Mojo - April 2010

McCain the Maverick Suffers Amnesia

| Mon Apr. 5, 2010 1:44 PM EDT

Newsflash: John McCain is no maverick—and has never been one. From a David Margolick Newsweek article:

"Maverick" is a mantle McCain no longer claims; in fact, he now denies he ever was one. "I never considered myself a maverick," he told me. "I consider myself a person who serves the people of Arizona to the best of his abilities."

Has McCain become detached from reality? Now that he's facing a tough challenge in the GOP primary for his Arizona Senate seat, the veteran senator is depicting himself as a Sarah Palin conservative, not a "maverick"—a term that for many suggests "a Republican who's willing to buck his party by working with liberal Democrats on such issues as campaign reform, climate change, tobacco restrictions, banning torture, and immigration reform." That sort of maverick label won't help McCain in a race in which his conservative loyalties are being questioned by Tea Partiers and others. Distancing himself from his good, ol' straight-talkin' mavericky days is one thing, but denying that he ever said he considered himself a maverick is  darn foolish. McCain might as well claim he never was in Vietnam. It's ridiculous to have to factcheck the guy on this, but here goes.

During his 2008 acceptance speech at the Republican convention, McCain said:

You know, I've been called a maverick; someone who marches to the beat of his own drum. Sometimes it's meant as a compliment, and sometimes it's not. What it really means is I understand who I work for. I don't work for a party. I don't work for a special interest. I don't work for myself. I work for you.

Weeks later, on Larry King Live, on October 29, 2008, McCain remarked,

Sarah's a maverick. I'm a maverick. No one expected us to agree on everything.

Is it worth Googling and Nexising any further? Probably not. No doubt, there are other instances in which McCain embraced the maverick banner. But even without any additional examples, J.D. Hayworth, the former GOP House member challenging McCain in the primary, has an easy-to-make ad. Cue ominous music: "In 2008, John McCain said, 'I'm a maverick.' Now, he says, 'I never considered myself a maverick.' Which is it? And what's worse? To deny you called yourself a maverick—or to forget you did?"

With this overly-calculated and desperate remark, a desperate McCain has made a hard reelection bid even harder.

Advertise on MotherJones.com

Exxon's Income Tax: $0 [UPDATED]

| Mon Apr. 5, 2010 1:26 PM EDT

[UPDATE: ExxonMobil's spokesman contacted Mother Jones to dispute this story, offering additional information concerning its US income tax liabilities for 2009. That information had been added to the end of this post.]

So, good news and bad news. The good news is, oil megacorporation ExxonMobil had such a profitable year in 2009, it contributed $15 billion to the world's tax coffers.

The bad news: Not a cent of that went to the IRS.

ExxonMobil, the world's second-largest company, says it actually paid out 47 percent of its profits in taxes, but not to the good ol' capitalist US of A. Says Forbes in a report on all the taxes of the US's top 25 firms (with added emphasis):

Exxon tries to limit the tax pain with the help of 20 wholly owned subsidiaries domiciled in the Bahamas, Bermuda and the Cayman Islands that (legally) shelter the cash flow from operations in the likes of Angola, Azerbaijan and Abu Dhabi. No wonder that of $15 billion in income taxes last year, Exxon paid none of it to Uncle Sam, and has tens of billions in earnings permanently reinvested overseas.

By contrast, the nation's largest corporation, Wal-Mart, paid $7.1 billion globally in taxes, and the lion's share of it—$5.9 billion, or 83 percent—went to the US government.

The most hilarious part is ExxonMobil still finds a way to bitch about its lot in life. The corporation's website includes an issues page on "industry taxes," which threatens that energy innovation is already on the ropes because of excessive taxes, and it will be forever consigned to the dustbin by any new taxes on windfall profits (or, we'd assume, plans like President Obama's to close the offshore earnings loopholes that saved ExxonMobil from the IRS this year). "While our worldwide profits have grown, our worldwide income taxes have grown even more. From 2004 to 2008 our earnings grew by 79 percent, but our income taxes grew by 130 percent," ExxonMobil's flacks wrote, presumably while playing the world's smallest—and most expensive—violin.

Not that this should shock anybody. In 2008, the New York Times discovered that one in four of the US's largest corporations regularly pay no income tax to the IRS, and billions are lost. Exxon's not alone: The Forbes article points out that General Electric avoided paying any income tax last year on profits of $10.3 billion. In addition to offshore tax shelters, GE had another ace in the hole: It submitted a record-breaking 24,000-page tax return. God bless the IRS's auditors; I'd have paid billions not to have to read that thing.

