engagements. There are many unfilled requests for this. Contact Molly Morrill to arrange this:; 215-557-3600. There is a lot of information and forms available online at the Committee of Seventy website: website.</p> <p>8. Check the Coalition calendar to see what’s listed: <a href="" title=""></a></p> <p>9. There is an app called the Cost of Freedom App widget detailing voter ID requirements in Pa and around the country which can be sent out to your email lists or social media contacts, especially to young people: <a href="" title=""></a> or contact Faye Anderson at 215-995-5028 or <a href=""></a> about this.</p> democracy election vote stealing Wed, 22 Aug 2012 19:12:43 +0000 Stan Shapiro 8523 at Republicans Try Stealing Election in Broad Daylight <p>The power hungry Republican Party and its corporate sponsors have now put our very democracy at issue. It’s a flawed thing to begin with, given the makeup of the U.S. Senate, the electoral college, and here in Pennsylvania, the small, inconvenient window of time within to vote, and the heavy restrictions that have been imposed on absentee voting. But under Act 18, enacted a few months ago, PA democracy is threatened in an even more profound way. Fully 10% of theoretically eligible PA voters – an astounding <a href="">18% of those living in Philadelphia</a> – may not be able to cast their votes at all in November’s election.</p> <p>This is because Act 18 requires all voters, even those well known to election officials and who may have been voting for decades at the same polling place, must show a photo id when they come to vote. And not any photo id will do; it must be a Penndot issued id, military, student or passport id, or one of a very few other kinds. An estimated million or more people in our state don’t have them.</p> <p>The overwhelming majority of those blocked from voting will be poor people, minorities, and young people. And, of course, most of these will be Democrats.</p> <p>A number of individuals and groups have filed suit to stop this abomination from going into effect in November, and the hearing on the suit will begin on July 25 in Commonwealth Court. But meanwhile it is up to us to do what we can to get people the ID’s they need. Fortunately a coalition of over 100 PA organizations has come together to accomplish just that, the <a href="">PA Voter ID Coalition</a>. They will provide you with training and materials to work in your very own neighborhood to get this work done. Please, if you value democracy, join this work.</p> <p>The Coalition is headquartered at 310 W. Chelten Avenue. They will hold a training on field operations Monday, July 23rd at 6 PM, and another on the elements of Act 18 on Wednesday, August 1st. Please stop by or call them at 1-866-687-8683 to find the best way for you to pitch in to save our democracy.</p> Sun, 22 Jul 2012 18:25:35 +0000 Stan Shapiro 8518 at Council Democrats Seal the Deal with Philly's 1% <p>Yesterday, Council repealed the wage tax rebate for the working poor. This landmark legislation, one of the signature achievements of the late Councilman David Cohen, was repealed by a 10-6 vote, with 8 of those repealing votes coming from Democrats. Voting in favor of repeal were the following:</p> <p>Clarke D-5th District<br /> Green D-At Large<br /> Greenlee D-At Large<br /> Henon D-6th District<br /> Jones D-4th District<br /> Kenney D-At Large<br /> O’Neill R-10th District<br /> Oh R-At Large<br /> Reynolds-Brown D-At-Large<br /> Tasco D-9th District</p> <p>Voting against repeal were the following, including only 5 Democrats:</p> <p>Bass D-8th District<br /> Blackwell D-3rd District<br /> Goode D-At Large<br /> Johnson D-2nd District<br /> O’Brien R-At Large<br /> Squilla D-1st District</p> <p>Generally I try not to engage in single-issue rating of politicians. But this is going to be a hard pill to swallow when it’s time to vote for the repealers again. The wage tax credit is the kind of tax provision that generally marks the divide between Democrats and Republicans. It’s targeted toward the working poor so only those that need it get it. Credit recipients recycle the money to the economy by spending it locally, rather than on overseas vacations, or by depositing it in offshore accounts. The City gains by enabling economically marginal families to pay their rent and utilities, thus keeping families intact and lowering pressure on local services. </p> <p><a href="">read more</a></p> 1% City Council Cohen wage tax cut Fri, 29 Jun 2012 15:07:25 +0000 Stan Shapiro 8505 at Council DEMOCRATS poised to kill tax break for low-wage workers. <p>Isn’t it nice that we have a Democratic City Council by a margin of 15-2? That must mean that, like the federal and state governments, the City does something to make its income-based tax progressive. And, indeed, in 2004, City Council enacted such a break, enabling workers classified as working poor by the State to knock their wage tax down to 1.5%, a meaningful cut.