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Posts Tagged ‘Taxes’

Uber admits underpaying New York drivers approximately $45 million

Thursday, May 25th, 2017

Uber’s gotta pay—with interest.

The infamous ride-sharing app admitted Tuesday that it had been underpaying its New York drivers since November 2014 due to an accounting error that took out more than the company’s 25 percent commission, the Wall Street Journal first reported.

Uber typically takes its commission after taxes and fees are deducted from a driver’s fare, but the accounting glitch that took it out beforehand resulted in a larger pay deduction for drivers. Uber’s terms of service did not specify that it took commissions out of gross fare earnings.

To make things right, Uber is repaying an average of $900 per driver with interest, which is estimated to cost a total of at least $45 million. One driver is receiving a $7,000 payout, Recode reported.

“We made a mistake and we are committed to making it right by paying every driver every penny they are owed, plus interest, as quickly as possible,” Uber’s regional manager in the U.S. and Canada, Rachel Holt, said in a statement. “We are working hard to regain driver trust, and that means being transparent, sticking to our word, and making the Uber experience better from end to end.”

Uber has had a rough year with multiple public relations disasters spanning a consumer and driver backlash for the company’s tepid response to the Trump administration’s immigration ban and a sprawling sexual harassment scandal. But the company’s issues with drivers over pay have also persisted.

In January, Uber settled a lawsuit that claimed the company misled drivers regarding earning potential and conditions of the company’s auto financing program. Drivers protested against poor pay throughout 2016, demanding higher pay.

Through it all, Uber has fought drivers on granting employee status and benefits, fair pay, and unionization. But despite the influx of lawsuits, it appears that drivers are going to keep fighting the company on issues.

Following news of Uber’s repayment of New York drivers, the Independent Drivers Guild, which represents more than 50,000 app drivers, called for a widespread investigation into the company’s payment practices.

“Drivers have been complaining about this and other shady accounting tactics to no avail,” said IDG’s executive director Ryan Price in a statement. “Drivers are relieved to be paid the money they are owed plus interest and we hope other companies follow suit.”

“We also call for regulators to launch an immediate investigation into ride hail applications fare and payment practices in our city.”

This article was originally published at ThinkProgress.org on May 24, 2017. Reprinted with permission.

About the Author:  Lauren C. Williams is the tech reporter for ThinkProgress with an affinity for consumer privacy, cybersecurity, tech culture and the intersection of civil liberties and tech policy. Before joining the ThinkProgress team, she wrote about health care policy and regulation for B2B publications, and had a brief stint at The Seattle Times. Lauren is a native Washingtonian and holds a master’s in journalism from the University of Maryland and a bachelor’s of science in dietetics from the University of Delaware.

Last Chance to Make Corporations Come Clean on Tax Havens

Friday, July 22nd, 2016

Isaiah J. PoolePeople who want multi;national corporations to be held accountable for their tax-dodging tactics only have a few more hours Thursday to tell the Security and Exchange Commission to support a tough rule that would go a long way toward making that happen.

The SEC is soliciting comments until 11:59 p.m. Eastern time on a new business and financial disclosure rule that would require corporations to make public more information about their overseas subsidiaries.

This rule would affect the estimated $2.4 trillion in profits that corporations ranging from Apple to Walmart have shunted offshore in order to avoid paying U.S. corporate taxes. Right now, the rules for disclosing corporate use of offshore tax havens is, as the tax code itself, riddled with loopholes.

For one thing, companies are not required to report their tax liabilities on a country-by-country basis, so the public – including investors in these companies – have no way to accurately judge how a company is lowering its tax liabilities or what would happen if a country decides to radically change its tax policies. Nor do companies routinely report the names and locations of their subsidiaries; no one knew, for example, that Walmart had 78 subsidiaries in overseas tax havens, with $76 billion in assets, before researchers for Americans for Tax Fairness ferreted out the information.

Another Americans for Tax Fairness report found that the pharmaceutical company Pfizer was holding twice as much of its offshore profits in overseas subsidiaries as it was reporting to the public.

This lack of transparency does harm to investors – who should know details of how the companies they invest in are funneling their profits and the risks associated with their tax-avoidance strategies – and harms the public as a whole, which is shortchanged every time corporations game the system to avoid paying the taxes they owe.

