Big Trump secret about to be revealed

The $83.3 million defamation judgment that writer E. Jean Carroll won Friday against Donald Trump will soon reveal the depth of his finances, long shrouded in smoke and mirrors, disclaimers that his financial statements are not to be trusted, and outright fabrications about his income and wealth.

The secret: does Trump have the money to pay Carroll?

Trump says he’ll appeal. He has few grounds to challenge the federal court judgment. But if Trump does appeal, it will pull back the curtain on his murky finances, where inflated valuations and concealed obligations are common.

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Trump testified almost a year ago that he was sitting on $400 million of cash. Be skeptical. Don’t discount the prospect that Donald conflated his personal money with cash from his MAGA fundraising operations, which by law cannot be used to pay Carroll.

Appealing will require Trump to either deposit the entire judgment amount with the court or obtain a bond covering 20% of the judgment, close to $17 million.

If you were in the financial business, would you loan any money to Trump? What if he offered to pay a fat fee upfront? A high-interest rate? What real estate would you take as collateral to back the bond, knowing that if the appeal fails, Trump will fight to keep you from collecting?

As early as this week, Trump expects a Manhattan judge to impose a fine of more than $300 million for persistent financial fraud.

Naked claim

Even if Trump had $400 million cash a year ago, an unverified claim, he has faced enormous legal and other bills since then. At the same time, his golf courses in Ireland and Scotland continued losing money, public records in London show.

The Carroll case and the expected New York state civil judgment for persistent fraud would consume 96% of the cash he claimed without proof.

Suppose Trump can’t financially qualify to pursue an appeal. In that case, Carroll can enforce judgment, seizing cash in bank accounts and pitting liens on properties such as the portion of Trump Tower that Trump still owns and Mar-a-Lago in Florida. That would take time and cost Trump a small fortune in legal fees — he has a history of stiffing his lawyers — to delay paying Carroll. Meanwhile, interest costs will add to the $83.3 million obligation.

Trump hopes that an appeals court will find the damages award excessive. Death cases, after all, are often settled for a few million dollars, sometimes a few hundred thousand.

He is unlikely to prevail because the jury awarded $18.3 million in compensatory damages and $65 million in punitive damages. As a rule, courts respect punitive awards of less than six times actual damages. This punitive award was about 3.6 times the compensatory damages.

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The punitive damages are intended, as Carroll lawyer Roberta Kaplan told the federal court jury, to get Trump to stop lying about Carroll. After an earlier trial, Trump was judged to have raped Carroll in a Bergdorf-Goodman department store dressing room, and to have lied about it in repeated attacks on Carroll. More than two dozen other women have accused Trump of rape or sexual assault.

Trump insists he never met Carroll and “she’s not my type.” During a pretrial deposition he was shown a photo of himself and his first wife facing E. Jean Carroll and her then husband. Trump misidentified Carroll as his second wife, Marla Maples. When his lawyer interrupted to repair the damage, Trump asserted that the sharply focused image was blurry.

Knowing Trump, I doubt he will stop attacking Carroll. His emotional state and views about women, frozen in puberty, and his declining mental health and cognitive capacity will not facilitate a proper change in conduct.

Fantasy finances

Trump’s finances have always been exercises in fantasy. For example, in 1985, he bought Mar-a-Lago for $10 million. He claimed it was a cash purchase with no mortgage. I have in my home a Chase Bank executive’s letter to Trump promising never to file the Mar-a-Lago mortgage at a courthouse, as banking laws require.

One reality is that Trump borrowed 125% of the purchase price, taking $2 million for himself while claiming he paid from his supposed rich cash deposits. A second is that bankers who declare their illegal conduct rarely get prosecuted or even disciplined, so weak is government regulation of finance in America.

The same year he bought Mar-a-Lago with the hidden mortgage, Trump also acquired the nearly finished Hilton Casino in Atlantic City. He paid with a $325 million loan, from which he shaved off a $5 million fee for himself.

Eventually, he owned three Atlantic City casinos, yet he never invested a dime in that New Jersey resort town. It was all borrowed money. Because he took fees for himself from the loan proceeds, his investment was less than zero, just as with Mar-a-Lago.

Only a foolhardy or corrupt banker would issue Trump a bond enabling his appeal of the $83.3 million award to E. Jean Carroll. If Trump fails to meet the financial qualifications for an appeal, there’s one thing we’ll know for sure: the man who ran for president claiming he was worth more than $10 billion is so financially weak, that when an 80-year-old woman grabbed him by the wallet, he couldn’t perform.

David Cay Johnston co-founded DCReport. He is a best-selling author and investigative journalist who for 13 years reported for The New York Times. Johnston is a specialist in economics and tax issues. He won a 2001 Pulitzer Prize. He teaches at Syracuse University College of Law.

The 3 crucial words missing in Trump ballot case

The Colorado Supreme Court decision Tuesday, barring Donald Trump from the 2024 Republican primary race, ignored the three most relevant words in the 14th Amendment. That almost certainly will greatly benefit Trump in his effort to regain the White House despite his failed coup in 2021.

Don’t expect to hear these three crucial words cited before the United States Supreme Court, which Trump says he will ask to take up the case, or to be the focus of mainstream news reports for reasons I’ll explain.

The Colorado challenge, one of nearly 20 filed so far, hangs on the 14th Amendment’s lifelong ban on holding office for anyone who “engaged in insurrection or rebellion.”

The 1868 amendment ensured that traitors who joined the Confederacy would never hold any office — federal, state or local — unless granted forgiveness by the grace of Congress.

The Colorado case, brought by six Republicans and one independent, argued that the 14th Amendment’s ban on holding office applies to Trump because he riled up a mob outside the White House and sent them to the Capitol two miles away.

By 4 to 3, the Colorado Supreme Court agreed with this argument. The dissenters don’t dispute that Trump motivated the attack, but argue that Trump was neither charged nor convicted of insurrection, which some United States Supreme Court justices are sure to latch onto, rejecting the idea that the 14th Amendment prohibition on holding office is self-executing.

But proving insurrection or rebellion is a much higher standard than our Constitution requires. That’s because the 14th Amendment prohibition also applies to anyone who gave “aid or comfort” to rebels and insurrectionists.

That Trump gave aid and comfort to the coup attempt is indisputable.

For more than three hours, Trump did nothing to stop the mob sacking our Capitol, shouting “hang Mike Pence,” calling for the murder of Speaker Nancy Pelosi and injuring 150 police officers in his failed attempt to overthrow our government.

Trump didn’t call on federal law enforcement or summon readily available National Guard troops.

Instead, Trump “gleefully” watched the attack on television in a room just off the Oval Office. Stephanie Grisham, the White House press secretary, testified that he even rewound some scenes of violence that he considered especially gratifying.

Because appeals deal with issues raised in lower courts — not issues that could have been or should have been raised — the U.S. Supreme Court is unlikely to examine the “aid or comfort” standard.

The high court will face a sticky problem, at least for justices like Samuel Alito and Clarence Thomas, who claim to act based on the plain meaning of words when they were written into our Constitution. Under their legal reasoning, Trump clearly cannot be on any ballot, the words “aid or comfort” being crystal clear.

Of course, Thomas should recuse himself given his wife’s declared support for the insurrectionists. Don’t count on the man who eagerly accepts lavish trips and money from billionaires with interests before the court to find his long-lost ethics.

Other 14th Amendment cases are pending in nearly 20 states. More are likely to be filed. Lawyers in those cases could include “aid or comfort” as a backup argument.

Should the U.S. Supreme Court leave Trump on the Colorado ballot through the legal convenience of sending the matter back to the Colorado courts for further consideration, that will leave time for other cases to proceed. If that happens, there is a good chance that the easily established “aid or comfort” standard will determine Trump’s fitness to be on any ballot in 2024.

How Trump brazenly took tax losses he knew were fraudulent

Donald Trump knowingly committed dozens of brazen tax frauds during the six years when he ran for office and was President, my analysis of the Congressional report on his tax returns and other documents shows. This explains why he fought all the way to the Supreme Court in a failed effort to keep his tax information secret.

One technique he used at least 26 times between 2015 and 2020 was as simple as it was flagrant. Trump filed sole proprietor reports, known as Schedule C, that showed huge business expenses despite having zero revenue. That created losses which Trump used to offset his income from work and investments, thus lowering his income taxes. Additional Schedule Cs had expenses exactly equal to revenues while only a few showed profits.

Trump knew this was unlawful because he lost two trials over his 1984 income taxes in which he did the exact same thing, a story I broke in June 2016. Both judges, in scathing opinions, ruled that Trump committed civil tax fraud.

That Trump persisted in using the same fraudulent technique in six years of recent tax returns is powerful evidence of mens rea or criminal intent. This device is not Trump’s most lucrative tax cheating technique, but it is the easiest for jurors to understand should Trump be indicted on tax charges.

The 65 Schedule Cs Trump filed as a candidate and as president helped him convert a federal tax bill that could have been as high as $46 million into a $2.1 million profit from the federal tax system, my analysis of the Congressional Joint Committee on Taxation staff report shows.

Trump received more than $154.2 million in wages, interest, dividends, capital gains, and pensions over the six years when he ran for president or lived in the White House. Despite this huge revenue stream, Trump reported minus $53.2 million in Adjusted Gross Income, the last number on the front page of your Form 1040 income tax return.

Other Tax Schemes

The Congressional report raises questions about numerous other tax deductions Trump took, including charitable deductions that may be bogus or overstated; treating personal expenses as business expenses; loans to his three older children that may be to escape gift taxes; and reporting almost $5 million of capital contributions as tax-deductible business expenses.

In short, Trump’s tax returns are a rich environment in which questionable conduct is found throughout the filings and needs only seasoned auditors to uncover fictional expenses.

Should our Justice Department or the Manhattan District Attorney’s office ask grand juries to indict Trump for tax crimes, the losses on supposed businesses with no income would be easy for jurors to understand. In contrast, a kitchen sink tax prosecution could confuse jurors because it would involve obscure tax law issues, possibly allowing Trump to slip away.

Year by Year

In four of the six years, Trump’s taxable income was zero.

The report shows that Trump paid no income tax in three of the six years and just $750 in 2016.

Over the six years, he paid $776,126 in net federal income tax. That’s just half of one percent of his positive income, the equivalent of a married couple earning $100,000 paying $500 instead of the typical $8,500. The typical tax rate for Trump’s income class is more than 25%.

Trump received $18.7 million in refunds under the Alternative Minimum Tax, which is $2.8 million more than he paid, a nifty profit off that tax law. Three decades ago Trump lobbied Congress for generous Alternative Minimum Tax refund provisions for himself and other real estate investors.

In four of those six years, all but 2016 and 2017, his Schedule Cs showed losses totaling almost $1.3 million.

Shocking But True

Because New York State tax returns adhere closely to federal rules on reporting income and tax-deductible expense, Trump almost certainly made additional profit off the Empire State tax system.

It may shock you to learn that there are legal ways to turn the burden of income taxes into a source of profit. Still, every sophisticated tax accountant and lawyer knows how business owners, especially real estate operators like Trump, can do this legally. As a leading Manhattan tax lawyer told me years ago: “If you’re big in real estate and pay any income tax, you should sue your tax lawyer for malpractice.”

Workers and pensioners are excluded from the rules that let rich business people and landlords convert the burden of income taxes into the joy of financial gains.

Accounting Alchemy

Medieval alchemists claimed that the mythical Philosopher’s Stone would turn lead into gold. They failed, but thanks to the modern alchemy of tax accounting, the black ink of taxable income can be transformed into the red ink of losses that in turn reduce or eliminate income taxes and can even turn the income tax system into a source of profit.

