Energy analysts predict that gas prices may have peaked, as prices have declined for the past week. Prices at the pump have been steadily rising since December, but analysts say that with last Friday?s high average of $3.94 per gallon, prices may have already hit their high water mark.
A divided Ninth U.S. Circuit Court of Appeals panel struck down a ban on political ads on public TV and radio stations, by a 2-1 vote.
Newark, New Jersey Mayor Cory Booker was treated at a hospital for smoke inhalation and burns on his hand after he rescued a woman from her burning house. “I just grabbed her and whipped her out of the bed,” Booker said when recounting the fire.
Minutes after its much-anticipated launch, North Korea’s rocket splintered into pieces over the Yellow Sea. In a rare admission, North Korea acknowledged the failure in an announcement on state TV, and world leaders quickly denounced the program as a violation of U.N. sanctions
Mitt Romney will be attending the National Rifle Association annual conference today. The NRA has come under fire recently for their involvement in pushing “Stand Your Ground” laws, which allowed George Zimmerman to walk free after shooting Trayvon Martin in Florida. Romney will address the NRA later today.
Newt Gingrich?s stalled presidential campaign is selling off one of its most prized possessions: the donor rolls. Desperate for cash, the campaign is auctioning off its donor list in an attempt to plug a $4.5 million hole.
Millionaires already know how they’ll get around the Buffett Rule. Bloomberg News explains, they have several methods to get around it.
And finally: It sounds like the Obamas and Jay-Z and Beyonce should go on a double date, as the president said this week that he likes Jay better than Kanye West, and the New York rapper’s wife, Beyonce, wrote a handwritten letter to Michelle Obama calling her “the ultimate example of a truly strong African American woman.”
Just hours before London buses were scheduled carry a Christian advertising campaign promoting ex-gay reparative therapy, mayor Boris Johnson, intervened to prevent the campaign. The posters would have appeared on five different routes in the capital and would have read, “Not gay! Post-gay, ex-gay and proud. Get over it!” “London is one of the most tolerant cities in the world and intolerant of intolerance,” Johnson said. “It is clearly offensive to suggest that being gay is an illness that someone recovers from and I am not prepared to have that suggestion driven around London on our buses.” Johnson’s political opponent is arguing that the mayor “should never have allowed the adverts to be booked” in the first place. A picture of the ads:
A favorite Republican pastime recently has been to demonize the unemployed by proposing that they submit to drug tests before collecting their unemployment insurance. Both at the federal and state level, Republicans have pushed for such a policy, even though, as it turns out, such requirements save barely any money and only prove that those on unemployment insurance are less likely than the public at large to be using drugs.
One Iowa Republican this week decided that such measures are not enough. During debate over Iowa’s budget, state Sen. Mark Chelgren (R) proposed that people who receive child support payments also be forced to submit to drug tests on the whims of the person making the payments:
The proposal came from Sen. Mark Chelgren, R-Ottumwa who said he was pushing the idea on behalf of an unidentified constituent who believed his ex was using child support money for illegal drugs.
A person paying child support under Chelgren?s proposal could require the recipient to a drug test every six months as long as they pay the costs.
?We shouldn?t be ducking our head and running away every time there?s a difficult issue coming up,? Chelgren said. However, following open laughter in the Iowa Senate chamber, Chelgren withdrew his amendment.
The Iowa Senate’s next task will be debating yet another Chelgren amendment. This one goes back to the standard Republican aim of forcing those collecting from state welfare programs to undergo drug tests. In Indiana, just 1 percent of those tested before collecting unemployment insurance or entering the state’s job training program during the final six months of 2011 failed their drug tests.
An economist argues we must cap emissions or put a price on carbon in order to avoid the worst impacts of climate change
by Gernot Wagner, reposted from Yale Environment 360
Steven Chu, the Secretary of Energy and a Nobel laureate, has argued that what the world needs is a handful of Nobel-level breakthroughs in energy technology. They sure would come in handy in the fight to avoid the worst consequences of global warming. But counting on breakthroughs is a crapshoot. We cannot rely on a miracle to navigate away from our current head-on collision with the planet.
