THE PRESIDENCY: “STABLE GENIUS?” – UNLIKELY – BUT, EVEN TRUMP’S HARSHEST CRITICS ADMIT THAT HE’S AN “EXTRAORDINARILY TALENTED CON MAN” – Move Over Charles Ponzi, Bernie Madoff, & Bernie Cornfield, You’ve Got Company At The Top!

http://www.newsweek.com/robert-reich-trump-may-be-dumb-he-has-plenty-emotional-intelligence-773200

Robert Reich writes in Newsweek:

For more than a year now, I’ve been hearing from people in the inner circles of official Washington – GOP lobbyists, Republican pundits, even a few Republican members of Congress – that Donald Trump is remarkably stupid.

I figured they couldn’t be right because really stupid people don’t become presidents of the United States. Even George W. Bush was smart enough to hire smart people to run his campaign and then his White House.

Several months back when Secretary of State Rex Tillerson called Trump a “fucking moron,” I discounted it. I know firsthand how frustrating it can be to serve in a president’s cabinet, and I’ve heard members of other president’s cabinets describe their bosses in similar terms.

Now comes “ Fire and Fury, ” a book by journalist Michael Wolff, who interviewed more than 200 people who dealt with Trump as a candidate and president, including senior White House staff members.

In it, National Security Advisor H.R. McMaster calls Trump a “dope.” Treasury Secretary Steve Mnuchin and former Chief of Staff Reince Priebus both refer to him as an “idiot.” Rupert Murdoch says Trump is a “fucking idiot.”

GettyImages-872383186Donald Trump’s hair blows in the wind as he boards Air Force One on November 10, 2017. JIM WATSON/AFP/GETTY

Trump’s chief economic adviser Gary Cohn describes Trump as “dumb as shit,” explaining that “Trump won’t read anything — not one-page memos, not the brief policy papers; nothing. He gets up halfway through meetings with world leaders because he is bored.”

When one of Trump’s campaign aides tried to educate him about the Constitution, Trump couldn’t focus. “I got as far as the Fourth Amendment,” the aide recalled, “before his finger is pulling down on his lip and his eyes are rolling back in his head.”

Trump doesn’t think he’s stupid, of course. As he recounted, “I went to an Ivy League college … I did very well. I’m a very intelligent person.”

Yet Trump wasn’t exactly an academic star. One of his professors at the University of Pennsylvania’s Wharton School of Business and Finance purportedly said that he was “the dumbest goddamn student I ever had.”

Trump biographer Gwenda Blair wrote in 2001 that Trump was admitted to Wharton on a special favor from a “friendly” admissions officer who had known Trump’s older brother.

But hold on. It would be dangerous to underestimate this man.

Even if Trump doesn’t read, can’t follow a logical argument, and has the attention span of a fruit fly, it still doesn’t follow that he’s stupid.

There’s another form of intelligence, called “emotional intelligence.”

Emotional intelligence is a concept developed by two psychologists, John Mayer of the University of New Hampshire and Yale’s Peter Salovey, and it was popularized by Dan Goleman in his 1996 book of the same name.

Mayer and Salovey define emotional intelligence as the ability to do two things – “understand and manage our own emotions,” and “recognize and influence the emotions of others.”

Granted, Trump hasn’t displayed much capacity for the first. He’s thin-skinned, narcissistic, and vindictive.

As dozens of Republican foreign policy experts put it, “He is unable or unwilling to separate truth from falsehood. He does not encourage conflicting views. He lacks self-control and acts impetuously. He cannot tolerate criticism.”

Okay, but what about Mayer and Salovey’s second aspect of emotional intelligence – influencing the emotions of others?

This is where Trump shines. He knows how to manipulate people. He has an uncanny ability to discover their emotional vulnerabilities – their fears, anxieties, prejudices, and darkest desires – and use them for his own purposes.

To put it another way, Trump is an extraordinarily talented conman.

