Tag Archives: Wall Street Journal

Justice Department Plans to Sue E-Book Publishers

In December, the European Union announced that it had opened formal antitrust proceedings to investigate whether the same publishers had “engaged in anti-competitive practices affecting the sale of e-books” in Europe.

Apple gets 30% of the price of any e-book. The Justice Department believes that Apple and publishers have used this model to raise prices across the e-book industry.

According to a report from the Pew Internet and American Life project, e-book reader ownership doubled between December 2011 and January 2012, jumping from 18% to 29%. Media Bistro reported in late February that 2011 e-book sales in the United States were up in 117% over 2010, generating $970 million.

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Santorum Praises Income Inequality in Detroit

, U.S. Senator from Pennsylvania.

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“Santorum Praises Income Inequality.”

That was the headline at, of all places, Fox News about Rick Santorum’s Thursday speech at the Detroit Economic Club. He said, “I’m not about equality of result when it comes to income inequality. There is income inequality in America. There always has been and, hopefully, and I do say that, there always will be.”

Mr. Santorum is unhinged in his public comments. Last week, he said that the President argued that Catholics would have to “hire women priests to comply with employment discrimination issues.”

He also suggested that liberals were leading religious people into beheadings. He said, “They are taking faith and crushing it. Why? When you marginalize faith in America, when you remove the pillar of God-given rights, then what’s left is the French Revolution. What’s left is a government that gives you rights. What’s left are no unalienable rights. What’s left is a government that will tell you who you are, what you’ll do and when you’ll do it. What’s left in France became the guillotine.”

Yet, to champion income inequality in Detroit is still incredibly tone-deaf.

Detroit has the highest poverty rate of any big city in America. Among cities with populations over 250,000, Detroit’s poverty rate topped the list at 37.6%, more than twice the national poverty rate. According to the Census Bureau, median household income in Detroit from 2006-10 was just $28,357, only 55% of the overall U.S. median household income.

This is a city that announced plans to close half its public schools and send layoff notices to every teacher in the system.

This is a city where the mayor’s pledge to demolish 10,000 abandoned structures will only shave the tip of the iceberg because, as The Wall Street Journal reported, “the city has roughly 90,000 abandoned or vacant homes and residential lots.”

Mr. Santorum went on to say this about income inequality on Thursday:

We should celebrate like we do in the small towns all across America — as you do here in Detroit. You celebrate success. You build statues and monuments. Buildings, you name after them. Why? Because in their greatness and innovation, yes, they created wealth, but they created wealth for everybody else. And that’s a good thing, not something to be condemned in America.

Mr. Santorum might want to walk around Detroit to see who’s celebrating and to see how many statues he can find to honor people who invented something and got rich.

Furthermore, he should check out the James J. Brady Memorial, which pays tribute to a federal tax collector who set out to address child poverty in the city by founding the Old Newsboys’ Goodfellows of Detroit Fund. The group provides “warm clothing, toys, books, games and candy” to local children every Christmas in addition to sending poor children to summer camps, the dentist, and to college.

Then again, charitable giving doesn’t appear to be high on Mr. Santorum’s list of priorities. As The Washington Post pointed out, based on his tax return, he has given the least amount to charity of the four presidential candidates who have disclosed their tax returns. His charitable giving was just 1.8% of his adjusted gross income.

The Obamas were the highest, giving 14.2%, even though their income was second lowest.

Via The New York Times.

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Filed under Economy, Politics, Stupid Is As Stupid Does

Gingrich Clashes with Other Candidates over Illegal Immigration

Gingrich's official portrait as Speaker

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Representative Michele Bachmann renewed her attack on Saturday of Newt Gingrich over illegal immigration, saying he favors “amnesty” for all illegal immigrants.

Rep. Bachmann released a letter that Mr. Gingrich signed in 2004 supporting a proposal by President Bush for a guest-worker program that would have given undocumented workers employee benefits.

Rep. Bachmann called Mr. Gingrich “the most liberal G.O.P. candidate on the issue of immigration reform.”

The issue arose after a debate on Tuesday night in which Mr. Gingrich called for a “humane” solution for illegal immigrants.

The Republican base has moved to the right on the issue since Pres. Bush floated his guest-worker program, which he dropped before his 2004 re-election campaign.

Republican primary voters disapprove of any program suggesting amnesty for illegal immigrants.