For decades I’ve been exposing ways that tax law and accounting rules favor the wealthiest business owners, hoping the voters would realize that the tax system that burdens them is, perversely, a lawful source of income for people like Trump.

Trump didn’t limit himself to lawful tax avoidance, my analysis of the Congressional report and other documents shows.

Fraud Trials

This takes us back to 1984, by far Trump’s most lucrative year up to that point. Trump Tower opened at the end of 1983, and his first Atlantic City casino opened in the Spring of 1984. Rivers of greenbacks flowed into Trump’s accounts.

State and city auditors spotted a Schedule C consulting business that showed no fees or other revenue but more than $600,000 in costs. State and city auditors disallowed the losses. Trump appealed. I couldn’t find a record of the IRS taking any action.

In scathing decisions following administrative trials, judges for New York State and City ruled that Trump was not entitled to use losses from this supposed consulting business to offset his other income.

Trump produced no receipts, no invoices, no work papers — nothing indicating the 1984 consulting business was more than a figment of his imagination.

“The record does not explain how Petitioner [Trump] had significant expenses without any concomitant income from his consulting business,” wrote H. Gregory Tillman, the city administrative law judge who tried the case in 1992.

Trump complained of double taxation, but Judge Tillman ruled that claim baseless. Using bold face to emphasize his point—an extraordinary step in a judicial opinion—Judge Tillman wrote, “The problem at issue is not one of double taxation, but of no taxation.”

Trump’s longtime tax accountant and lawyer, Jack Mitnick, gave damning testimony before Judge Tillman.

Photocopier Enables Fraud

The tax return the city received was not an original with “wet” (ink) signatures, but a photocopy.

Asked about the validity of the photocopy, Mitnick gave astonishing testimony.

“We did not” prepare that return, Mitnick testified, referring to himself and his firm. In other words, the tax return was a forgery. Mitnick’s signature was applied using scissors and a photocopy machine. (My first national journalism award, in 1975, was for exposing a corrupt Michigan state senator who put his name on his predecessor’s medical records using a photocopier, then trick the state Supreme Court into giving the supposedly dying senator a law license after he badly flunked the bar exam, and then miraculously recovering and using his law license to swindle his predecessor’s widow out of her fortune.)

Imaginary Businesses?

The Congressional report assumes that all the Schedule Cs on Trump’s recent tax returns actual businesses. Some of them may not exist except in tax filings. Auditors would be smart to demand evidence of business activity such as calendars, correspondence, travel to see potential clients, and the like to determine whether some or all of these businesses exist only on paper, if that.

While we only have details from six recent years of Trump’s taxes, it’s reasonable to suspect that he has used this technique continually since 1984 and may have well used it before then.

There is no statute of limitations on civil tax fraud, so even if Trump is never indicted, he could be pursued to collect taxes owed, along with penalties and interest, going back years or even decades.

But the beauty of the particular Schedule C scheme is that this is plain and simple.

Much more lucrative for Trump, the Congressional report indicates, was Trump apparently treating real estate as a Cost of Goods business rather than applying the real property rules. Bogus or overvalued charitable donations are another area of inquiry the Congressional report recommended.

Much of tax law is esoteric and difficult to grasp. But what Trump did again and again and again—taking expenses for businesses with no revenue—is so simple that jurors should have no trouble understanding the issues were Trump to be indicted by a federal or New York state grand jury.

The Congressional report also notes another tax integrity issue I have spent years exposing: the least compliant taxpayers get away with wrongdoing because fighting them consumes vast amounts of limited government resources. The IRS today is a mere shell of what it was at the turn of the century, or in 1980, in terms of capacity to uncover tax frauds and to pursue enforcement, civil or criminal, against those who thumb their nose at the law. The Transactional Records Access Clearinghouse at Syracuse University is a rich source of information on the decline of the IRS.

The Congressional report notes “the history of difficult negotiations between Mr. Trump’s counsel and IRS personnel” implying this explains why only one auditor was assigned to only one of the six Trump tax returns and that auditor was not allowed to seek advice from the specialists the IRS employees in fields from biology to real estate partnership rules.

Considering that Trump headed our government for four years while obviously cheating on his income taxes, his case deserves whatever resources it takes to bring him to civil and criminal justice.

Trump tax favors for big business lead to growth — of jobs paying $3 million a week

Last year the 237,000 highest paid employees in America together made more money than the lowest paid 60 million workers, my analysis of the latest federal wage statistics shows.

The top employees collected $659.3 billion for their work last year.

The worst paid 60 million workers earned $628.3 billion, about 5% less than the fat cats at the top of the pay ladder.

These pay figures illustrate a long-term trend, heavily influenced by federal government policy, to restrain wages paid to the vast majority and to focus pay increases at the top, especially Congressional antipathy to unions. Without unions, workers have little to no bargaining power.

The bosses hold Executive Class jobs—which DCReport defines as those paying $1 million or more. Million dollar and up positions are the fasted growing jobs in America both in growth rate and pay. And the rate of growth is accelerating.

Over the last three decades the Executive Class grew 325%, ten times the growth in the overall workforce, which increased 33%.

Last year alone, however, the number of Executive Class jobs grew 95 times faster than jobs overall, my analysis of the latest Social Security Wage Statistics report shows. Total jobs grew by 0.3% in 2021 while Executive Class jobs grew by 28.5%.

The 60 million workers at the bottom all made $25,000 or less. That means many of them worked part-time.

Looking only at full-time workers, those making at least $15,000, still shows a huge pay gap. The lowest paid 30 million full-time workers made less than the total paid to those 506 bosses at the top, my analysis of the wage data shows.

This deep and rapidly widening chasm in pay between those at the top and bottom is likely to continue growing under existing federal labor laws, tax policies and spending policies. Last year the 97% of full-time workers making less than $325,000 got pay raises averaging 2.7% while inflation ran 4.7%, leaving the typical worker $1,200 worse off in terms of buying power.

Who is responsible for this? Ultimately the voters are because they chose the Representatives, Senators and President who create the policies that encourage more for the haves and less for 97% of full-time workers and more than 99% of all workers, including part-timers.

Stark Divide

The stark divide between those at the very top of the pay ladder and the 166 millions people earning less than $250,000 a year, especially those in the lowest paying jobs, illustrates how the fruits of America’s economic success are benefitting only a thin sliver of society at the top.

I’ve been analyzing the annual pay statistics for more than a quarter of a century, documenting the steady shift in the share of all American wages and salaries going to those making more than $100,000, and especially to the $1 million and up Executive Class, with flat to falling wages for everyone else.

The savings and investments that the best paid employees can afford only widen the distance between America’s once vibrant but now hollowed out Middle Class and the Executive Class.

This divide plays a major role in fueling the rejection of democracy by many millions of Americans who, both polls and vote results show, are willing to throw away their liberties in the false hope that a dictatorial system will somehow alleviate their financial stress. Donald Trump and other would be dictators promise to alleviate financial pain but their policy pronouncements would do the opposite, instead further enriching the already rich.

The problem in may disparities traces back to voters abandoning the New Deal in 1980 and adopting the pro-business, pro-rich policies proposed in 1980 by Ronald Reagan.

In 1991 the Executive Class collected 2% of all pay. Last year they pocketed 6.7%. Search for this indisputable fact and the only place you will find it is at DCReport and the news organizations we let reprint our work for free.

In 1991 just 55,823 workers made $1 million or more in today’s money. [See footnote] Now that group totals 237,331 people, more than four times as many.

About one in 2,300 people got Executive Class pay in 1991. By 2020 one in 900 workers got Executive Class pay. Last year one in 700 did. This trend shows how Corporate America turns a firehose of greenbacks on its leaders but provides only a trickle of coins for the people whose labors generate the profits.

Revealing Indicator

The most revealing indicator of how the national wage pie is being resliced to favor those at the top is shown by the rapid increase in Executive Class jobs paying more than $50 million per year.

The $50 million and up jobs category was added by Social Security in 1997. The number of these super high paying jobs increased 38-fold in the next 24 years.

Just 13 employees made $50 million or more in 1997.

Last year 506 people held such highly paid jobs. Their average pay: $151 million. To be exact: $150,992,544.25. In all they collected more than $76 billion.

These pay figures illustrate a long-term trend, heavily influenced by federal government policy, to restrain wages paid to the vast majority and to focus pay increases at the top, especially Congressional antipathy to unions. Without unions workers have little to no bargaining power. Congress has passed numerous laws that hobble unions and require intensely detailed reporting of salaries and expenses, rules that Congress doesn’t apply to business.

Congress puts additional downward pressure on wages by keeping the minimum hourly wage at the $7.25 level that took effect in 2009.

Why Isn’t This MSM News?

Try as you may, you won’t find these fact and many more anywhere except DCReport and outlets that we let republish our work for free. I’ve analyzed the annual wage statistics report for more than a quarter century but have been unable to persuade any of our major news organizations to follow suit since I left The New York Times 14 years ago.

It’s hard to imagine any work so distasteful that it requires a paycheck of neatly $3 million a week to motivate performance. Of course, that’s not how pay works. The worst jobs tend to pay the least. Think underground construction and mining, foundries, dishwashing, and janitorial service. Physical drudgery, often combined with low status, equals bad pay no matter how much we need minerals mined underground, molten metals to form products, clean dishes in eateries and clean public toilets.

Jobs that pay a million or more per week come with lavish fringe and retirement benefits, corporate jet travel (with massive subsidies for personal use) and a retinue of aides to handle every care, all paid for by investors. Public and coworker adulation and even envy enrich these jobs even more.

Executive Class expense accounts also subsidize Executive Class lifestyles. In the late 1980s I was shown the financial summary of a CEO’s expense account. It totaled more than $2 million (almost $5 million in today’s money). The document was supposed to be introduced into the public record the next day but wasn’t so I couldn’t use it. But still, it gives you an idea of Executive Class lifestyles at the very top.

Not everyone in what DCReport calls the Executive Class is an executive. Anyone who gets a wage or salary and an end of the year W-2 wage statement is included in the annual Social Security wage reports. Bestselling novelists, Major League home run hitters, top actors, and singers show up in this data.

Trump Tax Law Effects

The number of $50 million and up employees has exploded since the Trump/Radical Republican tax law took effect in 2018 and the Trump Administration lavished taxpayer funds on big companies during the pandemic.

There were just 205 such super high paying jobs in 2017 the last year under the old tax law. There were 201 such jobs in 2018, 222 in 2019, a figure that jumped to 358 in the pandemic year 2020 and then to 506 last year.

The number of these super paying jobs rose as companies grew flush with cash from years of enjoying the much lower tax rates that started in 2018. That year corporate tax revenues fell by a third.

Donald Trump and his allies promised this money would fuel investments that create jobs. But much of the money was used instead for stock buybacks, which enhance the value of executive stock options, and to increase Executive Class paychecks. Buybacks and fatter Executive Class paychecks don’t stimulate growth, don’t create new jobs and certainly don’t encourage paying more to the vast majority of workers.

There is a bit of good news in the rise of Executive Class pay. In 2020, the Executive Class raked in 82% of all the increased pay in America, DCReport showed a year ago. In 2021 they raked in just 29% of all pay hikes.

The difference between those years?

Hardly anyone got a pay raise in 2020 as the pandemic savaged the economy—except those in the Executive Class—while in 2021 modest pay raises for the hoi polloi were widespread.

Average pay raises for those below the Executive Class averaged just $76 in 2020, not that anyone would notice.