That is why it’s important for people to take a few minutes now to tell the SEC to require corporations to tell the truth about their overseas subsidiaries. After all, expecting a corporation to be honest about how and where it earns its profits should not be too much to ask.

This blog originally appeared at OurFuture.org on July 21, 2016. Reprinted with permission.

Isaiah J. Poole worked at Campaign for America’s Future. He attended Pennsylvania State University and lives in Washington, DC.

Financial Transactions/Wall Street Speculation Tax Picks Up Steam

Tuesday, July 19th, 2016

Dave JohnsonThe idea of putting a small “Robin Hood” tax on financial transactions has been kicking around for a while, but in the last month the idea has picked up some real steam.

The Financial Transaction Tax (FTT), also called a “Wall Street Speculation Tax,” proposal asks for a small tax on financial transactions. Such a tax would slow down extreme speculation while raising money to pay for essential public services. The idea has been called a “Robin Hood Tax” because it takes from the rich. The FTT is a very tiny tax. Some proposals have suggested a tax of just three hundredths of a percent – a mere 30 cents on a $1,000 stock transaction.

This small tax would raise a lot of money, largely from automated “high-frequency trading.” This is an extreme practice of using computers to place extremely high volumes of stock orders at extremely high speeds, buying and selling the same shares sometimes in a fraction of a second. As much as half or more of all stock trading volume now comes from this high-speed trading. This practice makes extreme profits from a few traders but increases “volatility” (risk) in the market while doing nothing that benefits the economy.

A small FTT would make high-speed trading more costly, slowing it down while raising money for public services. For stocks, bonds and other financial transactions, the tax would be so small as to be practically unnoticed, while still raising significant sums because of the volume of trading.

An FTT has been endorsed by the 2016 Democratic Party Platform draft, which says:

“We support a financial transactions tax on Wall Street to curb excessive speculation and high-frequency trading, which has threatened financial markets. We acknowledge that there is room within our party for a diversity of views on a broader financial transactions tax.”

Hillary Clinton’s financial services reform proposal include a piece of the idea, applying it only to high-frequency trading:

Impose a tax on high-frequency trading. The growth of high-frequency trading has unnecessarily placed stress on our markets, created instability, and enabled unfair and abusive trading strategies. Hillary would impose a tax on harmful high-frequency trading and reform rules to make our stock markets fairer, more open, and transparent.

Bernie Sanders proposed an FTT on “high-speed trading and other forms of Wall Street speculation; proceeds would be used to provide debt-free public college education.” He hadalso supported previous FTT proposals, the 2011 and 2013 Harkin-DeFazio bills calling for a 0.03 percent tax on the sales of stocks and bonds.

A year ago Jared Bernstein explained the benefits in a New York Times op-ed, “The Case for a Tax on Financial Transactions,” writing:

An itty-bitty, one-basis-point transaction tax (a basis point is one-hundredth of a percentage point, or 0.01 percent) would raise $185 billion over 10 years… That would be enough to finance an ambitious expansion of prekindergarten programs for 3- and 4-year-olds and restore funding of college assistance for low-income students.

What’s more, a financial transaction tax could significantly reduce the amount of high-frequency trading.

… A one-basis-point tax on $1,000 worth of stock would cost the stock trader a dime. A $100,000 trade would generate a tax of only $10.

[. . .] 75 percent of the liability from the tax would fall on the top fifth of taxpayers, and 40 percent on the top 1 percent. The tax would also fall more on high-volume traders than on long-term investors, of course.

New DeFazio FTT Bill Introduced

This week Rep. Peter DeFazio (D-Ore.) introduced a FTT bill. His bill would raise $417 billion over 10 years, which could be used to fund national priorities like free higher education or job-creating infrastructure repair. At a news conference DeFazio said:

“Thanks to the reckless greed of Wall Street over the past few decades, the American economy is a grossly unbalanced playing field,” said Rep. DeFazio. “The only way we can level it is if we rein in reckless speculative financial trading and curb near-instantaneous high-volume trades that create instability in the stock market and our national economy. These financial practices have no intrinsic value, and exist to make a quick buck for already-wealthy speculators. If we want to give middle-class families a fair shot at a strong economy that works for all Americans, we need to put Main Street first.”