On Wednesday, Mr. Romney attacked Mr. Gingrich for tying legal status to the time someone has been in the country. “How about someone who has been here 20 years?” he said. “How about 12 years? How about 10? 5? 3?” He, too, labeled Mr. Gingrich’s proposal “amnesty.”

Mr. Gingrich said Friday at a campaign appearance that his Republican rivals were twisting his position. He repeated his support for a system to give legal status to some who have long been in the U.S., stating the least would be twenty-five years. He would leave the choice to grant legal status to local community boards.

Mr. Gingrich said he would secure the Mexican border by January 1, 2014 and fine businesses that hired undocumented workers, but in suggesting anything less than deporting all 11 million illegal immigrants, he opens himself up to charges of “amnesty.’’

Rep. Bachmann, who has made a hard line on illegal immigration a signature of her campaign, repeated that Mr. Gingrich favors amnesty for all 11 million.

The February 2004 letter that she circulated, printed in The Wall Street Journal, was an indication of how conservative opinion has shifted on the issue. Among its signatories was Ed Goeas, who earlier this year was an adviser to Mrs. Bachmann.

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Herman Cain and Co. Tout “9-9-9″ Plan

Herman Cain

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Herman Cain has called for a plan he calls “nine-nine-nine:” a flat 9% individual income tax rate, a 9% corporate tax rate, and a 9% national sales tax. He has uttered the triple digits repeatedly.

Mr. Cain’s rivals have tried to use the plan’s simplicity against him, responding that it sounds like the price of a pie with pepperoni, for example. (Har, har, Republicans.)

Mr. Cain and his proposal are getting new scrutiny as Republicans flirt with their candidates less than three months before casting the first votes of the primary season. A poll released Wednesday by NBC News and The Wall Street Journal found that Mr. Cain was effectively tied with Mitt Romney.

Although the specifics of the nine-nine-nine plan were developed in the last few months, it is only the latest incarnation of  ideas popular among some supply-side conservatives.

Mr. Cain was a co-chairman in 1996 of the presidential campaign of Steve Forbes, who advocated a flat tax — a single rate on income for all payers. Beyond the obvious problems of the flat tax (increased tax burden on poor people, reduced charitable donations, etc.), the flat tax would effectively double the taxes on the middle class.

The nine-nine-nine plan would be a radical and complex overhaul of the tax system. In developing it, Mr. Cain relied heavily on Rich Lowrie, an investment adviser at a Wells Fargo office in Pepper Pike, Ohio. Mr. Lowrie has never worked for a policy research group or an academic institution, or made a name through economic analysis.

Mr. Lowrie has a bachelor of science degree in accountancy. On his Facebook page, he describes his political views as “free markets.” Mr. Lowrie is involved with the Ohio chapter of Americans for Prosperity, the conservative organization supported by the billionaire Koch brothers.

The plan could have major economic and political challenges: It would result in a substantial revenue loss for the government and shift the tax burden toward lower- and middle-income people.

In an interview, Mr. Cain said he asked Mr. Lowrie to do a “regression analysis” that would allow the government to eliminate all taxes and collect the same revenue from just three streams. “The number came up to be 9%,” Mr. Cain said. “And that’s how we came up with nine-nine-nine.”

Mr. Lowrie, however, admits that he is not an economist. “I don’t list myself as an economist,” he said. “I have an accounting degree, and I’m an investment adviser.”

A former staff member for Mr. Cain in Iowa described his and Mr. Lowrie’s relationship as “buddy-buddy,” adding, “They were just like two executives palling around together.”

Their plan has drawn fire from right and left. Conservatives are wary of a national sales tax, concerned that it would create another method of taxation.

Critics, especially liberals, say the plan offers a huge tax break for the wealthy while imposing a steep new sales tax on the middle-class and working poor; everyday items like milk and bread would be subject to a 9% tax.

In Tuesday’s debate, Mr. Romney took aim at Mr. Cain’s: “Simple answers are always very helpful, but oftentimes inadequate.”

Mr. Cain said an independent analyst examined the plan and found it would raise the same revenue as the existing tax structure. The analyst, Gary Robbins, a consultant in Virginia, said the Cain plan was “revenue neutral.” Even Mr. Robbins, however, has reservations.

“It’s not the plan I particularly would do, but it’s a sound plan,” said Mr. Robbins. Actually, Mr. Robbins’s math determined that the across-the-board rates necessary to raise the same money as existing federal taxes should be 9.1%.

Somehow, 9.1-9.1-9.1 does not trip off the tongue.

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