He’s always been a conman. He conned hundreds of young people and their parents into paying to attend his near worthless Trump University. He conned banks into lending him more money even after he repeatedly failed to pay them. He conned contractors to work for them and then stiffed them.

Granted, during he hasn’t always been a great conman. Had he been, his cons would have paid off.

By his own account, in 1976, when Trump was starting his career, he was worth about $200 million, much of it from his father. Today he says he’s worth some $8 billion. If he’d just put the original $200 million into an index fund and reinvested the dividends, he’d be worth $12 billion today.

But he’s been a great political conman. He conned 62,979,879 Americans to vote for him in November 2016 by getting them to believe his lies about Mexicans, Muslims, African-Americans, Barack Obama, Hillary Clinton, and all the “wonderful,” “beautiful” things he’d do for the people who’d support him.

And he’s still conning most of them.

Political conning is Trump’s genius. It’s this genius – when combined with his utter stupidity in every other dimension of his being – that poses the greatest danger to America and the world.

Robert Reich is the chancellor’s professor of public policy at the University of California, Berkeley , and a senior fellow at the Blum Center for Developing Economies. He served as secretary of labor in the Clinton administration, and Time magazine named him one of the 10 most effective Cabinet secretaries of the 20th century. He has written 14 books, including the best-sellers Aftershock, The Work of Nations and Beyond Outrage and, most recently, Saving Capitalism. He is also a founding editor of The American Prospect magazine, chairman of Common Cause, a member of the American Academy of Arts and Sciences and co-creator of the award-winning documentary Inequality for All.”

*************************************************

Trump is a “danger to America and the world.” Let’s just hope we survive him and his nasty, would-be authoritarian regime!

PWS

01-08-18

 

THE GRIFTERS: Party Of Liars — GOP Tax Plan Proposes To Loot America For the Rich, Limit Government Services For Everyone Else, & Leave Future Generations To Pay The Price — Not Surprisingly, They Lie About It And Assume That Non-Fat-Cat Supporters Are Too Dumb Or Biased to Figure It Out! — Fact Checker Gives GOP Politicos Coveted “Four Pinocchios!”

https://www.washingtonpost.com/news/fact-checker/wp/2017/09/29/trump-aides-sell-tax-plan-with-pinocchio-laden-claims/

Glenn Kessler writes for the “Fact Checker” in the Washington Post.

The wealthy are not getting a tax cut under our plan.”
— Gary Cohn, director of the White House Economic Council, in an interview on ABC’s “Good Morning America,” Sept. 28, 2017

“The numbers are about a trillion and a half to the baseline. But more importantly, it’s a trillion dollars to policy, which is the right way of looking at it. We think there will be $2 trillion of growth. So we think this tax plan will cut down the deficits by a trillion dollars.”
— Treasury Secretary Steve Mnuchin, in an interview on Fox News, Sept. 28

In selling President Trump’s tax plan, his aides have resorted to making strikingly misleading statements to defend it.

At the moment, there are few details about the tax plan, only broad strokes. That makes it easier for the administration to make big claims as analysts scramble to try to make sense of the plan’s possible impact. That will be much harder once an actual tax bill is written and the details can be analyzed in depth.

In the meantime, we have a pair of Four-Pinocchio claims that are worth highlighting.

 

‘The wealthy are not getting a tax cut under our plan’

The Trump tax plan drops the top bracket from 39.6 to 35 percent, and allows for the possibility of a 25 percent top rate through a pass-through entity. It presumably would also eliminate a 3.8 percent Obamacare tax on investment income that hits only upper-income taxpayers.

So, on its face, this is a ridiculous statement to make for any plan that includes reductions in tax rates. That’s because federal income taxes are paid mostly by the wealthy. So when you cut income tax rates, it results in lots of dollars for the wealthiest taxpayers.

According to Treasury Department data, the top 10 percent of income earners in 2016 paid 80 percent of individual income taxes. The top 20 percent paid 94.8 percent. The top 0.1 percent paid an astonishing 24.5 percent of taxes.