[Update: Alan Jeffers, ExxonMobil's media relations manager, contacted Mother Jones to respond to this story, confirming that he had submitted a signed comment on this Web page (see way below). He first sent us an email, which states:

It is incorrect to say that ExxonMobil did not pay any U.S. income tax in 2009. In fact, we expect a significant U.S. federal income tax liability for 2009, although our tax return will not be filed until later this year. Our tax installments overpaid our 2008 U.S. federal income taxes and we used that excess in part to pay our 2009 estimated taxes. The amount stated in our 10-K filing with the SEC, which Chris [Christopher Helman, who originally reported on this story for Forbes] told me he based his story on, includes expenses or credits recorded during 2009, and can represent items from previous years or expectations for subsequent years. It is not our actual tax bill.

In a subsequent phone conversation, Jeffers told Mother Jones he "really had to dig in with our tax guys just to really explain what was going on here." He stressed that "the activity in that report"referring to the 10-K, an annual summary of company activity that must be submitted to the Securities and Exchange Commission"does not represent our tax bill," which has not been settled, since the company has not yet filed its 2009 IRS return. He added that, just as an individual might see a refund or not have to pay additional income taxes when they file, the firm could conceivably show a surplus or a zero on the "total income tax" line. When an individual gets a refund from the IRS, that doesn't mean she got off scot-free: It means she overpaid her taxes throughout the year. Jeffers said the same principle operates for ExxonMobil.

Jeffers, however, declined to discuss what ExxonMobil's actual US income tax liabilities might bein 2009, or in any yearexcept to say that it wasn't zero. "We don't disclose our tax bill; we're not required to," he said. "Just like most corporations and individuals, we disclose what we're required to."

Which leaves the figures in ExxonMobil's 10-K largely unexplained: Even if the firm overpaid taxes and earned a refund, it still wouldn't show up as a zero or a positive revenue in cashflow—unless the paid tax liabilities are concealed elsewhere in the report. And it doesn't explain why ExxonMobil's figures are so out of wack with its peer corporations, like Wal-Mart, cited in the original story above, or Chevron, which listed $200 million in US income tax on the same line in its 10-K, Forbes reported.

In any case, the original story is wrong in this respect: According to the 10-K, a screenshot of which is provided below, ExxonMobil didn't have a zero-tax liability in 2009; it was actually owed $46 million by the IRS, against $15.1 billion in foreign taxes owed. As Jeffers says, that may not be the case; but it's what ExxonMobil told the SEC, its shareholders, and the world. And since the firm refuses to share its actual tax numbers with the public, it's all we have to go by.]

John Kasich and Lehman

| Mon Apr. 5, 2010 12:22 PM EDT

Maybe it's too early in the election cycle, but I am surprised that Democrats haven't done more to tie the GOP to Wall Street. Perhaps it's because the Dems get plenty of money from investment bankers and don't want to upset donors. In any case, Ohio Gov. Ted Strickland, who is running for reelection this year, seems to be the exception. Strickland's opponent, former GOP Rep. John Kasich, spent over half a decade as a managing director at Lehman Brothers—the collapse of which helped trigger the recession that's hitting Ohio particularly hard. Strickland has been slamming Kasich's affiliation with the investment bank.

Strickland's strategy seems to be working. The Columbus Dispatch asked Kasich to release his tax returns for all eight years he was at Lehman, but so far the candidate has only released his 2008 return and a 2009 financial disclosure statement. They show that Kasich made $1.4 million in 2008—including $265,000 as a Fox News contibutor and $590,000 (his bonus was $432,000) from the doomed Lehman.

A Kasich spokesman told The Hill that the campaign was releasing the information "primarily to show that he did not profit from Lehman Brothers' demise." But that's not really the point of the Strickland campaign's attack. Kasich's background gives Strickland a simple story to sell to voters. While Ohio was suffering through the Bush years and into the "Great Recession," Kasich was on Wall Street, raking in the dough from a firm that participated (as almost all of them did) in the enormously risky bets that drove the economy to ruin. It's not that Kasich profited from Lehman's collapse. He wasn't short-selling his own bank's stock (as far as we know.) It's that he made his fortune and got out while everyone else paid the price for his firm's bad behavior.

Journalists will likely push Kasich to release the rest of his returns—the limited disclosure definitely makes it seem like he's hiding something—and then to try to force the candidate to go beyond talking about pay and explain what, exactly, he was doing at Lehman. Kasich claims he was not a top decision-maker at Lehman. So was he the classic ex-politico at the investment bank, a la Harold Ford, basically a lobbyist in disguise? Or was he doing something else entirely?

Mission Impossible: Financial Bill Deadline

| Mon Apr. 5, 2010 11:44 AM EDT

Democrats locking horns on financial reform are in a pickle. As Politico reports today, some Dems with a hand in crafting the Senate's Wall Street overhaul have begun to doubt whether a Memorial Day deadline is at all realistic for delivering a bill to President Obama. And they're probably right: That would mean a majority in the Senate agreed to a politically palatable bill, passed it, then both the House and Senate reconciled their two pieces of legislation and sent the combined bill to the president. In a little under two months. When it took the Senate banking committee, led by Sen. Chris Dodd (D-CT), far longer just to get out of committee.

