The Delaware loophole lives

HB2150 has been advertized as closing the infamous "Delaware Loophole" in exchange for lower corporate tax rates. Many people say it won't close the loophole while providing a big tax break to corporations.

How Loopholes Work

One common way corporations avoid taxes is by conducting transactions between their subsidiaries. Using an array of “tax planning” techniques, companies can shift profits from one subsidiary to another or into or out of a particular state – with no real economic purpose other than tax avoidance.

The best-known strategy is the infamous “Delaware loophole,” of which the Toys “R” Us Geoffrey Giraffe case is the most widely known example. Toys “R” Us set up a company[1] in Delaware to hold the trademark for the Geoffrey Giraffe logo. The holding company charges Toys “R” Us retail stores across the country a royalty to use the trademark. The retail stores deduct this payment to the holding company as a business expense, reducing their income in other states and, in turn, their taxes. This is legal, even though there is no need for a company to sell the use of a trademark to itself – and no reason to grant an expense deduction. Because royalty income is not taxed in Delaware, the Geoffrey holding company (owned by Toys “R” Us) gets to keep the money tax free.

Phyllis is Phuming

HARRISBURG, May 2 – State Rep. Phyllis Mundy voted against a $3.3 billion corporate-tax-cut bill that passed the state House today, noting that it would result in devastating budget cuts and fails to make big corporations pay their fair share of taxes in Pennsylvania.

"Giving large-multi-state companies a massive, multi-billion-dollar tax break and allowing them to continue to use accounting schemes to avoid paying their fair share of taxes is the definition of corporate welfare.”...

Beyond the bill’s failure to close corporate loopholes, it also provides multiple corporate tax cuts. Mundy said the House Democrats tried to offer amendments to the bill that would have eliminated property taxes for Pennsylvania homeowners but Republicans used a procedural maneuver to block those amendments from being considered.

The end result, Mundy said, is a bad bill for Pennsylvania taxpayers.

"This bill gives corporations new ways to avoid paying their fair share, while also giving them a massive tax cut," Mundy said. "And, worst of all, it would place an even greater tax burden on everyday hard-working citizens who will be left holding the bag."

According to the TL Mundy was joined by Eddie Day Pashinski in voting against the bill. Predictably Republicans Karen Boback and Tarah Toohil favored it. Mike Carroll, and Jerry Mullery  were among 23 Democrats who joined 106 Republicans to vote in favor of the bill.

The bill blows such a big hole in the state's finances that even Dept of Revenue Secretary Dan Mueser and Governor Tom Cabot have reservations. Hopefully it will die in the State Senate.

Food stamps

Pennsylvania will deny food stamps to people with assets over $2000 or $3250 for people over 60 with some exemptions starting May 1st. Most assistance programs have asset limits so I don't think that this is out of line although the limits are certainly too low. The asset limits - $2,000 for those under 60 and $3,250 for those over - are based on figures set by the U.S. Department of Agriculture in 1980 and never updated. If you have 100 grand in the bank you should try to along until you spend it down or find a new job but what the proper limit should be has to be raised.


Food stamps asset test condemned as 'idiotic, heartless'

Pa. plans asset test for recipients of food stamps

The thing that jumped out at me was reading the comments on the TL website. It was full of antidotes of Newport smoking welfare queens filling up their carts with steaks and lobsters on ACCESS day if they haven't already sold their allotment to some druggie for 50 cents on the dollar.

Some choice comments

the store was packed full of folks and I mean packed and their carts were full of those bags of frozen shrimp and those packs of spare ribs on the bone ....I asked the manager what the hell was going on ....he looked puzzled for a second until I waved around the store ...then he laughed and said that day was the day they reloaded the ACCESS cards

This young female, late teens-early twenties at the Wilkes Barre Walmart, had her cart STACKED, I'm telling you STACKED, with choice cut steaks, ribs, and other expensive cuts of meat that we normally wouldn't buy for ourselves because of the cost..

We should be tougher on unwed mothers. Gotta learn to keep the knees shut.