In 2014, the latest year Internal Revenue Service data is available, just the top 400 taxpayers — with $127 billion of income — paid $29.4 billion in income taxes, or more than 2 percent of all income taxes. That’s more than the bottom 70 percent of taxpayers combined.

 

In other words, the vast majority of American taxpayers pay little or nothing in income taxes; they instead mostly pay payroll taxes such as Social Security and Medicare. So it really strains credulity for administration officials such as Cohn to say the wealthy will not get a tax cut.

The wealthy pay most of the taxes, so unless the tax plan specifically leaves them untouched — which Trump’s plan does not — they will get big tax cuts. This is why distributional tables often look so lopsided when tax rates are reduced. The administration has suggested that another, higher rate level might be added, presumably so the distributional tables won’t look so ugly, but right now the plan calls for a significant reduction in the top rate.

Besides a reduction in the top tax rate, the tax plan would eliminate the alternative minimum tax (AMT). That in theory should be a boon for the wealthy as well, although it increasingly has snared families in the upper middle class, especially if they live in high-tax states or have many children.

 

The administration has called for eliminating the itemized deduction for state and local taxes, as well as the personal/dependent exemptions, which are key add-ons when calculating the AMT. (If those items were eliminated from the AMT, the number of tax filers facing the AMT would drop by 95 percent, according to the Joint Committee of Taxation.)

So it’s possible that for many people it would be a wash, or even a net loser, depending on whether a tax filer lives in a state with high taxes. According to JCT, the AMT is paid by 36 percent of returns with income of between $200,000 and $500,000, nearly 55 percent between $500,000 and $1 million, and nearly 18 percent above $1 million.

Still, in 2014, the top 400 taxpayers paid nearly $700 million because of the alternative minimum tax, nearly 2.5 percent of the total. The one recent tax return of President Trump that has leaked — for 2005 — shows his tax bill increased $31 million because of the AMT.

Finally, the tax plan calls for eliminating the estate tax, although it is unclear on whether any tax would be required when someone dies. Currently, the estate tax is estimated to affect only about 5,500 estates out of nearly 3 million estates because as much as $11 million can be shielded from taxation.

 

In theory, assets would be subject to capital gains tax instead, which could actually affect more people, but that has not been specified in the administration’s tax outline. If the administration also eliminates the gift tax and does not tax capital gains at death, some income earned by the wealthy may never be taxed.

“We strongly believe the final tax bill will not cut taxes for the wealthy as a class — but there is no way to solve for every single individual in the country,” a White House official said.

‘We think this tax plan will cut down the deficits by a trillion dollars’

Mnuchin made this statement in response to an observation that the nonpartisan Committee for a Responsible Federal Budget has estimated the tax plan would reduce revenue by $2.2 trillion over 10 years. (Including additional interest on the debt, CRFB estimated the deficit would increase by $2.7 trillion.) He argued that instead there would be an additional $2 trillion in revenue from economic growth, resulting in a $1 trillion reduction in the deficit.

Cohn, briefing reporters at the White House a few hours later, offered a different estimate: “We know that 1 percent change in GDP will add $3 trillion back. So if they’re right, we’re only going to pay down $800 billion of the deficit. I’ll live with a $800 billion paydown.”

It’s a little odd that Mnuchin is anticipating $2 trillion in revenue and Cohn is anticipating $3 trillion in revenue. But these are both very rosy estimates of the impact of a tax cut in economic growth. No serious economist believes that a tax cut boosts economic growth so much that the tax cut pays for itself.

The Congressional Budget Office, under Douglas Holtz-Eakin, a Republican, in 2005 estimated that a 10 percent reduction in federal income tax rates would have macroeconomic feedbacks of between 15 and 30 percent. In other words, a $1 trillion tax cut might yield $150 billion to $300 billion in additional revenue. That still means a reduction in revenue of as much as $700 billion.