That hasn?t stopped Breakthrough Institute co-founders Ted Nordhaus and Michael Shellenberger from arguing ? as they did in a recent article for Yale Environment 360 ? that technology research will stop the runaway train of climate change. You don?t have to bother limiting emissions through a carbon price or cap, they say, because energy innovation will come to the rescue.
Frankly, this is bunk. Reasonable people may disagree about what policies will best fight climate change. But climate science makes one thing clear: The planet must limit carbon emissions, or face a bleak future. And we will never get there unless we make policy changes that align market incentives with this goal. It?s economics 101. There?s no way to avoid making polluters pay for the damage they cause, or they?ll keep causing it. That either starts with a price on carbon or, ideally, a cap on carbon emissions.
Nordhaus and Shellenberger argue that taxing or capping carbon pollution is tough, so better to invest in new pollution control technologies instead (though they don’t say where those investments would come from ?the deficit-obsessed U.S. Congress doesn’t seem poised to provide major new funding for clean-energy R & D). Certainly, it?s true that it will be tough to keep polluters from passing on the costs of their pollution to the rest of us, as they always have. It?s also true that innovation in governance has never been easy. Ask Niccolò Machiavelli, who wrote in The Prince, back in 1505: ?The innovator has for enemies all those who have done well under the old conditions, and lukewarm defenders in those who may do well under the new.?
And, yes, greater investment in clean energy R&D will likely produce important advances, especially if government takes a more active role, as urged by the American Energy Innovation Council, whose leaders include hardheaded business types like John Doerr, Bill Gates, Chad Holliday, and Jeff Immelt.
But no one, including the American Energy Innovation Council, would seriously suggest ? as Nordhaus and Shellenberger do ? that we just focus on innovation and dismiss the hard but all-important task of capping or pricing pollution.
R & D alone just isn?t enough. There?s an all-important second ?D?: deployment. And clean energy deployment won?t happen by itself. The world already has a $5 trillion-a-year energy industry that makes lots of money for lots of people, and does so while forcing the rest of us to pay enormous socialized costs of its pollution.
That?s O.K., say Nordhaus and Shellenberger. All we need to do is subsidize new technologies to bring down their price. They aren?t the first to make this claim. Ted Nordhaus?s uncle, the Yale University economist William D. Nordhaus, has written eloquently on the topic. Companies don?t care that their inventions may set the stage for others to create profitable new products, he says, and as a result, they don?t invest enough in research. The logical prescription: spend public money on research.
But the elder Nordhaus, like any good economist, also understands that the only way to make these subsidies effective is ?directed technical change? ? that is, subsidize in order to generate needed innovation, but also put a cap or a price on pollution to make sure the innovation does what we want it to do.
This is what the European Union does. It subsidizes R&D (&D) through a variety of direct and indirect means, while employing a cap-and-trade system that covers almost half of EU emissions. It?s difficult to determine the portion of emissions reductions achieved by each of these policies, especially given the economic downturn and other external factors. What is clear is that total emissions in the sectors covered by the EU?s Emissions Trading System have declined by 4 percent from 2007 to 2010, the last year for which comprehensive data is available. The decline is expected to continue in the years ahead. (View a graphic).
Nordhaus and Shellenberger try to argue that Europe?s cap has been counterproductive. To support their claim, they focus on emissions intensity ? emissions per unit of economic output. That is fundamentally the wrong metric. The planet doesn?t care about emissions per dollar . It?s absolute emissions that count. Moreover, Nordhaus and Shellenberger are forced to cherry pick data to make their case.
They pick 2008-2009 and argue that energy intensity in the power sector increased despite cap and trade. It?s true, EU energy intensity did increase slightly by around 0.3 percent that year. More to the point, however, Europe?s overall energy intensity ? much like the United States and most everywhere else on the planet ? has declined consistently over time. Even in 2008-2009, absolute power sector emissions decreased, and that wasn?t a fluke. The latest (partial) data show fossil generation in large EU states fell 3 percent in 2011.
Switching from coal to natural gas was responsible for some of the EU’s emissions reductions. A natural gas boom in the United States may have a similar effect. This boom, Nordhaus and Shellenberger argue, was the result of basic research on shale gas extraction technologies. They may be right about the role of government funding here, but that has little to do with the need for controlling pollution through caps or prices.
