For the richest Americans, Democrats want to shift toward taxing their wealth, instead of just their salaries and the income their assets generate, reports The Wall Street Journal. The personal income tax indirectly touches wealth, but only when assets are sold and become income. At the end of 2017, U.S. households had $3.8 trillion in unrealized gains in stocks and investment funds, plus more in real estate, private businesses and artwork, according to the Economic Innovation Group, a nonprofit focused on bringing investment to low-income areas. Most of the value of estates over $100 million consists of unrealized gains. Much has never been touched by individual income taxes and may never be.
The problem, Democrats say, is that capital gains are taxed only when gains are realized through a sale and become income. An investor who buys $10 million in stock that pays no dividend and watches it grow to $50 million doesn’t pay income tax on that appreciation unless the stock is sold.
If an investor dies before selling, the unrealized gains get wiped out, for income-tax purposes. The heirs treat the assets’ cost basis as $50 million, not $10 million; they face no income tax on the $40 million of capital gains if they sell, although an estate tax may be due. This long-standing elimination of unrealized gains at death, for tax purposes, is called “stepped-up basis.”
It means the optimal tax strategy for the very rich, fine-tuned and promoted by the wealth-planning industry, is straightforward: Hold assets until death, borrow against them for living expenses and barely pay income taxes.
Prying Eyes on This Side of the Border
On the southwestern end of the Tohono O’odham Nation’s reservation, roughly 1 mile from a barbed-wire barricade marking Arizona’s border with the Mexican state of Sonora, stands a small black mast-mounted with cameras and sensors is positioned on a trailer hitched to the truck. The Border Patrol’s monitoring of the reservation has been a grim aspect of everyday life, reports The Intercept. And that surveillance is about to become far more intrusive.
The vehicle is parked where U.S. Customs and Border Protection will soon construct a 160-foot surveillance tower capable of continuously monitoring every person and vehicle within a radius of up to 7.5 miles. The tower will be outfitted with high-definition cameras with night vision, thermal sensors, and ground-sweeping radar, all of which will feed real-time data to Border Patrol agents at a central operating station in Ajo, Arizona. The system will store an archive with the ability to rewind and track individuals’ movements across time — an ability known as “wide-area persistent surveillance.”
CBP plans 10 of these towers across the Tohono O’odham reservation, which spans an area roughly the size of Connecticut. Fueled by the growing demonization of migrants, as well as ongoing fears of foreign terrorism, the U.S. borderlands have become laboratories for new systems of enforcement and control. Firsthand reporting, interviews, and a review of documents for this story provide a window into the high-tech surveillance apparatus CBP is building in the name of deterring illicit migration — and highlight how these same systems often end up targeting other marginalized populations as well as political dissidents.
Insurance Companies Encourage Ransomware Attacks
Ransomware is proliferating across America, disabling computer systems of corporations, city governments, schools and police departments. This month, attackers seeking millions of dollars encrypted the files of 22 Texas municipalities. Overlooked in the ransomware spree is the role of an industry that is both fueling and benefiting from it: insurance. In recent years, cyber insurance sold by domestic and foreign companies has grown into an estimated $7 billion to $8 billion-a-year market in the U.S. alone. While insurers do not release information about ransom payments, ProPublica has found that they often accommodate attackers’ demands, even when alternatives such as saved backup files may be available. The FBI and security researchers say paying ransoms contributes to the profitability and spread of cybercrime and in some cases may ultimately be funding terrorist regimes. But for insurers, it makes financial sense, industry insiders said. It holds down claim costs by avoiding expenses such as covering lost revenue from snarled services and ongoing fees for consultants aiding in data recovery. And, by rewarding hackers, it encourages more ransomware attacks, which in turn frighten more businesses and government agencies into buying policies.
We should look closely at Britain’s decision to elect a man so renowned for his untrustworthiness
In previous British elections, to say that trust was the main issue would have meant simply that trust is the trump card – whichever leader or party could secure most trust would win. Now, the emerging question about trust is whether it even matters anymore.
This is at least partly because Brexit has deepened the crisis of trust. The 2019 election was always going to be about Brexit – and not only because some people would vote according to where they stood on the matter. It was also because the emotional turbulence initiated by the 2016 referendum continues to dominate national politics in a more general way.
Memo from a historian: White ladies cooking in plantation museums are a denial of history
Fall is almost gone and winter is coming, as are hundreds of hearth cooking demonstrations at countless historic homes and plantations throughout the nation.
Like an automated clock, historic kitchens become the center stage for historical storytelling at this time of year.
In New England, these stories sit firmly in the mythos of Thanksgiving, focusing on sterilized versions of the 1621 feast between Pilgrims and Wampanoag. In the mid-Atlantic, these stories blend their Amish, German and Dutch roots to talk about Colonial fare in early America.
Trump and the ‘deep state’ are in lockstep when it comes to torture
It’s a paradox of impeachment politics.
As President Trump faces charges of high crimes and misdemeanors in Congress, he denounces the alleged “deep state” cabal out to get him. His campaign is running a powerful online ad about the supposed conspiracy. It features footage of former CIA director John Brennan and former acting director John McLaughlin at a recent event in Washington. I had a memorable encounter with Brennan at the event, so I know what he’s talking about. No one has demonized the CIA leadership more effectively than Trump.