Income Tax News

A man once affiliated with the local Black Lives Matter RI group has gained national media attention for his endorsement of Donald Trump in the upcoming presidential race, but local advocates are calling into question his credentials.

This week, headlines circulated from national media proclaiming that Mark Fisher, a “leader” of BLM RI, had thrown his support behind Trump.

But while the national news media described Fisher as a “leader” of Black Lives Matter and “co-founder” of Black Lives Matter RI, the group’s current head, Gary Dantzler, disputes those claims, saying Fisher only worked as an advocate.

Local BLM RI group says Fisher was not a ‘co-founder’

Dantzler, who is the head of BLM RI and registered the group as a nonprofit with the IRS in 2021, said Fisher was not a co-founder but, starting that year, worked for a matter of months as an advocate.

“Mark Fisher stated he was one of the co-founders of BLM,” Dantzler said. “Absolutely not. He was a respected advocate for BLM. That’s it. And he was paid and somewhere he got fired and demoted.”

Currently, there is no Rhode Island-based Black Lives Matter group in the IRS’ nonprofit database with Fisher listed. However, Fisher was listed as a director in BLM RI’s articles of incorporation with the state in 2020. A 2022 annual report shows his name was removed that year.

In late October, Fisher posted online an undated photo of himself within a group of people wearing BLM RI T-shirts. Dantzler is shown at the far left of the image. Dantzler did not immediately comment on the picture.

What made the headlines? A nearly month-old interview and a Fox News appearance.

On Nov. 6, Fisher appeared on the “Kim Iversen Show” and expressed his support for Trump. The show, posted on YouTube and video platform Rumble, is run by Kim Iversen, who was fired in 2022 from The Hill’s “Rising” web show. Iversen is a COVID-19 vaccine skeptic, has called Jan. 6 insurrectionists oppressed “political prisoners” and has said Ukraine shouldn’t fight Russia’s onslaught.

“I like Trump personally,” Fisher said on the show. “And I think right now who we have sitting in the Oval Office is just a deep disappointment. I deeply have disdain for him, and I really dislike the vice president as well.”

Fisher also defended those who were involved in the Jan. 6 Capitol attack.

On Nov. 28, Fisher was welcomed onto “FOX & Friends” where he reiterated his views. Both Iversen’s show and Fox referred to Fisher as a “BLM leader.” Fox also titled him as a “co-founder” of BLM RI.

Fisher did not immediately respond to an inquiry from The Providence Journal.

Prominent local PAC issues clarification about Fisher, BLM RI

Friction has historically lingered between BLM RI and BLM RI PAC, the Black Lives Matter Rhode Island Political Action Committee, which is a separate entity with different membership. The PAC has a visible social media presence and routinely sends out news releases, though Dantzler said it is “unfair” that people associate BLM with the PAC after “the work I put in through the years” on his own organization.

On Wednesday, the PAC released a statement to officially disassociate itself from Fisher, stating he “is not and has never been affiliated with our organization.”

“The views expressed by Mr. Fisher in the referenced Fox News segment do not reflect the values or beliefs of BLM RI PAC,” the group said. “We would like to emphasize that Mark Fisher claims association with Black Lives Matter Rhode Island, a nonprofit organization. Any statements or actions attributed to him should not be conflated with our organization.”

Dantzler denounces Fisher’s Trump endorsement

Dantzler said he is “really disgusted” by Fisher’s endorsement of Trump, and accused Fisher of “trying to hijack the BLM movement of RI.”

Though BLM RI does not engage much with local media, Dantzler said it still holds office space on Main Street in Pawtucket and has been working with the Department of Labor and Training on workforce development initiatives. Dantzler said the organization was also conducting COVID-19 testing as recently as three months ago.

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Dear Savvy Senior: I’m interested in contributing to a health savings account to help boost my retirement savings but would like to better understand how they work. What can you tell me? {em}— Almost 60

Dear Almost: A health savings account, or HSA, is a fantastic financial tool that can help you build up a tax-free stash of money for medical expenses now and after you retire. But to qualify, you must be enrolled in a high-deductible health insurance plan. Here’s an overview of how they work and how you can open one.

HSAs have become very popular over the past few years as the cost of health care continues to skyrocket, and because more and more Americans have high-deductible health plans.

The great benefit of a HSA is the triple tax advantage that it offers: Your HSA contributions can be deducted pretax from your paycheck, lowering your taxable income; the money in the account grows tax-free; and if you use the money for eligible medical expenses, withdrawals are tax-free.

And if you change jobs, the HSA moves with you.

To qualify, you must have a health insurance policy with a deductible of at least $1,500 for an individual or $3,000 for a family in 2023. In 2024, the deductible rises to $1,600/individual or $3,200/family.

This year, you can contribute up to $3,850 if you have single health insurance coverage, or up to $7,750 for family coverage. Next year (2024) you can contribute significantly more — up to $4,150 for single coverage or up to $8,300 for family coverage. And people age 55 and older can put away an extra $1,000 each year. But you cannot make contributions after you sign up for Medicare.