The fear among Democrats, the Politico story highlights, is that a May 31 deadline, which the administration put in place, will imbue financial reform talks with the same partisan flame-throwing that so marred the health care debate. Ditching the deadline, worried Dems say, could allow for improved negotiations and a better shot at a bipartisan financial reform bill. It might also blunt the public blowback seen with the health care bill's passage. A number of outsiders—lobbyists, former government officials—quoted in the Politico story say the deadline was more a rhetorical flourish than anything, an effort by Obama and Co. to keep Congress' talks moving at a rapid clip.

Not only that, but there's the fear that any major legislation considered after Memorial Day will be overtaken by campaigning for the looming fall elections. That's certainly true for vulnerable Dems—those who voted for health care, for instance—who'll be spending much of the second half of 2010 clawing to keep their seat and, inevitably, less concerned about systemic risk and capital restrictions and consumer protection agencies. It's sad, but a reality—especially in what's shaping up to be a tough midterm election for Democrats, among them those fighting for financial reform.

Of course, no one who's closely followed financial reform believes the Memorial Day deadline means anything. After all, Dodd said early last year that he expected a financial bill to be completed by year's end. Well, it's April 2010, and the full Senate hasn't even begun talks. What remains to be seen, and what really matters, is whether the Democratic leadership will be able to juggle writing new financial reforms and helping party members campaign to keep their seats. It's a balancing act that could land them what they want on both accounts.

Michael Steele Plays That Race Card

| Mon Apr. 5, 2010 10:52 AM EDT

Imagine if President Barack Obama hit the podium one day and griped, "My critics are tougher on me because I'm a black man." Ka-booomb! We'd have the mother of all-about-race political-media circuses. TV pundits would explode. Limbaugh and Beck would fly into higher orbits of outraged craziness. Editorial pages would be crammed with reax. The nation would go nuts.

GOP leader Michael Steele said essentially the same thing on Monday about himself, but it's unlikely that he'll detonate such a nuclear daisy chain—because so many people already expect him to make dumb remarks.

On Good Morning America, Steele had this exchange with host George Stephanopoulos: 

STEPHANOPOULOS: As an African American, do you have a slimmer margin for error than another chairman would?

STEELE: The honest answer is: Yes.

STEPHANOPOULOS: Why is that?

STEELE: It just is. Barack Obama has a slimmer margin. We all -- a lot of folks do. I mean, it's a different role for me to play and others to play. And that's just the reality of it. But you take that as part of the nature of it....My view of politics is much more grassroots-oriented. It's not old-boy-network-oriented. And so I tend to come at it a little bit stronger, a little bit more streetwise, if you will. That's rubbed some feathers the wrong way.

Though Steele has bumbled much as GOP chieftain, he says his precarious position there is partly due to the color of his skin. Whatever happened to the Republican obsession with race-blind performance? And it may well be that if a white guy had pulled the same boneheaded moves as Steele, he'd be out by now. In any event, Steele is using race as a shield against the growing criticism targeting him. Fortunately, he doesn't have the standing—or seriousness—to trigger a nationwide over-reaction.

Grand Old Tea Party?

| Mon Apr. 5, 2010 10:37 AM EDT

Last week, Huffington Post's Sam Stein looked into the results of a new Gallup Winston Group poll of members of the "Tea Party." As it turns out, Tea Partiers are mostly white, mostly older, and very conservative. They get their news from Fox, of course. Digby says this should be obvious "to anyone with eyes." Marc Ambinder, reporting on a Gallup poll that was released on Monday, takes the analysis a step further*:

Pay attention to terminology: it's true that just half of those Tea Parties surveyed called themselves Republicans. Yes, the lion's share of the other half say they're independent. But they're not: they're Republican-oriented conservative voters who are dismayed by the direction of the GOP and who don't want to identify with the party's brand. That's not surprising, given how tarnished that brand is. Only 8% identify as Democratic; 7% identify as liberal; 70% percent identify as conservative; two-thirds are pro-life; nearly 90% were opposed to the health care bill.

Ambinder adds that Gallup should have asked for respondents' views on Obama ("is he a socialist?"), immigration, and race, and sought responses on policy questions (i.e., "do they support a 'fair tax'"). Those are great suggestions, but I wanted to add a few more data points to this discussion.

The first is a story from Monday's New York Times reporting that Tea Partiers have made Sen. Harry Reid (D-Nev.), the Senate majority leader, their "No. 1 Target" for November. That shows that while Tea Partiers often claim that they are not Republicans, they happen to share the same electoral goals as the institutional GOP.