I call bullshit on this idiocy. I know people who have to use food stamps to feed their families and they are not buying prime rib and lobsters. Most of them work in low paying jobs and are not proud of having to rely on a government a program just to eat, but you got to feed the kids. Sure there are some bad actors who will abuse the system but most of them don't.

When I was growing up my family had to use food stamps from time to time because my father went from one shit job to another and was always being laid off. I cringed when my mother pulled out the food stamp book at the Ack-a-me to pay for the groceries and hoped that none of my classmates spotted us. I skipped the free lunch at school because of the stigma attached and the razzing that would ensue. It really sucks to be poor in this country, then and now.

I'm not the only one who grew up in such circumstances.

The Blogfather:

I know what it’s like to grow up on the then-economy brand substandard foodstuffs, government surplus cheese and powdered milk. Despite the rage that simmered inside of me, I had to endure the not-so-hushed comments when my mom produced her food stamp booklets at the check-out aisle.

Last month I was asked by Tiffany on her TV show about out of bounds comments. This one that is on the TL website would get deleted by me because it accuses a public official of a crime:

I've turned people in for foodstamp fraud, unemployment fraud, hell I even turned in a former boss directly to IRS and Dan Meuser for non-filing of personal and business taxes both federal and state for six years now. He is still very much in action and not so much as a letter of inquiry from either entity.

Different rules for different venues.

The Mother's Milk of Politics

The TL has a rundown of the money raised by the Row Officer candidates so far for the May Primary Election. The Luzerne County election website doesn't have the full reports available online yet but I'm sure Leonard will make sure that they are posted soon.

Relatively speaking the candidates have raised modest amounts of money with large chunks coming from the hopefuls themselves.

One of the fat wallets that is a little lighter that I spotted in the article is Dan Meuser, of West Pittston, Harveys Lake and other places. Meuser is the former president of Pride Mobility and lost the 2008 10th CD GOP Primary to Chris Hackett. He dropped a thousand bucks on Walter Mitchell and Nanda Palissery each.

In the Controller's race Luzerne County Republican Party endorsed candidate Nanda Palissery has the most bucks.

Total: $7,460
From the candidate: $4,255
Spent: $4,109
Cash on hand: $3,350
Big donors: Dan Meuser $1000

The other candidates

Edd Brominski

Total: $3,775
Candidate: $2500
Spent: $2,762
Cash on hand: $1,013
Big donors: ?


Alice Coffman

Total: $4,479
Candidate: ?
Spent: $3,550
Cash on hand: $928
Big donors: ?

Walter Griffith

Total: $1,680
Candidate: $1,145
Spent: $2,825
Cash: 0
Big donors: ?

Bob Sypniewski

No information available

There is only one Democratic candidate in the race for Controller which disappoints me. I hate unopposed elections.

Bob Morgan

Total: $6,840
Candidate: $263
Spent: $4,772
Cash: $2,067
Big donors: Arlene Pasonick $1,000, Robert Stella $900

The thing to remember is that money can flow into this race at the last minute and we will not know about it for months.

Chris Hackett is against earmarks

My friend Chis Hackett had a letter to the editor (LTE) published in the Times-Leader today. Just to refresh your memory Hackett was the runner up in the recent (2008) 10th Congressional District election losing to Democratic Freshman Chris Carney in what some people say is an overwhelmingly Republican District. I beg to differ on that. Even the people out in Honesdale, Sunbury and Carbondale saw the light. Carney did a good job in his first 2 years and we have a habit of reelecting incumbents unless they do something stupid like strangling their mistress.

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I'll will always be grateful to Chris Hackett for giving me an interview after he announced he was running for Congress. I also requested one with Meuser but his people kept jerking me around. I think Hackett's downfall was his reluctance to give me another interview as we approached the General Election. Just goes to show that you that we can disagree without being disagreeable.

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Some people give me the credit (blame) for the split in Republican party after the hard fought primary between Hackett and Dan Meuser because of the often spirited exchanges that went on in the comments on Gort42. I'm too modest to take credit for that.

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Back to the letter.

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Like most Americans, I want our president to be successful in leading our country. While it is unrealistic to believe that we would all agree on most or even many policy directions, I think it important that we maintain an open mind and focus on the possibilities that lie ahead.