The money can be used for out-of-pocket medical expenses, including deductibles, co-payments, Medicare premiums, prescription drugs, vision and dental care and other expenses (see IRS.gov/pub/irs-pdf/p502.pdf, page 5, for a complete list) either now or when you retire for yourself and your spouse as well as your tax dependents.

Unlike a flexible spending account, an HSA doesn’t require you to use the money by the end of the year. Rather, HSA funds roll over year to year and continue to grow tax-free in your HSA account for later use.

In fact, you’ll get a bigger tax benefit if you use other cash for current medical expenses and keep the HSA money growing for the long term. Be sure to hold on to your receipts for medical expenses after you open your HSA, even if you pay those bills with cash, so you can claim the expenses later. There’s no time limit for withdrawing the money tax-free for eligible medical expenses you incurred any time after you opened the account.

But be aware that if you do use your HSA funds for non-medical expenses, you’ll be required to pay taxes on the withdrawal, plus a 20 percent penalty. The penalty, however, is waived for those 65 and older, but you’ll still pay ordinary income tax on withdraws not used for eligible expenses.

You should first check with your employer to see if they offer a HSA, and if they will contribute to it. If not, you can open an HSA through many banks, brokerage firms and other financial institutions, as long as you have a qualified high-deductible health insurance policy.

If you plan to keep the money growing for the future, look for an HSA administrator that offers a portfolio of mutual funds for long-term investing and has low fees. Some of the top-rated HSA providers in 2023 are Lively, HealthEquity, OptumBank, Fidelity, HSA Bank and Bank of America.

After setting up your HSA plan, adding money is pretty straightforward. Most plans let you do online transfers from your bank, send checks directly, or set up a payroll deduction if offered by your employer. To access your HSA funds many plans provide a debit card and most allow for reimbursement.

Send your senior questions to: Savvy Senior, P.O. Box 5443, Norman, OK 73070, or visit SavvySenior.org. Jim Miller is a contributor to the NBC “Today” show and author of “The Savvy Senior” book.

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SALEM — City Council updated the city’s vicious dog ordinance language in its meeting Tuesday.

The much-discussed update was forwarded to council by the rules and ordinances committee in its Oct. 3 meeting and modifies the language of the section of the ordinance regarding dangerous or vicious dogs killing another domestic animal. Under the previous version of the ordinance the language specified the killing of another dog, and only another dog, while the update changes the ordinance to read as “companion animal.” The change also adds companion animal to the list of the ordinance’s defined terms and would be defined as “any animal that is kept by an individual for the purpose of companionship or support.”

This comes in the wake of a case of a dangerous dog within city limits, which Mayor Cyndi Baronzzi Dickey and Health Commissioner Alanna Hughes have previously discussed at length in the Salem Board of Health’s September and August meetings. In the September meeting Dickey explained that the dog in question had entered a resident’s garage while at large and “destroyed their cat,” and that officers “couldn’t do anything about it” due to the ordinance language specifying dogs.

Council also approved a resolution adopting and approving amendments to the rules and regulation of the Regional Income Tax Agency (RITA) effective Jan. 2, 2024, for use as the city’s income tax rules and regulations during any period which the city has contracted with RITA for the administration of municipal income tax. Councilman Steve Faber questioned the nature and reason for the proposed changes and City Law Director Brooke Zellers explained that the state had changed the requirements for municipal income tax, which prompted RITA to adjust their policies in accordance with the change, and that this resolution was to ensure the city’s policies were up to date and matched the new guidelines.

Other financial matters approved included a resolution authorizing Dickey to apply for and accept financial assistance if awarded from the Salem Community Foundation in the amount of $70,845 for the purpose of purchasing a 2024 Dodge Durango to replace a current K-9 vehicle used by the Salem Police Department. Councilman Evan Newman questioned if there were any plans to upcycle or re-purpose the vehicle that is proposed to be replaced, and City Service Safety Director Joe Cappuzzello said that he had spoken with Police Chief J.T. Panezott and the potential to redeploy the vehicle elsewhere within the city’s fleet such as for housing or zoning was being evaluated, but that if doing so was unviable the vehicle could be sold.

Other action included the re-appointment of Board of Health President Pro-Tempore Judy Sicilia, and long -erving Board Member Newt McKnight to the Salem City Board of Health; the re-appointment of Rick Lutsch to the Board of Housing Appeals, and John Panezott to the Board of Zoning Appeals.

During her report Dickey encouraged residents to visit the walkway the city has installed on State Street between Sugar Tree Alley and State. Dickey said that the project was nearly complete and that the walkway had been widened, with stamped concrete patterned to resemble brick, pillars to match the stadium and wrought iron fencing expected to arrive on Friday. Dickey said the walkway also featured lamp posts which were already “decorated and lit for Christmas,” and that the city would be lighting the trees in the nearby municipal lot for Christmas. Dickey also said that the Salem High School art club had agreed to paint a large cursive “Salem” and other decorative greenery and mural elements on the lot’s dividing wall in the spring. Dickey said all of these renovations, paid for with American Rescue Plan Act (ARPA) funding, were part of the city’s ongoing efforts to promote use of municipal parking. Dickey noted that doing so was especially important because in that area of State Street there is no street parking and local businesses in the area have said their customers have difficulty parking to come to their business.