The legislation is supported by the Take On Wall Street Coalition. Learn more about the FTT/Wall Street Speculation Tax at the Take On Wall Street website.

This post originally appeared on ourfuture.org on July 14, 2016. Reprinted with Permission.

Dave Johnson has more than 20 years of technology industry experience. His earlier career included technical positions, including video game design at Atari and Imagic. He was a pioneer in design and development of productivity and educational applications of personal computers. More recently he helped co-found a company developing desktop systems to validate carbon trading in the US.

Bowles-Simpson 'B-S' Zombie Plan Tells Working People to 'Drop Dead'

Tuesday, February 19th, 2013

Jackie TortoraIt’s back. No matter how many times working people reject the Bowles-Simpson “B-S” budget plan that cynically claims it would “promote economic growth “—but would actually snuff out the recovery and cut lifelines for working families—it keeps coming back to the table.

Erskine Bowles and Alan Simpson released another tired plan today that would cut Social Security COLAs to pay for lower tax rates for corporations and the wealthiest Americans, among other things.

AFL-CIO President Richard Trumka released the following statement:

Once again, Bowles and Simpson have produced a plan that tells working people to “drop dead.” In December 2010, Bowles and Simpson put forward a budget blueprint that proposed to cut tax rates for corporations and the richest Americans and eliminate taxes on overseas corporate profits, and then pay for these lower tax rates by cutting Social Security benefits, shifting Medicare costs to individuals, taxing health benefits and cutting federal employees’ pay, benefits and jobs. The updated budget blueprint Bowles and Simpson put forward today cuts tax rates for the richest Americans and corporations and pays for these lower tax rates by cutting Social Security COLAs, taxing health benefits and cutting federal employees’ health and retirement benefits. For working people and the future of our nation, it is dead on arrival.

In recent actions and a call-in day to Congress, working families have urged their representatives and senators to:

  • Protect Social Security, Medicare and Medicaid from benefit cuts.
  • Repeal the “sequester” and close loopholes for Wall Street and the wealthiest 2% of Americans instead.

This post was originally posted on AFL-CIO on Feb. 19, 2013. Reprinted with Permission.

About the Author: Jackie Tortora is the blog editor and social media manager at the AFL-CIO.

Corporate Profits Hit Record High While Worker Wages Hit Record Low

Tuesday, December 4th, 2012

A constant conservative charge against President Obama is that he is inherently anti-business. However, businesses keep defying the storyline by making larger and larger profits, rebounding nicely out of the Great Recession.

In the third quarter of this year, “corporate earnings were $1.75 trillion, up 18.6% from a year ago.” Corporations are currently making more as a percentage of the economy than they ever have since such records were kept. But at the same time, wages as a percentage of the economy are at an all-time low, as this chart shows. (The red line is corporate profits; the blue line is private sector wages.):

 

Corporations made a record $824 billion in profits last year as well, while the stock market has had one of its best performances since 1900 while Obama has been in office.

Meanwhile, workers are getting the short end of the stick. As CNN Money explained, “a separate government reading shows that total wages have now fallen to a record low of 43.5% of GDP. Until 1975, wages almost always accounted for at least half of GDP, and had been as high as 49% as recently as early 2001.”

This post was originally posted on Think Progress on December 3, 2012. Reprinted with Permission.

About the Author: Pat Garofalo is the Economic Policy Editor for ThinkProgress.org at the Center for American Progress Action Fund. Pat’s work has also appeared in The Nation, U.S. News & World Report, The Guardian, the Washington Examiner, and In These Times. He has been a guest on MSNBC and Al-Jazeera television, as well as many radio shows. Pat graduated from Brandeis University, where he was the editor-in-chief of The Brandeis Hoot, Brandeis’ community newspaper, and worked for the International Center for Ethics, Justice, and Public Life.

How A Proposed Pennsylvania Law Would Make Workers Pay Taxes To Their Boss

Wednesday, October 24th, 2012

According to Good Jobs First, an organization that promotes accountability in economic development, several states allow corporations to literally pocket their employees’ tax payments. Rather than having those taxes go towards public services, the companies withhold money from their workers’ paychecks and just keep it, never remitting it to the state, under the guise of a job creation program.