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During the recent presidential campaign, as a country, we chose “change.” And make no mistake, I agree our country needs change in how Washington, D.C., functions. As I listened closely to the various campaign promises, I hoped that John McCain or Barack Obama would do what they said while trying to win our votes and focus the actions of the government on serving the people, not the special interests.

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But as we’ve seen in the past, words are easy; actions take courage and conviction. And rarely is the easy action or decision the right path. Further, accountability is a bedrock principle of our nation; and I firmly believe we need to hold politicians accountable. When they make a campaign promise or pledge, we must demand they stand by it.

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President Obama said during the campaign: “Absolutely, we need earmark reform. And when I’m president, I will go line by line to make sure that we are not spending money unwisely.” This promise was made when he was debating Sen. McCain, who has a long and consistent record of not requesting earmarks. Candidate Obama told us he would take this fiscally conservative approach, which is very unpopular with the special interest groups that permeate our nation’s capital.

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This would require him to stand up to the House and Senate leadership by saying: It’s not going to be business as usual. If you send me that $410 billion spending bill, I will veto it and I will bring light and attention to those who brazenly requested these outrageous pet projects.
He could use his great communication skills in this way to further the cause of accountable and legitimate government spending.

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But sadly, instead, he has chosen the easy path, one that uses the same tired game of blaming prior administrations. President Obama says this spending bill is the last administration’s business, therefore his campaign promises don’t apply. “I’ll submit an earmarks-free budget next year.” What a complete cop-out and an example of why most Americans find it difficult to believe anything a politician says.

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Remember, President Obama, we signed on for change in Washington, not more political double speak. We need to fix our system now. We can’t afford (and I do mean afford) any more wasteful spending or political word twisting.

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Change is hard; but it is far better to make these changes now while we can decide, rather than having the decisions made for us when the Chinese or sovereign oil nations stop buying our Treasury bonds to finance these expenditures, and our “financial diet” is forced upon us.

Dan Meuser speaks

Unsuccessful Republican PA 10th CD candidate Dan Meuser was interviewed by Chris Freind of The Bulletin.

Meuser: Reform The State GOP

He said that the Republicans got blown out in the last 2 elections because "We did a terrible job telling the average voter what we were going to do for them and poorly articulated how our policies would affect people's everyday lives." He claims that PA voters are "center right" and reminds us that Nancy Pelosi is a liberal bogeyman. He repeats the Republican mantra that tax cuts are the best solution to every problem that we face and he likes Mitt Romney for President.

He does have a good idea for party building "We need to immediately start organizing our party and reaching out to perspective voters as they turn 18, invite College Republicans to our events and have strong local party leadership. We can work together with the County organizations and committee people to set and exceed voter registration goals."

Some of the comments at GrassrootsPA about this article are surprising. One poster even accuses Meuser of undermining Republican nominee Chris Hackett.

Straight Talk Express Crashed

Really.

McCain bus in Miami crash

Into a blue van no less.

Maybe John McCain will now get around on a Jazzy supplied by Dan Meuser.

I've been told that he showed up for the big Harley rally in Sturgis riding one.

Sturgis: Sex, Alcohol, Drugs, Bikers And John McCain

The Republcans are broke

I know that sounds absurd but hear me out.

Republicans with money are not stupid. You pay for a product that will pay off and the Republican party doesn't offer a good return on investment.

If the Luzerne County Republican party was just plain broke it would probably be an improvement and I don't know what shape the state party is in but the national committees are hurting.

The congressional arm of the Republicans, the National Republican Congressional Committee (NRCC) had $4 million in debt and $1.6 million in cash at the end of September and the Democratic Congressional Campaign Committee (DCCC) had $28.3 million in the bank. I'll skip the other committees because the results are similar. If you can project money into enthusiasm the Dems are way ahead with Hillary and Obama picking up more money than the whole Repulican field so far.





Mitt Romney has asked his supporters to auction off old campaign stuff and donate it to his cause and the Democratic National Committee couldn't resist the temptation to auction off his past policy positions:

"Unless smooth-talking Mitt Romney was planning on recycling those old tax-raising, pro-choice, pro-gun control, pro-immigrant, pro-gay rights and pro-campaign finance reform positions in a general election, we thought we'd auction them off for charity."