Median pay—half make more, half less—rose in 2020 by a mere $26. That’s for the entire year so it’s less than 50-cents a week. Many workers in the lower half of the pay scale got no raise. Nearly all 2020 pay raises went to the top tenth of the workforce, those making at least $100,000, with nearly all of that flowing to the Executive Class.

Last year full-time workers making up to $250,000 got an average raise of $1,600. Executive Class raises averaged $840,500 or 500 times as much.

These pay disparities explain much of the widespread discontent in America that fuels support for politicians who would take away our liberties and replace our democracy with dictatorial policies, a concern I have been writing about for more than a quarter century.

That fewer than a quarter million of America’s nearly 170 million employees collected close to a third of all the pay increases last year shows how our elected leaders have allowed the corporate rich to rig our economy in their favor. Government indulgences dating back four decades that have minimized competition and encouraged monopolies, duopolies, and oligopolies also favor the Executive Class over rank-and-file workers. So do contracts that prohibit many workers, even some blue collar workers, from taking a job at another company in the same industry.

I documented many of these subtle and severe policies of upward redistribution of income and wealth earlier in this century in my award winning and bestselling economic trilogy, Perfectly Legal, Free Lunch, and The Fine Print. All remain in print.

The First Part and today’s Second Part of my reporting on the new wage statistics focused on full-time workers. Part Three will look at part-timers, the one in four American workers making less than $15,000 a year. The pay story for these 41 million people is a mix of good and bad news.

Footnote: For 1991, I included in the Executive Class those paid $500,000 and up because that threshold in 2021 money was $1 million because prices doubled over those 30 years.

Executives got $500 for each $1 raise you got: The latest on pay in America

Here’s the real news on your 2021 pay raise, thanks to exclusive reporting by DCReport.

The Executive Class received $500 for every dollar in raises you earned last year, my annual analysis of the latest official pay data shows.

If you worked full-time and made less than $250,000, your average pay increase last year was $1,600.

For the Executive Class paid $1 million or more, the average pay increase was $840,500—500 times as much.

Pay for the Executive Class, which had been slowly taking a growing share of all American wages, salaries, and bonuses, has taken off like a rocket since the Trump/Radical Republican tax law took effect in 2018.

Average pay increases for the 97.3% of full-time workers making under $250,000 fell far short of the 4.7% U.S inflation rate, rising just 2.7%. That means the vast majority of full-time workers lost almost $1,200 of buying power.

Meanwhile, Executive Class pay rose 40.7% in 2021, nearly nine times more than the inflation rate. And it wasn’t an isolated response to pandemic economics.

The number of Executive Class workers exploded in 2021, up from 184,631 in 2020. That’s a 29% growth in just one year for Executive Class employees compared to an overall growth rate in paid workers at any wage of 0.3%. In other words, the number of people in the Executive Class is growing more than 100 times faster than the overall pool of employees.

My analysis shows the Executive Class slowly pulling ahead over time. Then the Trump/Radical Republican tax “cuts” were enacted in December 2017.

I use scare quotes because there was no tax cut, only a deferral of unpaid taxes into the future. It was a classic Trumpian trick that only a few of the best journalists caught and reported as such.

Phony Tax Cuts

The seeming tax “cuts” were financed with borrowed money. That means interest is adding to the increased debt that financed the tax “cuts.” Republicans are citing that increased debt as a reason to demand cuts in spending, including phasing out Social Security and Medicare. That’s also a trick to expand the upward redistribution of income and wealth.

The Trump/Radical Republican scheme that slashed taxes paid by corporations is central to the rising pay of the Executive Class.

Corporate income tax revenue fell by one-third in 2018 when the law took effect. Trump and his allies promised the tax cut would result in new investment to create new jobs. Some of that happened, but much more significant was the use of tax “savings” for stock buybacks and huge paydays for the Executive Class.

The result is that pay for the Executive Class, which had been slowly taking a growing share of all American wages, salaries, and bonuses have taken off like a rocket, increasing much faster since the tax changes took effect than in the previous 16 years.

In 1991 the Executive Class—those making $1 million or more in inflation-adjusted dollars—got just 2% of all pay. By 2017, the last year before the Trump/Radical Republican tax law took effect, that share of all pay had grown to almost 4.7%.

Last year, just four years after the tax law changes, the Executive Class raked in 6.7% of all pay.

Growth Rate Triples

The awful truth is that the rate of growth in Executive Class pay tripled once the Trump/Radical Republican tax law took effect. It took 16 years to increase that group’s share of all pay by 2.7 percentage points but then just four years to increase by slightly more than 2 percentage points.

These numbers come from my analysis of the Social Security Wage Statistics report. Every year Social Security adds up every wage, salary, and bonus to the penny. This is the same data you get in your annual W-2 wage statement from your employer. And it is the same data that the Internal Revenue Service uses to verify what you put on your income tax return. There simply is no better source of pay data.

My analysis this year focuses on full-time workers, those making between $15,000 and $250,000. I then compared these nearly 119 million workers to the Executive Class, those paid $1 million or more.

Social Security breaks pay down into income categories or groups. I’ve been analyzing this report annually for more than a quarter century, documenting the flat to falling incomes of most workers while the Executive Class rolls in ever more dough.

This long-term trend of most people getting nowhere while those at the top grow much richer each year explains much of the venomous discontent infecting American politics.

The vast majority of Americans have no idea of this data or how government policies encourage more for the already rich because our major news organizations have, so far, largely ignored it. I retain hope that will change.

All that most American workers know is that they see on television more and more people who own many mansions and personal jumbo jets while they strain to make ends meet.

Threat to Democracy

Donald Trump and others who would end our democracy and impose a dictatorship exploit this understandable rage over economics without offering anything except to make things worse. That $500-to-$1 pay increase ratio will soar if we give up our democracy, as many tens of millions of Americans apparently are willing to do by supporting candidates who promise to stay in office regardless of what voters decide and, in some cases, to make Trump president for life.

Unless you read my reporting, you probably don’t know about how the Executive Class is sucking up so much of the increased pay in America. Even though the data is readily available, no one else in American journalism (or academia) takes the time to analyze this valuable source of data. That’s surprising because this is the most accurate and useful pay data in America.

Skeptical readers are invited to download the annual wage statistics, which go back to 1990, and test the accuracy of my reporting. Go to this web page and then adjust the year in the URL.

To be clear, what journalists from legitimate news organizations tell you is highly accurate. But it is also mostly based on what sources tell reporters, verbally or in press releases, and what critics say in response. I call that the “official version of events.” Solid, but superficial and limited in scope.

Many rich troves of highly revealing official government data never make the news because few journalists know where to find such data. I’m close to alone in sifting through such data and making it meaningful apart from TRAC, the clumsily named but highly valuable Transactional Records Access Clearinghouse at Syracuse University. TRAC is run by David Burnham, a former top New York Times reporter, and Susan Long, a business professor.

Average Is Misleading

To the extent that the annual Social Security report makes the news, all you are likely to hear about is the average wage.

In 2021 the average annual wage for all employees, from those who made just $1 to those making more than $100 million, was $58,129.99, up from $53,383.18 in 2020.

On the surface, that looks like a healthy increase of nearly 9%, roughly double the inflation rate.

But without analyzing the distribution of pay hikes, the average is misleading because pay at the top has no limit and that’s where the big raises are.

More than two-thirds of all people who earned a paycheck in 2021 made less than the average wage, Social Security noted. This number has been slowly rising for decades, a sign of top-end wage growth and stagnation below.

My analysis also shows that nearly all of the 2021 pay increases went to people up the income ladder, the one in eight employees making $100,000 or more.

Median Wage

One indicator of the way average pay distorts is shown by the median wage—half make more, half less. Economists consider the median a good indicator of typical pay.

Median pay last year was $37,586, up nearly $3,000 from 2020, when the median was $34,612.

But the median is also misleading because one in four workers made less than $15,000. They were all part-timers. We know that because the federal minimum wage is $7.25. If you worked 40 hours a week for all 52 weeks your gross pay would be $15,080.

Last year the 237,331 Executive Class employees made, on average, almost $2.8 million. Two decades earlier, the same group numbered just 55,823 and earned less than $2 million when measured in 2021 dollars.

Comparing Executive and Median Pay

In 2021, Executive Class average pay was $2,777,799, up 44% above inflation after two decades. In contrast, the median for all workers rose only about half that, 23% above inflation.

But keep in mind that most of the new Executive Class people were paid near the threshold of $1 million annual pay. That tends to hold down the average at the top.

To understand the explosive growth of Executive Class pay—that $500 to $1 pay increase ratio—we have to look at the highest paid of the Executive Class, including the hundreds of people whose average paycheck in 2021 was $151 million.

That will be explored in Part 2 of our series, while Part 3 will focus on the part-timers who make less than $15,000 annually.

Repeat felon Swiss bank may finally lose privileged American status

Unless the Biden administration loses its nerve, one of the most corrupt banks in the world – Credit Suisse – will soon be banned from the lucrative business of steering pension fund assets into opaque investments where thievery and poor performance are easy to hide.

If you haven’t heard this news it’s because nothing has appeared about it in The New York Times, The Wall Street Journal, The Washington Post, or even Bloomberg. We checked those and other influential news organizations and found zip.

That’s not surprising because there was no Department of Labor press release declaring its plan to act against Credit Suisse. The action was disclosed yesterday in a routine publication of federal government actions.

Credit Suisse’s status “is a privilege, not a right, and U.S. taxpayers should not be paying for the U.S. Government to bend over backwards to ensure that a convicted entity and its affiliates get to enjoy a privileged status under U.S. law.”

“The Convictions and other alleged Credit Suisse-related criminal misconduct constitute serious years-long systemic criminal misconduct that counsels against” letting the Swiss bank retain its privileged, the Labor Department notice declared. The privilege was to put pension money into investments other than stocks, bonds, mutual funds, and the like.

Credit Suisse would be granted one year to disentangle itself from American pension funds under the notice that the Department of Labor posted April 19 in the Federal Register, a document few news organizations consult despite it being a rich source of what our government is doing.

Like many such notices this one is written in language not meant to be understood by mere mortals, but if you need help with insomnia try this document for numbing your mind.

Privilege Explained

The Labor Department is planning to take away Credit Suisse’s privileged status as a Qualified Professional Asset Manager.

That status allows Credit Suisse to put pension funds it manages into investments that are generally prohibited. The qualified status reduces the risk of Credit Suisse executives and pension trustees being held personally liable for errors, though it does not protect against violating the bank’s duty of loyalty, also known as fiduciary duty, to the pension plan.

Why do banks promote exotic and typically opaque investments? Typically, they generate lucrative fees, certainly larger fees than investing in index funds, a reliable way to increase wealth.

Advocates for Integrity

The Labor Department action comes after years of efforts by a handful of determined of people in the U.S., Australia and Europe who have worked to expose bank crimes and have insisted on meaningful serious punishments.

Jim Henry, DCReport’s investigative economics editor, is among those people as is Bill Black, the law professor responsible as a banking regulator for nearly a thousand high-level bankers going to prison during the savings and loan debacle three decades ago. The most determined advocate is Paul M. Morjanoff, an Australian who specializes in recovering money from fraudulent transactions.

Tim Blixseth, a lumber baron, record producer and resort developer, sent the Labor Department a scathing commentary in September 2014, when the Labor Department began accepting comments on whether to let Credit Suisse bank to continue advising pension funds on exotic investments.

“Credit Suisse has a long and exhaustive history of disregard for laws of the United States as well as other countries,” he wrote. “Credit Suisse has been fined billions of dollars for its nefarious actions. Their actions are not a one-time mistake by a rogue employee, but rather a multi-year, multi-occurrence, coordinated, and premeditated enterprise.”