Good Jobs First found that “nearly $700 million is getting diverted each year. And it is very unlikely that the affected workers are aware, given that no state requires that the diversion be disclosed on pay stubs.” Now, Pennsylvania is considering becoming the latest state to participate, as the Philadelphia City Paper reported:

Republican Governor Tom Corbett is deciding whether or not to sign legislation that would require some workers to pay taxes to their bosses. Yes, you read that right. The bill, which would allow companies that hire at least 250 new workers in the state to keep 95-percent of the workers’ withheld income tax, is an effort to to recruit Oracle to the state.

Your taxes would get withheld by your boss like normal, but they would then keep them and spend it on private jets or monogrammed bathroom fixtures or whatever instead of turning them over to the state–turning your tax dollars over to the state being the whole reason they were ostensibly “withheld” in the first place.

“These deals typify corporate socialism, in which business gains are privatized and costs socialized,” wrote Reuters David Cay Johnson. “Leaders in both parties embrace these giveaways because they draw campaign donations from corporate interests and votes from people who do not understand that they are subsidizing huge companies.” The Pennsylvania Budget and Policy Center listed a host of reasons that Gov. Tom Corbett (R-PA) should reject the law, including its effect on state revenue and its loopholes that will allow companies to collect their workers’ tax payments even if they create no new jobs.

This post originally appeared in ThinkProgress’s Wonk Room on October 24, 2012.  Reprinted with permission.

About the Author: Pat Garofalo is an Economic Policy Editor for ThinkProgress.org at the Center for American Progress Action Fund. Pat’s work has also appeared in The Nation, U.S. News & World Report, The Guardian, the Washington Examiner, and In These Times. He has been a guest on MSNBC and Al-Jazeera television, as well as many radio shows. Pat graduated from Brandeis University, where he was the editor-in-chief of The Brandeis Hoot, Brandeis’ community newspaper, and worked for the International Center for Ethics, Justice, and Public Life.

New Law Ups the Ante Significantly for California Employers Who Are Caught Misclassifying Employees As Independent Contractors

Tuesday, October 18th, 2011

Brad Yamauchi

Kevin AllenBackground

One common strategy used by companies to cut labor costs is to classify as much of its work force as “independent contractors” as possible. A company does not have to pay payroll taxes for independent contractors nor does it have to worry about pesky labor code requirements pertaining to minimum wages, overtime, meal and rest breaks, or expense reimbursement requirements. Additionally, a company does not have to cover independent contractors under workers’ compensation insurance, and is not liable for payments under unemployment insurance, disability insurance, or social security.

Given these cost savings, it should, perhaps, not be surprising that there has been a trend in companies classifying more of their workforce as independent contractors. A 2007 study by the General Accounting Office estimated that the number of workers classified as independent contractors rose by almost two million between 1995 and 2005 alone.

However, just calling someone an independent contractor does make it so and many companies do so without considering the legal distinctions between employees and independent contractors. Indeed, there is a presumption that workers are employees (Labor Code Section 3357) and a company that wishes to rebut this presumption will be required to undergo a multi-factor test which includes questions regarding whether the company has control, or the right to control, how the work is done and the manner and means by it is performed. See, S. G. Borello & Sons, Inc. v Dept. of Industrial Relations (1989) 48 Cal.3d 341. If they are unable to do so, then the worker will be classified as an employee and the company will potentially be on the hook for four years of overtime wages, meal and rest premiums, etc.

The New Law

S.B. 459 was chaptered by California’s Secretary of State as Chapter 706, Statutes of 2011. It will appear as Sections 226.8 and 2753 of the California Labor Code. The new law:

  • Prohibits the “willful misclassification” which is defined as “avoiding employee status for an individual by voluntarily and knowingly misclassifying that individual as an independent contractor.”
  • Prohibits charging a misclassified individual “a fee or making any deductions from their compensation for any purpose, including for goods, materials, space rental, services, government licenses, repairs, equipment maintenance, or fines arising from the individual’s employment where any of the acts… would have violated the law if the individual had not been misclassified.”
  • Subjects violators to dramatic civil penalties of at least $5,000 and as much $15,000 per violation, in  addition to any other penalties or fines permitted by law. Violators who are determined to have engaged in a  pattern of violations are subject to a civil penalty of at least $10,000 and as much as $25,000 per violation.
  • Gives the Labor and Workforce Development Agency authority to assess penalties and includes special requirements for licensed contractors subject to the Contractors’ State License Board.
  • Subjects non-lawyers who advise an employer to misclassify a worker to joint and several liability with the employer.

