The rich are different from you and me. They have Swiss bank accounts.
Well, at least Mitt Romney does.
That was one of the big revelations when Romney released his tax records in January -- a revelation that Vanity Fair recently looked into, along with the rest of his finances. Of course, it's no secret that Mr. Romney is a man of means. But what is still secret is just how Romney has invested those means.
Maybe not so much secret as secretive. Romney has released his return for 2010 and an estimate for 2011. So we have a broad outline of what his personal finances look like. And they look something like an Epcot of financial investments: There is a blind trust with offshore accounts in Switzerland, Bermuda, and the Cayman Islands -- not to mention an almost comically large IRA account. None of this is illegal. But it has raised questions about Romney's Caribbean tax havens and his Swiss bank account. The former makes sense. The latter not as much.
Question #1: Remind me: Why does Romney have money in the Caribbean?
Let's take a quick detour. Imagine that a tax-exempt entity -- like a university endowment -- buys or otherwise acquires a business. Maybe a macaroni company. That company would have a nice little competitive edge. It wouldn't have to pay taxes. That's exactly what happened when some wealthy alums donated the Mueller Macaroni Company to the New York University Law School in 1948. This loophole prompted Congress to close it 1950. Only a tax-exempt entity's "related" businesses would in fact be tax exempt. Everything else would be taxed as "unrelated business income".
What does this have to do with Mitt Romney? Well, university endowments and public pensions are some of the biggest investors in private equity funds like Romney's Bain Capital. Those investors don't want to be hit with the unrelated business tax -- so Bain Capital sets up shop in the Caymans where it can avoid the unrelated business income tax. You might still be wondering: What does this have to do with Mitt Romney -- at least now? He left Bain Capital in 1999 (or 2001). He did, but he didn't. He still gets a share of Bain Capital's profits every year as part of his retirement package. And Bain still has corporate blockers in the Caymans. That's why Romney has investment income from the Caymans.
Question #2: Why does Romney have a Swiss bank account? And what's so great about a Swiss bank account versus any other tax haven?
Swiss banks are the gold standard of tax havens because of their secrecy and stability. Actually, that sentence should be in the past tense. Swiss banks are not nearly as secret as they used to be. Time was, the Swiss government jealously guarded its banks' reputation for never revealing client information. It was a crime to do so. High-net individuals the world over flocked to the Alps to hide money from tax collectors back home. But that started to change in 2008. A former UBS banker came forward with tales of how he helped wealthy American clients evade taxes -- including such charming details as smuggling diamonds in tubes of toothpaste. The IRS launched an investigation, and came up with a list of 52,000 names it wanted from the Swiss banking giant. A settlement followed, and then a new U.S. law. Now foreign banks have to cooperate with the IRS or face fairly tough penalties. Auf Wiedersehen, Swiss banking secrecy über alles.
But Swiss banks still have plenty going for them. They can thank the Swiss franc for that. It's a safe-haven currency -- and that makes their banks safe havens too. The Swiss are famous for their fiscal prudence and low inflation, which makes their currency particularly strong. That's even more true now thanks to the euro crisis. Demand for Swiss francs is so great that the Swiss National Bank had to cap the value of their currency last year. It was getting so expensive that it threatened to push the Swiss economy into deflation.
The Romney camp has hinted that he only had a Swiss bank account because he wanted Swiss francs. In other words, he was hedging against the dollar declining in value. That's fair, even if it's a bit odd for someone with $250 million. But you don't need a Swiss bank account to get Swiss francs. You can just buy Swiss francs.
Another possibility is that Romney had the Swiss bank account to make it easier to wire money from one European investment to another. We can't say without seeing more tax returns. All we do know is his lawyer closed this Swiss bank account in 2010.
That's the final point. Mitt Romney's long-time lawyer, R. Bradford Malt, has managed Romney's personal finances since Romney was elected governor of Massachusetts. That's when Romney set up a blind trust, to avoid any possible conflicts of interest. Still, there are questions about just how blind the trust has been. And, besides, Romney is ultimately responsible for his own money.
Question #3: Is it fair for the Obama campaign to go after the Swiss bank account?
When most people hear the words "Swiss bank account" they think "tax evasion". That's not always fair. There are plenty of good reasons an American might have a Swiss bank account. Maybe they live abroad. Or work for a Swiss company. But those are good reasons that don't apply to Mitt Romney. He didn't live abroad. And he didn't work for a Swiss company.
