'Big, Beautiful' Medicaid Cuts, Explained

The Medicaid cuts are a scam to get the tax cuts passed - including those which extend Estate Tax Rules currently in force. When the GOP loses Congress, the cuts will be stopped. The most onerous cuts passed in 2017 were permanent - and were likely bipartisan behind the scenes - those cuts being the ones that cut corporate income tax rates and introduced matching pass through rates and qualified dividend rates to match - which is pretty much a good idea. Biden wanted to add a 5% increase to the bad cuts but did not get it done - so we really are in the Trump economy and had been through the entire Biden Administration. Biden and Harris could not say this because they wanted to claim credit for the strong Dow - which inflated in price (more money, same goods in Blue Chip sector with the addition of a lot of junk (Bitcoin and Mortgage Backed Securities built into index funds). 

Balancing the budget without raising taxes on business must wait for more basic tax reform. The real cost to the poor is because of tariffs, which are about the same as a value added tax with the kind of exemptions you would expect legislators to throw in rather than have a broad based tax. Tariffs are necessary to at least match VATs that are zero rated at export - with the understanding that other national VATs add back taxation by the importing nation. To an extent, state sales taxes do that - although at lower rates - and businesses who charge sales taxes can deduct them from their Gross Income. Families are partially held harmless by the increase in the Child Credit by $500 per year, although this works out to only $41.66 per month per child. Not renewing the cuts does not decrease tariffs and reduces the Child Credit to $1000 per year per child - which is an increase of 124.98 per month in taxes - although abandoning the Trump cuts would bring back the child tax exemption of a bit more than $3000 per child per year - which effectively still puts a lot of people off the tax roles who are poor. Harris would have increased the child credit to about what the Big Beautiful Bill goes to, with a $500 sweetener for newborns. Child tax credit amounts are one of those bipartisan measures that need to be doubled and indexed for inflation.

The GOP should also give low wage workers a raise - Trump may be embarrassed into doing that if the Pope asks him to. To make it back to Clinton era levels, it would have to be $12 per hour. Biden should have passed this in his first year. So should have Obama. If hours are cut to 7 per day for a four day week more people would get jobs and to keep the same wage level, the rate would need to be $14.50. In some states, it already is. Only GOP states screw over their own people, largely due to White Supremacist ideology which assumes that only people of color have these jobs.

Running a deficit is essential to keep capitalism active because this keeps interest payments flowing to investors who hold bonds directly or through mutual funds (77% of which is owned by the top 10% - who own 54% of pension, retirement account and bank assets and deposits). For capitalism to grow, the deficit must grow. $300 Billion per year over ten years may not even pay the interest, depending on what the Fed does with interest rates. We actually need a much higher deficit - and will get one in all reality since most cuts will not occur as sold. The top tax rate under Trump is 37%, which is a bit less than half of the difference between the Bush rate of 35% and the Clinton and Obama rates of 39.6%. This rate applies to ordinary dividends, wages and short term capital gains (net for the year). Only celebrities pay these rates - from CEOs to sports and entertainment stars. The vast majority of income for the top 0.1% (the real wealthy - the rest of the top 1% work for a living as doctors and lawyers and such) get their income from qualified dividends and capital gains - while dividends and pass throughs take money from workers, capital gains do not - they are essentially gambling winnings.  Again, these rates need to go up as part of permanent law as they do not run out. The actual capital gains rate (before SM taxes funding Obamacare subsidies - which is 3.8% on non-wage income over $400,000 - Biden increased the threshold from the $200,000 in the original law) is 20% and has been since Bush 43. Obama did not change that rate - even though this is one of the main ways that the wealthy make money.

Business and capital gains rates (including dividends) should be 26% or so and be bipartisan and permanent. This will be enough to allow manageable increases to the deficit. The current rates allow the creation of junk in the stock markets. A 19.5% VAT or tariff is necessary to reduce the budget deficit (or less if carbon taxes are enacted and made visible on invoices) - but only if the child tax credit and minimum wage are increased as above, which would automatically increase social security payouts to enough that seniors and the disabled don't need additional income from work or other government benefits. You would know this if you followed by channel and read my fiscalequity.blogspot.com page, which contains my comments to the revenue committees through The Center for Fiscal Equity.

Brian Cox: Our planet is fragile, but space may hold the solution

There is a big galactic community out there that has a version of the prime directive - where we are the primitive species. We don't get to join because of physics - rather, it is when we advance ethically and spiritually enough to be a safe bet to not start a war. We seem to reserve to ourselves the kind of free will that allows us to focus on the evil that other people do. Evil does not actually exist - we created it. Not God (who exists) or the Devil (who does not exist).