</p> <p>But Council really didn’t like it. To get this little piece of tax justice passed, its sponsor, the late, great, Councilman David Cohen, had to agree to phase it in over a six year period. Soon after Cohen’s death, multiple efforts were launched to repeal it outright. Although these were unsuccessful, the tax break was postponed three additional times, and the benefit itself was sharply reduced, to no more than 1% under the general rate of the tax.</p> <p>As restructured, the wage tax credit is now scheduled to begin taking effect in 2016. But the restructuring and the delay did not reduce Mayor Nutter’s zeal for doing away with it altogether. With little fanfare he introduced a bill to repeal it altogether along with his budget for next year. Now it has been voted out of Committee to the floor of Council by a 9-8 vote. </p> <p>Remember, the wage tax is about as regressive a tax as you can have based on income. It excludes all sources of income but wages. It is flat, levied currently at a rate of 3.93%, on a worker’s first and every other dollar of wages. No deductions, exemptions, credits or reductions of any kind apply for low wage workers. Upper income workers who deduct taxes from their federal taxes, however, may pay as much as a third less than the nominal rate.</p> <p>This is not a City in which there is a general reluctance to cut taxes, at least not those that benefit the 1%. Just recently Council defined wages to exclude those paid to hedge fund managers. Since 1996, the rate of the wage tax has been cut 16 times to bring it down from 4.96% to its current rate. All of those cuts benefited the rich far more than the poor. That’s simple to see. A cut of 1% is worth $1,000 to someone earning $100,000, but only $100 to someone earning $10,000. </p> <p>Why would Democrats fight the idea of giving low wage workers some additional bit of relief from this heavy tax burden in a town with a poverty rate exceeding 25%? Good question. Please call and ask them before a final vote is taken next Thursday. All we need is one of them to come to their senses and reject this war on the poor. When you talk to them, ask them what they think it means to be a Democrat in Philadelphia.</p> <p>Here are the Democrats who voted to repeal this little piece of tax justice and decency:</p> <p>Green (At Large)<br /> Greenlee (At Large)<br /> Henon (6th District)<br /> Jones (4th District)<br /> Reynolds Brown (At Large)<br /> Tasco (9th District)<br /> Clarke (5th District)</p> <p>Also, two Republicans voted to repeal:</p> <p>O'Neill (10th District)<br /> Oh (At Large)</p> <p>Ask them why any Democrat should vote for them. They got plenty of Democratic votes in the last election. (You can get contact info for Council members <a href="">here</a>.) You can find out who your District Councilperson is <a href="">here</a>.</p> <p>And here are the 8 members who voted to keep the tax cut:</p> <p>Bass (8th District)<br /> Blackwell (3rd District)<br /> Goode (At Large)<br /> Johnson (2nd District)<br /> Kenney (At Large)<br /> O'Brien (At Large)<br /> Quinones-Sanchez<br /> Squilla (1st District)</p> <p>Call and thank them. Note O’Brien: a Republican who did the right thing. How often can you say that?</p> City Council Democrats wage tax Sun, 17 Jun 2012 14:59:24 +0000 Stan Shapiro 8497 at The .00001 have again spoken; peasants, go away . . . <p><a href="">Today’s Inky</a> reports that the Chamber of Commerce is getting all up on its 1% haunches about Councilman Bill Green’s proposal to raise the Use and Occupancy tax for the schools. It just gets me the way the “liberal media” goes all wobbly at the knees whenever the Chamber in all its imperial wisdom speaks. Today our lordly overseer says that raising the U &amp; O is a no no because, among many other things, “tenants remain mobile and react swiftly to price changes in this environment." That quote is from Rob Wonderling, the former Republican State Senator and present Chamber President. Several other wise men are quoted in agreement. The Inky can seem to find no one who disagrees.</p> <p>So what is this horrible U &amp; O tax? It’s a tax on the value of real estate occupied by businesses. It’s been around for thirty years or so as a workaround of PA law which bars commercial real estate from being taxed at a higher level than residential. As the Inky does acknowledge, that means -- compared to other Northeastern cities -- Philadelphia businesses don't pay a whole lot of real estate tax. But you have to scroll down to get to that. Way up high you have the prediction of Mr. Crocodile Tears himself (also known as Robert Zuritsky, president of Parkway Corp.) that increasing the tax would cost 10,000 to 25,000 jobs in two years.</p> <p>Be scared out of your bejabbers everyone, very scared. Apparently Bill Green who sponsored the U &amp; O increase is appropriately, awesomely scared, because according to the article, he’s abandoned his own bill. Others in Council are listed as skeptical to say the least.</p> <p><a href="">read more</a></p> Chamber of Commerce City Council U &amp; O tax Tue, 12 Jun 2012 22:04:15 +0000 Stan Shapiro 8496 at