Dickey also said that the city had been interviewing for positions within the city that would need to be filled soon including health commissioner, housing inspector and housing clerk.

Dickey also wished all residents a happy Thanksgiving, noting she hoped they “got some relaxation and time with family or loved ones.”

These sentiments were echoed by each member of council during pleasure of council, who all wished residents a safe and happy Thanksgiving.

City Council President Sara Baronzzi also reminded residents that the city’s annual Christmas Parade will be held at 6:30 p.m. Nov. 30. This year’s parade route will begin at the high school and proceed to Lincoln Avenue, continuing to State Street, then Ellsworth Avenue, concluding on Second Street. Following the parade, the public is invited to city hall to enjoy the annual city tree lighting with Mayor Cyndi Baronzzi Dickey, holiday music by Salem High School Encore Show Choir and a meet and greet with Santa Claus.

Cappuzzello said that this year after the tree lighting Santa Claus will be in council chambers so children could sit on Santa’s lap and get their photo taken with him.

City council will meet next at 7 p.m. Dec. 5.

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The Treasury Department and the Internal Revenue Service issued proposed regulations to update the investment tax credit rules to encompass various forms of renewable energy.

The proposed regulations, which were posted Friday, update rules that haven’t been changed since 1987. The proposal updates the kinds of energy properties eligible for the Section 48 investment tax credit to reflect various changes in the energy industry, especially when it comes to technological advances on renewable energy, and updates from last year’s Inflation Reduction Act.

The proposed regs offer definitions of energy properties for which the ITC was available before the IRA, including, but not limited to, solar process heat, fiber-optic solar property, combined heat and power system property, qualified fuel cell property, and qualified microturbine property.

Solar panels in Kentucky

Bloomberg Creative Photos/Bloomberg

The proposed rules also deal with technologies that were added to the investment tax credit as energy property by the IRA, including electrochromic glass, energy storage technology, microgrid controllers, and biogas property. The IRA added new provisions to the credit to permit smaller projects to include the cost of some kinds of interconnection property within their credit amount.

On top of that, the proposed regs contain general rules for the investment tax credit, including the application of the “80/20” rule to retrofitted energy property, dual use property, and issues related to multiple owners of an energy property. Under the 80/20 rule, an existing project is considered to be newly placed in service as long as all the used property in the project doesn’t represent more than 20% of the fair market value of the project after its refurbishment, with 80% or more of that fair market value represented by costs included in the depreciable basis of the new property.

The Treasury Department and the IRS have been rolling out a stream of guidance and regulations over the past year pertaining to the Inflation Reduction Act and its provisions related to the renewable energy industry, including electric vehicles and solar and wind credits.

The latest set of proposed regs could have the effect of expanding the investment tax credit from a base of 6% up to 70% for qualifying projects.

“To continue the investment and jobs boom created by the Inflation Reduction Act, Treasury has focused on providing companies with clarity and certainty needed to secure financing and advance clean energy projects nationwide” said Deputy Secretary of the Treasury Wally Adeyemo in a statement Friday. “Today’s guidance provides clarity for offshore wind and battery storage projects, as well as small-scale projects that need to connect to the grid.”  

The notice of proposed rulemaking offers greater clarity around the eligibility of power conditioning and transfer equipment like subsea export cables used in offshore wind projects, as well as certain power conditioning equipment located in onshore substations.

The notice also includes proposed rules around the eligibility of standalone battery storage for the investment tax credit, reflecting a provision in the IRA to help support the development of long-duration energy storage to help utilities transition to renewable sources like wind and solar.

The notice also includes proposed rules pertaining to the inclusion of costs of interconnection-related property for lower-output clean energy installations, including the costs of upgrades to local transmission and distribution networks that are necessary to connect the clean energy. The aim is to lessen the costs and delays for new, smaller clean energy installations to connect to the grid and start producing power.

The notice also proposes updates to a variety of other technical definitions and rules to provide greater clarity and certainty for clean energy project developers.

The Treasury and the IRS said they will accept comments on the proposed regulations for 60 days.