That doesn't mean Mitt Romney was up to no good. There's no evidence of that. It's entirely possible that Romney really was just hedging against the dollar. That's the legitimate reason a very wealthy person would want a Swiss bank account. The not-so-legitimate reason is the secrecy -- to hide money from the IRS. It's unfair for the Obama campaign to insinuate Romney was doing the latter. But it'd be a lot more unfair if Romney was more transparent. We just don't know enough to say anything definitively. We don't know how long the account existed. We don't know whether Romney's lawyer or Romney himself set it up.
What we do know is that this kind of stuff doesn't seem weird to Romney. It's what the über-wealthy do. But it is weird to most everyone else. It's not what the 99 percent do. Actually, we know one more thing. Romney can end this controversy whenever he wants. He just has to release more tax records. He's running for office for Pete's sake. He should say something.
In other words, Romney should take a page from the Swiss. Even they're less secretive nowadays.
His paranoid style paved the road for Trumpism. Now he fears what’s been unleashed.
Glenn Beck looks like the dad in a Disney movie. He’s earnest, geeky, pink, and slightly bulbous. His idea of salty language is bullcrap.
The atmosphere at Beck’s Mercury Studios, outside Dallas, is similarly soothing, provided you ignore the references to genocide and civilizational collapse. In October, when most commentators considered a Donald Trump presidency a remote possibility, I followed audience members onto the set of The Glenn Beck Program, which airs on Beck’s website, theblaze.com. On the way, we passed through a life-size replica of the Oval Office as it might look if inhabited by a President Beck, complete with a portrait of Ronald Reagan and a large Norman Rockwell print of a Boy Scout.
As Oklahoma attorney general, Scott Pruitt sued the federal government to prevent rules about air and water pollution from taking effect.
Throughout the long campaign, and in the long month that has followed, President-elect Donald Trump sounded some odd notes about the environment.
He rejected the scientific fact of climate change, calling it a hoax or a fraud. He repeatedly announced his intent to repeal all of the Obama administration’s environmental regulations. He lamented, wrongly, that you couldn’t use hairspray anymore because it damaged the ozone layer.
And then, out of nowhere, he met with Al Gore, who won a Nobel Peace Prize for educating the public about the dangers of climate change.
While the broad strokes of Trump’s policies were never in doubt, there was often enough bizarreness to wonder what he would do with the powers of the Environmental Protection Agency.
Why the ingrained expectation that women should desire to become parents is unhealthy
In 2008, Nebraska decriminalized child abandonment. The move was part of a "safe haven" law designed to address increased rates of infanticide in the state. Like other safe-haven laws, parents in Nebraska who felt unprepared to care for their babies could drop them off in a designated location without fear of arrest and prosecution. But legislators made a major logistical error: They failed to implement an age limitation for dropped-off children.
Within just weeks of the law passing, parents started dropping off their kids. But here's the rub: None of them were infants. A couple of months in, 36 children had been left in state hospitals and police stations. Twenty-two of the children were over 13 years old. A 51-year-old grandmother dropped off a 12-year-old boy. One father dropped off his entire family -- nine children from ages one to 17. Others drove from neighboring states to drop off their children once they heard that they could abandon them without repercussion.
Why has Trump shown such eagerness to select former military brass for his Cabinet? The reasons may be both pragmatic and political.
Donald Trump didn’t always speak highly of military brass. “I know more about ISIS than the generals do,” he said in fall 2016. “Believe me.” In September, he added, “I think under the leadership of Barack Obama and Hillary Clinton, the generals have been reduced to rubble. They have been reduced to a point where it’s embarrassing for our country…. And I can just see the great—as an example—General George Patton spinning in his grave as ISIS we can’t beat.”
But Trump’s disdain had a caveat: “I have great faith in the military. I have great faith in certain of the commanders, certainly.”
These days, he’s leaning toward the second pole. Already, Trump has selected three retired generals for Cabinet-level jobs. On Tuesday, he formally announced that he’s nominating retired Marine General James Mattis as defense secretary. On Wednesday, multiple outlets reported that he has selected John Kelly, another retired Marine general, as secretary of homeland security. Former Lieutenant General Michael Flynn got the nod as national security adviser on November 17.
The same part of the brain that allows us to step into the shoes of others also helps us restrain ourselves.
You’ve likely seen the video before: a stream of kids, confronted with a single, alluring marshmallow. If they can resist eating it for 15 minutes, they’ll get two. Some do. Others cave almost immediately.
This “Marshmallow Test,” first conducted in the 1960s, perfectly illustrates the ongoing war between impulsivity and self-control. The kids have to tamp down their immediate desires and focus on long-term goals—an ability that correlates with their later health, wealth, and academic success, and that is supposedly controlled by the front part of the brain. But a new study by Alexander Soutschek at the University of Zurich suggests that self-control is also influenced by another brain region—and one that casts this ability in a different light.
