Live Updates: After Report on Tax Payments of Richest Americans, Congress Rethinks the Code


“My intention as the author of the 2017 tax reform was not that multibillionaires ought to pay no taxes,” said Senator Patrick J. Toomey, Republican of Pennsylvania.
Credit…Anna Moneymaker for The New York Times

A jaw-dropping report by ProPublica detailing how America’s richest men avoided paying taxes has intensified interest in Congress, even among some Republicans, in changing the tax code to ensure that people like Jeff Bezos and Warren Buffett pay their fair share.

For Republicans, the idea that the tax code should give preferential treatment to investment has been sacrosanct, ostensibly to promote economic growth and innovation that could benefit everyone. But the news this week showed how the treatment of stocks, bonds, real estate and huge loans taken off those assets has sent the tax bills of the richest Americans plummeting.

“My intention as the author of the 2017 tax reform was not that multibillionaires ought to pay no taxes,” said Senator Patrick J. Toomey, Republican of Pennsylvania, who helped write the law that slashed taxes by more than $1 trillion. “I believe dividends and capital gains should be taxed at a lower rate, but certainly not zero.”

Democrats, especially in the Senate, have been hard at work on a tax package to finance President Biden’s costly domestic agenda, including a major infrastructure plan, climate change measures and the expansion of education and health care benefits. Much of that work — vehemently opposed by Republicans — has been focused on clawing back tax cuts lavished on corporations by the 2017 tax law, President Donald J. Trump’s signature legislative achievement, and on preventing multinational corporations from shifting taxable profits offshore.

The ProPublica report, analyzing a trove of documents detailing the tax bills of household names such as Mr. Bezos, Mr. Buffett, Elon Musk and Michael Bloomberg, showed that the nation’s richest executives paid just a fraction of their wealth in taxes — $13.6 billion in federal income taxes during a time period when their collective net worth increased by $401 billion, according to a tabulation by Forbes.

“Americans knew that billionaires played these kinds of games,” Senator Ron Wyden of Oregon, the chairman of the tax-writing Finance Committee, said on Wednesday. “What was significant yesterday was it was all laid out in stark detail about the most affluent people in America.”

He said he was working on an array of proposals to get at the issue, possibly including a return to some kind of minimum tax, and would soon unveil specific proposals.

“Billionaires are going to have to pay their fair share, every year,” he said.

Secretary of Defense Lloyd J. Austin III at the 2021 West Point Commencement Ceremony in Michie Stadium in May.
Credit…Michael M. Santiago/Getty Images

Defense Secretary Lloyd J. Austin III suggested to lawmakers on Thursday that he supports changes to the laws that govern how the military handles sexual assault cases, a major shift for military leadership, which has long resisted such changes.

“Clearly, what we’ve been doing hasn’t been working,” Mr. Austin said in his opening remarks before the Senate Armed Services Committee. “One assault is too many. The numbers of sexual assaults are still too high, and the confidence in our system is still too low.”

Mr. Austin appeared to be endorsing the recommendations of a panel he appointed to study the issue earlier this year. That panel recommends that independent military lawyers take over the role that commanders currently play in deciding whether to court-martial those accused of sexual assault, sexual harassment or domestic violence.

But he was clearly stopping short of endorsing a measure long pushed by Senator Kirsten Gillibrand, Democrat of New York, that would cut out the military chain of command from decisions over sexual assault, but also extend outside prosecutorial power over many other serious crimes as well.

President Biden has endorsed her approach, at least for now, and her bill has gained support from at least 70 members of the Senate — including many who voted against the same bill in 2014, arguing it would undermine commanders, the long held view of Pentagon leaders — and key members in the House.

Senator Jack Reed, Democrat of Rhode Island, and chairman of the Armed Services Committee, believes Ms. Gillibrand’s bill goes too far and has been working behind the scenes with Pentagon officials to reign it in.

“I want to be sure that whatever changes to the U.C.M.J. that I recommend to the president and ultimately to this committee, that they are scoped to the problem we are trying to solve, have a clear way forward on implementation, and ultimately restore the confidence of the force in the system,” Mr. Austin said, referring to the Uniform Code of Military Justice, which is the foundation of the American military legal system. “You have my commitment to that, and also my commitment to working expeditiously as you consider legislative proposals.”