The second point is that while the Tea Partiers' anger and frustration are certainly real, the movement has been helped along by Fox News' active promotion and gobs of GOP money. The Tea Party Express, which is highlighted in the Times story about Reid, is run by the Our Country Deserves Better PAC. As the Washington Independent's Dave Weigel has reported, OCDB's leadership is chock-full of professional GOP operatives, including Republican political consultant Sal Russo. (The Times doesn't see fit to mention the GOP connection until about two-thirds of the way into the story.) Howard Kaloogian, a former California assemblyman who ran the 2003 recall campaign against former California Governor Gray Davis in 2003, is also affiliated with OCDB. As Arnold Schwarzenegger fans know, Kaloogian's quixotic recall campaign eventually succeeded—with the help of boatloads of money from GOP Rep. Darrell Issa.

Two other big GOP-affiliated groups have helped the Tea Parties gain national prominence. The first is FreedomWorks, which is run by former (Republican) Senate majority leader Dick Armey. FreedomWorks promotes Tea Party events, sets up websites for activists, provides talking points and media training, and holds conference calls for Tea Party leaders. FreedomWorks' partner-in-Tea-Party-organizing is Americans for Prosperity, a conservative group run by Tim Phillips, the former lobbying partner of onetime Christian Coalition director (and Jack Abramoff scandal star) Ralph Reed. (CampusProgress and Ambinder have good round-ups of some of the work the groups have done.)

None of this is to say that the Tea Parties aren't "real." But when the Times writes about them targeting the top Senate Democrat, it should make clear up top just how deep the connections between the Tea Party and the Grand Old Party run.

*Corrected

Advertise on MotherJones.com

Fred Karger's Fight for Gay Rights

| Mon Apr. 5, 2010 9:20 AM EDT

On Friday, Salt Lake City and its mayor, Ralph Becker, joined the growing list of cities nationwide to ramp up protections and rights for gay, lesbian, bisexual, and transgender citizens, as the city's ban on discrimination in the workplace and in housing for the GLBT community took effect. Voicing support for Salt Lake City's new laws, in addition to gay-rights groups, was an unlikely organization: the Mormon Church. Indeed, the Mormon Church had pledged to support Salt Lake City's anti-discrimination laws as early as last fall, when a church spokesman said, "The church supports these ordinances because they are fair and reasonable and do not do violence to the institution of marriage."

The Church's support of gay rights is anything but typical. As MoJo's Stephanie Mencimer describes in her latest piece, "Game Changer," the Mormon Church has consistently, secretly battled gay marriage for several decades. And though Salt Lake City's laws have nothing to do with marriage, the Mormon Church as a gay rights ally is nonetheless startling.

Leading the effort to push back against the Mormon Church's gay marriage opposition, Mencimer writes, is a man named Fred Karger, a wily, creative, unrelenting thorn in the Mormon Church's side. A former TV actor and top GOP operative (remember Willie Horton? That was Fred), Karger is now taking his bag of political tricks into the gay marriage battle nationwide—and, in many ways, winning. The story of his transformation and battle against the Mormon Church is one you don't want to miss.

We're Still at War: Photo of the Day for April 5, 2010

Mon Apr. 5, 2010 5:00 AM EDT

war photo 040510

During a team-building challenge, US Army 1st Lt. Alan Roy, right, and Sgt. Luis Garcia crawl through an obstacle course on Camp Taji, on Iraq, March 23, 2010. Photo via the US Army by Sgt. Travis Zielinski.

Health Care Reform: Minorities Still Waiting

| Sat Apr. 3, 2010 11:08 AM EDT

Salon’s Joan Walsh recently called out white working class voters who wrongly think health care reform only helps people of color. On Thursday, the Kirwan Institute for the Study of Race and Ethnicity released a fact sheet (PDF) that bolstered Walsh's argument by explaining that recently passed reforms won’t improve the low quality treatment received by racial and ethnic minorities.

The bill won't tackle social factors like poor food quality, toxic or pollutant-riddled neighborhoods, poverty, and other bad deals that are disproportionately dealt out to people of color and that contribute to their generally poorer health. The Kirwan Institute applauds the Patient Protection and Affordable Care Act for expanding (PDF) the number of health care centers in the country and insuring a projected 16 million people. But the Institute also points to health and care disparities affecting different ethnic communities. People of color are less likely to get lifesaving heart medications, bypass surgery, dialysis, or kidney transplants—but they are more likely to have feet and legs amputated for late-stage diabetes treatment. That means the battle for improved health care is not over. And more legislation is needed to address racial health disparities.

Corn on "Hardball": Violence towards Goverment on the Rise

Fri Apr. 2, 2010 7:58 PM EDT

David Corn joined Perry Bacon on MSNBC's Hardball with Chris Matthews to discuss the recent uptick in violent threats towards lawmakers and President Obama.

David Corn is Mother Jones' Washington bureau chief. For more of his stories, click here. He's also on Twitter.