Blixseth was one of 13 resort developers who took out loans from Credit Suisse. All 13 resorts went bankrupt. The borrowers said Credit Suisse deceived them with unusual terms that violated banking industry standards. Credit Suisse insisted it did nothing wrong.

Heather A. Lowe, a lawyer for the nonprofit Global Financial Integrity, made the most direct and understandable appeal to take away Credit Suisse’s Qualified Professional Asset Manager status.

Credit Suisse’s status “is a privilege, not a right, and U.S. taxpayers should not be paying for the U.S. Government to bend over backwards to ensure that a convicted entity and its affiliates get to enjoy a privileged status under U.S. law,” Lowe wrote in December 2014.

Two months ago Sen. Elizabeth Warren (D-MA) asked the Labor Department to block Credit Suisse from using its privileged position as a pension funds manager because of its admission of bribery. For decades Warren has worked to expose and punish corruption and predatory practices in banking.

Rap Sheet

Credit Suisse has a long and thoroughly documented history of refusing to turn over money due to heirs of Holocaust victims, helping super-rich Americans cheat on their taxes and making loans using unusual terms that turned into disasters for the borrowers. One of its most recent felonies was punished with a $175.5 million fine. That’s chump change for a bank with assets of about $1.6 trillion. The fine was barely 1/10,000th of those assets.

Credit Suisse has a long rap sheet with 49 violations, according to the Good Jobs First Violation Tracker. Its updated report by Phil Mattera is an instructive read. It is far from the only bank with a history of felonies and other serious offenses as this matrix prepared by Jim Henry shows.

Eight years ago Credit Suisse made a deal to avoid serious punishment for some of its criminal conduct. It paid a fine of $2.6 billion, money that was tax-deductible in Switzerland where it is based. No individual was indicted. Credit Suisse got to keep its American banking license. [Correction: Eight former Credit Suisse employees, none of them high level executives, were indicted over a three year period.]

Credit Suisse’s chief lawyer in negotiating this soft-on-crime deal? Christopher Wray, then a litigation partner at King and Spalding, where he earned $9.2 million in his last year. In addition, Wray apparently was paid directly by outside clients, the largest of which was Credit Suisse.

Ethics Exemption

Donald Trump named Wray FBI director in 2017 after he fired James Comey who would not pledge personal loyalty to Trump. Since then, the FBI has cut back severely on white-collar crime cases. Early in the Obama administration, there were more than 1,000 white-collar prosecutions each month, a figure that fell to under 100 a month under Trump. The number of cases has risen under Biden but is still less than half the number from a decade ago.

As FBI director Wray got a special exemption from federal ethics rules. Wray was granted unrestricted authority to continue “participating in matters involving” an unnamed client.

Inexplicably, President Joe Biden has kept Wray on as FBI director.

You can be sure that over the next few weeks that some of the highest-paid and most skillful white-collar crime and regulatory lawyers in America will be doing everything they can to allow Credit Suisse to keep its privileged position as a manager of pension funds. And even. If they lose, Credit Suisse, after a management shakeup now underway, will surely be back in the future seeking to regain its privileged, and lucrative, status as a Qualified Professional Asset Manager.

Maverick economist offers Congress 3 smart ways to lower gas prices and still punish Putin

Are oil and gasoline prices being manipulated to create inflated profits? It’s easy enough to find out, maverick energy economist Robert McCullough told Congress Tuesday.

It’s also easy for our government to adopt temporary policies that will lower costs at the pump by:

  • Ripping the dark veneer off opaque market
  • Creating incentives for more drilling in the short run
  • Taxing away any windfall profits

McCullough is a super smart and jolly old man who runs his own energy economics consulting firm in Portland, Ore.

He is hated by the energy and utility industries because his reports cut through the fog of economics and provide clear, understandable insights into the many ways the energy industries manipulate markets and politicians for their gain. And he is big on market incentives to make markets efficient and open.

READ: Russian artist depicts Bucha victims in photos staged around Moscow

The most effective policy to curb Russian aggression in Ukraine is to displace Putin’s oil exports with enhanced U.S. production while protecting U.S. consumers from unnecessary price increases at the pump.”

There is good reason for our federal government to exercise its authority to help citizens cope with the surge in gasoline prices, which soared 38% since last March. That combined with increased travel as the pandemic wanes means that spending on gasoline has increased 44% in the last 12 months.

McCullough’s testimony is the kind of deeply informed plain talk that seldom makes the news or congressional hearings. Instead, self-serving industry talking points infect public discussion of energy markets, just as nonsense about “freak accidents” infects news coverage of worker deaths on the job as we reported this week.

Sen. Maria Cantwell of Washington, the Democrat who leads the committee, is trying to show ways that our government can mitigate the impact of Putin’s war on energy prices through smarter regulatory policies.

That’s a difficult task in the Congress where the word regulation is treated as if it had only four letters by politicians who mouth ill-informed nonsense about market economics and promote corporate socialism policies that enhance profits and damage the overall economy, largely by draining money out of consumer pockets.

READ: AOC gets official to admit USPS leaders don't care about sending truck work to anti-union state

What follows is a summary of McCullough’s testimony, edited to remove technical details. All ideas are his.

McCullough told the Senate Commerce, Science and Transportation Committee to focus on three areas: transparency, drilling and windfall taxes.

The first can prevent rigged markets that artificially inflate prices.

The second will temporarily increase oil extraction, which can be done through the carrot of incentives.

The third is a stick to beat windfall profits out of the system, making price gouging pointless.

1. Transparency

Making oil and gasoline markets transparent “is the least expensive and most effective tool in guaranteeing efficient markets.” These markets in the United States are “vastly less transparent than competing fuels like electricity and natural gas.”

Requiring disclosure of oil and gasoline trades, just as it’s required for other commodities, is an inexpensive and effective way to expose price manipulations. Creating “a database of wholesale transactions for oil and gasoline similar to [the existing] database for electricity is critical to discourage anomalous trading.”

Requiring wholesale traders to report transactions should help with the well-known “up like a rocket, down like a feather” changes in gasoline prices that don’t closely track oil market prices.

California is “prone to mysterious price excursions. In the second week of March, as oil and gasoline prices fell across the U.S., California’s gasoline prices continued to increase. There is some evidence that trades which caused this increase” were rigged.

2. Drilling

Because no one knows how long Putin’s war will last it makes little to no sense for oil drilling entrepreneurs to deploy hundreds of idle drilling rigs to pump more oil. But there’s an easy way to turn this into a smart move.

“The federal government’s existing oil inventory could be loaned, rather than sold, into the market. The loan would be repaid with federal contracts to buy oil in the future, thus smoothing prices for small drilling companies and ensuring that a sudden unexpected end to the war would not ruin their finances.”

President Joe Biden has taken some steps in this direction by releasing oil from the national petroleum reserve.

That oil should “be with purchases of crude in West Texas Intermediate forward markets [which] will expand liquidity and provide broad incentives for additional production in the Anadarko, Appalachia, Bakken, Eagle Ford, Haynesville and Permian basins:

Despite the Russian invasion that began Feb. 24 the number of active American oil drilling rigs since then has risen by just 11 to 533. Three times that many oil rigs are idle.

The Biden administration has been warning for a year that Russia would attack Ukraine. In the past 12 months the spot price of oil has gone from about $60 a barrel it’s about $108 a barrel. Huge price spikes like that typically invite more drilling, but not this time because of uncertainty about how long the Russian war and sanctions on the Russian economy will persist.

Most drillers will maximize profits by staying home and selling their existing crude oil flows into the spot markets. If they spend money to drill anew or to re-open capped wells, that will cost money while also tending to drive prices down. That’s why the entrepreneurial drillers are pulling more black gold out of the ground.

DCReport believes them McCullough plan to loan oil from our government’s strategic petroleum reserve into the market and then pay it back with guaranteed purchases of future oil production would be a smart and economically efficient way to use incentives to lower the price of gasoline at the pump.

3. Windfall Profits Tax

Gasoline prices and oil industry profits this year “are going to be enormous.”

To discourage price gouging and blunt incentives to limit oil production, Congress should introduce a windfall profits tax. That is a concept long understood in economics and in tax policy to discourage harmful economic behavior by eliminating incentives to cheat and artificially inflate consumer prices.

Congress should combine a windfall tax on oil company profits due to the war in Ukraine with a tax credit to those firms which expand oil production. That in turn would help lower prices at the pump.

Such a carrot-and-stick approach could produce tremendous public benefits, but almost certainly would be attacked by know-nothing lawmakers as harmful to the oil industry, one of the biggest financiers of political campaigns in America.

Public perceptions

While Russia is the world’s largest oil exporter, and efforts to shrink those exports will drive prices upward, the United States does not need to suffer significantly from economic pressure designed to persuade Putin to withdraw from Ukraine.

“Public perceptions of the United States and its energy balance have lagged behind market developments.” Glib newscasters report America is being held hostage by foreign oil producers, including Russia.

“In reality, the United States is now roughly able to supply its own requirements and is not in any risk of reliving the painful days of the 1973 oil boycott.”

Expanding American exports of liquefied natural gas would link domestic energy prices paid by consumers more closely to world markets, an issue rarely if ever mentioned by those politicians promoting the mindless mantra of drill, baby, drill.

The most effective policy to curb Russian aggression in Ukraine is to displace Putin’s oil exports with enhanced U.S. production while protecting U.S. consumers from unnecessary price increases at the pump. There are dumb ways to do that and smart ones.

Like McCullough, DCReport favors smart.

The dangerous Ukraine invasion issue no one is talking about

Let’s step back for a moment from the awful human tragedy in Ukraine as the Russian army targets civilians. There is an even bigger issue here. And until we come up with an answer it’s going to continue to plague the world.

It’s an issue that Americans, more than anyone else, should understand. Yet based on all the news and commentary I’ve been reading since the Russian buildup began almost a year ago, this overarching issue is not even on the table.

The bigger issue is that there is no way to stop a nuclear power from invading a non-nuclear power, as America did 18 years ago this month when it took down the dictatorship in Iraq.

And make no mistake, Vladimir Putin himself has long made clear that Ukraine is not the only country he intends to take over.

Three years ago I spent a week in Ukraine. Every person to whom I spoke, whether in a formal interview or casual conversation, said that Putin was going to invade their country.

Many of them expected an invasion while Donald Trump was in office. That made sense because Trump repeatedly declared his trust in and fealty to Putin, denounced American intelligence agencies saying he did not trust them and lambasted our NATO allies. Destabilizing and, if possible, shuttering NATO is a long-term stated goal of the modern Russian tsar, as foreign affairs columnist Trudy Rubin explained recently.

Putin, whose words I have carefully read for two decades, doesn’t plan to stop with Ukraine. He has called the collapse of the old Soviet Union the worst geopolitical disaster of the 20th century and has said he is determined to put it back together. His words:

“Above all, we should acknowledge that the collapse of the Soviet Union was a major geopolitical disaster of the century. As for the Russian nation, it became a genuine drama. Tens of millions of our co-citizens and co-patriots found themselves outside Russian territory.

“Moreover, the epidemic of disintegration infected Russia itself.”

Fear in The Baltics

For more than a decade the political leaders of the Baltic states – Estonia, Latvia and Lithuania – have been telling every visiting journalist willing to listen that sooner or later they expect Russian tanks to overrun their countries.

I have family, via a son’s marriage, in Slovakia. They fear that Russian tanks will come, though they know not when; anxieties deepened mightily by the invasion of Ukraine.

We don’t need to worry about Moscow and Washington wiping each other out with atomic bombs.