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Members of the West Virginia Public Employee Insurance Agency Finance Board listen to public comment on proposed premium increases for fiscal year 2025 at the Charleston Culture Center in Charleston, W.Va. on Monday, Tuesday Nov. 13, 2024. (AP Photo /Leah Willingham)

CHARLESTON, W.Va. (AP) — The agency in charge of managing health insurance for more than 200,000 government workers in West Virginia is facing pushback over proposed premium increases, five years after public school employees went on strike over rising health care costs.
The state Public Employees Insurance Agency is proposing a premium hike that would amount to a 35% increase in two years for state employees. In a series of public hearings this week, workers said they can’t afford the increases, despite recent tax cuts and raises for state employees.
During a virtual hearing Thursday, teacher Casey Lockerbie said that even with a raise, she’s making less than she did last year because of this year’s increases.
“The whole reason we went on strike a few years ago was to fund PEIA, and I just don’t think this is the solution for it,” said Lockerbie, who travels into West Virginia from a neighboring state to work. “You want to attract people to come to the state and work for you, but you’re penalizing the people that are coming into the state and working.”
With the health insurance agency facing a $376 million deficit earlier this year, the GOP supermajority state Legislature passed a wide-ranging bill increasing state employee health insurance premiums by around 25% in July. There’s also a new surcharge of around $150 for spouses who forgo their employer’s insurance to opt into the state plan.
The law made it mandatory for the Public Employees Insurance Agency to enact an 80-20 cost split between the employer and employees.
Under the proposed plan, state employees’ premiums would increase an additional 10.5% next July. The agency’s finance board is expected to take a final vote in December, after listening to feedback this month at public hearings across the state.
The second year of proposed increases comes after Republican Gov. Jim Justice promised in 2021 that premiums would not go up on his watch.
In 2018, West Virginia school employees went on strike for the first time in two years in large part over concerns about the Public Employees Insurance Agency’s long-term solvency. Gov. Justice created a task force to study the issue as part of his agreement with labor unions. But it never resulted in any significant policy changes to stabilize the budget.
Justice says the increases are offset by raises — a $2,300 increase for state employees this year — and is proposing another 5% increase next year to offset the cost. He also signed a law this year cutting the state income tax by an average of 21.25% across brackets.
Opponents of the increase argue raises don’t go far enough. West Virginia teachers are among the lowest-paid in the nation.
During a hearing in Charleston earlier this week, school service personnel union leader Joe White said he knows members of the agency finance board have their hands tied because of the legislation passed earlier this year.
But White asked the board to remember that the people incurring the cost are “human, they’re families.”
“Organized labor, labor organizations, school employees — we’re not the devil, folks,” he said. “They’re employees that’s out there working for the state of West Virginia who should be treated with respect.”
Retired employees not yet eligible for Medicare and city and county employees insured by the agency would also see increases.

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Utah House Republicans named a new leadership team Tuesday night, selecting House Majority Leader Mike Schultz of Hooper to take over as speaker from outgoing House Speaker Brad Wilson of Kaysville.

“Are you surprised?” a smiling Schultz asked reporters gathered for a news conference following a 1 1/2-hourlong, closed-door caucus where the GOP, who hold 61 of the House’s 75 seats, also voted to move up other current members of leadership.

Their choice of Schultz as speaker over Rep. Melissa Garff Ballard, R-North Salt Lake, goes to the full House for a vote Wednesday, in an extraordinary session set for 5 p.m. where a resolution supporting Israel will also be considered.

Schultz would fill the vacancy being left by Wilson, whose resignation a year before his term as speaker was set to end in order to run for the U.S. Senate becomes effective at 5 p.m. Wednesday.

The new Republican leaders are House Majority Leader Jefferson Moss, R-Saratoga Springs; Majority Whip Karen Lisonbee, R-Syracuse; and House Majority Assistant Whip Casey Snider, R-Paradise.

All of the races were contested. Moss had been majority whip; Lisonbee, majority assistant whip; and Snider, chairman of the powerful Rules Committee.

“It makes us all better if there’s a little bit of competition,” Schultz said, adding that he was most excited about “how we still come together. … Going through this leadership election race, I didn’t hear one negative thing said about any of the members sitting here.”

That says a lot about the House GOP caucus and the state, he said.

“The citizens of this state should be proud of who they send to Capitol Hill,” Schultz said. He said Utah lawmakers hold themselves to “a higher standard” than their GOP counterparts in Congress, who have repeatedly struggled to settle on a U.S. House speaker.

“We work really hard not to disparage one another, if we have disagreements,” he said, citing both written and unwritten rules that “just won’t let it fly.” Plus, Schultz said, “the citizens of this state expect more out of us. We realize that and we’re committed to that.”

Moss said the Republican supermajority has over the last year or two made an effort to get Democrats more involved in the budget process, and they also meet weekly with minority leadership.

Schultz wasn’t ready to be specific about his priorities as speaker, saying he needed to get support for them from the caucus first, including something he’s “very passionate about” that could be announced on Wednesday.

“We need to focus on the big things,” Schultz said, including the impact of growth on energy, water and infrastructure. “The House is the voice of the people. We’re just naturally built to be more reactionary. But we also want to think bigger than that.”

He said the state “is at a crossroads on so many fronts.”

At the same time, Schultz said, “there’s a lot of distrust in government right now. I want the House of Representatives to earn some of that trust back. So that will be a top focus for us as well.”

Lawmakers are also seeing state revenues grow slower than anticipated.