There will be another great collapse, where galaxies are swallowed by their super massive black holes that all move toward the great attractor - which will set off another Big Bang when they crash together and create critical mass.

We have existed as beings for more than one collapse and bang - but we forget this when incarnate. In ultimate reality, time does not occur in the same way. That eternal thing you were talking about. We are already there - but on the other side. There is now too much credible NDE experience reported to deny such things without lapsing into feelings and personal authenticity rather than openness to reason.

Did Climate Skeptics Get THIS Right?!

A few years ago, I wrote a paper on how global warming works and how science is not effectively communicating. I will stick to the science in these comments. They constitute a smoking gun. Taken together, this information goes from scientific speculation on what might happen to a trail of evidence as to what is actually happening. 

We are talking about proof, not probabilistic models as to what might happen. 

This research shows what is happening at Barents Sea:

"Sigrid Lind has shown steady warming from the mid-2000s, with much of it attributed to sea surface temperature increases. The decline in sea ice has lessened salinity and mixed the layers of the sea – causing it to warm (Lind 2018). Wang, et al, associate Barents Sea Warming with temperature in the Northern Atlantic (Wang 2019). Sea ice loss has led to stronger El Nińo events (Liu 2022). Arctic surface water temperature measurement is leading to better science (Olthoff 2022). Amplified warming continues to lead to Barents Sea churn (Cai 2022). Huang, et al confirm the role of the winds in this warming (Huang 2022). Right on schedule, this weather pattern has started, yielding the worst year on record (Cheng 2023). Sea ice will melt further due to shifting winds (Gramling 2023). Some even question if Barents is still arctic (Gerland 2023). At COP28, one of the panels was about whether a tipping point had been reached. The explanation is in line with the above research (ICCI 2033)."

Cai, Ziyi er al.  2022.“Amplified wintertime Barents Sea warming linked to intensified Barents oscillation,” Environ. Res. Lett. 17( 044068) DOI: 10.1088/1748-9326/ac5bb3

Gerland, Sebastian, et al. 2023. “Still Arctic?-The changing Barents Sea” Elementa Science of the Anthropocene 11(1). DOI: 10.1525/elementa.2022.00088

Gramling, Carolyn. 2023. “Arctic sea ice may melt faster in coming years due to shifting winds. Science News August 16, 2023. Accessed December 6, 2023 https://www.sciencenews.org/article/ice-melting-dipole-arctic-oscillation

Huang, Ji, Robert S. Pickart, Zhuomin Chen & Rui Xin Huang. 2022. “Role of air-sea heat flux on the transformation of Atlantic Water encircling the Nordic Seas” Nature Communications 14(141) DOI: 10.1038/s41467-023-35889-3.

Lind, Sigrid , Randi B. Ingvaldsen and Tore Furevik. 2018. “Arctic warming hotspot in the northern Barents Sea linked to declining sea-ice import,” Nature Climate Change 8 634–639.

Liu, Jiping, et al. 2022. “Arctic sea-ice loss is projected to lead to more frequent strong El Niño events” Nature Communications 13:4952.  https://doi.org/10.1038/s41467-022-32705-2 

Olthof, Ian, Robert H. Fraser, Jurjen van der Sluijs 3 & Hana Travers-Smith. 2022. “Detecting long-term Arctic surface water changes,” Nature Climate Change  doi:10.1038/s41558-023-01836-9

Wang, Quiang, et al. 2019. “Ocean Heat Transport into the Barents Sea: Distinct Controls on the Upward Trend and Interannual Variability,”  Geophysical Research Letters 46(22), 13180-13190. DOI 10.1029/2019GL083837.

The key bit of research on how heat gets from the Pacific to Barents Sea (dropping moisture at the Rockies but keeping the heat - then picking up more moisture in the Gulf of Mexico and Atlantic and dropping it all at Barents is found here:

"Research on Barents Sea and Arctic warming (cited above), and how this affects the jet stream, and the current climate cycle is well established, as is the role of the westerly winds which move heat toward Northern Europe and Barents. Richard Seager, David Battisti and others have shown that the warming of the north Atlantic and Barents Sea is cause by the westerly winds from the Pacific, which drop their moisture at the Rockies – becoming dry – and then proceeding to the Atlantic, as well as variations in surface sea temperature (Seager et al, 2000, 2002, 2006, 2007)."

