Charles Krauthammer is blind to his irony

Charles Krauthammer’s May 29, 2009 column is full of irony, but I am not sure that he sees it.

The sum of his criticism of Obama’s choice of Sonia Sotomayor to be the next supreme court justice is this:

Since the 2008 election, people have been asking what conservatism stands for. Well, if nothing else, it stands unequivocally against justice as empathy — and unequivocally for the principle of blind justice.

So that is pretty clear, justice should be blind, it should look only at the law, not the situation of the defendants or plantiffs.

So why does he start out his column painting a sympathetic picture of Frank Ricci, a plantiff?

Sonia Sotomayor has a classic American story. So does Frank Ricci.

Ricci is a New Haven firefighter stationed seven blocks from where Sotomayor went to law school (Yale). Raised in blue-collar Wallingford, Conn., Ricci struggled as a C and D student in public schools ill-prepared to address his serious learning disabilities. Nonetheless he persevered, becoming a junior firefighter and Connecticut’s youngest certified EMT.

After studying fire science at a community college, he became a New Haven “truckie,” the guy who puts up ladders and breaks holes in burning buildings. When his department announced exams for promotions, he spent $1,000 on books, quit his second job so he could study eight to 13 hours a day and, because of his dyslexia, hired someone to read him the material.

He placed sixth on the lieutenant’s exam, which qualified him for promotion. Except that the exams were thrown out by the city, and all promotions denied, because no blacks had scored high enough to be promoted.

Seriously, if irony was water, Charles Krauthammer would have waterboarded himself here.  We shouldn’t be deciding cases on empathy, but hey you should look at this guy Frank Ricci and be empathetic to the obstacles he has overcome.  If Krauthammer really wanted to take on the issue of that case, he could have used his column-inches more wisely and explored the idea of throwing out the promotions because of the lack of diversity of those who passed the lieutenant’s exam, rather than a empathy building exercise.

And then there is some more irony, but this a multiple column irony, in this same column, Krauthammer says that empathy’s proper place is not on the bench but in other branches of government. 

Empathy is a vital virtue to be exercised in private life — through charity, respect and loving kindness — and in the legislative life of a society where the consequences of any law matter greatly, which is why income taxes are progressive and safety nets are built for the poor and disadvantaged.

But back on April 3, 2009, his column contained this gem,

Obama has far different ambitions. His goal is to rewrite the American social compact, to recast the relationship between government and citizen. He wants government to narrow the nation’s income and anxiety gaps. Soak the rich for reasons of revenue and justice. Nationalize health care and federalize education to grant all citizens of all classes the freedom from anxiety about health care and college that the rich enjoy. And fund this vast new social safety net through the cash cow of a disguised carbon tax.

Obama is a leveler. He has come to narrow the divide between rich and poor. For him the ultimate social value is fairness. Imposing it upon the American social order is his mission.

Fairness through leveling is the essence of Obamaism. (Asked by Charlie Gibson during a campaign debate about his support for raising capital gains taxes — even if they caused a net revenue loss to the government — Obama stuck to the tax hike “for purposes of fairness.”) The elements are highly progressive taxation, federalized health care and higher education, and revenue-producing energy controls. But first he must deal with the sideshows. They could sink the economy and poison his public support before he gets to enact his real agenda.

Now in all fairness to Krauthammer, Obama is no longer in the legislative branch, but in the executive branch.  And he didn’t say that empathy belongs in the executive branch, but he didn’t say it must be excluded from it, like it must from the judicial branch.  So it could be a wash on the branch of government issue.

But yet, his April 3rd column made him seem like he was against progressive taxation, or at least extreme versions of it, and not that big a fan of the social safety net, at least looking like nationalized health care and more affordable access to higher education.

I guess that isn’t really irony so much as rampant hypocrisy, in one column railing against progressive taxation and social safety net programs, and then praising them as part of the empathy that exists in the legislative life.  That is often par for course for the highly paid talking heads that dominate the group-think inside the beltway, that often think that we don’t check what they wrote before.

-Josh

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Sadly there is truth in this

One of my high school classmates wrote this letter to the editor in the Strib.

VETO OF BULLYING BILL

Future Republicans, start your harassment

Well, of course Gov. Tim Pawlenty vetoed the bullying bill. If junior high bullies can’t get practice beating up on poor kids, foreign kids and kids perceived to be gay, how will they ever become right-wing politicians?

BEN WEISS, ST. PAUL

Sadly, as the Republican tent has shrunken, it seems that it is based on xenophobia and focusing on tearing down others.  So I have to agree with my friend Ben on this one.  I dare the Republican party, not individual Republicans who may be more moderate, to prove him wrong!