Earlier Tuesday, legislative leaders serving on the Executive Appropriations Committee were told the state saw a nearly $50 million shortfall in the budget year that ended June 30, due to a drop in anticipated income tax collections.

Individual income taxes fell almost 5% short of expectations, while corporate income taxes were more than 6% lower, adding up to a more than $119 million shortfall. At the same time, sales tax collections jumped 10%, almost $70 million above the budgeted amount.

Even with revenues falling short, however, the state still has more than $3 billion in budget reserves, the committee heard. An economic update described the state’s financial situation as moving from boom to balance, with the end of federal COVID-19 funds.

Originally Appeared Here

Here is the situation on Thursday, November 9, 2023.

Fighting

• Three people were killed in Russian attacks on the village of Bagatyr, in the eastern Donetsk region. Ukraine’s emergency service said the three bodies were recovered from the rubble of a destroyed house.
• A Russian missile damaged a Liberia-flagged civilian vessel as it was entering a Black Sea port in the Odesa region, killing one and injuring four people, Ukrainian officials said. The vessel was supposed to transport iron ore to China, according to Ukraine Infrastructure Minister Oleksandr Kubrakov.
• Ukrainian Energy Minister German Galushchenko said Russia had attacked Ukrainian power infrastructure 60 times in the last several weeks. Galushchenko is visiting the United States to discuss ways to protect and strengthen the country’s energy network as temperatures drop.
• Ukraine said it was behind the assassination of Mikhail Filiponenko, a deputy in the Moscow-backed parliament in occupied Luhansk, who was killed in a car bombing in eastern Ukraine. The military intelligence agency said it worked with Luhansk resistance forces in the killing.
• Russia is sending Ukrainian prisoners of war to the front lines of their homeland to fight on Moscow’s side in the war, according to the Russian state news agency RIA Novosti. The news agency said the soldiers swore allegiance to Russia when they joined the battalion, which entered service last month.

Politics and diplomacy

• Meeting in Tokyo, the Group of Seven (G7) reiterated its unwavering support for Ukraine. “Our steadfast commitment to supporting Ukraine’s fight for its independence, sovereignty, and territorial integrity will never waver … We further call on China not to assist Russia in its war against Ukraine,” the foreign ministers of Canada, France, Germany, Italy, Japan, the United Kingdom, the US and the European Union, said in a statement.
• The European Commission recommended opening formal membership talks with Ukraine, in a major show of support for Kyiv. “Today is a historic day,” Commission President Ursula von der Leyen said. “This is a strong and historic step that paves the way to a stronger EU with Ukraine as its member,” Ukrainian President Volodymyr Zelenskyy posted on social media.
• Russian President Vladimir Putin lauded what he described as important “high-tech” Russian military cooperation with China after meeting top Chinese general Zhang Youxia in Moscow. Russian Defence Minister Sergei Shoigu was also at the meeting, his second with Zhang in 10 days. At its meeting on Wednesday, the G7 urged Beijing, which has not condemned Moscow’s invasion of Ukraine, “not to assist” in the war.
• Russian military courts jailed two more Ukrainian soldiers who were captured in Mariupol in 2022. The two were sentenced to 19 and 20 years in prison for allegedly shooting civilians in separate incidents. Russia took thousands of Ukrainian soldiers captive after the fall of Mariupol, with some sent to Russia and others held in occupied eastern Ukraine.
• A Russian state prosecutor is seeking an eight-year jail term for 33-year-old Alexandra Skochilenko, an artist who staged a protest against Moscow’s war in Ukraine by replacing supermarket price tags with anti-war messages. Skochilenko is being tried on the charge of knowingly spreading false information about the Russian army.
• National Security Council spokesman John Kirby told reporters the US had used 96 percent of the funds it had allocated for Ukraine.

Weapons

• Ukraine’s parliament approved a law to allow funds raised from income tax paid by military personnel to be used to fund arms purchases and production. The finance ministry said the move was expected to raise about 96 billion hryvnias ($2.7bn).
• Slovakia’s new government carried through on a campaign pledge and rejected a previously drafted plan to send more military aid to Ukraine. The package, prepared by the previous administration, included 140 KUB air defence system rockets, more than 5,000 pieces of 125 mm cannon ammunition and 4 million rounds of small arms ammunition.

Originally Appeared Here

Photo taken on Oct. 9, 2023 shows the White House in Washington, D.C., the United States. (Xinhua/Liu Jie)

For the upcoming 2024 presidential election, the ballooning deficit and debt is not likely to take center stage.

by Xiong Maoling and Matthew Rusling

WASHINGTON, Nov. 6 (Xinhua) — Recently released data showed that U.S. federal deficit in fiscal year 2023 expanded significantly, with already elevated U.S. debt piling up. Why U.S. budget deficit keeps growing? What are the political obstacles that prevent budget deficit from coming down?