The DNC said it would donate a matching amount from the auctions to a pet shelter.

So the national party has no money so they need candidates that can self finance. In the Pennsylvania 10th district, millionaire Dan Meuser faces a primary against another NRCC-recruited opponent, businessman millionaire Chris Hackett.

Short of cash, NRCC seeks millionaires

Faced with lingering debt and a losing fundraising battle, House Republicans are recruiting a slew of self-funding candidates to run in many of their top races this election cycle. At least seven candidates with the ability to self-fund millions have stepped forward in key districts for the GOP so far, and more could be on the way...

Democrats are quick to point out that self-funding candidates have a shoddy track record. Last cycle, only four of 28 candidates who spent more than $1 million on their congressional bids were elected to Congress, and only three of 48 won in the previous three cycles combined, according to the Center for Responsive Politics.

PA 10th CD update

After a flurry of activity things have been kind of quiet. Only Don Ely and Chris Hackett have officially announced that they are running for the Republican nomination. Dan Meuser's legal troubles over exploding wheelchairs and a sexual harassment lawsuit along with his donations to Democrats provided some fun that I'm sure will be revisited as the campaign heats up. Joe Peters' "poll" gave everybody a nice chuckle. We've had a nice discussion in the comments about these and other pressing issues such as who is pro-life and when they got there, who actually lives in the district and a few swipes about marital status. Meanwhile incumbent Chris Carney is serving on active duty and is busy blowing up things in Iraq by remote control.

In an attempt to elevate the discussion I will be meeting with Chris Hackett on Thursday to discuss boring stuff like issues. I hope to talk with all the candidates before the primary. If anyone has any questions they would like me to ask Chris please leave them in the comments or send me an email. Be nice folks and please keep it clean.

Chris Hackett for Congress

He is the owner of OneSource Staffing Solutions and a resident of Shavertown which is an area we call the back mountain that until the last gerrymandering wasn't even in the 10th Congressional District. His press release announcing that he is candidate for the Republican nomination has some red meat for for conservative voters.

Campaign to Focus on Lower Taxes, Job Creation, Cutting Government Waste, Ending Illegal Immigration, Strong National Security and PromotingConservative Pro-Life Family Values

It's hard to argue with the first 3, who isn't for lower taxes, creating jobs and eliminating waste but his idea of strong national security sounds like it came right out of the White House: "Congress is talking too much about how to withdraw from a war Islamic extremists are waging against us and our way of life, and not enough about how to win. We cannot afford to back down from this real enemy." So he has bought into Bush's idea of never ending war in the Middle East, not much difference from Carney.

He wants to stop illegal immigration and favors making English the official language, protect gun rights and opposes tolls on I-80.

PA 10th CD update

Chris Carney has now attracted at least 5 Republican challengers.

Don Ely, a retired school teacher and minister from Northumberland County is the only one who has officially announced his candidacy for the nomination. Davis Haines of Tunkhannock is someone I've never heard of but he knows State Rep. Tina Pickett and showed up at her picnic. As predicted self described Homeland Security expert and statewide loser Joe Peters has been on the hustings. Greg Skrepenak's (D-Luzerne) buddy Christopher Hackett of One Source Staffing Solutions got some nice press in the Williamsport paper. He emphasized his opposition to illegal immigration, which is standard fare for a Republican, but that is dangerous territory for someone who runs a temp agency.

And the eventual nominee Dan Meuser had a nice interview with Townhall. He bobbed and weaved about Iraq and other foreign policy issues and takes a couple of swipes at Bush. He's against increasing taxes, promotes free trade but doesn't want to screw with Social Security.

I think Meuser will be the nominee because he has the most money, even if he gives some of it to Hillary and other Democrats. The GOP is going to be playing defense in 2008 and having a candidate like Don Sherwood that is willing to buy a seat in Congress will be a great help.