It?s true that natural gas may prove to be a lower-carbon fuel than coal for generating electricity, but only if leaks in the natural gas system, from production to use, are strictly limited. It?s also true that even if the U.S. shifted entirely to gas from coal, we would still not meet the long-term emissions reduction goals science tells us are necessary.
In short, we need to ramp up and be able to sustain R&D (&D) ? and that is nearly impossible when all market forces are pointing in the opposite direction. We need to guide private research efforts, and we need to pay for public ones. The American Energy Innovation Council lists five ways for government to come up with the necessary funds, four of which point to increasing the price of fossil energy.
The best policy instruments toward that end are pricing or, ideally, capping greenhouse gas emissions. Already, Europe?s Emissions Trading System has helped give the EU the global lead in green technology deployment, and similar policies are being put in place from California to Australia and New Zealand. India has a coal tax. Brazil has placed an absolute limit on emissions and has significantly decreased emissions due to deforestation. China is starting seven regional cap-and-trade pilot programs.
Policies like these can change market incentives, which, despite the contentions of Nordhaus and Shellenberger, are key to fighting climate change. Only by getting the incentives right can we create the conditions for development and ? most crucially ? deployment of new technologies.
Ultimately, the world needs both new technologies and proper market incentives. Neither can go it alone.
Gernot Wagner is an economist at the Environmental Defense Fund, where he works on market-based solutions to a wide range of environmental problems. He is author of the book But Will the Planet Notice? How Smart Economics Can Save the World.
This piece was originally published at Yale Environment 360 and was re-printed with permission.
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This piece is the fifth in a six-part series on taxation, and a joint project by The American Prospect and its publishing partner, Demos.
There is no shortage of alarmism when it comes to corporate taxes. Earlier this year, Mitt Romney said that the U.S. tax code ?looks like it was devised by our worst enemy to tie us in knots.? A more recent memo drafted by the Senate Republican Caucus claimed that the ?corporate income tax harms workers, consumers, job creation, investment, and innovation? (you have to wonder what else exactly is left).
These statements are enough to scare anyone into thinking that the entire U.S. economy will crumble if corporate tax rates aren?t slashed tomorrow. But, as Republicans often claim, are U.S. corporate tax rates really among the highest in the world? And are workers really so dependent on protecting corporate profits? More important, is there any reason the U.S. shouldn?t raise more revenues from corporations during this time of great fiscal need?
Those pushing for corporate tax cuts commonly cite the fact that, as of April 1, 2012, the U.S. officially has the highest corporate income tax rate in the world. When you add together federal, state, and local taxes, the combined rate shakes out at 39.2 percent.
Of course, nobody really pays that: A widely-cited study last fall revealed that the 280 most profitable corporations in the U.S. collectively paid an average rate of 18.5 percent from 2008-2010. Seventy-eight of these corporations actually paid zero in taxes during one of these years. The disparity between the official, statutory corporate tax rate and the effective rate is due primarily to the countless deductions and exemptions that corporate lobbyists have successfully woven into the tax code over the years.
The good news is that a growing bipartisan consensus has developed around the idea of seriously rolling back these deductions. The bad news is that President Barack Obama?s framework for corporate tax reform, put forth in February, advocates making it revenue-neutral. This outcome would contrast starkly with the last major overhaul of the corporate tax system in 1986, signed by President Ronald Reagan, which closed loopholes while increasing overall revenues.
Consider the budgetary impact of revenue-neutral corporate tax reform. In 1955, corporate taxes made up 27.3 percent of all federal revenue; today, that share is estimated at 9.6 percent. And although soaring corporate profits have driven steady GDP growth over the past decades, corporate taxes as a share of GDP are a quarter of what they were in 1955.
Revenue from corporate taxes has not only fallen from its historic level, but also remains significantly below that in other countries. While corporate taxes make up 1.5 percent of GDP in the U.S. today, they are 1.9 percent of GDP in Germany, 3.3 percent in Canada, and 3.9 percent in Japan. The average of corporate taxes among member nations of the Organisation for Economic Co-operation and Development (OECD), a European group that promotes economic and social well-being around the world, is 3.5 percent.