Although independent contractor misclassification cases are nothing new, the new law will lead to an increase in such lawsuits. Perhaps the most significant change is the addition of the new penalties. To wit, a company engaged in 100 violations could be liable for $2,500,000 in penalties under the new statute, in addition to the existing remedies (such as attorney’s fees and costs under Labor Code Section 218.5, penalties under Labor Code Section 203 and 226, interest).

The bottom line– Companies should think twice before misclassifying their work force to avoid paying employees premium wages and avoid payroll taxes!

About the authors:Brad Yamauchi is a partner and Kevin Allen is a litigation associate at Minami Tamaki LLP in San Francisco, California.  The firm has litigated individual and class action wage and hour, civil rights and financial and consumer fraud cases for 35+ years. It is currently handling class action misclassification claims in the hi-tech, restaurant, retail, communications and trucking industries on behalf of thousands of employees.

Business Owners, Investors Say Tax Changes Make ‘Zero Difference’ In Hiring: ‘I’m Not Sure What The Connection Is’

Tuesday, October 4th, 2011

Tanya SomanaderWrapping the wealthy in the term “job creator,” Republican lawmakers are hammering President Obama over the “Buffett rule,” a tax reform policy based on the simple and popular notion that millionaires should pay their fair share in taxes. To the GOP, this is a surefire way to ensure millionaires or “job creators” do not invest in the economy. “The reason we tax cigarettes in this country is to get people to stop smoking,” said House Budget Committee Chairman Paul Ryan (R-WI). “If you tax capital more, you get less capital. If you tax job creators more, you get fewer jobs.”

But a surprising group of people find that to be entirely untrue: the “job creators” themselves. As the billionaire behind the Buffett Rule, Warren Buffett, explained, “I have worked with investors for 60 years and I have yet to see anyone — not even when capital gains rates were 39.9 percent in 1976-77 — shy away from a sensible investment because of the tax rate on the potential gain. People invest to make money, and potential taxes have never scared them off.”

Indeed, 200 millionaires created a group known as the Patriotic Millionaires to make this exact case. In a direct rebuttal of the GOP, members of the group like Ask.com founder Garrett Gruener noted that a higher tax rate makes “zero difference” in how he invests:

Ask.com founder and Oakland venture capitalist Garrett Gruener said that changes in the marginal tax rates make “zero difference” about where he is going to invest.

“The kind of investing I’ve done for the last 25 years isn’t based on how a few points of the income tax rates change,” said Gruener, a Democrat and member of the Patriotic Millionaires. But “somehow, the Republicans have managed to convince 98 percent of the people that they are affected by how 2 percent of the population is taxed.”[…]

Business owners also dismantled the other Republican talking point that higher tax rates will harm small businesses. “I’m not sure what the connection is” between raising tax rates and hiring, said Anchor Brewing CEO Keith Greggor. Anchor has added 26 full-time and 10 part-time employees since last year. Not a lot of “small-business owners I know are millionaires,” Greggor added. SF Made, an organization that represents 230 San Francisco manufacturers with 100 or fewer employees, said if there is a connection between raising taxes and inhibiting small-business investment, “we haven’t seen it.”

Patriotic Millionaires launched a video last month challenging Republican millionaires in Congress for their opposition to the Buffett Rule, stating that millionaire lawmakers’ “continued support of policies that advance their own economic self-interests is un-American.” But if Republican lawmakers are unwilling to listen to the “job creators” they say they speak for, then perhaps they will heed the advice of their figurehead President Ronald Reagan. After all, the Buffett rule is practically his idea.

Disclaimer: The thoughts and opinions of this post are the author’s alone and do not represent those of Workplace Fairness.

This blog originally appeared in ThinkProgress on October 3, 2011. Reprinted with permission.

About the Author: Tanya Somanader is a reporter/blogger for ThinkProgress.org at the Center for American Progress Action Fund. Tanya grew up in Pepper Pike, Ohio and holds a B.A. in international relations and history from Brown University. Prior to joining ThinkProgress, Tanya was a staff member in the Office of Senator Sherrod Brown, working on issues ranging from foreign policy and defense to civil rights and social policy.