Seager, Richard, et al. 2000  “Causes of Atlantic Ocean Climate Variability between 1958 and 1998” Journal of Climate 13, 2845-2862.

Seager, R., et al. 2002.  “Is the Gulf Stream responsible for Europe’s mild winters?” Quarterly Journal of the Royal Meteorological Society 128, 2563–2586 doi: 10.1256/qj.01.128

Seager, Richard. 2006. “The Source of Europe’s Mild Climate: The notion that the Gulf Stream is responsible for keeping Europe anomalously warm turns out to be a myth,” American Scientist the magazine of Sigma Xi, The Scientific Research Society. 94 via Research Gate

Seager, Richard, and David S. Battisti. 2007. “12. “Challenges to Our Understanding of the General Circulation: Abrupt Climate Change” via Research Gate.

The Big Beautiful Bill

Donald is trying to look folksy, but he still sounds like a refugee from Queens - because that is what he is.

The reconciliation bill is ignorant and mean around the edges, targeting migrants for Medicaid and SNAP cuts. This means that doctors and hospitals will be carrying bad debt until bankruptcy or default. Pantries will have to step up to help poor families - although Food Stamps are already inadequate now.

The majority of the bad tax cuts - those rewarding capital - were enacted on a permanent basis. They are not expiring and not in this bill. The only real give away to the wealthy is to keep the status quo on the inheritance tax going. The problems with this bill need reform to fix, not grandstanding. House Leadership is mostly not up to the task. I know of only one or two serious Ways and Means subcommittee chairs. The rest are not worth their keep.

Those seeking big debt savings misunderstand why Moody's joined the downgrade parade. It is because the Republicans are unwilling to make sure the debt is actually paid - or can be. I suspect that tariffs are more to blame this time around. Rating agencies cannot stand unserious people in either Congress or in the Administration.

Deficits must be adequate to pay net interest (rolling it over), create new debt for fractional reserve currency operations (there is no button that does that at the Fed - Modern Monetary Theory is a scam), and provide leverage for investment in mutual funds (high yield), pension funds and other retirement accounts. Now that my generation is retiring, people are heading for the exits and minimizing risk - moving from growth funds to income funds. Capital gains are being replaced with secure dividend and interest income. The emerging recession - tariffs again - will hurt retiree returns.

What tax reforms, may you ask? Goods and Services Tax - or tariffs - it matters little if VAT is used for industrial policy; a subtraction VAT (with employers rather than employees being the responsible party) to channel childcare, child income and health benefits to workers federally and to education at the state level - thus replacing corporate income taxes with both  of these - with subtraction VAT surtaxes taking up the slack for individual filing by the middle class ($150K), upper middle ($500K) and the wealthy to cover high salaries, interest and dividends. 

 Death taxes, wealth taxes and capital gains taxes are better replaced with an Asset VAT at point of sale - rather than through end of the year filing. Time to stop rewarding failure as a way to hide income. The AVAT would be marked to market at IPO, option exercise (CEOs especially - but also short sales), and the first sale after inheritance, donation or gift - but with zero rating for sales to a qualified ESOP or COOP.

Trump's new airplane

Let Trump have his airplane, but without warfighting abilities.  Donald Trump will never nuke Russia - so it is no loss not to include the ability to do so in Air Force One. Anything to take Trump (and the current SECDEF) out of the line of command is a plus. As for the Trump Library - the next Attorney General can keep the jet as the press plane. The ability to make it a flying library piece is silly - Trump only gets $2M for travel. He could never fly the thing.

Did I get it COMPLETELY wrong last week??

Agriculture has grown - with its costs and benefits evening out. Coal in China is a problem - and if you look at how actual Chinese people live, on average, the benefits of their industrialization are primitive - accruing mostly to elites. The question we must focus on is how our activities have affected the heating of Barents Sea, which has varied hugely - not marginally - and is correlated with the use of gasoline powered vehicles. We need to permanently park these things and replace them with tethered electric in urban, suburban, exurban and highway settings (with hybrids in rural areas where infrastructure would cost more energy and carbon than the harm created).  

Climate goals are too little too late. The spring in the US has brought about yet another year of record heat in the same areas in both El Nino and La Lina years. The tipping point was breached at least ten years ago. Drastic action is needed to reset Barents Sea to a point where we keep breeching records. Global temperatures are not the issue. Heating of that specific place, caused by a specific chain of events that have been traced, is what must be focused on - not probabilistic climate models and international goals. 

Middle Class In Top 10 Cities Will Collapse - As Significant Shortages F...

