On my Friday night call-in radio show, I discuss the major news stories of the week. Last week, topics for discussion were numerous. In this commentary, I will discuss, in no particular order of priority, some of the highlights.
One: According to a New York Times editorial, the U.S. Attorney in Manhattan, Preet Bharara, told the New York City Bar Association that "illegal insider trading is rampant" and vowed that he would use "'every legitimate tool' to track down and prosecute this crime." The editorial writer said, "It's about time," and I agree.
Wall Street entrepreneurs have, figuratively speaking, gotten away with murder. They (individuals and firms) have beggared millions and ended up with deals providing for multimillion fines, but no prison time, while poor and middle-class people stealing far less go to prison in addition to paying fines.
I believe when the Wall Street rip-off artists are apprehended, law enforcement should seek to obtain some prison time for individuals, particularly in the pay-to-play scams -- forms of bribery. It is ridiculous and an insult to the honest people in our society and on Wall Street.
Two: President Obama is giving in much too quickly on the issue of extending the Bush tax cuts. The Republicans have threatened to filibuster any legislation that does not extend those tax cuts across the board (they sunset for everyone in 2011). Even the Schumer proposal that the pre-Bush tax rates be restored on those earning a million or over has been subject to a Republican filibuster threat. In response to Republican threats, the Senate leadership withdrew bills to restore pre-Bush tax rates for households earning over $250,000 and those earning over a million.
In my view, the Democratic leadership and the Obama administration should put the Republicans to the test and see if they are really willing to go to the mattress (an expression from organized crime days which seems a fitting description of Republican tactics) and embarrass themselves before the country with a filibuster. Let them bring the operation of government to a halt and pin the responsibility on the elephant as President Clinton did on Speaker Newt Gingrich.
One of the most unknown tax injustices was revealed by the New York Times when it pointed out that the top 400 taxpayers who earned $250 million on average in 2005 paid income taxes at a 17.2 percent rate. The rate is lower than that of a family making between $50,000 and $75,000 a year, which was 17.4 percent.
The tax code was created to help the rich become richer and should be junked. If the public really knew how they are being abused, we might see a call for the guillotine. I favor the "flatter tax" (not the flat tax). The flat tax exempts from tax all unearned income (e.g., stock and bond income, etc.), and thereby provides the rich with yet another loophole. The flatter tax, on the other hand, taxes all income, earned and unearned, to be subject to three progressive rates. Supporters of the flat tax, e.g., Steve Forbes, et al, who can manipulate the form of their income, of course prefer a flat tax with its broad exemption.
Similarly, the Democrats should move to extend unemployment insurance for the two million unemployed Americans whose weekly payments will end this year and who still are unable to find jobs. The unemployment rate has risen this last quarter from 9.6 to 9.8 percent and 15 million Americans are now unemployed, with millions more underemployed. Put the Republicans against the wall and let them reveal their true immoral selves before the public. Why are the President, Senate Majority Leader Harry Reid and the Democratic leadership so reluctant to take on the Republicans for the balance of this month when they still have large majorities in both Houses?
Three: Airline passengers who are opposed to the enhanced pat-downs or totally revealing x-ray machines can take the train, drive to their destination, or stay home. We are currently at war with Islamic terrorists now situated in 62 countries. If we want to protect our planes and passengers from terrorists who have made clear they want to kill every American - man, woman and child, we must be willing to surrender some of our normal rights of privacy to defend our country. To do otherwise means we are surrendering to the Islamic terrorists.
Four: Arizona has decided it can no longer fund the costs of organ transplants for those on Medicaid. Nineteen people, who could have had organ transplants (the organs were donated), but couldn't finance the medical costs themselves, died. This is unacceptable when we are pouring billions a month into the financing of the Afghan war. Worse still, President Obama has decided that we are no longer getting out in 2011 and announced a new date of 2014, which you can be sure will be extended. The latest outrage is that our soldiers are being shot and killed by the very Afghans they are training to defend their own country. Six American soldiers were shot and killed last week by an Afghan border guard in training. There have been a number of such incidents. We should get out of Afghanistan immediately. The Times on December 2 described the Afghan government as follows: "From hundreds of diplomatic cables, Afghanistan emerges as a looking-glass land where bribery, extortion and embezzlement are the norm and the honest man is a distinct outlier." Who can defend offering up American lives and treasure to support such a country? If terrorist camps reopen when we leave, bomb them incessantly with drones and other aircraft and use special forces to conduct surgical -- in and out -- strikes.
Five: In our traditional, but regrettable, way of favoring the rich and sticking it to the poor, we have a story concerning our criminal courts in New York City. The Times of December 9 reported, "In 19,137 cases from that year , bail was set at $1,000 or less. The report found that 87 percent of the defendants in those cases did not post bail and went to jail to await trial. They remained for an average of 15.7 days."
The upshot of the bail system is that it may impose jail time on someone ultimately found innocent; or compromise someone's ability to properly defend oneself because of being in jail; or even encourage some who are innocent to plead guilty in order to avoid bail being set which they cannot meet. Remember my earlier reference to the rich on Wall Street who buy freedom from prison by getting settlements? Life is unfair, but need it be this unfair?
Bail should be used to insure the defendant will appear at trial and some of us believe -- I am one of them -- to keep a dangerous person off the streets until trial, including pedophiles and other predators. It should not be used to impose additional punishment on the poor.
Why not join the discussion on a Friday night from 7 p.m. to 8 p.m. Eastern Standard Time on Bloomberg Radio?