....
WASHINGTON -- Congressional Republicans' opposition to any
tax rate hike on the top two percent of earners shows few signs of
letting up as the debate wears on. But the beneficiaries of that
opposition, the nation's wealthiest executives, have themselves begun
opening up to the possibility of a rate hike.
On Tuesday, FedEx Chairman and CEO Fred Smith, an adviser to Sen. John McCain's presidential campaign, said that the notion that tax hikes on the richest Americans would kill jobs was simply "mythology."
And on Monday, a gathering of the nation's top defense executives took a surprising turn when they endorsed tax rate increases on the wealthy and cuts of up to $150 billion to the Pentagon's budget. Top executives from Northrop Grumman, Pratt & Whitney, TASC and RTI International Metals appeared at the National Press Club at an event organized by the Aerospace Industries Association, the top defense contractor lobbyist.
David Langstaff, CEO of TASC, said that the executives were speaking out because so far leaders of the defense industry were "talking a good game, but are still unwilling to park short-term self-interest." After the event, he told a defense reporter for Politico that tax rates need to go up.
“In the near term, [income tax rates] need to go up some,” Langstaff said. "This is a fairness issue -- there needs to be recognition that we’re not collecting enough revenue. In the last decade we’ve fought two wars without raising taxes. So I think it does need to go up.”
David Hess, head of Pratt & Whitney, said his parent company, United Technologies Corp, believed personal income tax rates should be on the table; Dawne Hickton, CEO of RTI, said he would back a rate hike if it led to a deal.
The CEOs join other high-profile executives who are willing to chip in more. Following a meeting with President Barack Obama last week at the White House, executives emerged to endorse higher rates. "There needs to be some revenue element to this, and [Obama] started with rates," said Joe Echeverria, CEO of Deloitte LLP. "And he started with rates on what we would define [as] the upper two percent … that we have to pay our fair share. And I think everybody was in agreement with that notion."
AT&T CEO Randall Stephenson, who was also at the meeting, said in a statement that a deal "will require a compromise involving an increase in both tax rates and revenue."
Goldman Sachs Chief Executive Lloyd Blankfein, meanwhile, told CNN after the meeting that "if we had to lift up the marginal rate, I would do that."
When asked Wednesday about increasing support among wealthy executives for higher taxes on the rich, Republicans on Capitol Hill showed no signs of letting up.
Sen. John Thune (R-S.D.) said he had not heard the CEOs' remarks this week but insisted he would not support rate increases. He would rather see revenue generated through capping deductions, he told The Huffington Post.
"The reason deductions is a more attractive way to do this is because it doesn't hit small businesses nearly as hard as rate increases do," Thune said. "That is a concern to me, because ultimately what we need to be thinking about is economic growth. Do our policies inhibit or facilitate economic growth? And rate increases on small businesses are going to be counterproductive in terms of growing the economy and creating jobs."
Sen. Marco Rubio (R-Fla.) struck a similar chord with respect to rates, saying he would not support any deal allowing tax rates for the top two percent to expire.
"I'm deeply concerned that raising rates or further complicating the tax code is going to make it harder for us to generate the revenue we need to get out of this hole that we're in," Rubio said in an interview. "To me, it's not about a pledge -- it isn't about protecting millionaires and billionaires. It's about creating new taxpayers, because that's the only way we're going to get out of this."
But Sen. Dan Coats (R-Ind.) was slightly more flexible. While he reiterated the need for comprehensive tax reform, the senator acknowledged that he did not think restructuring the tax code would be possible before the end of this year, when the Bush-era tax cuts are set to expire.
"It's very hard to see that we can get that done in a quick two to three week process here. So I'm hoping that whatever comes down will have enforceable instructions that certain goals must be reached through comprehensive tax reform at a date certain in 2013," Coats told HuffPost. "To cherry-pick right now on tax would be -- what we'd have to do is come back and revisit and revise, and we need more certainty."
Sen. John McCain (R-Ariz.) said he did not want to deal in hypotheticals, but added that he has been considering the opinions of a wide variety of sources. Asked about executives expressing a willingness to see their rates go up, he responded, "I am always glad to receive advice … I can't speculate on what might happen, [but] I have some confidence in the Speaker and Sen. McConnell in arriving at a resolution."