The middle class earns one third of adjusted gross income and have college degrees. The bottom third of AGI holders are 77% of the population. They are suffering, but not collapsing, because they have no where else to go. How we adjust salaries for inflation is what makes their situation continually worse, since prices chase the median dollar of income (not the median household). Percentage adjustments magnify inequality. Fixed dollar adjustments at all levels diminish inequality. We will do one or the other. If we could preserve current inequality, we would be committing an evil act because the intention is evil.

Qatar just gave Donald Trump a $400 million plane. Uh, what? 💸 | Chris C...

The Air Force One in the Reagan Library was replaced by Boeing for $1. Nothing about this is news. Dive deeper. Also, the Foreign Gifts and Decorations Act is a system by which all officials can accept foreign gifts and surrender them to the United States. The press pool would also love to ride in this plane - as well as staff.

About the tax cuts...

I read the Tax Policy Center summary on the tax cuts. The ones we really hated on the left are actually permanent (the business cuts that made firing people a good business decision). None of what is expiring is particularly weighted toward the wealthy. Tax reform is needed to get a unified rate for business income tax (unless it is abolished and replaced with a subtraction VAT), pass through tax, dividend, interest and capital gains taxes (which should be an Asset VAT).

The tariffs, when fully analyzed, could be done sanely. Simply match the VAT rate of countries that zero rated their VAT at export. Then we are on an even keel. While a higher rate for China and Vietnam sound like social justice for Chinese workers - none of the proceeds would do them any good - it would just bring pain to American consumers.

Ideally, Chinese workers would have the same standard of living as American workers - whether supply chain or American subsidiary. A tariff may help American workers - but that should not be the only goal. I suspect that any number we have on Chinese GDP - even with PPP adjustments - is wrong because the data in China is bad - both on output and population. Most serious analysts say that, pre-COVID, the number of people was more like 800M, and that COVID may have killed half their population. Remember, people were given 24 hours to leave Wuhan (taking COVID with them) before the city was sealed off. In northern China, the number of dead were ten times what is normal during the pandemic. Xi may have wanted a trade embargo to clean up the mess while saving face. In the end, their rate should be 13% - unless we impose a higher rate until their workers have standards of living equal to our own - a provision which automatically gives workers an even shake.

The DOGE and immigration provisions that are so obnoxious and crypto-fascist are all being overturned by the judicial system. The Heritage Foundation can no longer be considered a serious think tank, given how badly their work on Project 25 failed.

That leaves Ukraine. Trump backed the wrong horse. Hegshead's pro-Russia actions are traitorous, but Russia is no longer much of a threat. The fact that Putin is now making noises that he wants to settle means he is losing. Let him. Pete should be fired, but his, Gabbard's and Trump's affection for Putin is no more damaging that Jill Stein's. 

It looks like we will survive as a nation - given the help of the Court system to overturn the worst instincts of Steven Miller and Elon Musk. 

It is almost time to start bipartisan talks on dealing with the tax cuts, as long as both sides deal in good faith. Again, even though it is outside what is required, a 26% tax on business returns is as reasonable a compromise now as it was when I suggested it in 2017.

We can even compromise on abortion. Allow abortion until a child can be delivered and then, from that point until 26 weeks, allow and encourage fetal hospice - including in Catholic hospitals. No one has a right to not be born or to expect extraordinary measures when they are.

Doing these things will destroy fundraising. I suspect that many who voted for the President would not think that this would be a bad thing.

So, if anyone wants to share this video with Fox News....

The United Kingdom, After America || Peter Zeihan

Given the new trade (framework) with the U.S., for me this is 20-20 hindsight.

There is only one way the US and Canada can mix their fortunes. First, the US needs to regionalize, with a VP and House and Senate caucus for each region (with each region getting 3 votes - one from each of these - as a new electoral college). Regions would have same number of EVs and could bloc vote by either compact or amendment - although the latter is needed to let caucuses cast votes rather than it being winner take all. This would end the ability for someone like Trump to be elected.

Crossing the northern border could be done in two ways. Provinces could request statehood OR we could rejoin a newly drafted commonwealth - one that has Canada, Australia, the US, UK and Ireland as members - with a Windsor monarch but the kind of regions outlined above. The Ireland, Wales and Scotland would form a region, England would be another, Australia (maybe with NZ) another and 7 from North America. They would select a head of government as above with an Electoral College of 30, with 16 required to elect. If worse comes to worse, the Crown could break ties.

Many Thoughts About The New Pope

Leo won't back track from Francis on blessing gay unions or those who married without an annulment. On the prior, he was "in the room." He was also a registered Republican from 2012 to 2016. Who he voted on in the 2016 primary can be guessed. 