“The big problem is that there is no fully specified plan,” Holtz-Eakin said. “Without one, you can’t gauge the growth or know the budget cost. I’m broadly sympathetic to the framework, but it is a start, not the finish.”

As Holtz-Eakin put it earlier this year in an opinion column for The Washington Post: “Proposing trillions of dollars in tax cuts and then casually asserting that such a plan would ‘pay for itself with growth’ … is detached from empirical reality.”

Indeed, contrary to popular perception, even Ronald Reagan predicted revenue would fall as a result of his big 1981 tax cut that reduced tax rates. That is shown in Reagan administration and Congressional Budget Office scores of the Reagan tax plan reproduced in a 2011 article for Tax Notes by Bruce Bartlett, who helped craft the 1981 tax cut as a congressional aide at the time. The estimates turned out to be wrong because the 1981-1982 recession was deeper than expected and inflation fell more rapidly than expected, so Reagan boosted taxes just one year after his tax cut.

William A. Niskanen, chairman of Reagan’s Council of Economic Advisors, co-wrote a paper in 1996 that defended Reagan’s economic record but also said it was “an enduring myth” that Reagan officials believed tax cuts would pay for themselves. “This was nonsense from day one, because the credible evidence overwhelmingly indicates that revenue feedbacks from tax cuts is 35 cents per dollar, at most,” Niskanen wrote, noting that “the Reagan administration never assumed that the tax cuts would pay for themselves.”

A Treasury Department study on the impact of tax bills since 1940, first released in 2006 and later updated, found that the 1981 tax cut reduced revenue by $208 billion in its first four years. George W. Bush’s 2001 tax cut — also a rate cut — led to a revenue loss of $91 billion, over four years, the Treasury paper calculated. (The figures are rendered in constant 2012 dollars.)

Both the Reagan and Bush tax cuts came during periods of economic stress, which is certainly not the case now. So there is less room now for a big swing upward in the economy, especially with the country’s aging workforce.

The Treasury Department did not respond to a query for an explanation of Mnuchin’s math. But frankly it is irresponsible for a treasury secretary to claim a certain amount of growth or revenue without even producing the details of a plan, as the details determine the impact on the economy.

The Pinocchio Test

Though the details of the tax plan are sparse, both Cohn and Mnuchin made statements that are simply false. Of course the wealthy will do well under the tax cut, even if certain deductions are eliminated, and it’s silly to pretend otherwise. And it’s a fantasy to claim that the tax cut will pay for itself — and even reduce the deficit — especially in an economy that already has low unemployment and a booming stock market.

Four 🤥

The wealthy are not getting a tax cut under our plan.”
— Gary Cohn, director of the White House Economic Council, in an interview on ABC’s “Good Morning America,” Sept. 28, 2017

“The numbers are about a trillion and a half to the baseline. But more importantly, it’s a trillion dollars to policy, which is the right way of looking at it. We think there will be $2 trillion of growth. So we think this tax plan will cut down the deficits by a trillion dollars.”
— Treasury Secretary Steve Mnuchin, in an interview on Fox News, Sept. 28

In selling President Trump’s tax plan, his aides have resorted to making strikingly misleading statements to defend it.

At the moment, there are few details about the tax plan, only broad strokes. That makes it easier for the administration to make big claims as analysts scramble to try to make sense of the plan’s possible impact. That will be much harder once an actual tax bill is written and the details can be analyzed in depth.

In the meantime, we have a pair of Four-Pinocchio claims that are worth highlighting.

 

‘The wealthy are not getting a tax cut under our plan’

The Trump tax plan drops the top bracket from 39.6 to 35 percent, and allows for the possibility of a 25 percent top rate through a pass-through entity. It presumably would also eliminate a 3.8 percent Obamacare tax on investment income that hits only upper-income taxpayers.