-Josh

Corporate Taxes too high??

The one trick pony that is the Republican Party, whose only solution to anything is tax cuts, have been whining about how our corporate tax rates are too high. Yet there are plenty of loopholes that corporations use to get out of paying their fair share. Al Norman reports on the Huffington Post about one that Wal-Mart was using and has lost in North Carolina.

Two years ago, the Wall Street Journal ran a story revealing that Wal-Mart pays billions of dollars a year in rent for its stores, but in 25 states—most of them east of the Mississippi—it has been paying most of that rent to itself, and deducting that amount from its state taxes. This scheme has allowed Wal-Mart to avoid paying several hundred million dollars in state taxes.

Based on a dodge developed by its accounting firm, Ernst & Young, as a “local tax reduction strategy,” Wal-Mart’s financial self-dealing has allowed it to pay rent to itself through a maze of eight corporate subsidiaries created in 1996, including Real Estate Investment Trusts (REITs).

Under the agreement with itself, Wal-Mart pays 2.5% of gross sales monthly as rent to its own REIT, which then wires the money quarterly to Wal-Mart Property Company in the form of a dividend, which is then paid to Wal-Mart Stores as a tax-exempt “dividends received.” All of these transactions are handled through a “cash management agreement” between all the parties. Neither the REIT nor the Property Company has any employees.

The REITs don’t pay taxes, as long as they pay 90% of their income out in dividends to shareholders. In Wal-Mart’s case, the REITs are owned by Wal-Mart subsidiaries registered in Delaware, a state that has no corporate income tax. Wal-Mart gets the benefit of the rent expense, but also gets the benefit of the non-taxed dividend, on the same monies. The dividends escape taxation, and the original rent that created the dividends is deducted from taxable income in the states where the “expense” is incurred. The rent, in essence, goes from one Wal-Mart pocket, into another.

Now if you were a person against paying your income or payroll taxes, wouldn’t it be sweet to be able to set up an automatic system to shuffle money to reduce your tax liability.  Of course, I think taxes provide useful services, so I wouldn’t do that, but maybe some of you readers would like to do that.

When North Carolina challenged this financial shenanigans, and required Wal-Mart to consolidate its financial earnings, Wal-Mart paid then sued.

On December 31, 2007 an Emergency Special Judge in Wade County, North Carolina Superior Court, ruled in favor of the state of North Carolina, and against Wal-Mart’s lawsuit. The Judge ruled that North Carolina had the statutory right to force a corporation to state its “true net income” through a consolidated statement, ” so as to properly reflect the extent of the corporation’s activities in the state.” The judge ruled that Wal-Mart’s treatment of rent had no “real economic substance,” and was only a mechanism for reducing the taxes it pays to the state of North Carolina. “Plaintiffs do not deny the facts demonstrating the circular journey taken by the ‘rents’ paid by these plaintiffs,” the judge wrote, “but contend that on each leg of the journey plaintiffs were only taking advantage of a lawful deduction afforded them by then-existing tax law. Such a piecemeal approach exalts form over substance, however…There is no evidence that the rent transaction, taken as a whole, has any real economic substance apart from its beneficial effect on plaintiffs’ North Carolina tax liability. It is particularly difficult for the court to conclude that rents were actually ‘paid,’ when they are subsequently returned to the payor corporation.”

That really is the sum of it, can you truly get a tax deduction for paying rent, when that money is returned to you, in effect, not paying rent?  Fortunately for North Carolina tax payers, the Wade County judge saw through the bullshit of this tax evader (and Court of Appeals upheld it).

-Josh

Will we ever see this high capacity storage?

The New York Times reports that General Electric has created a digital storage system using holograms that would put the equivalent of 100 DVDs on one disc.

The storage advance, which G.E. is announcing on Monday  [article from April 28, 2009], is just a laboratory success at this stage. The new technology must be made to work in products that can be mass-produced at affordable prices.

But optical storage experts and industry analysts who were told of the development said it held the promise of being a big step forward in digital storage with a wide range of potential uses in commercial, scientific and consumer markets.

“This could be the next generation of low-cost storage,” said Richard Doherty, an analyst at Envisioneering, a technology research firm.

This is pretty exciting news, and I really hope that they can bring this to market.  Of course, my worry is that the RIAA and MPAA will try to stifle innovation to protect their industries, while denying or limiting consumers ability to have bigger and cheaper storage options .  You have to wonder about those defenders of the free market, what do they think about how intellectual property laws make the market a little less free. 

-Josh