Dan Meuser update

It looks like Meuser is making the rounds of the conservative interest groups and kissed Grover Norquist's ring by signing his Taxpayer Protection Pledge. Norquist is best known for this quote, "My goal is to cut government in half in twenty-five years," he says, "to get it down to the size where we can drown it in the bathtub." He's also a good friend of Jack Abramoff, even helping him with his work for some Indian tribes' that landed him in jail.

Meuser's company, Pride Mobility Products Corp., has run into another legal problem.

EXETER – A woman formerly employed at Pride Mobility Products Corp. has filed a wage discrimination lawsuit against the company, alleging she was paid less than male counterparts who performed the same job.

She also is alleging sexual harassment and retaliation for complaining about it. Earlier Pride settled a lawsuit over the death of an elderly man using their wheelchair, in which plaintiffs alleged that a defective battery caused a fire.

The timing of this lawsuit is interesting and Pride said they'll fight it court. Want to bet they settle out of court with a confidentiality clause included in the agreement.

And we all know about some of his campaign contributions that prompted this "Thank You" from the Pennsylvania Democratic Party Chairman.


Dear Mr. Meuser,

On behalf of the Pennsylvania Democratic Party, I wanted to thank you for your kind, past contributions to strong Democrats such as Congressman Paul Kanjorski, Senator Hillary Clinton, Congressman Charlie Rangel and many others. Your contributions have helped Democrats to take back the House and Senate in 2006 and potentially take the White House in 2008.

Thanks to your contributions, the Democratic majority in the House of Representatives has been able to increase the minimum wage, ensure that our men and women in uniform have the resources they need in Iraq and continue to put pressure on President Bush to change his failed policies in Iraq.

We thank you for your past support and hope that you continue assisting us.
Sincerely,

T.J. Rooney

EDITOR'S NOTE: in the 2004 and 2006 elections, Dan Meuser and Pride Mobility made the following contributions to Democratic Candidates in the House and Senate. (Click here for contribution record)

Rumors and gossip

I sit here in my little corner of Luzerne County and throw out some speculation and it gets all kinds of attention. If any of it's wrong I will post a correction, after all I don't want to violate any of Bernie's ethics rules.

My previous post about Joe Peters running in the 10th CD was picked up by Stanley at Keystone Politics in KP's Delegation '08 Blog but LVDem is not impressed by him noting that he got creamed in his AG run. The Yonk thinks he will cruise to victory but I doubt that my friend. 2008 is going to be another big year for the Democrats. His biggest fan is Bill Fitz who considers himself the kiss of death in these sort of things. He also posted it at PAWaterCooler.com which is hottest new PA website according to the Politico. Christopher Hackett, of One Source Staffing Solutions, has also been mentioned as the "true conservative" considering a run. But after the Mueser brothers catching flak about giving to Democrats his $5000 donation to Luzerne County Democratic Commissioner Greg Skrepnak will need to be explained. But just like Pride Mobility, One Source has to pay to play.

In the 11th CD it seems that Scranton Times columnist Chris Kelly reads Gort42 and cites my Chris Doherty post -without attribution: While supporters decried Judge Munley’s decision as a bitter defeat, it was the best possible outcome for Mayor Fife (Barletta), who some fans have dubbed “St. Lou.” His enhanced martyrdom will be invaluable next year when he’s running against Scranton Mayor Chris Doherty for the congressional seat now occupied by Rep. Paul Kanjorksi. GrassrootsPA points out a story of the the chairman of National Republican Congressional Committee knocking down Hazleton Mayor Lou Barletta's door to get him to run against Kanjo. Lou is so coy. Another rally in support of Lou's law is planned for Nanticoke this Sunday. And just to add to the fire:

I drove past Senunas' Bar in W-B yesterday afternoon ...and spotted John Yudichak having a drink with Jim and Evie McNulty. I have a tendency to read into things, but I know Big Jim has done work for him in the past, and he's up for re-election next year ... but why meet at a bar that's not in his district or near South Scranton, where McNulty lives and has his office. Yudichak has always had ambitions to run for higher office, and I wonder if he's thinking about running for ether state senate against Musto or congress against Kanjo. It would be really interesting (and good for Kanjo) if both Doherty and Yudichak ran.