What kept the rivalry between Washington and Moscow a Cold War, what kept either from launching nuclear ballistic missiles, was the concept of MAD – Mutually Assured Destruction.

That idea was articulated in a 1962 speech by Robert McNamara, the former Ford Motor chief executive whose hubris was unbounded. He believed that his team could use math, logic and aerial bombing to defeat the Vietnamese who wanted to be free of Chinese, French, Americans or any other oppressor. Never mind that post-World War II studies showed bombing can disrupt war material manufacturing and sow fear, but that’s pretty much all. Its overall effectiveness is disputable in a largely agrarian society. The old Soviet called Ukraine “The Ukraine” and Russia’s breadbasket.

While we may yet see a limited nuclear war using small battlefield nuclear bombs, all-out nuclear war would leave the world with nothing but ashes and an aftermath of deadly radiation.

MAD doesn’t mean that two nuclear powers will never confront one another on the battlefield. We have seen, for example, repeated skirmishes between troops in Kashmir, parts of which are disputed territory claimed by two nuclear powers, India and Pakistan. But neither New Delhi nor Islamabad is likely to risk losing their capital city to nukes over parts of a region about the size of Minnesota or Utah.

That said, MAD doesn’t apply when a nuclear power attacks a non-nuclear power.

That few people grasp this is evident in all the silly talk by politicians and pundits about creating a no-fly zone over Ukraine to take away invading Russia’s air power advantage. Indeed, such talk perfectly illustrates the impotent options for stopping an invading nuclear power from seizing any non-nuclear country.

No-Fly Zone Nonsense

The no-fly zone notion also shows a widespread lack of critical thinking skills in America.

Creating a no-fly zone starts with taking out radar, rocket launchers and other military equipment that would pose a threat to patrolling military planes needed to enforce the no-fly zone.

Even without putting a single jet fighter or reconnaissance plane in the air to make sure Russia could not use Ukrainian airspace we would be at war with Russia.

This is no small matter. Russia holds almost half of the world’s nuclear weapons, an estimated 6,257 out of 13,080.

In 2014, during his invasion of Ukrainian Crimea, Putin denied that he deployed “little green men” whose military uniforms lacked insignia. After his forces took control, giving Russia a warm-water port, Putin laughed that of course those were his soldiers.

When then-President Barack Obama and other Western leaders spoke of Putin’s invasion of Crimea being wrong, the modern tsar upped the ante. Putin threatened the use of nuclear weapons. “It’s best not to mess with us,” he declared.

Only so long as Russia does not confront conventional forces from NATO, with its nuclear weaponry in reserve, there is little danger that Putin would turn to The Bomb.

It is important, however, to know that almost a third of Putin’s nukes are battlefield-sized weapons, smaller bombs to take out battalions comprised of hundreds of soldiers, not cities. Only a fool would rule out Putin launching small tactical nuclear weapons if for no other reason than to terrorize people and make clear the depth of his determination to rule, as Stalin, did over a vast empire that includes some countries that today are free from Russian domination.

Satellites Join NATO

Some of these former Russian satellites are not only free, but they also joined NATO. Among them: Bulgaria, the Czech Republic, Hungary, Poland and Slovakia.

Putin says NATO is the aggressor against Russia. For sure it’s unnerving for NATO to exist if you are in Putin’s shoes. Imagine if the oceans surrounding us, Canada and Mexico were all Russian satellites in a military alliance to contain the United States. But there’s zero evidence the West plans to invade Russia or any other country.

Putin points to the NATO intervention against Serbia in the war in the Bosnian war (or as our managing editor used to say, the war in Bosnia-Schizophrenia). But NATO didn’t start that conflict with its ethnic cleansing, it just stepped in to stop it.

So how to address nuclear powers invading non-nuclear ones?

One obvious solution – an atrocious one – would be to make every country a nuclear power.

That’s crazy. Corrupt military officers or a revolt could put the bomb in the hands of terrorists, religious zealots, criminals or just plain crazy people. Hollywood has long played with this terrible idea in films from The Peacemaker in 1997 to several of the James Bond fantasies.

It Starts With Lies

Invasions by nuclear powers start with lies, palpable lies that deceive because they come with a patina of truth, making them easy to fob off on those without critical thinking skills and the politicians who live in fear of losing their grip on power.

Both America’s Iraq invasion and Russia’s Ukrainian invasion of choice were based on calculated lies.

The George W. Bush administration ginned up tales of Iraqi weapons of mass destruction, persuading many gullible politicians and journalists.

When George W. Bush warned that Iraq had nuclear weapons the statements were palpably false. Besides, if Saddam Hussein had them we would have known.

A Radioactive Cat

As far back as the 1984 Olympics in Los Angeles, I wrote about how incredibly sensitive nuclear detection equipment would spot any effort to slip a nuclear bomb into Southern California. The entire Southern California region was mapped for radiation levels before and during the games. (My story on which buildings nuclear arms experts said would be the prime targets for a Russian nuclear attack in Southern California, to run as a map overlay on a two-page map of the games venues, was killed by spineless Los Angeles Times editors.)

In 2008, the Seattle Times reported that a car returning from Canada at 70 mph was stopped after a border agent, parked in the freeway median, detected nuclear isotopes. What the agent found was a cat treated for cancer three days earlier with radiation.

So, without a doubt, if Iraq had possessed nukes, we would have known. Ditto the baseless insistence by the younger Bush administration that Iraq had created and amassed biological weapons which a demonstrably gullible reporter turned into worldwide news.

The official British inquiry into the Iraq invasion, known as the Chilcot Report, is devastating in its detailing of the lies, miscalculations and self-delusions that preceded the invasion.

I recommend reading Pages 40 – 62 of the Executive Summary (the full report runs 530 pages). It also shows how invading Iraq decreased stability and put Britons and others at greater risk of terrorist attacks by pointlessly fostering hatred of the invading allied nations.

In this same vein of official lying to justify the unjustifiable, Putin and his cronies tell the Russian people that the invasion is to defend Mother Russia from attack and to remove modern Nazis from the Kyiv government.

Putin’s Nazi Nonsense

What Russian state media – Putin has shut independent news – don’t tell people is that the elected president of Ukraine, Volodymyr Zelenskyy is a Jew.

Jeff Danziger Cartoon

To be sure, there certainly are very far right-wing elements in Ukraine, just as there are neo-Nazis in the United States and many other countries. But to claim that Nazis or their modern ideological descendants control Ukraine is absurd. Pardon me while I take a moment to laugh out loud.

It’s also astonishing how few news reports and comments by elected officials note that eight years ago the Ukrainian people rose up and deposed a Putin puppet who had been stealing hundreds of millions of dollars from the public treasury. Its known as the Orange Revolution.

The deposed Russian puppet built a lavish palace where before fleeing his staff dumped incriminating documents. Recovered ledgers showed payments totaling tens of millions of dollars to Paul Manafort, who later became Donald Trump’s 2016 campaign manager. The 2016 Republican National Convention gutted its former stance and adopted Russian perspectives on Ukraine at Manafort’s and Trump’s urging.

GOP Drops Kremlin Skepticism

Before Trump, Republicans were ferocious critics of Kremlin behavior. In the 1950s they conducted official hunts for Reds hiding under beds and working at the State Department and Pentagon.

Now Trump and many Republicans side with Moscow. So does Fox News’s Tucker “I’m rooting for Russia” Carlson, the No.1 cable host in America. Carlson is trying to walk back his comments, but what I hear each night is just nuanced pro-Kremlin chatter.

Also missing in our national discussion is the Ukrainian diaspora. Under the old Soviet Union, millions of Russians were forced to move into Ukraine, diluting the local ethnic population. Before the invasion more than one in six Ukraine residents was Russian. Also, a few decades ago Ukraine had a population of more than 50 million, but today only about 40 million.

As Ukrainians flee for their lives that ratio will rise. Putin will no doubt tout future census numbers to support his nonsense claim that Ukraine is part of Russia, a subordinate part.

Kyiv Ancient Unlike Moscow

Kyiv was a thriving city a millennia ago. Back then Moscow was a wide place in the forest with a few huts. There’s a strong case for saying Kyiv is the mother of Russia, but not the other way around as Putin insists.

So how is the world to deal with invasions of non-nuclear countries by nuclear powers? I don’t have an answer, but I do have a suggestion: We need to study and devise a new global doctrine to address this menace.

And I suggest using my imaginary analytical friend, the Cosmic Journalist, to analyze the issue.

The Cosmic Journalist, coming here from another planet, can be clear-eyed. This tool for inquiry can appreciate that Putin feels contained by America, with its oceans on each side. U.S. allies simultaneously recognize that Putin’s disappointment at the collapse of the Soviet Union is no grounds for invading other countries.

Featured Image: Pixabay

NOW WATCH: Fox News reporter pushes back when host Greg Gutfeld accuses media of ginning up 'emotional' Ukraine reaction

Fox News reporter pushes back when Gutfeld accuses media of ginning up 'emotional' Ukraine reactionwww.youtube.com

Stunning new data on radical Republican policies shows how the richest workers got a lot richer under Trump's rule

Donald Trump's presidency and the Covid pandemic combined to make 2020 a remarkably enriching year for the highest-paid workers in America. Meanwhile, the numbers for the bottom 99.9% are, in a word, awful.

Just one in 900 workers makes $1 million or more, a new Social Security report on wages shows. My annual analysis of this data shows that this thin and rich group made 14% more money in 2020 than in 2019.

On average, the pretax pay of the $1 million-and-up workers increased by $305,600. That's after adjusting for inflation.

The share of all pay going to $1 million-and-up workers grew by a fourth during Trump's four years.

The other 99.9% of American workers got an average raise of just $76 each. But even that overstates how badly most workers did. That's because most of this minuscule pay increase went to the 1/10th of workers making $100,000 to $1 million. The bottom 88%, those making less than $100,000, got next to nothing.

The standard measure for worker pay is the median. It illustrates the typical pay situation because at the median, half of workers make more while half make less. Median pay in 2020 rose by a mere $26.

What a Surprise!

Put another way, for each $1 of increased pay going to the typical worker, each worker in the two-comma club collected $11,750.

Suppose $26 is the height of the heel of a shoe worn by a man standing on Fifth Avenue outside Trump Tower. The heel is 1 inch. The height for the highest-paid workers' pay would soar 315 feet above that 58-story highrise, for a total of 908 feet. That's a lot of heels. Plus one.

Trump has a policy: One for you, thousands for the rich; another for you, thousands more for the rich…

And don't forget, Trump's 2017 tax law gave the most highly paid workers a roughly 4% federal income-tax cut. Also, those workers tend to be the Americans with significant stock portfolios and Trump gave corporations a 40% tax-rate cut. So, they got a two-fer.

Crumbs for the Rest

You didn't get anything like either of those income-tax cuts. You got crumbs in tax savings plus the burden of $2 trillion in federal debt to pay for the Trump/Radical Republican tax cuts.

Indeed, if you live in the states with most of the high-paying jobs – California, Connecticut, New York, Maryland and the like – Trump and congressional Republicans increased federal incomes for millions of people. That's because Trump and the Radical Republicans took away your deductions for state and local income and property taxes and mortgage interest. The number of Americans who itemize deductions, including charitable gifts, fell by three-fourths after Trump's tax cuts for the rich and the companies they own became law.

More pay going to workers at the top is a long-term trend that began long before Trump. What's significant in the newest data is how much that trend accelerated during the Trump years.

In 2016, just 143 workers made $50 million or more. That number jumped 50% in Trump's first year as president and stayed at that level in 2018 and 2019. But in 2020, Trump's last year as president, the number of workers paid $50 million and up soared to 358, 1.5 times as much as under Barack Obama.