So, on its face, this is a ridiculous statement to make for any plan that includes reductions in tax rates. That’s because federal income taxes are paid mostly by the wealthy. So when you cut income tax rates, it results in lots of dollars for the wealthiest taxpayers.

According to Treasury Department data, the top 10 percent of income earners in 2016 paid 80 percent of individual income taxes. The top 20 percent paid 94.8 percent. The top 0.1 percent paid an astonishing 24.5 percent of taxes.

In 2014, the latest year Internal Revenue Service data is available, just the top 400 taxpayers — with $127 billion of income — paid $29.4 billion in income taxes, or more than 2 percent of all income taxes. That’s more than the bottom 70 percent of taxpayers combined.

 

In other words, the vast majority of American taxpayers pay little or nothing in income taxes; they instead mostly pay payroll taxes such as Social Security and Medicare. So it really strains credulity for administration officials such as Cohn to say the wealthy will not get a tax cut.

The wealthy pay most of the taxes, so unless the tax plan specifically leaves them untouched — which Trump’s plan does not — they will get big tax cuts. This is why distributional tables often look so lopsided when tax rates are reduced. The administration has suggested that another, higher rate level might be added, presumably so the distributional tables won’t look so ugly, but right now the plan calls for a significant reduction in the top rate.

Besides a reduction in the top tax rate, the tax plan would eliminate the alternative minimum tax (AMT). That in theory should be a boon for the wealthy as well, although it increasingly has snared families in the upper middle class, especially if they live in high-tax states or have many children.

 

The administration has called for eliminating the itemized deduction for state and local taxes, as well as the personal/dependent exemptions, which are key add-ons when calculating the AMT. (If those items were eliminated from the AMT, the number of tax filers facing the AMT would drop by 95 percent, according to the Joint Committee of Taxation.)

So it’s possible that for many people it would be a wash, or even a net loser, depending on whether a tax filer lives in a state with high taxes. According to JCT, the AMT is paid by 36 percent of returns with income of between $200,000 and $500,000, nearly 55 percent between $500,000 and $1 million, and nearly 18 percent above $1 million.

Still, in 2014, the top 400 taxpayers paid nearly $700 million because of the alternative minimum tax, nearly 2.5 percent of the total. The one recent tax return of President Trump that has leaked — for 2005 — shows his tax bill increased $31 million because of the AMT.

Finally, the tax plan calls for eliminating the estate tax, although it is unclear on whether any tax would be required when someone dies. Currently, the estate tax is estimated to affect only about 5,500 estates out of nearly 3 million estates because as much as $11 million can be shielded from taxation.

 

In theory, assets would be subject to capital gains tax instead, which could actually affect more people, but that has not been specified in the administration’s tax outline. If the administration also eliminates the gift tax and does not tax capital gains at death, some income earned by the wealthy may never be taxed.

“We strongly believe the final tax bill will not cut taxes for the wealthy as a class — but there is no way to solve for every single individual in the country,” a White House official said.

‘We think this tax plan will cut down the deficits by a trillion dollars’

Mnuchin made this statement in response to an observation that the nonpartisan Committee for a Responsible Federal Budget has estimated the tax plan would reduce revenue by $2.2 trillion over 10 years. (Including additional interest on the debt, CRFB estimated the deficit would increase by $2.7 trillion.) He argued that instead there would be an additional $2 trillion in revenue from economic growth, resulting in a $1 trillion reduction in the deficit.

Cohn, briefing reporters at the White House a few hours later, offered a different estimate: “We know that 1 percent change in GDP will add $3 trillion back. So if they’re right, we’re only going to pay down $800 billion of the deficit. I’ll live with a $800 billion paydown.”

It’s a little odd that Mnuchin is anticipating $2 trillion in revenue and Cohn is anticipating $3 trillion in revenue. But these are both very rosy estimates of the impact of a tax cut in economic growth. No serious economist believes that a tax cut boosts economic growth so much that the tax cut pays for itself.