Still, some Republicans have broken with their party and indicated their support for accepting President Barack Obama's proposal to extend tax cuts only for the first $250,000 of income. Last week, Rep. Tom Cole (R-Okla.) urged fellow Republicans to agree to the president's tax plan, and since then a number of Republicans have made similar statements, including Sen. Olympia Snowe (R-Maine.), Sen. Tom Coburn (R-Okla.), Rep. Kay Granger (R-Texas) and Rep. Robert Dold (R-Ill.).
http://www.huffingtonpost.com/2012/12/05/top-two-percent-tax_n_2245596.html
On Tuesday, FedEx Chairman and CEO Fred Smith, an adviser to Sen. John McCain's presidential campaign, said that the notion that tax hikes on the richest Americans would kill jobs was simply "mythology."
And on Monday, a gathering of the nation's top defense executives took a surprising turn when they endorsed tax rate increases on the wealthy and cuts of up to $150 billion to the Pentagon's budget. Top executives from Northrop Grumman, Pratt & Whitney, TASC and RTI International Metals appeared at the National Press Club at an event organized by the Aerospace Industries Association, the top defense contractor lobbyist.
David Langstaff, CEO of TASC, said that the executives were speaking out because so far leaders of the defense industry were "talking a good game, but are still unwilling to park short-term self-interest." After the event, he told a defense reporter for Politico that tax rates need to go up.
“In the near term, [income tax rates] need to go up some,” Langstaff said. "This is a fairness issue -- there needs to be recognition that we’re not collecting enough revenue. In the last decade we’ve fought two wars without raising taxes. So I think it does need to go up.”
David Hess, head of Pratt & Whitney, said his parent company, United Technologies Corp, believed personal income tax rates should be on the table; Dawne Hickton, CEO of RTI, said he would back a rate hike if it led to a deal.
The CEOs join other high-profile executives who are willing to chip in more. Following a meeting with President Barack Obama last week at the White House, executives emerged to endorse higher rates. "There needs to be some revenue element to this, and [Obama] started with rates," said Joe Echeverria, CEO of Deloitte LLP. "And he started with rates on what we would define [as] the upper two percent … that we have to pay our fair share. And I think everybody was in agreement with that notion."
AT&T CEO Randall Stephenson, who was also at the meeting, said in a statement that a deal "will require a compromise involving an increase in both tax rates and revenue."
Goldman Sachs Chief Executive Lloyd Blankfein, meanwhile, told CNN after the meeting that "if we had to lift up the marginal rate, I would do that."
When asked Wednesday about increasing support among wealthy executives for higher taxes on the rich, Republicans on Capitol Hill showed no signs of letting up.
Sen. John Thune (R-S.D.) said he had not heard the CEOs' remarks this week but insisted he would not support rate increases. He would rather see revenue generated through capping deductions, he told The Huffington Post.
"The reason deductions is a more attractive way to do this is because it doesn't hit small businesses nearly as hard as rate increases do," Thune said. "That is a concern to me, because ultimately what we need to be thinking about is economic growth. Do our policies inhibit or facilitate economic growth? And rate increases on small businesses are going to be counterproductive in terms of growing the economy and creating jobs."
Sen. Marco Rubio (R-Fla.) struck a similar chord with respect to rates, saying he would not support any deal allowing tax rates for the top two percent to expire.
"I'm deeply concerned that raising rates or further complicating the tax code is going to make it harder for us to generate the revenue we need to get out of this hole that we're in," Rubio said in an interview. "To me, it's not about a pledge -- it isn't about protecting millionaires and billionaires. It's about creating new taxpayers, because that's the only way we're going to get out of this."
But Sen. Dan Coats (R-Ind.) was slightly more flexible. While he reiterated the need for comprehensive tax reform, the senator acknowledged that he did not think restructuring the tax code would be possible before the end of this year, when the Bush-era tax cuts are set to expire.
"It's very hard to see that we can get that done in a quick two to three week process here. So I'm hoping that whatever comes down will have enforceable instructions that certain goals must be reached through comprehensive tax reform at a date certain in 2013," Coats told HuffPost. "To cherry-pick right now on tax would be -- what we'd have to do is come back and revisit and revise, and we need more certainty."
