IPS Blog

By the twelfth month of 2012,
The Institute’s brought to you:
Twelve months of justice,
Eleven revenue raisers
Ten great op-eds
Nine detailed studies,
Eight economic hardship investigations,
Seven street heat protests,
Six Africa actions,
Five Mideast primers,
Four Drug War critiques,
Three green jobs plans,
Two carbon taxes,
And a transition to a Main Street economy

Here is to many more years of progress. From all of us at IPS, thank you for your support!

Under pressure to address a massive deficit, legislators voted overwhelmingly this week in favor of a tax on financial speculation. This really happened, I swear.

OK, it was in Europe, not the United States. But it could happen here—and it should.

The vote in the European Parliament on December 10 was the latest in a series of victories by international campaigners for a tax on trades of stocks, bonds, and derivatives. Often called a “Robin Hood Tax,” the goal is to raise massive revenues for urgent needs, such as combating unemployment, global poverty, and climate change.

A financial transaction tax would also discourage the senseless high frequency trading that now dominates our financial markets. Recently, the chief economist of the Commodity Futures Trading Commission (the top U.S. derivatives regulator) found that such trading practices are hurting traditional investors.

In reaction to the Parliamentary vote, David Hillman, of the U.K. Robin Hood Tax campaign, said that the tax “will raise at least 37 billion euros per year for the countries involved whilst reining in the worst excesses of the financial sector.”

Nicolas Mombrial, a Brussels-based policy adviser for Oxfam, added that “The European Parliament’s overwhelming support reflects the will of Europe’s people. In cash-strapped times, an financial transactions tax is a no-brainer that is morally right, technically feasible, and economically sound.”

Read the rest of this article on the Mother Jones website. 

This week in OtherWords, columnist Jim Hightower and cartoonist Khalil Bendib lampoon the latest in airline abuse. If you're planning to board a plane to celebrate this holiday season with family or friends, I hope that your voyage is as stress-free as possible.

And speaking of this holiday season, please consider making a year-end tax-deductible contribution to OtherWords. Our service is free for newspapers, new media outlets, and engaged citizens. But professional editing, proofreading, and concerted efforts to get new outlets to run these bold opinions requires at least a modest budget. Any amount you can give will be used wisely and effectively to help us expand our nationwide reach. You can make a one-time or a recurring donation on our website or mail a check payable to OtherWords to this address: Institute for Policy Studies; 1112 16th Street, NW, Suite 600; Washington, DC 20036.

For contributions of $100 or more, we'll send you or someone you designate a copy of columnist Sam Pizzigati's latest book: The Rich Don't Always Win. For contributions of $150 or more, we'll also include our cartoonist Khalil Bendib's latest collection: Too Big to Fail. Both make great gifts.

Scroll down to see this week's lineup and please subscribe to our weekly newsletter if you haven't signed up yet.

1. Ripe for Reduction / Miriam Pemberton
   The pending budget deal must include long-overdue military spending cuts.
2. Our National Failure to Commit / Don Kraus
   The Senate hasn't approved any major multilateral treaties since 1997.
3. Jobs or the Environment? / Lee Ballinger
   Soon it will be too late and we'll have neither.
4. Billionaires with No Skin in the Game / Jason Salzman
   If the top two percent is up in arms about losing their Bush tax cuts, why aren't they generating any street heat?
5. In Fact, Fairly Taxing the Rich Won't Scare Them Away / Sam Pizzigati
   Recent research debunks some of the most common arguments against raising taxes on the richest Americans.
6. The Airline Industry's Fee-for-All / Jim Hightower
   Nearly every airline these days is addicted to fees.
7. Our Health Care System is Still Sick / William A. Collins
   The health industry is about making money, not healing.
8. Fly the Stingy Skies / Khalil Bendib cartoon

In poll after poll, the American people say they are far more concerned about the jobs crisis than the “debt crisis.” A powerful coalition of CEOs says they have an answer for both problems.

Give us more tax breaks, they say, and we’ll use the money to invest and create jobs. The national economic pie will expand and Uncle Sam will get plenty of the frothy meringue without having to raise tax rates.

That’s the line of the Fix the Debt campaign. Led by more than 90 CEOs, this turbo-charged PR/lobbying machine is blasting the message that such “pro-growth tax reform” should be a pillar of any deficit deal (along with cuts to benefit programs like Social Security and Medicare).

And it might be a good line — if not for some pesky real-world facts. You see the same corporations peddling this line have already been paying next to nothing in taxes. And instead of creating jobs, they’ve been destroying them. Here are five examples of job-cutting, tax-dodging CEOs who are leading Fix the Debt.

1. Randall Stephenson, AT&T
U.S. jobs destroyed since 2007: 54,000
Average effective federal corporate income tax rate, 2009-2011: 6.3%

Randall Stephenson presides over the biggest job destroyer among the Fix the Debt corporate supporters, having eliminated 54,000 jobs since 2007. The company also has one of the largest deficits in its worker pension fund — a gaping hole of $10 billion.

Can Stephenson blame all this belt-tightening on the Tax Man? Not exactly. Over the last three years, AT&T’s tax bills have been miniscule. According to the firm’s own financial reports, they’ve paid Uncle Sam only 6.3 percent on more than $43 billion in profits. If the telecom giant had paid the standard 35 percent corporate tax rate over the last three years, the federal deficit would be $12.5 billion lower.

So where have AT&T’s profits gone? A huge chunk has landed in Stephenson’s own pension fund. His $47 million AT&T retirement account is the third-largest among Fix the Debt CEOs. If converted to an annuity when he hits age 65, it would net him a retirement check of more than a quarter million dollars every month for the rest of his life.

While his economic future is more than secure, Stephenson emerged from a meeting with President Obama on November 28 “optimistic” about the chances of reforming (i.e., cutting) Social Security as part of a deal to avoid the so-called “fiscal cliff.”

2. Lowell McAdam, Verizon
U.S. jobs destroyed since 2007: 30,000
Average effective federal corporate income tax rate, 2009-2011: -3.3%

Another telecommunications giant, Verizon, is close behind AT&T in the layoff leader race, with 30,000 job cuts since 2007. Like its industry peer AT&T, Verizon also has a big deficit in its pension accounts. It would need to cough up $6 billion to meet its promised pension benefits to employees and another $24 billion to meet promised post-retirement health care benefits.

Did the blood-sucking IRS leave Verizon no choice but to slash jobs and underfund worker pensions? Far from it. The company actually got money back from Uncle Sam, despite reporting $34 billion in U.S. profits over the last three years. If Verizon had paid the full corporate tax rate of 35 percent, last year’s national deficit would have been $13.1 billion less. Had that amount been used for public education, it could have covered the cost of employing more than 190,000 elementary teachers for a year.

Verizon’s new CEO, Lowell McAdam, already has $8.7 million in Verizon pension assets, enough to set him up for a $47,834 monthly retirement check. McAdam’s predecessor, Ivan Seidenberg, who has also signed up as a Fix the Debt supporter, retired with more than $70 million in his Verizon retirement package.

Wanna see who is rounding up the worst five? Read the rest at Alternet.

Daphne Wysham on Al Jazeera discussing the World Bank and climate change:

"It was 1992 when the World Bank was asked at the Rio Earth Summit to begin to marshall the funds to address the climate crisis, to help the developing world move away from fossil fuels, and they have done the exact opposite."

Daphne Wysham is a fellow at the Institute for Policy Studies and works with the Sustainable Energy and Economy Network. See the interview on Al Jazeera's website here.