Mr. Austin’s remarks Thursday could set off an intense political battle that will test the power of Ms. Gillibrand among her bipartisan Senate allies, including Senator Chuck Schumer, Democrat of New York and the majority leader, who could be forced to pick sides in determining the measure’s fate, and the White House.

In either event, it seems clear that commanders are all but certain to lose full control over sexual assault prosecutions. “Change is coming to the department,” Mr. Reed said Thursday in reference to the assault issue.

When he was confirmed by the Senate, Mr. Austin made sexual assault one of his first priorities. In February, he appointed the independent commission to examine the issue and give recommendations that he and the service chiefs could consider.

The members of the panel are seeking a new career track in the Defense Department in which judge advocates general — military lawyers — would be specially trained to deal with such cases. This alone would be a major shift in how the military does things. Mr. Austin has said he wants the service chiefs to review the recommendations.

Momentum has been in place for such changes since Mr. Biden was elected. Kathleen Hicks, the deputy defense secretary and the first woman to serve in the No. 2 role at the Pentagon, and General Mark A. Milley, chairman of the Joint Chiefs of Staff have both said they have been swayed that the current system does not serve victims well.

A report out of Fort Hood, Texas, last year that detailed a culture of harassment and abuse gave fuel to Ms. Gillibrand’s measure and parallel efforts in the House.

In 2019, the Defense Department found that there were 7,825 reports of sexual assault involving service members as victims, a 3 percent increase from 2018. The conviction rate for cases was unchanged from 2018 to 2019; 7 percent of cases that the command took action on resulted in conviction, the lowest rate since the department began reporting in 2010.

Rep. Ilhan Omar addressing the media at a news conference in Brooklyn Center, Minn., in April.
Credit…Nicholas Pfosi/Reuters

Representative Ilhan Omar is again at odds with her Democratic colleagues over Israel.

The latest contretemps began on Monday, when Ms. Omar, Democrat of Minnesota, wrote on Twitter about a virtual exchange she had with Secretary of State Antony J. Blinken.

In the exchange, Ms. Omar pressed for an investigation of human rights abuses both by Israeli security forces and by Hamas. But on Twitter, she seemed to compare Israel and the United States not only to Hamas, considered a terrorist group by the State Department, but also to the Taliban.

“We must have the same level of accountability and justice for all victims of crimes against humanity,” she wrote. “We have seen unthinkable atrocities committed by the U.S., Hamas, Israel, Afghanistan, and the Taliban.”

The analogy prompted outrage from a dozen Jewish Democrats in the House. They issued a statement saying that equating the United States and Israel to Hamas and the Taliban “is as offensive as it is misguided,” and, in congressional parlance usually meant to elicit an apology, they asked her to “clarify her words.”

“Ignoring the differences between democracies governed by the rule of law and contemptible organizations that engage in terrorism at best discredits one’s intended argument and at worst reflects deep-seated prejudice,” they wrote. “The United States and Israel are imperfect and, like all democracies, at times deserving of critique, but false equivalencies give cover to terrorist groups.”

Rather than apologize, Ms. Omar fired off a defiant response on Thursday morning.

“It’s shameful for colleagues who call me when they need my support to now put out a statement asking for ‘clarification’ and not just call,” wrote Ms. Omar, one of two Muslim women in the House, accusing her detractors of bigotry. “The Islamophobic tropes in this statement are offensive. The constant harassment & silencing from the signers of this letter is unbearable.”

The back-and-forth comes as Democrats are desperate for unity as they try to move forward with razor-thin majorities on infrastructure, tax code changes, universal preschool and expanded access to community college.

Threats to push such bills through Congress over Republican opposition using budget rules that bypass filibusters are only real if every Democrat is on board, and a public fight with Ms. Omar’s liberal wing could complicate the effort.

A House Democratic aide familiar with the back-and-forth said Ms. Omar’s anger stemmed from her treatment by the dozen colleagues who publicly upbraided her. She had heard that they were going to publicly call for a clarification of her remarks and reached out to them several times on Wednesday. They did not respond before their public chastisement, said the aide, who…



Read More: Live Updates: After Report on Tax Payments of Richest Americans, Congress Rethinks the Code

2021-06-10 14:04:20

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