SURGING DEFICIT

The U.S. federal government recorded a budget deficit of nearly 1.7 trillion U.S. dollars in fiscal year 2023, which ended in September, up 23.2 percent from the previous fiscal year, the Treasury Department said in a recent report.

This adds to America’s already ballooning federal debt, which recently exceeded a staggering 33.6 trillion dollars.

Soaring debt has also pushed up the Treasury’s debt issuance. Former Dallas Federal Reserve President, Richard Fisher, said that the daily borrowing of the U.S. government for the next 90 days as the country goes into the last quarter is 8.66 billion dollars a day. “These numbers have gotten horrendously large,” he told CNBC.

The federal deficit grew significantly more last year than expected due to rising borrowing costs and declining tax revenues, according to an analysis from the Congressional Budget Office.

Since March 2022, the U.S. Federal Reserve has lifted interest rates from near zero to 5.25-5.5 percent in an aggressive tightening cycle. With the latest decision on Wednesday, Fed has now skipped a rate hike for two consecutive meetings for the first time since the start of the tightening cycle, but interest rates remain a 22-year high.

Meanwhile, data from Treasury Department showed that net interest reached 659 billion dollars in the fiscal year 2023, ranking sixth in the outlays and accounting for 10.7 percent of the total outlays, which indicated growing cost to finance the debt amid higher interest rates.

In addition, massive government borrowing will lead to a glut of supply in the bond market, which will drive down prices and push up yields, Fisher said. That would create a vicious cycle of rising debt and rising interest payments.

On the tax side, the decrease in tax revenue in fiscal year 2023 was mainly caused by three factors: lower capital gains tax revenue amid the volatility in financial markets, surging claims for a tax break from the pandemic era due to possible fraud, as well as natural disasters, which prompted the Internal Revenue Service (IRS) to delay tax-filing deadlines in some states, such as California.

Beyond such short-term factors, there are structural reasons for the soaring deficit. Peter G. Peterson Foundation has said that the U.S. fiscal deficit is largely due to aging baby boomers, rising healthcare costs and an unreasonable tax system, and that the pandemic has accelerated an already unsustainable fiscal trajectory.

The tax system has been a bone of contention between the Democratic and Republican parties. Biden administration officials and Democratic lawmakers have sought to blame the rising deficits on former President Donald Trump, arguing that a Republican tax cut he signed into law in 2017 reduced federal revenue and widened deficits. A political fight is also likely when most of Trump’s tax cuts are set to expire at the end of 2025.

The Biden administration, despite calling for tax on the rich, signed into law only two measures — a minimum tax on large corporations and a tax on stock buybacks, and also increased funding for the IRS to fight tax fraud.

Such measures, however, are not enough to offset the overall projected increase in deficits in the coming years, according to The New York Times.

POLITICAL OBSTACLES

Budget groups have long warned that U.S. fiscal policy is unsustainable, and both parties are to blame.

“How we got here is a long story of repeated chapters of fiscal irresponsibility on both sides of the aisle. Leaders in Washington have made imprudent decisions over decades, time and again choosing a favorite new tax cut or spending program above our collective future,” Michael Peterson, CEO of the Peter G. Peterson Foundation, said when the U.S. debt exceeded 30 trillion dollars for the first time.

It’s clear where the rub lies, but why is it so hard to slash fiscal deficit?

“We could tax more or cut some spending, but there is little political support for either,” Dean Baker, senior economist at the Center for Economic and Policy Research, told Xinhua.

In an opinion piece in the The New York Times, Nobel Prize-winning economist Paul Krugman recently said that despite Republicans touting government spending reduction, “ask voters about specific spending, and there’s almost nothing they want to cut.”

Social Security, health care and other safety net programs accounted for most government spending. Add military spending and interest payments, and what’s left –“nondefense discretionary” spending — is a small slice of the total. “So there’s no possibility for major spending cuts unless we slash programs that are extremely popular,” Krugman argued.

Raising taxes is also politically difficult. Conservatives have long wanted to cut taxes, and Republicans have even tried to reduce funding for the IRS, even though Democrats have accused them of intentionally limiting the resources needed to track down tax cheats by the wealthy.

While Democrats say they are willing to tax the rich, it is difficult to implement the policies. And Democrats are reluctant to endure the political pressure to raise taxes on the middle class.

“It’s politically difficult for the Biden administration to try to make sure that the most wealthy are paying in accord with their share of the economy,” Clay Ramsay, a researcher at the Center for International and Security Studies at the University of Maryland, told Xinhua.

“It’s also been hard even to support the IRS with the resources to collect what the most wealthy owe under existing law,” Ramsay said, adding that the IRS did receive 80 billion dollars to be spent over 10 years in August. Republicans, meanwhile, have been trying to rescind the IRS funding.

Observers believe that America’s debt problem largely stems from its two-party system, in which both parties want to spend more money to please their voters and garner more votes. While reining in debt growth is good for the U.S. economy in the long run, no administration or political party wants to be remembered as the “devil” who reduces welfare programs or raises taxes.