The Filthy Rich Shout "Greed Is Good" and Party With The Politicians

Friday, August 19th, 2011

jonathan-tasiniWhen I wrote the “The Audacity of Greed” in 2008, I had a chapter called “Vodka and Penises” which detailed a rather unique birthday party thrown in Sardinia, Italy, in 2000 by Tyko CEO Dennis Kozlowski in honor of his wife–it featured vodka spraying from the penis of a replica of Michelangelo’s David. Kozlowski, who eventually went to jail for stealing lots of company money including the funds to pay for this little soiree, flew seventy-five guests to the Hotel Cala di Volpe where the privileged invitees played golf and tennis, ate fine food, listened to a performance by the singer Jimmy Buffett (who was paid a fee of $250,000 to appear) and enjoyed a birthday cake in the shape of a woman’s breasts festooned with sparklers on top.

It was a symbol of the greed and avarice coursing through American business.

And it ain’t over–as Leon Black is happy to demonstrate.

Let’s set the backdrop first: millions of Americans are without work, millions more can’t find decent paying work, we still are trying to dig out of a financial crisis caused largely by greed and avarice on Wall Street, we have the greatest divide between rich and poor in 100 years, and we are enduring a longer-term attack against the people by a bankrupt “free market” system that values a few CEOs over the rest of us.

No matter. The party must continue:

Last Saturday night, the financier Leon D. Black celebrated his 60th with a blowout at his oceanfront estate in Southampton, on Long Island. After a buffet dinner featuring a seared foie gras station, some 200 guests took in a show by Elton John. The pop music legend, who closed with “Crocodile Rock,” was paid at least $1 million for the hour-and-a-half performance.

And:

Mr. Black had his backyard transformed into a faux nightclub setting, constructing a wooden deck over his swimming pool and building a tent for Mr. John’s concert. After a buffet of crab cakes and steak, partygoers sat on couches with big puffy pillows.

Who was there?

The stars of music and fashion collided with a who’s who of Wall Street. Revelers included Michael R. Milken, the junk-bond pioneer and Mr. Black’s boss at Drexel Burnham Lambert in the 1980s; Julian H. Robertson Jr. , the hedge fund investor; Lloyd C. Blankfein, the chief executive of Goldman Sachs; and Mr. Schwarzman, head of Blackstone Group.Rounding out the guest list were politicians including Mayor Michael R. Bloomberg and Senator Charles E. Schumer of New York, who rubbed elbows with the media celebrities Martha Stewart and Howard Stern.[emphasis added]

And:

On Saturday night, to be sure, there was little talk of carried interest at the Blacks’ home on Meadow Lane, one of the Hamptons most desirable addresses for its panoramic views of the Atlantic Ocean and Shinnecock Bay. He counts among his neighbors Calvin Klein and David H. Koch, the billionaire industrialist.[emphasis added]

So, here is what is important to glean from this obscene affair, which underscores how we have been robbed–and how we will continue to be robbed in the future.

In my most recent book, “It’s Not Raining, We’re Being Peed On,” I wrote about “carried interest”. Private equity firms get a special tax break—it’s called “carried interest”, Rather than being taxed at the top rate of 35 percent, the private equity fund managers like Black only pay 15 percent through a loophole called “carried interest.” To understand carried interest, you have to first understand how money managers get paid in the yacht-sailing, mansion-buying world of private equity.

First, they receive a fee, which is a percentage of the funds they invest. This fee is usually in the range of two percent, and is taxed like your run-of-the-mill wage income.

Second, and far more lucratively, money managers get a fee based on the performance of their fund—a fee in the range of 20 percent. It’s the second fee that is the so-called “carried interest”—and it’s how the money managers of private equity really rake in the big bucks that pay for their Picassos, yachts and mansions.

In the normal world of taxable income (and let me say that nothing in the tax code is simple when it comes to schemes that allow people like Black to shelter their money), carried interest is taxed as investment income—at the capital gains level of 15 percent (much lower than the top wage income rate), even though most of these managers invest very little, if any, of their own money.