Sen. John McCain (R-Ariz.) said he did not want to deal in hypotheticals, but added that he has been considering the opinions of a wide variety of sources. Asked about executives expressing a willingness to see their rates go up, he responded, "I am always glad to receive advice … I can't speculate on what might happen, [but] I have some confidence in the Speaker and Sen. McConnell in arriving at a resolution."
Still, some Republicans have broken with their party and indicated their support for accepting President Barack Obama's proposal to extend tax cuts only for the first $250,000 of income. Last week, Rep. Tom Cole (R-Okla.) urged fellow Republicans to agree to the president's tax plan, and since then a number of Republicans have made similar statements, including Sen. Olympia Snowe (R-Maine.), Sen. Tom Coburn (R-Okla.), Rep. Kay Granger (R-Texas) and Rep. Robert Dold (R-Ill.).
http://www.huffingtonpost.com/2012/12/05/top-two-percent-tax_n_2245596.html
Defense Execs Say Deeper DoD Budget Cuts, Higher Taxes OK 3DEZ12
[updated Wednesday 12/5]
WASHINGTON: Top executives from four major defense and aerospace firms
sent a message to Congress and the Obama administration today: the
nation expects its elected leaders to lead and the well-paid executives
are willing to accept higher personal and corporate taxes on the path to
find a solution to the nation's fiscal woes. On top of that, they
conceded that the Pentagon budget must be cut even more deeply than the
$487 billion already targeted over the next decade to seal an increasingly elusive deal to stop the automatic spending cuts known as sequestration.
David Langstaff, CEO of an engineering and analysis services company called TASC,
issued the strongest call for additional defense cuts. Those who have
benefited from past national spending "should be willing to sacrifice,"
he said. That means tax increases, bitterly opposed by most Republicans,
and "reform," which usually means the kinds of cuts to the big
entitlement programs like Social Security and Medicare that most
Democrats refuse to discuss.
Pressed to get specific on budget cuts, Northrop Grumman CEO Wes Bush suggested a tiny additional $20 billion to $25 billion over 10 years (on top of the $487 billion already cut by last year's Budget Control Act). But Langstaff suggested $150 billion over the next decade.
Invoking the mantra of the now-retired Chairman of the Joint Chiefs of Staff, Adm. Mike Mullen, Langstaff declared that the greatest threat to national security was the federal debt, not any foreign foe. To defeat that threat, Langstaff went on, those who have benefited from past federal spending -- such as himself -- "should be willing to sacrifice."
[Updated 12/5: It's worth quoting Langstaff's remarkable statement at greater length: "[Defense industry executives] are talking a good game, but are still unwilling to park short-term self-interest.... Every trade group, special interest and corporate lobbyist is up on Capitol Hill clamoring that Congress solve the problem, avoid the fiscal cliff and not default to sequestration...'but don't touch my budgets!' We can't have it both ways...we need to stop pretending there's a scenario out there that offers no defense cuts."]
While it's remarkable for the defense industry to propose defense cuts, Langstaff's proposed $15 billion per annum reduction is still a much smaller percentage of the defense budget than was trimmed in past post-war drawdowns. And it's nowhere near enough, according to a trio of good-government groups who convened a conference call this afternoon explicitly to rebut the quartet CEOs.
"When he said the $150 billion figure, I honestly cringed," said Ben Freeman of POGO, the Project on Government Oversight, a persistent and respected critic of defense programs. Across DoD's $600 billion budget, "that's less than the amount of inflation," Freeman scoffed. "We can get $15 billion from [cuts to] individual programs."
"He's playing defense," punned Bill Hartung of the dovish Center for International Policy. "He's trying to keep that number as small as possible."
But the pro-defense cut camp smells blood in the water. "The public isn't falling for this scare campaign," sneered Christopher Preble of the libertarian Cato Institute. Preble took time to mock the Aerospace Industries Association, which organized this morning's four-CEO panel as part of a massive campaign to stop sequestration, for investing heavily in a stop-sequestration campaign that has "backfired" and whose studies of the potential economic damage -- up to 2 million jobs, by AIA's count -- have been "thoroughly discredited."