He cannot be "woke" because his mother was a person of color - as they say in Louisiana where she is from. This is likely why he lived on the south side of Chicago. The city was segregated then and has not changed much since. I would assume he has no room for White Supremacy, since he isn't what they would consider White. Indeed, if someone is a Republican who likes Leo, they are, by definition, woke.

Michael Watkins: You can’t afford to be a dinosaur | Big Think+

Jung identified four cognitive functions: thinking (reasoning to make decisions) feeling (decisions on values), intuition (group agreement on concepts or values - and creativity) and sensory (individual perception). AI needs to have at least three of these working together, with thinking doing non-creative fact checking, feeling is a reaction to sensory information and seeks authenticity - deliberate bias where norms can be programmed - but must be able to change based on both individual sensory information and group intuition/creativity, sensory is easy for external input - but it is blind to personal sensation other than diagnostics, while intuition is where generative AI comes in. 

These functions exist in combination - and also include internal and external foci.

 For example, thinking/creating is a group activity with organized and specialized knowledge. When one of these functions is extraverted, the other is introverted. For example, intuitive thinking (deep dive into problems) is paired in humans with external intuition - contributing creativity to the larger system. It can also have a broad base of knowledge for the purpose of imposing a plan (rather than offering solutions).  Knowing a lot and offering a lot of options is socially inconvenient - and is the problem with current generative AI. Internal analysis for internal aggrandizement is Skynet.

Thinking can also be paired with sensing. For example, seeking reasons and storing the information (in order to offer options to clients or other machines), or seeking sensory input from the outside to take a deep dive in solving problems (and then coming up with a single answer).

Individual feeling is based on morality - and is paired with extraverted sensing - either hedonistically or by drawing from a range of data points in order to provide a single answer to the group based on a broad set of facts. External feeling is reading the room and is paired introverted sensing - recording group values in memory (and using these to solve problems with focus).

Sixteen profiles are based on having one ability be strong and its ability week, with the other two balancing and the prime function being either internal or external.

The beauty of machines is that you can have all four functions balanced, so there can be two basic functional sets depending on whether senses are for external use to yield on answer for the group or storage of data to provide a variety of options.

Did you know Pope Leo XIV has roots in New Orleans?

Our first Creole pope. This shows why he was born on the South side. In other words, he knew the sting of racism as a child.

We have a Pope!

There are American bishops who were not made cardinals or archbishops by Francis who were waiting for Francis to die and be replaced by a pope that would vindicate them. They are the ones who did not want to give Biden Communion.  Their hopes have now been dashed. Blessed be God!

Regarding union with Canada - God Save the King

If the United States were to divide into regions, I can definitely see how BC would join Oregon, Washington and Idaho to form Cascadia, Yukon, Alaska, the northern territories, other western provinces and Montana, Wyoming, Minnesota and the Dakotas could be a First Nations territory - with Greenland as a part. Ontario could join with Wisconsin, Michigan and Ohio, with New England, Quebec and the Maritime provinces joining as well.

There is only one condition to make this happen. Membership in the British Commonwealth. Then, each region could have a PM, rather than a regional vice president, Scotland, Ireland and Wales and England would each be regions in the empire - with each regional PM electing a unified head of government whose name could never be Trump.

We could even make Harry the governor general - or the King! Anytime Trump bloviates about making Canada the 51st state, throw joining the Commonwealth in his face. Bullies need to be put in their place.

China’s population is just a fraction of 1.4 billion

This is very scary, if true. Maybe the trade embargo is a cover story. I have seen such schemes before. Does anyone have the straight dope on this? Anyone been to China lately?

The REAL Reason Americans Feel So Poor (even when they aren’t)

WAGES are incremented for inflation on an equal percentage basis for median workers, but not at all for minimum wage workers and their immediate supervisors. Prices increase by the inflation rate at the 90th percentile - the median DOLLAR. THAT is why we are worse off, both comparatively and absolutely - although overseas workers are even worse off, as you say, so that most people get cheaper stuff - with these costs driven down accordingly on lower quality goods and imported foods.

Trump's goal (and those of his voters) are to upend the global neoliberal regime. A feature, not a flaw. Tariffs based on comparative GDP help American workers (but not consumers or business owners), although those tariffs should, in part, be used for human capital improvement projects in our overseas supply chain. I do not expect that from Trump.

The real question is comparative power, not comparative well being (which is a distraction from the former - see Marx on commodity fetishism).