A professor of cognitive science argues that the world is nothing like the one we experience through our senses.
As we go about our daily lives, we tend to assume that our perceptions—sights, sounds, textures, tastes—are an accurate portrayal of the real world. Sure, when we stop and think about it—or when we find ourselves fooled by a perceptual illusion—we realize with a jolt that what we perceive is never the world directly, but rather our brain’s best guess at what that world is like, a kind of internal simulation of an external reality. Still, we bank on the fact that our simulation is a reasonably decent one. If it wasn’t, wouldn’t evolution have weeded us out by now? The true reality might be forever beyond our reach, but surely our senses give us at least an inkling of what it’s really like.
Americans are optimistic about the communities they live in—but not their nation. Why?
I have been alive for a long time. I remember the assassination of John F. Kennedy, when I was a 10th-grader, and then watching with my family through the grim following days as newscasters said that something had changed forever. The next dozen years were nearly nonstop trauma for the country. More assassinations. Riots in most major cities. All the pain and waste and tragedy of the Vietnam War, and then the public sense of heading into the utterly unknown as, for the first time ever, a president was forced to resign. Americans of my children’s generation can remember the modern wave of shocks and dislocations that started but did not end with the 9/11 attacks.
Through all this time, I have been personally and professionally, and increasingly, an American optimist. The long years I have spent living and working outside the United States have not simply made me more aware of my own strong identity as an American. They have also sharpened my appreciation for the practical ramifications of the American idea. For me this is the belief that through its cycle of struggle and renewal, the United States is in a continual process of becoming a better version of itself. What I have seen directly over the past decade, roughly half in China and much of the rest in reporting trips around the United States, has reinforced my sense that our current era has been another one of painful but remarkable reinvention, in which the United States is doing more than most other societies to position itself, despite technological and economic challenges, for a new era of prosperity, opportunity, and hope.
Strangling public-sector unions in Wisconsin has shrunk teachers’ pay and benefits. Who’s next?
Back in 2009, Rick Erickson was happy with his job as a teacher in one of the state’s northernmost school districts on the shores of Lake Superior. He made $35,770 a year teaching chemistry and physics, which wasn’t a lot of money, but then again, he received stellar healthcare and pension benefits, and could talk honestly with administrators about what he needed as a teacher every two years when his union sat down with the school district in collective bargaining sessions.
Then, five years ago, Wisconsin passed Act 10, also known as the Wisconsin Budget Repair Bill, which dramatically limited the ability of teachers and other public employees to bargain with employers on wages, benefits, and working conditions. After Act 10,Erickson saw his take-home pay drop dramatically: He now makes $30,650. His wife is a teacher, too, and together they make 11 percent less than they did before Act 10. The local union he once led no longer exists, and so he can’t bargain with the school district for things like prep time and sick days. He pays more for health care and his pension, and he says both he and his wife may now not be able to retire until they are much older than they had planned.
Studies show that for most types of cognitively demanding tasks, anything but quiet hurts performance.
Like most modern “knowledge” workers, I spend my days in an open office. That means I also spend my days amid ringing phones, the inquisitive tones of co-workers conducting interviews, and—because we work in a somewhat old, infamous building—the pounding and drilling of seemingly endless renovations.
Even so, the #content must still be wrung from my distracted brain. And so, I join the characters of trend pieces everywhere in wearing headphones almost all day, every day. And what better to listen to with headphones than music? By now, I’ve worked my way through all the “Focus” playlists on Spotify—most of which sound like they were meant for a very old planetarium—and I’ve looped back around to a genre I like to call “soft, synthy pop songs whose lyrics don’t make much sense:” Think Miike Snow rather than Michael Jackson.
To many white Trump voters, the problem wasn’t her economic stance, but the larger vision—a multi-ethnic social democracy—that it was a part of.
Perhaps the clearest takeaway from the November election for many liberals is that Hillary Clinton lost because she ignored the working class.
In the days after her shocking loss, Democrats complained that Clinton had no jobs agenda. A widely shared essay in The Nationblamed Clinton's "neoliberalism" for abandoning the voters who swung the election. “I come from the white working class,” Bernie Sanders said on CBS This Morning, “and I am deeply humiliated that the Democratic Party cannot talk to where I came from.”
But here is the troubling reality for civically minded liberals looking to justify their preferred strategies: Hillary Clinton talked about the working class, middle class jobs, and the dignity of work constantly. And she still lost.