POGO's Freeman added that the "save jobs by stopping defense cuts" argument overlooks the fact that defense firms have already "cut thousands of jobs" even as revenues rose steeply in recent years. And he derided the industry overall, saying "it's not very good at delivering jobs or delivering weapons...From the Joint Strike Fighter to the LCS [Littoral Combat Ship], lots of things are over budget, under-performing, and delayed."
"I'm more hopeful than some that we will get some Pentagon cuts," Freeman went on. The current fiscal cliff negotiations are "a three-way heavyweight fight," he said, in which tax hikes and entitlement cuts are far more politically difficult than cutting defense.
Besides, Freeman and his cohorts said, Pentagon spending cuts -- even at sequestration levels -- would not be immediately painful for the defense industry, anyway. Although the AIA and its allies in Congress have kept the spotlight on weapons programs, those accounts are fairly well insulated from sequestration's effects, because most procurement and R&D funding is not spent until a year or more after Congress appropriates it.
"Many of the companies have large backlogs, [and] the Pentagon has $100 billion in unobligated dollars" -- money already appropriated but for which no contract has been signed -- said Hartung: "There's no fiscal cliff for the Pentagon. It's more of a gradual slope."
That said, Hartung went on, "sequestration is bad management." The law would blindly, mindlessly, automatically cut almost all federal programs -- with a few exceptions such as military pay -- by almost exactly equal amounts: 9.4 percent for non-exempt defense programs and 8.4 percent for non-defense, according to estimates by the president's Office of Management and Budget.
What's worse, although the impact on procurement and R&D programs would be delayed, the damage to other areas would be immediate. Federal grant programs and aid to state and local governments would have to slash their spending immediately, which means layoffs of teachers, police, and the like, said Hartung.
Also immediate would be the impact on federal workers, both at the Pentagon and at civilian agencies. Since laying off a civil servant actually costs more in the short run than it saves -- especially, Freeman noted, if they're then replaced by outside contractors -- the federal government would have to save on payroll by ordering employees on unpaid leave instead.
But no federal employee can be furloughed this way for more than 22 work days a year. Assuming every agency furloughs every single employee for that maximum amount of time, that still only saves 22 days out of the (on average) 261 work days in the year: 8.43 percent, just barely enough to meet the sequestration mandate of 8.40 percent for non-defense agencies. So if an agency deems any of its employees too essential to furlough -- like air traffic controllers, for example, cybersecurity experts, or intelligence analysts -- it may not actually be able to implement sequestration without breaking federal law.
Pressed to get specific on budget cuts, Northrop Grumman CEO Wes Bush suggested a tiny additional $20 billion to $25 billion over 10 years (on top of the $487 billion already cut by last year's Budget Control Act). But Langstaff suggested $150 billion over the next decade.
Invoking the mantra of the now-retired Chairman of the Joint Chiefs of Staff, Adm. Mike Mullen, Langstaff declared that the greatest threat to national security was the federal debt, not any foreign foe. To defeat that threat, Langstaff went on, those who have benefited from past federal spending -- such as himself -- "should be willing to sacrifice."
[Updated 12/5: It's worth quoting Langstaff's remarkable statement at greater length: "[Defense industry executives] are talking a good game, but are still unwilling to park short-term self-interest.... Every trade group, special interest and corporate lobbyist is up on Capitol Hill clamoring that Congress solve the problem, avoid the fiscal cliff and not default to sequestration...'but don't touch my budgets!' We can't have it both ways...we need to stop pretending there's a scenario out there that offers no defense cuts."]
While it's remarkable for the defense industry to propose defense cuts, Langstaff's proposed $15 billion per annum reduction is still a much smaller percentage of the defense budget than was trimmed in past post-war drawdowns. And it's nowhere near enough, according to a trio of good-government groups who convened a conference call this afternoon explicitly to rebut the quartet CEOs.
"When he said the $150 billion figure, I honestly cringed," said Ben Freeman of POGO, the Project on Government Oversight, a persistent and respected critic of defense programs. Across DoD's $600 billion budget, "that's less than the amount of inflation," Freeman scoffed. "We can get $15 billion from [cuts to] individual programs."
"He's playing defense," punned Bill Hartung of the dovish Center for International Policy. "He's trying to keep that number as small as possible."
