Gleanings: August 13, 2016

This week’s gleanings: Black Lives Matter declares its platform / Ford Foundation declares financial support for Black Lives Matter / Candidates campaign to lighten the burden of childcare costs /  Ohio competes with offshore tax havens to protect wealth of top 1% / Black families need 228 years to amass wealth now owned by white families / U.S. enjoys strong economic growth but suffers weak social progress

Black Lives Matter declares its platform

On Aug. 1, Black Lives Matter and more than 50 associated organizations released a “vision for black lives: policy demands for black power, freedom, and justice” under the banner of the Movement for Black Lives.

The vision, which was more than a year in the making, sets out demands in six areas and offers 40 recommendations for their implementation. Demands encompass “ending the war” on black people, reparations, invest-divest, economic justice, community control, and political power.

“We seek radical transformation, not reactionary reform,” Michaela Brown, communications director of Baltimore Bloc, a participating group, said in a statement.

“As the 2016 election continues, this platform provides us with a way to intervene with an agenda that resists state and corporate power, an opportunity to implement policies that truly value the safety and humanity of black lives, and an overall means to hold elected leaders accountable.”

Ford Foundation supports the Movement for Black Lives

The Ford Foundation recently declared its intention to provide long-term financial support for the organizations and networks that compose the Movement for Black Lives.

“We’ll provide long-term support to the Movement for Black Lives, so that these visionary leaders and organizations can continue to cultivate and maintain a movement of young black women and men who are pushing through established boundaries as they seek to realize the promise of equality and justice for all.”

Candidates campaign to lighten burden of childcare costs

The need for affordable child care has entered this election cycle as an issue for both the Democratic and Republican candidates.

The issue is a pressing concern for many families, who struggle with one of the most significant expenses in the family budget.

“High-quality child care is out of reach for many American families—not just those with low incomes,” according to the Economics Policy Institute.

“In nearly half the country, it’s now more expensive to educate a 4-year-old in preschool than an 18-year-old in college,” reports the WSJ.

The U.S. Dept. of Health and Human Services considers childcare affordable if it consumes no more than 10 percent of a family’s income. By this standard, EPI reports infant care is “affordable” in only two states: South Dakota and Wyoming.

In the Cincinnati metro area, a two-parent, two-child family with “a decent yet modest standard of living” pays 17.3 percent of its $5,160 monthly earning for childcare, according to EPI estimates. Nationally, families below the federal poverty level paid an average of 30 percent of their income in child care costs, according to the U.S. Census Bureau.

Hillary Clinton says no family should pay more than 10 percent of its income for child care. An expansion of the childcare tax credit, a policy proposal by the Center for American Progress, is expected to be a key part of Clinton’s plan, according to the Washington Post. Additional relief would come through universal pre-K education, an expansion of Head Start, increased federal funding for on-campus childcare facilities, and scholarships for college students with children.

Donald Trump says households should be able to deduct average child-care costs from their taxes. The Wall Street Journal reported, “It wasn’t clear how such a tax break might be structured, how it would complement existing credits and whether it would be available to tens of millions of families that don’t pay income taxes because they have lower incomes.”

A tax deduction is regressive, helping high-income households while providing no benefits to low-income families that can least afford childcare, reports ThinkProgress.

Ohio competes with offshore tax havens to protect wealth of top 1%

Secretly protecting the wealth of the super rich from tax authorities, divorcing spouses, ungrateful children, business partners, and creditors is usually considered the business of lawyers, accountants, bankers, and trust specialists in offshore havens like Bermuda, Nauru, St. Kitts, Antigua, Tortola, Switzerland, the Channel Islands, Monaco, Cyprus, Gibraltar, and Liechtenstein.

Since 1990, however, the market for secrecy and tax avoidance has been increasingly served by an onshore industry in the United States, said the Tax Justice Network in a July 2012 report.

“From Delaware to Alaska, Nevada, and South Dakota, a growing number of states are offering inexpensive legal entities like limited liability corporations and asset protection trusts whose levels of secrecy, protection against creditors, and tax advantages rival those of the world’s traditional  secretive offshore havens.”

On Aug. 9, 2016, The New York Times reported, “The clear leaders are Nevada, Delaware, South Dakota and Alaska, but other states have also joined the asset-protection frenzy. New Hampshire, Wyoming, Tennessee and Ohio all hope to dip a spoon in the trillion-dollar-plus pot of cream that had traditionally been preserved in offshore tax havens like the Cayman Islands.”

Some question the move away from traditional trust and estate principles towards a system of so-called creditor-proof trusts and dynasty trusts, which can pass fortunes from generation to generation for hundreds of years without paying estate taxes. They argue that a debtor should pay his debts, not defraud his creditors, and that these new trusts erode the traditional system of liability.

The Ohio legislature changed state trust law to permit dynasty trusts in 1999 and domestic asset protection trusts (so-called creditor-proof trusts) in 2013.

Black families need 228 years to amass wealth owned by white families

If current policies remained in place, it would take 228 years for black families to accumulate the wealth now owned by white families, reports the WSJ on a study by the Corporation for Enterprise Development and Institute for Policy Studies.

U.S. enjoys strong economic growth but suffers weak social progress

The United States ranks fifth on GDP per capita but 19th on the Social Progress Index among 133 countries, writes Michael Green in the Harvard Business Review.

The Social Progress Index measures the lived experience of citizens using 53 different indicators, including nutrition, safety, education, human rights, opportunity, tolerance, and higher education. The index shows failings in the U.S. over the last 30 years, particularly in areas of personal safety, education, environmental conditions, and health.

“The lives of too many Americans are blighted, compared to the citizens of other wealthy countries. It’s not just about the economy; it’s about how the benefits of economic growth are used,” says Green.

 

 

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