For the upcoming 2024 presidential election, the ballooning deficit and debt is not likely to take center stage.

“The Republicans will argue that the administration’s spending is largely waste, and Democrats will argue that it is largely investment, plus vital maintenance … The Republicans will argue that tax revenues should be cut and are hurting the little guy; the Democrats will argue that the rich are not paying their fair share,” Ramsay said.

These arguments, which date back to the 1930s, won’t have much impact on voters’ decisions in the presidential election, he said.

Echoing his views, Brookings Institution Senior Fellow, Darrell West, told Xinhua that deficits traditionally have not been a big issue in American elections. “I don’t think it will be decisive in the upcoming election,” West said.  ■

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The Republican-controlled House on Thursday approved legislation to send roughly $14 billion in emergency aid to Israel and cut about the same amount from the Internal Revenue Service, in a deeply divided vote on a measure that Senate leaders say they won’t take up and President Biden has already threatened to veto.

Biden in October requested $106 billion in emergency foreign aid for Ukraine’s defense against Russia’s invasion, Israel’s response to Hamas’s attacks and to counter Chinese influence in the Pacific.

New House Speaker Mike Johnson (R-La.) chose to split the Israel funding off from the rest of the aid and declared the House would cut the budget to pay for the spending to keep the federal deficit from growing.

But the cuts to the IRS would actually cost taxpayers money, meaning the aid for Israel would add to the deficit even more than just borrowing the $14 billion Biden wants to send, according to a nonpartisan analysis by the Congressional Budget Office. The move would reduce the tax agency’s ability to audit high-income earners and tax evaders, costing taxpayers $26.8 billion in lost tax revenue, the CBO projected. IRS Commissioner Daniel Werfel put the lost income at closer to $90 billion.

The legislation passed by a 226-196 vote, with 12 Democrats — Reps. Angie Craig (Minn.), Donald G. Davis (N.C.), Lois Frankel (Fla.), Jared Golden (Maine), Josh Gottheimer (N.J.), Greg Landsman (Ohio), Jared Moskowitz (Fla.), Darren Soto (Fla.), Haley Stevens (Mich.), Juan Vargas (Calif.), Debbie Wasserman Schultz (Fla.) and Frederica S. Wilson (Fla.) — joining most Republicans to back it. Republican Reps. Thomas Massie (Ky.) and Marjorie Taylor Greene (Ga.) voted against the measure.

“We have obligations and we have commitments. And we want to protect and help and assist our friend Israel, but we have to keep our own house in order as well,” Johnson told reporters Thursday. “And I think people at home, I think the American people understand that. At home, you have to balance your budget. At home, you have to make tough decisions, and Washington should run the same way.”

House Democrats rejected that characterization and rushed to the defense of the IRS. The tax agency got roughly $80 billion in expanded funding in the Inflation Reduction Act in 2022, one of Biden’s signature legislative achievements.

Republicans took aim at the funding immediately upon taking control of the House this year, voting to rescind the money in a bill that died in the Senate. They’ve looked for opportunities to peel more of that funding away in subsequent spending bills. Rep. Kevin McCarthy (R-Calif.), then the House speaker, struck a deal with Biden in June to reprogram $20 billion of the IRS funding as part of an agreement to raise the federal debt limit.

“It’s something that, as policy, we’ve looked at since January,” said Rep. Brian Mast (R-Fla.), a U.S. Army veteran who has also volunteered to serve in the Israel Defense Forces. “We’ve done it in stand-alone legislation, done it in different places, I think it’s something that’s just been on the table and became an easy place to look as a pay-for.”

Democrats said the move against the IRS money was a pointless partisan stunt.

“Don’t say that somehow we’re offsetting the cost of our foreign aid package here. We’re not. That’s a joke,” Rep. Jim McGovern (D-Mass.) said on the House floor. “It’s an insult to the intelligence of the American people. It’s an insult to the members of Congress that serve in this institution.”

Rep. Jerrold Nadler (D-N.Y.) called the legislation “an insult to Jewish Americans.”

Senate Majority Leader Charles E. Schumer (D-N.Y.) said Thursday that the Democratic-controlled upper chamber “will not consider this deeply flawed proposal.”

Sens. Patty Murray (D-Wash.) and Susan Collins (R-Maine), the chair and vice chair of the Senate Appropriations Committee, respectively, are drafting a separate aid package to include Israel, Ukraine and Asia-Pacific defense funding, though it’s not yet clear how much money it would send.

“It still mystifies me,” Schumer said, “that at a moment when the world is in crisis — at a time when we need to help Israel to respond to Hamas — the House GOP thought it was a good idea to tie Israel aid to a hard-right proposal that will raise the deficit and is totally, totally partisan, all the while helping wealthy tax cheats get away scot free.”

Biden has said he would veto the House bill if it made it to the Oval Office. Administration officials Thursday argued that linking Israel funding with money for Ukraine, defense against China and U.S.-Mexico border security was crucial to U.S. interests.