Monthly gross paychecks for those 358 highest-paid workers averaged close to $8 million each. A worker at the median pay would have to labor for more than 225 years to get paid what these workers made in a month.

More for the Top

Even more significant, the share of all pay going to $1 million-and-up workers grew by a fourth during Trump's four years.

Their collective pay rose to 5.2% of all worker compensation, up from 4.2% of total compensation in 2016 under Obama. That means most workers got a thinner slice of the American wage pie under Trump, the opposite of MAGA pledges to improve most incomes and just as I predicted back in 2015 and 2016.

The median worker in 2020 made just $34,612, or less than $3,000 a month before taxes. During Trump's four years, inflation-adjusted median income rose by 5%.

By far the biggest increase in median pay in this century occurred in 2014 under Obama when Social Security data show an increase of 3.44% over 2013.

The average pay for all workers was $53,383.18, or less than $4,500 per month.

More than two-thirds of workers made less than the average. The average is higher than the median because all those very highly paid workers skew the average upward.

One more awful fact: The number of Americans with any work fell in 2020 by more than 1 percentage point. In 2020, more than 1.7 million fewer people found any paid work than in 2019. That's the first time this has happened in all of Trump's life.

While Trump at his inaugural promised that every act he took would be for the benefit of the "forgotten men and women" of America, it was all just another con.

His actions, again and again, favored the highly paid, the already rich and, not least of all, the Trump-Kushner family.

What criminal defenses does Steve Bannon have?

Steve Bannon faces real trouble when he goes on trial for contempt of Congress. He has no legitimate defense — unless a judge sets aside decades of principles governing defenses in criminal cases.

If that happens, we are all in for a lot of trouble enforcing laws in America.

Bannon is still working to overthrow our government. "We're taking down the Biden regime," Bannon declared before surrendering to federal officials Monday. He was released hours later pending trial.

Bannon told his podcast audience on Jan. 5 that the next day "tomorrow it's game day. So strap in. Let's get ready" and "now we're on the point of attack tomorrow."

Bannon's problem is that he has no legitimate defense to the two crimes in his federal indictment. The indictment charges refusal to testify before the House committee investigating the Jan. 6 insurrection and refusing to turn over documents.

We know from his lawyer what his defense will be. Bannon will assert that one of his lawyers told him not to comply with a subpoena from Congress. He'll also say he only followed orders from Donald Trump, a private citizen.

Trump claims executive privilege to block testimony about the White House's role in the attempted coup.

Executive privilege is a legal courtesy extended to sitting presidents so they can hear unfettered advice from aides on carrying out their Presidential duties. Trying to hang onto power after losing an election by overthrowing our government isn't a presidential duty.

President Joe Biden has waived executive privilege in this matter.

Since Trump is a private citizen, Bannon was never a White House employee, and anything they did to prevent the peaceful transition of power was inherently unlawful, any claim to executive privilege is nonsense.

But of course, with one in four federal judges being a Trump appointee and some federal judges being deeply political in their rulings, anything can happen.

Bannon's core problem is that a claim of "Donald made me do it" is no more valid than saying "the devil made me do it." It's a defense no judge should allow

However, one of Bannon's lawyers told reporters Monday that the Justice Department's Office of Legal Counsel advisory opinions show that Bannon should not be prosecuted.

What the lawyer didn't say is that those opinions concern lawful advice, not insurrection.

Bannon does have a possible and tenuous lawful defense. He could argue that he didn't know he had to comply with the subpoena for his testimony and documents. But Bannon blew up any hope of that Hail Mary defense with his defiant comments outside of court Monday.

"We're going to go on the offensive against this," Bannon said, a video crew from his War Room podcast recording his words.

David Schoen, who Bannon ridiculed nine months ago as an "absent-minded professor" during Trump's second impeachment, now represents Bannon.

Schoen asserts that Bannon was merely following the advice of another lawyer in refusing to comply.

"Mr. Bannon is a layperson. When the privilege has been invoked by the purported holder of the privilege, he has no choice but to withhold the documents," Schoen told reporters. "Mr. Bannon acted as his lawyer counseled him to do by not appearing and by not turning over documents in this case. He didn't refuse to comply."

Competent prosecutors should have little trouble demolishing that defense, assuming a judge even allows it.

The House committee wants to know about the role of Trump and his advisers in orchestrating the Jan. 6 insurrection. Evidence that committee members have already disclosed shows that weeks of planning went into the violent attack. The Trumpian mob shouted, "hang Mike Pence," after Trump told them to head for the Capitol.

As quoted in the Congressional contempt citation, Bannon told his podcast audience on Jan. 5 that the next day "it's going to be quite extraordinarily different. All I can say is, strap in. … You made this happen and tomorrow it's game day. So strap in. Let's get ready" and later "it's all converging, and now we're on the point of attack tomorrow."

This isn't the first indictment for the former Naval officer. In 2020 Bannon and three confederates were indicted for stealing money from the "We Build the Wall" charity, a scam from the get-go.

Donors were promised that every penny raised would go to building a wall on the Mexican border. Only a short bit of crappy barrier was erected.

As detailed in my soon-to-be-published book The Big Cheat, Donald Trump Jr. and his girlfriend, Kimberly Guilfoyle, went to New Mexico to help raise money for this fraud.

Trump pardoned Bannon for his million-dollar theft, but not his three pals. They go on trial in March in Pensacola.

That indictment charged founder Brian Kolfage, a seriously disabled veteran, with stealing $350,000 plus buying a yacht called the Warfighter, a Range Rover SUV, a golf cart, jewelry, and cosmetic surgery.

Bannon's acceptance of the pardon in his million-dollar charity theft is an admission of guilt under Burdick's 1925 Supreme Court ruling.

George Burdick, a New York City journalist, refused to testify about his sources of information about the Treasury Department. Offered a pardon, Burdick rejected it. In Burdick, the Supreme Court held that a citizen is free to refuse a pardon because acceptance constitutes an admission of guilt.

Judge Analisa Torres, who oversaw part of the wall scam case, dismissed the charity fraud charges against Bannon after he accepted Trump's pardon. She wrote that "from the country's earliest days, courts, including the Supreme Court, have acknowledged that even if there is no formal admission of guilt, the issuance of a pardon may 'carr[y] an imputation of guilt; acceptance a confession of it.' "

An innocent person should be granted executive clemency, not a pardon, Judge Torres wrote. She cited a 19th Century ruling by the New Jersey Supreme Court ruling explaining the distinction between pardons and executive clemency:

"If there be no guilt, there is no ground for forgiveness. It is an appeal to executive clemency. It is asked as a matter of favor to the guilty. It is granted not of right but of grace. A party is acquitted on the ground of innocence; he is pardoned through favor."

Bannon got one big presidential favor from Trump, a pardon that saved him from the prospect iof years in prison as a major league charity thief. Now Bannon has no personal savior to rescue him from accountability, not unless he finds judges willing to allow illegitimate defenses to the crimes he boasts about committing and a jury dumb enough to let him off.

Halloween means trick, not treat, for some children

As you give trick-or-treaters candy this weekend let's not forget the devil inside the candy wrapper. The chocolate business profits from child slaves in Africa and the United States has the power to put an end to this evil, just not the political will to act.

Seven big food makers — Hershey, Mars, Mondelēz, Nestlé, Cargill, Barry Callebaut, and Olam – make most of the profits off the labor of enslaved children.

The Biden administration is required by law to seize every one of the cocoa beans that will soon began arriving in Philadelphia and a few other American ports from the 2021 harvest in West Africa. Products of child labor and slaves have been contraband since at least 1930, which means Customs and Border Protection can — and should — seize the beans. Yet no president from Hoover to Trump has enforced the law.

President Barack Obama in 2016 signed a new law strengthening the power to seize products of forced labor. President Bill Clinton signed a 2000 law that was supposed to help end child enslavement by strengthening the 1930 contraband law. Still, a law not enforced is no law at all.

Child enslavement, and the de facto economic enslavement of adult cocoa plantation workers, continue because the Big Seven chocolate companies use their economic power to drive the prices of cocoa beans to such ridiculously low levels that plantation owners can't pay decent wages.

Earlier this year DCReport told about the "relationships between the candy makers and the cocoa farms in West Africa, which provide 70% of the world's cocoa supply. Half is grown in Ghana and Ivory Coast. Most American chocolate is made from Ivory Coast cocoa beans."

In Europe, however, the first moves to seriously address child slavery in the chocolate business began in this, the International Year for the Elimination of Child Labor. Next year a global conference on child labor is scheduled in South Africa.


Self-serving nonsense

Hershey, Mars, Mondelez and the four other big chocolate companies say they are horrified that children become de facto slaves on cocoa plantations in West Africa.

The chocolate makers also claim that they cannot track most of the beans they buy back to specific farms. The reason is they aren't required to, not that they cannot do so.

What the Big Seven do instead is exercise their market power to drive down farmgate prices. That forces plantation owners into becoming de facto enslavers of the desperately poor.

The $3 billion Americans spend this year just on Halloween chocolate treats shows how deep the economic interest of see-no-evil candy companies and those of us who buy from them help ensure continued misery for as many as 1.5 million enslaved children.

European Inquiry

Now, at long last, the European Union is asking hard questions while the American Congress ignores those children as well as many others forced to work in the coffee bean fields of Central and South America as well as Africa.

In formal legal filings before the European Commission, the Big Seven assert that they merely buy the cocoa beans and are not responsible for, nor can they stop, the abuses of cheap labor, including children dragooned into dangerous work wielding machetes on the plantations. That's self-serving nonsense.

The European inquiry has been pushed for years by a handful of antislavery activists. The hero of this antislavery movement is Fernando Morales de la Cruz who has waged a long and lonely struggle to get the world to pay attention to 21st Century slavery.

De la Cruz says that the American government "has been looking the other way to the fact that most cocoa and also most chocolate imported by the U.S. are produced with child labor."

He also notes how American foreign aid, a tiny bit of the federal budget, does nothing to reduce enslavement.

De la Cruz says the American Department of Labor promises to eliminate child labor in the cocoa fields are meaningless because "it's impossible to eliminate child labor and eradicate poverty while corporations are buying cocoa for less than one-fourth of its real value. The only way to fix this is to multiply the price paid to cocoa growers by four and then to make all chocolate industry corporations act within the rule of law."

His focus is not just on cocoa beans, but also on coffee as you can read at the website Café for Change. He also organized cartoonists to illustrate the problems of enslaved children and of adults trapped in economic slavery, hoping to reach hearts the way chocolate reaches tastebuds.

Quadruple Farmgate Prices

"The chocolate companies must pay three to four times current prices" to create the economic conditions required to eliminate enslavement, de la Cruz said. The candy companies know this as shown by studies they commissioned (and which tend to absolve them) as well as reports in trade publications like Confectionary News.

Eight formerly enslaved boys who worked in the cocoa fields are suing the Chocolate Seven companies under the Trafficking Victims Protection Reauthorization Act.

Their lawsuit alleges unjust enrichment, negligent supervision, and intentional infliction of emotional distress. Their lawyer is Terrence Collingsworth of nonprofit International Rights Advocates.

The companies assert that the formerly enslaved boys have no legal standing – that is, no right — to sue. The companies also say there is no relief the companies can provide so the case should be tossed. Those defense arise because the law is structured to favor the haves over the have nots.

While that civil case grinds on, existing law if enforced can put a stop to 21st Century cocoa field slavery.

What Can Be Done

Can anything be done to make the chocolate companies pay fair and reasonable prices instead of using their economic power to grind down poor Africans and create slave conditions?

That's easy – enforce existing law.