But the pro-defense cut camp smells blood in the water. "The public isn't falling for this scare campaign," sneered Christopher Preble of the libertarian Cato Institute. Preble took time to mock the Aerospace Industries Association, which organized this morning's four-CEO panel as part of a massive campaign to stop sequestration, for investing heavily in a stop-sequestration campaign that has "backfired" and whose studies of the potential economic damage -- up to 2 million jobs, by AIA's count -- have been "thoroughly discredited."
POGO's Freeman added that the "save jobs by stopping defense cuts" argument overlooks the fact that defense firms have already "cut thousands of jobs" even as revenues rose steeply in recent years. And he derided the industry overall, saying "it's not very good at delivering jobs or delivering weapons...From the Joint Strike Fighter to the LCS [Littoral Combat Ship], lots of things are over budget, under-performing, and delayed."
"I'm more hopeful than some that we will get some Pentagon cuts," Freeman went on. The current fiscal cliff negotiations are "a three-way heavyweight fight," he said, in which tax hikes and entitlement cuts are far more politically difficult than cutting defense.
Besides, Freeman and his cohorts said, Pentagon spending cuts -- even at sequestration levels -- would not be immediately painful for the defense industry, anyway. Although the AIA and its allies in Congress have kept the spotlight on weapons programs, those accounts are fairly well insulated from sequestration's effects, because most procurement and R&D funding is not spent until a year or more after Congress appropriates it.
"Many of the companies have large backlogs, [and] the Pentagon has $100 billion in unobligated dollars" -- money already appropriated but for which no contract has been signed -- said Hartung: "There's no fiscal cliff for the Pentagon. It's more of a gradual slope."
That said, Hartung went on, "sequestration is bad management." The law would blindly, mindlessly, automatically cut almost all federal programs -- with a few exceptions such as military pay -- by almost exactly equal amounts: 9.4 percent for non-exempt defense programs and 8.4 percent for non-defense, according to estimates by the president's Office of Management and Budget.
What's worse, although the impact on procurement and R&D programs would be delayed, the damage to other areas would be immediate. Federal grant programs and aid to state and local governments would have to slash their spending immediately, which means layoffs of teachers, police, and the like, said Hartung.
Also immediate would be the impact on federal workers, both at the Pentagon and at civilian agencies. Since laying off a civil servant actually costs more in the short run than it saves -- especially, Freeman noted, if they're then replaced by outside contractors -- the federal government would have to save on payroll by ordering employees on unpaid leave instead.
But no federal employee can be furloughed this way for more than 22 work days a year. Assuming every agency furloughs every single employee for that maximum amount of time, that still only saves 22 days out of the (on average) 261 work days in the year: 8.43 percent, just barely enough to meet the sequestration mandate of 8.40 percent for non-defense agencies. So if an agency deems any of its employees too essential to furlough -- like air traffic controllers, for example, cybersecurity experts, or intelligence analysts -- it may not actually be able to implement sequestration without breaking federal law.
http://defense.aol.com/2012/12/03/defense-execs-say-deeper-dod-budget-cuts-higher-taxes-ok/
WHEN I see an unusual website source for a visitor to my blog I check it out, so I checked out counterpoint strategies (as well as their website allows) since they took a look at this post on my blog at 0938/7DEZ12. Not impressed because the words or even the concept of truth and honesty didn't appear anywhere I was able to access. Seems like a pr firm for the wealthy who lost big time this last election and are now trying to "influence" public opinion and politicians votes concerning the fiscal cliff, defense spending, and the federal debt ceiling.
WHEN I see an unusual website source for a visitor to my blog I check it out, so I checked out counterpoint strategies (as well as their website allows) since they took a look at this post on my blog at 0938/7DEZ12. Not impressed because the words or even the concept of truth and honesty didn't appear anywhere I was able to access. Seems like a pr firm for the wealthy who lost big time this last election and are now trying to "influence" public opinion and politicians votes concerning the fiscal cliff, defense spending, and the federal debt ceiling.
New York arrived from recon.counterpointstrategies.com on "Bucknackt's
Sordid Tawdry Blog: Top Two Percent To GOP: Tax Us & Defense Execs
Say Deeper DoD Budget Cuts, Higher Taxes OK 5&3DEZ12".
09:31:48 -- 1 hour 58 mins ago
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