So, a private equity big shot honcho hauling down millions of dollars in “incentive” is taxed at a 15 percent rate, while the receptionist who works in his office, or the police officer who guards the equity baron’s property, probably earn $50,000 or so if they’re lucky—and those average working people pay a 25 percent tax rate on that income (not to mention payroll taxes), a far larger share of their income than the fellow who banks “carried interest.”

Which is how Black can afford to throw obscene birthday parties.

How “carried interest” continue to remain in place can be summed up, in large part, with two words: Chuck Schumer. Schumer has been one of Wall Street’s greatest defenders. And, while there have been calls to eliminate the “carried interest” bonanza, Schumer has blocked that effort time and again, and has also, most recently, flip-flopped on the absurd proposal to give corporate American a tax holiday on the profits companies have stashed over seas.

I understand the movtivation: Wall Street is a huge honeypot for campaign contributions. That is Schumer’s obsession.

But, keeping “carried interest” costs billions of dollars in money lost to our government’s treasury–money for schools, health care for seniors, research, and jobs.

One final point on the private equity world. Even if the “carried interest” is eliminated, we need to keep another point in mind: private equity firms make their huge profits by buying up companies and stripping them of hundreds of thousands of workers in the name of “efficiency”. The longer-term economic crisis is, at heart, a hammering down of wages–which has led to deep despair among the people who can’t make ends meet. Private equity firms have been at the leading edge of feeding that disastrous economic system.

Which is why we should care–and take notice–of the people who party and rub shoulders at these kinds of obscene events.

They just do not care.

Ultimately, for all the rhetoric, this is about the power and wealth of the business and political elite.

It is not about us. Until we torch this system.

*This blog originally appeared in Working Life on August 19, 2011.

About the Author: Jonathan Tasini is the executive director of Labor Research Association. Tasini ran for the Democratic nomination for the U.S. Senate in New York. For the past 25 years, Jonathan has been a union leader and organizer, a social activist, and a commentator and writer on work, labor and the economy. From 1990 to April 2003, he served as president of the National Writers Union (United Auto Workers Local 1981).He was the lead plaintiff in Tasini vs. The New York Times, the landmark electronic rights case that took on the corporate media’s assault on the rights of thousands of freelance authors.

AFSCME Members Rally to Save Public Services

Thursday, February 25th, 2010

Image: James ParksWhile state and local governments and school districts across the country struggle with budget deficits, AFSCME members are standing up to tell their elected representatives that raising revenues is the best solution to a budget crisis instead of cutting critical public services just when they are needed the most.

State and local governments and school districts have a $178 billion budget shortfall this year alone.

In Illinois, more than 3,000 activists, including hundreds of members of AFSCME Council 31, rallied at the state Capitol rotunda in Springfield this month to demand that lawmakers pass legislation to increase the individual income tax rate and expand the state’s sales tax base.

AFSCME members in Washington State lobbied lawmakers to preserve state services.

AFSCME members in Washington State lobbied lawmakers to preserve state services.

Meanwhile, some 1,500 AFSCME members from throughout New York State demonstrated and met with legislators in Albany earlier this month to find a fair way to protect essential public services.

AFSCME President Gerald McEntee told the New York State workers:

Elected leaders are on the verge of destroying vital public services and putting more people out of work. They’re jeopardizing the health and safety of the people and our communities.

In Maryland, a delegation of AFSCME members carried boxes of “Budget Fight Back” cards to their lawmakers in January. Signed by more than 3,000 state employees, the cards propose a plan to generate more than $2 billion in revenue to close a budget gap, including drawing on the state’s rainy day fund, expanding the sales tax to more services and increasing gas and alcohol taxes.

You can read more about efforts by AFSCME members in other states to save public services on AFSCME’s website here.

*This article originally appeared in AFL-CIO blog on February 24, 2010. Reprinted with permission.

About the Author: James Parks had his first encounter with unions at Gannett’s newspaper in Cincinnati when his colleagues in the newsroom tried to organize a unit of The Newspaper Guild. He saw firsthand how companies pull out all the stops to prevent workers from forming a union. He is a journalist by trade, and worked for newspapers in five different states before joining the AFL-CIO staff in 1990. He has also been a seminary student, drug counselor, community organizer, event planner, adjunct college professor and county bureaucrat. His proudest career moment, though, was when he served, along with other union members and staff, as an official observer for South Africa’s first multiracial elections. Author photo by Joe Kekeris

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