Just the threat by President Biden to seize one cocoa bean ship would surely get the attention of the Big Seven chocolate companies.

If that fails to wring immediate change the Biden administration need only seize and dump the cargo of one ship combined with a vow to continue seizing each new chocolate bean ship arriving on the Delaware River.

Persuading the British, French, and other European governments to do the same would be optimal.

Biden could even send the Navy to capture cocoa bean ships on the high seas as the British Navy did in the 19th Century, interdicting more than a thousand slave ships and freeing an estimated150,000 enslaved Africans.

A Role for Congress

Congress should open hearings into trafficking in contraband. Imagine what Rep. Katie Porter (D-CA), the former law professor who has shamed corporate executives with smart questions, could do leading such a committee.

Child enslavement, and the de facto economic enslavement of adult cocoa plantation workers, continue because the Big Seven chocolate companies use their economic power to drive the prices of cocoa beans to such ridiculously low levels that plantation owners can't pay decent wages even if they want to do so.

While plantation owners get paid for their beans only about a quarter of what is needed to operate the plantations without de facto slavery, paying them more would have only a minor affect on chocolate bar prices because cocoa beans are a minor part of the cost of candy bars.

In the processed foods industry, the food itself typically is the cheapest or nearly cheapest ingredient. In the year 2000, for example, a $3.39 box of breakfast cereal contained grain that cost just nine cents while the box cost a dime. Advertising costs 11 times as much as the grain. The same is basically true of chocolate, tea, and coffee.

That matters because quadrupling farmgate prices for cocoa beans means that the price of $1 chocolate bars would only go up by a few dimes.

Enforcement Essential

The next step after threats of seizure or actual seizures would be for the candy companies and their agents to document that they pay their economic slaves higher wages so plantation owners don't just pocket the money. That requires a strict regime of enforcement, including audits of payments to workers, open access for inspectors, and criminal prosecution with prison for violators. Recalcitrant plantation owners might need to see their peers' land seized to stop their vile conduct.


The Ivory Coast already has some solid laws on the books, just no serious enforcement. And that won't change so long as the Big Seven candy makers use their economic power to pay unreasonably farmgate prices.

American Customs and Border Protection reports many seizures of contraband at the border and ports, but its focus is on drugs like cocaine and fentanyl, along with cash, not on the equally illegal products of child labor and slave labor. What a strange set of moral values our government has, taking serious action against drugs and associated cash and turning a blind eye to profiteering off slavery.

The Biden White House does nothing because hardly anyone in America knows that their purchases of chocolate treats enable child enslavement. Without pressure from the public few things change for the better in America as our history with slavery, voting rights, union rights, and indeed laws against domestic child labor show.

This is an evil we can eradicate. Doing so requires the consumers who buy chocolate to tell Congress and the White House that they want America to take every lawful step it can to end child slavery.

What could be a better Halloween treat for enslaved African children than turning their misery into decent lives?

How just $3 a day can buy America a very rich future

How much would you be willing to invest for a better future for yourself, for today's youngsters, and beyond?

Would you be willing to invest $3 a day?

That's more than the gross upfront cost of President Joe Biden's human infrastructure bill.

Sadly, but that's not how news reports describe the American Families Plan. Across the board, our major news organizations cite a big, scary, and ultimately meaningless number: $3.5 trillion.

To grasp what a huge and meaningless number that is, imagine putting matches to dollars bills. If you lit one greenback per second it would take 110,985 years to burn all that money.

Folks who make at least $100,000 per day would bear 86% of the cost of Biden's human infrastructure plan.

But the Biden plan money won't be consumed; it will be invested.

When our Air Force planes and Navy ships burn kerosene and marine diesel fuel, tax dollars used to buy that fuel are shot out as exhaust. That's tax dollars consumed.

Biden's plan adds value, making each dollar invested today worth more dollars in the future by increasing incomes, creating private-sector jobs, increasing more business profits, and raising more tax dollars as the economy grows.

Human Scale v. Big Scary Numbers

At DCReport, we try to make numbers human scale. That means we start with the big scary and incomprehensible $3.5 trillion gross cost and divide by ten because the money would be spent over a decade.

Next, we divide the $350 billion per year by 332.8 million Americans as of this writing. Then we divide that by 365 days to get $2.88 per day per American ($11.52 for the iconic family of four).

And how much is $2.88? It was less than the average price of a cup of coffee back in 2019. Gourmet coffee shops that year charged on average $4.24 per cup.

Most Would Pay Nothing

Now the best news: that $2.88 per day won't cost you a penny if you make less than $165,600, analysis by the Tax Policy Center shows. Years of experience have demonstrated that its computer model reliably forecasts the costs and benefits of tax policy changes.

Biden's plan would reduce federal taxes for eight out of ten households. The poorest 48 million households would pay $620 less in taxes. That means the poorest Americans would enjoy a 4% increase in their after-tax income. That's the equivalent of two extra weeks of pay each year.

Families making $91,800 to $165,600 would pay on average $120 less in federal taxes. Not much, but also not a tax increase.

Now consider people on the 80th to 89th rungs of the income ladder, people who make $165,600 to $243,000 in total income. Their taxes would go up, but by just $420 on average, less than half the price of a cup of coffee.

The Richest Pay

The burden for the Biden human infrastructure plan would fall overwhelmingly on the 120,000 highest income households in America, people whose annual income ranges from $3.6 million to several billion dollars annually.

The folks who make at least $100,000 per day would bear 86% of the cost of Biden's human infrastructure plan. They were also the primary beneficiaries of the Trump 2017 tax cuts, repeating a quarter of the tax savings. This is more like a take back of a tax favor financed with borrowed money than a tax increase.

Yes, we have Americans whose annual income is in the billions of dollars. One example: Larry Ellison collects almost $1.8 billion a year in dividends from Oracle, the company he launched in 1977 with a federal government contract. And that's far from all of Ellison's income.

How the Richest Benefit

The top one in a thousand households would also reap huge benefits from the Biden human infrastructure plan, making them even wealthier over time.

The richest among us would benefit because investing in a better educated, more productive workforce not burdened by student debt, which holds back the formation of families, home buying, and all the spending that goes with furnishing and setting up a family domicile.

A more productive workforce with more after-tax income means the vast majority would have more money to spend on the goods and services offered by the wealthiest families and the businesses they own, control, or invest in. Voila, government policy that helps the many also makes the already rich richer while making the creation of new riches more likely.

How Most Americans Benefit

My life is an example of how taxpayer investments in citizens more than pay for themselves. The $8,960 that federal taxpayers invested in my college and postgraduate education over seven years under the War Orphans Educational Assistance Act has been paid back many times over in federal income taxes. Indeed, the inflation-adjusted value of that taxpayer investment in me was paid back in full just from taxes on royalties from Perfectly Legal, the first book in my award-winning trilogy on the American economy.

More broadly, one of the smartest if not the smartest federal investment ever was the GI Bill, officially the Servicemen's Readjustment Act of 1944. The GI Bill is what enabled a Seattle grocer's son named Bill Gates to become a lawyer and, in turn, give his son the money that launched Microsoft with jobs that poured money into federal coffers.

The GI Bill doubled the number of college degree holders in ten years and resulted in more education, higher incomes, and less poverty. And this was despite the racist and sexist details of the GI Bill that kept many Black Americans and women who served from participating. The Biden plan has no such barriers, though once enacted, DCReport will scrutinize the final legislation looking for any subtle discriminatory features that Congress may slip in.

When Republicans and a handful of Democrats declare that they will vote against the American Families Plan, here is what they are really saying: you should pay higher taxes; you should not get as much in benefits as you could for those taxes; you should pay higher prices for prescription drugs; you should endure more medical bills; you should have your pockets drained to pay for childcare and eldercare.

Irrational Tax Hatred

And why? Because the ideological and irrational anti-tax crowd, which denounce all new taxes as bad, wants to ensure that the already best-off Americans can have more now instead of the more prosperous future that we could all enjoy.

We would be a poor country today but for massive taxpayer investments in the future like the GI Bill and the related War Orphans Act. The way to think about human infrastructure is that it's not spending, like those fossil fuels consumed by military planes and ships, but an investment in a better and all around wealthier American future.

At a gross cost of $2.88 per day, the American Families Plan is a bargain. At a net cost of less than zero only fools would say no.

A clear repudiation: Larry Elder's mammoth defeat may signal the death rattle of Trumpism

The overwhelming rejection of the effort to recall California Governor Gavin Newsom is a powerful message for those Republicans who think their future lies with Donald Trump and Trumpism. It doesn't.

The vote was roughly 2-to-1 against the recall. That's a landslide by any measure. Indeed, when the results are certified, Newsom may have beaten the recall by a larger margin than his 2018 victory in the gubernatorial race.

For Republicans who backed the recall, that's a clear repudiation. And what makes it even more significant is that Newsom did some things as governor that stirred anger and resentment.

What made Newsom especially vulnerable was his arrogant and foolish decision during the pandemic last year to have dinner in a Napa Valley French restaurant without a mask. He violated other Covid protocols as well even though he had issued a severe mask-up order that some restaurant owners say was too harsh and killed their enterprises.

"Do as I say and not as I do" has ended the careers of more than a few politicians, yet Newsom is coming out of the recall much stronger than ever.

When the final votes are counted, the share of ballots favoring recall is likely to be smaller than the share of California ballots for Trump over Joe Biden in 2020. Ouch, if you're a Trumpublican.

That's a clear sign that Trump's influence is waning -- especially since Trump weighed in to support the recall.

The next few days will be filled with Trumpian complaints that the election was rigged, no matter the lack of evidence. Baseless claims will fool some people, but over time they just become the pathetic whining of losers like Trump. Baseless claims don't attract more voters, which is Politics 101.

The week before the election, Trump said the election was rigged for Newsom. He reiterated that on election day.

Larry Elder, the leading Trumper seeking to replace Newsom, posted assertions that the official vote results were fraud and statistical analysis proved it.

That's a remarkable claim to make before any vote results are known and before the election ends – unless you just make stuff up.

Elder is a longtime fixture in the Los Angeles radio market.

Elder is a true red Trumper who spouts crazy, illogical, half-baked, fact-free, absurd and downright offensive ideas, sometimes contradicting himself just the way his hero Donald Trump does.

Facts are to Elder just as they are to Trump: they don't matter. Like Trump, Elder creates his own reality.

Among the craziest things Elder has proposed are reparations for slave owners because their "property" was taken away after the Civil War.

Elder's campaign made clear that he intended to govern California in pure Trumpian style, by Tweet rather than substance. That also alarmed voters in a state whose economy is heavily based on science. Indeed, even the Hollywood fantasy machine relies on science to churn out films, television shows and video games.

Most Californians had never heard of Elder.

As word about Elder's jumbled, racist, misogynistic, anti-science and extreme anti-abortion beliefs got traction among Californians who had never listened to his radio rants, alarm bells started to go off. And not just among Democrats. Business leaders were also worried. And that caused voter turnout to soar.

Trumpism can't grow and regain power when all its got are made up tales of vote fraud. California voters just proved it by overwhelming margins at the polls.

Lousy jobs report? Not at all

"Disappointing" is all over the news Friday about the August jobs report. The economy added 235,000 jobs as covid made a big comeback, especially in Southern states where governors spurn science and people stayed away from bars, restaurants, and shopping malls.

Most of these news reports note lacked context about how rare it is to add that many jobs in a month. Most of the reports I read also failed to note that under President Joe Biden jobs are growing at more than triple the rate under Trump before the pandemic began.

Overall, the American economy is growing even faster than the 6% that Trump promised voters. Prepandemic, Trump delivered barely half that growth rate.

