Oct. 7: Holding corporations accountable

Oct. 7: Holding corporations accountable

Only one of Louisiana’s five major U.S. Senate candidates agrees with Gov. John Bel Edwards that oil and gas companies should face legal damages for their role in damaging the state’s fragile coastline. Public Service Commissioner Foster Campbell told an LSU audience that “politicians with tap dancing shoes” have failed to hold the industry accountable for its role in destroying more than 1,900 square miles of  wetlands. U.S. Reps. Charles Boustany and John Fleming, retired Col. Rob Maness and lawyer Caroline Fayard disagreed.  Meanwhile, author John M. Barry, writing in The Advocate, deconstructs and refutes the industry’s arguments against taking responsibility.

The oil and gas industry applied all its political muscle to make sure the state did not enforce permits and the law. What else can they come up with? Oh, yeah, we should all cooperate to solve the problem, not blame anyone. That’s code for: taxpayers– i.e., everyone but the industry — should pay for it. In fact, taxpayers should pay for part of it; dams more than 1,500 miles upriver, which retain over one hundred million tons of sediment annually, do justify asking taxpayers nationally to pay their share. So should all parties who caused damage, including oil, gas, and pipeline companies. If Louisiana does not even attempt to hold responsible an industry whose own scientists blame it for causing enormous damage, how can we expect taxpayers from Oregon to Rhode Island to pay? If coastal Louisiana is to have any chance of surviving, the governor’s initiative has to succeed. We are running out of time.

 

The Delaware loophole

With tax reform looming as the top issue for Louisiana lawmakers in 2017, much attention will focus on the business community – and how much tax corporations should pay compared to families. In that vein, The Atlantic’s Alana Semuels looks at the “Delaware loophole” that corporations have used to move their profits into low-tax states, and the ways that such loopholes can be closed. She interviews Michael Mazerov, a senior fellow at the Center on Budget and Policy Priorities:

They can adopt what’s called combined reporting, which requires companies located in a state to include the net profits of all their domestic entities in a combined firm; this allows a state to determine a company’s tax burden by looking at its property, payroll, and sales. Other states give themselves “add-back” authority by law, allowing tax collectors to disallow deductions a company takes in order to avoid paying state taxes. There’s also what’s called the “economic nexus” doctrine, under which a state claims a right to tax a corporation’s income earned within the state if the company has a sufficient economic footprint there. … States worry that closing the loophole will cause businesses to move elsewhere to get more favorable tax treatment. More to the point, politicians who want to be seen as business-friendly don’t want to add new corporate taxes, so instead they leave the Delaware loophole in place, allowing companies to quietly avoid paying taxes.

 

10-20-30 plan gains traction

U.S. Rep. Jim Clyburn’s “10-20-30” plan to fight poverty is based on a simple premise:  “Any federal program subject to this plan would be required to direct at least 10 percent of total investments to counties where at least 20 percent of the population has lived under the federal poverty line for at least 30 years.” It has gained bipartisan support and serious nods from House Speaker Paul Ryan and presidential nominee Secretary Clinton. A $1.7 billion pilot program proved successful, so now Clyburn is pushing to expand its application.  Brooking’s Elizabeth Kneebone explains how to make this program a national success

Successfully attracting and implementing federal funding … requires a certain amount of institutional and/or jurisdictional capacity to navigate the application process, handle project implementation, and comply with reporting requirements—capacity many persistently poor places may lack. They could look to the USDA StrikeForce program. This program identifies sub-county pockets of persistent poverty, and USDA staff then “work with state, local and community officials [in these areas] to increase awareness of USDA programs and help build program participation through intensive community outreach and technical assistance.” Programs like this, as well as Strong Cities Strong Communities and Promise Zones demonstrate that capacity building and technical expertise are part and parcel of successfully attracting and implementing investments to improve outcomes for people and places. Making technical assistance and capacity building an explicit part of the 10-20-30 plan would not only underscore policymakers’ commitment to ensure federal dollars reach persistently poor places, but also make those investments more effective in practice.

 

Education and Civil Rights

The Civil Rights Act of 1964 and the landmark legislation that followed meant the formal end to legal segregation in America. But more than 50 years later, as David Johns and Andrene Jones-Castro remind us in an NBC News editorial, inequality remains a serious problem that can best be remedied by improving education.

Investments in high-quality early learning such as the national push for universal pre-K is essential to building a foundation for development, learning, academic success, and productive citizenry. Ultimately, a solid early education paves the way for long-term success and moves us forward to closing opportunity and achievement gaps. Educational opportunities…must be supported by cross-agency policies and collaborative practices that lead to thriving students, productive citizens, and successful communities across our country. New laws and provisions should be authorized to increase access to safe and affordable housing for children and families, provide greater avenues for adult and youth employment, increase access to nutrition and transportation, as well as reformed criminal justice policies that restore individuals and communities.

 

Number of the Day

83– Number of weeks that national unemployment filings have been below 300,000, the longest streak since 1970 [Source: Bloomberg]