“All four are important,” National Security Council spokesman John Kirby told reporters. “And the whole idea of an urgent supplemental is you’re submitting what you think are urgent requests. And the president wants to see all of them honored, all of them acted on by Congress, all of them together. We wouldn’t have submitted it that way if we didn’t believe that they all weren’t important.”

The House proposal turned what could have been an easy political win for the new speaker into a partisan fight that jeopardized crucial aid to the U.S.’s top Middle Eastern ally. It also previews, some GOP lawmakers said, the brash tactics many expect Johnson to employ in future bids to extract concessions from the Senate and White House.

Even Johnson’s bid to add a so-called pay-for to the Israel package is relatively unheard of — most emergency aid is not accompanied by compensatory spending cuts — signaling to the hard-right wing of the House GOP the speaker’s willingness to tangle with both Democratic and Republican Senate leaders over previously noncontroversial policies.

“They should respond and negotiate,” Rep. Chip Roy (R-Tex.), a member of the far-right House Freedom Caucus, said of the Senate, “not tell us we’re wrong.”

Amy B Wang contributed to this report.

Originally Appeared Here

Carlene Coombs, Daily Herald

Heidi Balderree, state senator for Utah District 22, stands near the Traverse Mountain Outlets in Lehi on Wednesday, Oct. 25, 2023.

After former state Sen. Jake Anderegg announced he was retiring from serving Senate District 22, Heidi Balderree decided it was time for her to step in and advocate for her community and conservative policy, leading her to run a campaign for the open seat.

Balderree, a Saratoga Springs resident, won the Utah GOP special election to replace Anderegg earlier this month and now represents constituents within Lehi, Saratoga Springs, Eagle Mountain and a small portion of Draper in the Utah Senate.

Before being chosen by Republican delegates to fill Anderegg’s seat, Balderree worked in policy reform, most recently working for Americans for Prosperity, a conservative political advocacy group. She left her position with the group shortly after being elected.

Some of the policy reform work she contributed to included advocating for Utah’s school choice bill that passed this year, which provides families with vouchers for private schools, and last year’s state income tax reduction.

Balderree and her family lived in Saratoga Springs for seven years before moving to California for work for more than four years. But the political environment of California and its more liberal policies led Balderree to return to Saratoga Springs, and, in total, she and her family have lived there for a combined 17 years.

She said she chose to return to the Beehive State because Utah, particularly her district, respects conservative values and “it feels like home.”

“If you want to start a business, (Utah) is a great place,” she said. “If you want to raise your family, it’s a great place, if you want to thrive economically.”

She also hopes to be a more conservative voice in the Senate and to support conservative legislation from representatives in the Utah House.

“It might have been harder to find a more conservative sponsor in the Senate and I’m happy to do that,” she said. “Because I feel like I’ll help add to that space and be a place where I can really collaborate with some of my colleagues to promote more conservative legislation.”

Education, transportation and scaling back taxes are some of the topics Balderre intends to address in the Legislature.

With the rapid growth being seen in her district, she said, transportation is a particular concern for people living in and moving to the area.

The new senator said she already has set up meetings with the Mountainland Association of Governments and Utah Transit Authority to discuss transportation issues in her district.

She said she supports public transit but is interested in privatizing the transit sector to improve transit and use taxpayer dollars elsewhere, but acknowledged that would take some time.

“I believe in free markets and I don’t think the government always does the best job like the private sector can,” she said.

Regarding education, Balderree said she’s currently looking at co-sponsoring legislation regarding “sexual conduct” in schools and transparency for parents.

“I think some parents just want to know what their kids have access to,” she said. She said she’s heard concerns from parents and grandparents who are worried kids are not being educated but rather “indoctrinated” and want schools to go back to “reading, writing and arithmetic.”

Housing is another key issue in the area and Balderree expressed her trust in the free market system to dictate how the housing market chooses to increase supply.

“Whether it’s high density, whether it’s tiny homes, whether it’s single-family dwelling units, what I would like to see is less heavy-handedness from the state and allowing people to dictate what needs to be built,” she said.

Balderree supports past work the Legislature has done to loosen restrictions on accessory dwelling units. She would also like to see the new first-time homebuyer program — which provides new homeowners with $20,000 if they are building new construction — be expanded to first-time homeowners who are buying existing homes.

Other legislation Balderree plans on supporting or running is an expansion to Utah’s “Lemonade Law,” which allows children to operate occasional businesses, like a lemonade stand, without being subject to regulation that other businesses face. Balderree said she wants to expand the law to include 18-year-olds who are still in high school.

Additionally, Balderree would “support anything” that would lower taxes for Utahns.

“I’m 100% supportive in (reducing taxes), particularly our income tax,” she said. “I’d like to see that get reduced further this year.”

Because Balderree was elected to replace Anderegg after his resignation, she’ll be filling out the end of his term, which ends next year, and already plans to run for reelection.

“There are things that I want to do, and it’ll take more than a year to do them,” she said.

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Originally Appeared Here