July was excellent with more than a million jobs added. In June, the economy added 962,000 jobs. That makes the August number seem small, but only by very short-term comparison.

Under President Biden, the economy has added an average of 636,000 jobs per month, the federal Bureau of Labor Statistics "all employees" report CES0000000001 shows. That's close to 4.5 million jobs added since Biden became president on Jan. 20.

On Donald Trump's watch – before the pandemic – the economy added only 188,000 jobs per month. President Obama did better than that once the collapsing economy he inherited turned around in early 2010, adding more than 200,000 jobs per month on average.

Genuinely awful

Looking at Trump's entire time in office, his jobs performance was genuinely awful. On Trump's watch, the economy lost an average of 2.8 million jobs per month. That's primarily because in March and April of 2020 the economy lost 22.4 million jobs.

Since Ronald Reagan assumed office four decades ago, only one president has added an average of more than 235,000 jobs a month. That was Bill Clinton. During Clinton's eight years, the economy added an average of 242,000 jobs per month.

Clinton did even better than those figures suggest because there were about 62 million fewer Americans on his watch. Adjust for that smaller population and the Clinton economy added the equivalent of about 297,000 jobs per month with today's population of 333.3 million people.

In August, the economy added 37,000 manufacturing jobs. Under Trump 1,800 more factories closed. Thousands of factory workers lost their jobs, primarily because of his disastrous and ill-informed tariffs.

The most interesting August job developments were in the delivery of goods compared to the traditional retail trade and in services like bars and restaurants.

Jobs in transportation and warehousing, which benefit from the home delivery of products, grew by 53,000 and brought the total to a modestly new high with 22,000 more such jobs than before the pandemic.

Retail employment – thinks clerks at malls – declined, with 29,000 fewer jobs in August and 285,000 fewer than in February 2020, before the pandemic.

Bars and restaurants shed 42,000 workers, evidently because fear of coronavirus infection is keeping more people at home. That number may worsen in the months ahead as the anti-vaxxers, sheep worm remedy users, and mask refusers spread more gratuitous disease and death.

Trump Faltering in 2019

The Trump economy was faltering even before the pandemic, as I reported here citing official government data. Trump's overall economic performance was subpar, as I detailed from official government data in April 2019 when I gave Trumpa grade of C for economic performance.

Candidate Trump repeatedly said he would produce 6% annual economic growth. He only got above 4% for one quarter. Even that was only because businesses stepped up purchases ahead of his disastrous tariffs.

After three years in office, economic growth under Trump was worse than every other president after Harry Truman except for George H.W. Bush.

Under Biden, the economy grew at a 6.5% annual rate from April through June, the second quarter of this year. the Congressional Budget Office estimates that "real GDP will grow by 7.4 percent in calendar year 2021."

Happy Go Magic Land

Many Trump fans refuse to accept that Trump was bad for the economy and jobs even before the pandemic. These Trumpers seek solace in the childish fantasy world of Happy Go Magic Land.

And don't forget, Trump ran in 2016 promising to pay off the entire federal debt in eight years. Instead, during his four years, it grew and grew, in good part to finance tax cuts for the wealthiest Americans and large corporations.

So read the 235,000 jobs added in context. It's a sharp fall from June and July, but that's mainly due to covid making a comeback in states headed by Republican governors who deny science and thus kill their own citizens.

Viewed in context, the 235,000 jobs created in August are a clear positive for America.

Want to know what we could have done with all of the money we’ve wasted in the last 20 years​? Look at China

All the recrimination-filled reporting and commentary about how fast Afghanistan fell to the Taliban after President Biden made the courageous decision to finish withdrawing our troops miss a much more important story.

This story concerns why Americans can't have nice things anymore while our main economic competitor, China, is investing in a lucrative and influential future. It's the story of jettisoning the sensible Powell Doctrine on military action in favor of chronic combat that creates enormous fortunes for investors in the military-industrial complex, all enabled by jingoistic political cowardice in Washington.

For two decades our elected leaders foolishly spent our money trying to impose democracy at the point of a rifle in a country with no democratic culture or tradition.

To date, United States taxpayers have spent about $2.3 trillion on an undeclared war that cost 2,448 American servicemen and women their lives as well as the lives of more than 100,000 Afghanis.

This butcher bill comes to more than $6,000 for each American man, woman, and child. Our elected leaders borrowed all that money because of federal tax cuts in 2001, 2003, 2004, 2006, 2009, 2010, 2012, and 2017.

America would be far better off today had Congress built a giant bonfire with all those greenbacks.

Cutting taxes in a time of war is as dumb an idea as ever infected American politics.

America would be far better off today had Congress built a giant bonfire with all those greenbacks. Seriously.

That's because the costs of this foolish enterprise will continue until the last eligible dependent of an Afghan combat veteran dies sometime near the dawn of the 23rd Century.

Last Civil War Check

It wasn't until last year when Irene Triplett died and her $73.13 monthly check stopped, that American taxpayers paid out the last pension from the Civil War, which ended in 1865.

The total ultimate Afghan war bill? More than $6.4 trillion, according to the Cost of War Project at Brown University. That's more than $100,000 for the iconic family of four.

There's a good chance that estimate will prove low because our government instilled hatred of America and democracy among many of the 35 million Afghanis. Once the Taliban completes their bloodbath—executing American collaborators, women who dared work outside the home, and other infidels—they are likely to hunt for ways to exact revenge on us. After all, we'd do the same —in fact, we already have.

And all this approved without a declaration of war, as required by our Constitution.

While our elected officials squandered money on an undeclared war that drained our economy, the dictatorial regime in Beijing bought China a bright future.

No Better Life

China spends more than 5.5% of its economy on infrastructure. America spent about 3.1% of the economy on steel and concrete infrastructure way back in 1980 before more than half of today's Americans were born. In recent years American infrastructure investment has been slashed by half to a record low.

None of this Afghan war spending bought us a better life. None of it was an investment in the public, which is the commonwealth foundation on which private wealth is built.

That money didn't maintain or build new roads, dams, bridges, rail lines and public buildings that could last centuries if adequately designed and constructed. It didn't buy textbooks or strengthen our third-rate grid in this electricity-dependent Digital Age.

It bought bullets and bombs that become useless once they go off. And the overwhelming majority of those killing devices were wasted because they failed to kill their targets and, worse, often killed innocents, including women and children.

China, in contrast, didn't spend its money on wars. Indeed, China hasn't been in a war in this century, though it brutally oppresses those within its grasp who challenge its totalitarian control.

Creating Wealth

Instead, China invested in public furniture that makes commerce more efficient, shrinks its carbon footprint, reduces rural poverty and expands influence beyond its borders. Those investments create jobs galore and, in turn, wealth.

"Infrastructure investment in China has increased significantly in recent decades and has been a significant driver of economic growth and improved standards of living," according to the Reserve Bank of Australia.

The can-do spirit has been throttled in America by petty politicians like the anti-taxers who insist we cannot afford to invest in the public's welfare. Be it making college tuition-free or nearly so or taking care of our existing infrastructure. They stand for tax cuts for the rich and the big companies that their patrons own. At the same time, they oppose building new and refuse to recognize that electricity, cell phones and the internet are core necessities of life in the Digital Age.

The can-do spirit, however, is not gone from this Earth. It's just moved to China, which in 43 hours tore down and replaced a multi-lane highway bridge in Beijing, as this fantastic brief video shows.

Think about how long it takes to get anything done in America these days.

In just 10 years, starting in 2008, China built nearly 16,000 miles of high-speed rail. That more than doubled total global high-speed rail.

How many miles of high-speed rail carry passengers in America? None.

This smart CNBC program explains why America has no high-speed rail and how we also lost many urban rail transit systems in the post-war era.

China isn't afraid of debt either.

Investing in the Future

China's infrastructure investments, private and public, are essentially 90% debt-financed. From 2000 to 2014, China invested the equivalent of $29.1 trillion U.S. dollars in infrastructure while issuing $26.1 trillion of debt, researchers at Oxford University calculated.

Our Congress is in a lather about just $1 trillion for traditional infrastructure.

To a person, the Republicans won't consider a separate bill that defines infrastructure in human terms with money for housing, expanded education, cash to lift children out of poverty, climate change mitigation, rural internet access, and investments in science.

From my many visits to China in this century, it's evident that the regime there builds smooth roads on very deep beds of rock, assuring potholes will be rare, not as in America standard.

These long-lasting Chinese highways with extensive lanes put to shame the German Autobahn, which puts to shame our cheapskate Interstate highway system.

America thinks in terms of 90-day corporate financial reports and two-year election cycles. China's leaders think in terms of decades and centuries.

America has literally gone backward in some areas since 1863.

During the Civil War, the president of the New York Central worked in Manhattan but lived in Batavia, midway between Rochester and Buffalo in Western New York. Dean Richmond took his private rail car down to arrive at work Monday morning and returned home late Friday supper.

The trips he took in 1863 took 90 minutes less than today.

If we built the kind of trains that China already has, then Batavia to Manhattan could take under two hours, not eight.

If America seriously invested in infrastructure, we could build elevated mag-lev trains like the one connecting the Shanghai airport to the edge of that city. The repulsive force of magnets liftsrail passenger cars millimeters above the tracks so trains can run at a friction-free 300 miles per hour. Put such trains in vacuum tubes, and you could go from L.A. to Manhattan in less time than it takes to reach JFK from Manhattan or LAX from Beverly Hills. All while using a tiny fraction of the energy a jetliner uses per passenger today to connect those megacities.

But instead of working toward such goals, we squabble over the scraps left over after wasting blood and treasure in a war that had no purpose except to catch those behind the awful attack on us almost two decades ago.

We had good reason to enter Afghanistan in 2001 after Osama bin Laden's fanatical followers crashed jetliners into both World Trade Towers, the Pentagon and tried to hit the fourth target until passengers bravely brought down that plane in the Pennsylvania countryside.

The Real Vietnam Comparison

The 2001 invasion should have followed the Powell Doctrine, named for Colin Powell, the former chairman of the Joint Chiefs of Staff and later Secretary of State. He said a lesson of Vietnam is that America should use military force only when national security demanded it and then only after building overwhelming global support and applying overwhelmingly military force.

Instead of applying that doctrine to find and kill bin Laden and his confederates, the inexperienced George W. Bush agreed with conservative fanatics that said we could buy our way into capturing our enemies.

Air Force cargo planes stuffed with American dollars flew to the Middle East during the Afghan and Iraq wars. We gave quite literally tons of greenbacks to warlords who promised to catch bin Laden and his pals. They lied.

They took our money and hid the mastermind of 9/11. President George W. Bush declared in 2004 that he was "not concerned" about finding bin Laden.

Not until Barack Obama became president was our military told to find and capture him, as they did on May 2, 2011.

But Obama, like Trump, lacked the political nerve to do what Biden did – stop investing in a bad decision to keep troops in Afghanistan.

Be glad we pulled out troops this month because Biden said "enough." Don't be surprised that the Taliban are in control of that country. They were always going to come out on top, be it this month, 10 years ago or 100 years from now.

And be glad the ultimate total cost of this folly is only about $100,000 per family because it could have gone on forever, the costs piling higher and higher every day because of the political cowardice of George W. Bush, Barack Obama and Donald Trump.

And, now, please think about all the good things we could be investing in to make our lives better had we elected politicians who read and understand our first president's farewell warning about foreign entanglements and our 34th president, Dwight Eisenhower, whose farewell warning about the dangers of our military-industrial complex.

Of course in a democracy, we chose our leaders so we know ultimately who is to blame for why we can't afford nice things and we are falling behind China: Ourselves.