These statistics underscore how misleading it is to claim that the U.S. imposes a uniquely onerous tax burden on corporations compared with other developed countries. In fact, the opposite is true. With this added revenue, moreover, our global competitors have more resources to fund the infrastructure projects and human capital programs that are vital to securing an upwardly mobile and internationally competitive economy. By insisting on revenue-neutral corporate tax reform, we risk making this imbalance worse even as global economic competition intensifies. Already, the fiscal crunch in the U.S. has driven cutbacks in education at a time when key indicators show the U.S. falling behind in this crucial area.
Consider the other alarm bell sounded by those calling for more corporate tax cuts?namely, that easing up on corporate tax rates will benefit workers and help create jobs.
Again, the facts suggest otherwise. The first two years after the official end of the Great Recession, more than 84 percent of all growth in national income went exclusively to corporations. American workers, meanwhile, were able to grab just 4.4 percent of income growth in the post-Recession recovery.
In other words, in a head-to-head match-up between corporations and American workers, corporate profits accounted for nearly all of the already-limited spoils of the post-Recession recovery. This is particularly incredible given corporate profits remain a comparatively small share of total national income in any given year?around 10 percent in 2009 and 2010?while workers incomes account for over 60 percent in the same period.
These numbers say one thing very clearly: When it comes to bouncing back from a serious economic contraction, it?s not the case that ?workers, consumers, and job creation? all benefit from higher corporate profit margins. And if that?s the case, then why?as even President Obama has proposed?would we limit the scope of corporate tax reform strictly to those proposals that do not require corporations to contribute more to the public pool? Haven?t corporate profits seized enough of it already?
Corporate profits will only become more resilient and foster greater inequality as the financialization of the U.S. economy continues. But Wall Street is not alone?corporate America, including the major low-wage employers in the retail and food services sectors, has collectively demonstrated superior power and might over American workers in the contest over who gets what.
Against this backdrop, revenue-positive corporate tax reform is non-negotiable. Not only would more progressive corporate taxation reverse the trend of growing inequality, it would also raise funds needed to expand wage-support programs like the Earned Income Tax Credit, which are only going to become more crucial as low-wage jobs proliferate in the post-recession recovery.
Closing all corporate tax loopholes while only modestly lowering top corporate tax rates would raise tens of billions of dollars in new revenue per year. A prudent overall goal is to move corporate tax revenues to just under the OECD average of 3.5 percent of GDP. Whatever the specifics, the guiding principle is that revenue-positive corporate tax reform must be accepted as an imperative of our fiscal policy.
Given the role that corporate profits play in exacerbating inequality, it is important to understand corporate tax reform as a key component of social policy in the U.S. Revenue-positive tax reform would therefore not only help balance the budget, but also balance the playing field between workers and corporations.
I've admired Newark Mayor Cory Booker since watching Street Fight about his initial run for office. I follow his Twitter account and see how invested he is in helping his constituents. Now he knocks it out of the park by saving his neighbor from a house fire.
Newark Mayor Cory Booker was taken to a hospital Thursday night for treatment of smoke inhalation he suffered trying to rescue his next-door neighbors from their burning house.
"I just grabbed her and whipped her out of the bed," Booker said in recounting the fire. Booker told The Star-Ledger he also suffered second-degree burns on his hand.
The fire started in a two-story building on Hawthorne Avenue in the Upper Clinton Hill neighborhood, shortly before the mayor arrived home after a television interview with News 12 New Jersey.
Five people were taken to the hospital for treatment: the mayor, a woman from the house and three members of his security detail. The woman was listed in stable condition at Saint Barnabas Medical Center in Livingston with burns to her back and neck.
Booker left his home shortly after 6 a.m. this morning to make an appearance on the CBS Morning Show in New York. The mayor will hold a press conference at 10 a.m. at his home to discuss the incident.
Newark Fire Director Fateen Ziyad said after the mayor arrived home he saw flames and smoke from the second floor of the building next to his home, and no residents outside - Star Ledger
I wouldn't be surprised to see him as the keynote speaker in Charlotte.