The Congressional Budget Office, under Douglas Holtz-Eakin, a Republican, in 2005 estimated that a 10 percent reduction in federal income tax rates would have macroeconomic feedbacks of between 15 and 30 percent. In other words, a $1 trillion tax cut might yield $150 billion to $300 billion in additional revenue. That still means a reduction in revenue of as much as $700 billion.

“The big problem is that there is no fully specified plan,” Holtz-Eakin said. “Without one, you can’t gauge the growth or know the budget cost. I’m broadly sympathetic to the framework, but it is a start, not the finish.”

As Holtz-Eakin put it earlier this year in an opinion column for The Washington Post: “Proposing trillions of dollars in tax cuts and then casually asserting that such a plan would ‘pay for itself with growth’ … is detached from empirical reality.”

Indeed, contrary to popular perception, even Ronald Reagan predicted revenue would fall as a result of his big 1981 tax cut that reduced tax rates. That is shown in Reagan administration and Congressional Budget Office scores of the Reagan tax plan reproduced in a 2011 article for Tax Notes by Bruce Bartlett, who helped craft the 1981 tax cut as a congressional aide at the time. The estimates turned out to be wrong because the 1981-1982 recession was deeper than expected and inflation fell more rapidly than expected, so Reagan boosted taxes just one year after his tax cut.

William A. Niskanen, chairman of Reagan’s Council of Economic Advisors, co-wrote a paper in 1996 that defended Reagan’s economic record but also said it was “an enduring myth” that Reagan officials believed tax cuts would pay for themselves. “This was nonsense from day one, because the credible evidence overwhelmingly indicates that revenue feedbacks from tax cuts is 35 cents per dollar, at most,” Niskanen wrote, noting that “the Reagan administration never assumed that the tax cuts would pay for themselves.”

A Treasury Department study on the impact of tax bills since 1940, first released in 2006 and later updated, found that the 1981 tax cut reduced revenue by $208 billion in its first four years. George W. Bush’s 2001 tax cut — also a rate cut — led to a revenue loss of $91 billion, over four years, the Treasury paper calculated. (The figures are rendered in constant 2012 dollars.)

Both the Reagan and Bush tax cuts came during periods of economic stress, which is certainly not the case now. So there is less room now for a big swing upward in the economy, especially with the country’s aging workforce.

The Treasury Department did not respond to a query for an explanation of Mnuchin’s math. But frankly it is irresponsible for a treasury secretary to claim a certain amount of growth or revenue without even producing the details of a plan, as the details determine the impact on the economy.

The Pinocchio Test

Though the details of the tax plan are sparse, both Cohn and Mnuchin made statements that are simply false. Of course the wealthy will do well under the tax cut, even if certain deductions are eliminated, and it’s silly to pretend otherwise. And it’s a fantasy to claim that the tax cut will pay for itself — and even reduce the deficit — especially in an economy that already has low unemployment and a booming stock market.

Four 🤥 🤥 🤥 🤥

********************************************

Four Pinocchios is getting into “Jeff Sessions’s territory!”

But, I can see that they were richly deserved. I watched Steve “Munchkin” Mnuchkin on “Meet the Press” with Churck Todd this AM.  It was appalling!

Munchkin lied about Puerto Rico, lied about the tax plan, and then lied and tried to cover up his own responsibility for trying to get a “freebie” at taxpayer expense for his honeymoon. The idea that there was any “national security” reason for the Munchkin keeping in touch with the White House is preposterous.

Indeed the very idea that Munchkin would have any role in national security other than making sure the checks don’t bounce is prima facie ridiculous. And, if he did, that’s what secure facilities in the CIA part of the nearest U.S. Embassy are for. Or for that matter, that’s what subordinates in the Trasure Department are for. Gotta believe that every once and awhile spooks have to make secure communications with Washington.

When confronted by Todd with his obvious lies and cover-ups, Munchkin just kept on spewing whoppers. Finally, Todd gave up, thanked him, and let the record speak for itself.

PWS

10-01-17