a judge threw it out. The companies were also stymied in Massachusetts. But without the threat of federal enforcement, their state-by-state approach got legislation passed this year in Washington, Georgia and Alabama.

Ms. Moore said she was pessimistic about Mr. Biden’s following through on his promises.

“That was certainly the hope,” she said. “I’m old enough to learn that you can’t pin all your hopes on any one politician.”

Kate Conger contributed reporting.

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Student Loan Help For Millions Coming From Biden After Delay

The precise details of President Biden’s plan were reportedly still not finalized on the eve of the announcement.

President Joe Biden on Wednesday is set to announce his long-delayed move to forgive up to $10,000 in federal student loans for many Americans and extend a pause on payments to January, according to three people familiar with the plan.

President Biden has faced pressure from liberals to provide broader relief to hard-hit borrowers, and from moderates and Republicans questioning the fairness of any widespread forgiveness. The delay in Biden’s decision has only heightened the anticipation for what his own aides acknowledge represents a political no-win situation. The people spoke on the condition of anonymity to discuss Biden’s intended announcement ahead of time.

The precise details of President Biden’s plan, which will include an income cap limiting the forgiveness to only those earning less than $125,000 a year, were being kept to an unusually small circle within the Biden administration and were still not finalized on the eve of the announcement.

Down-to-the-wire decision-making has been a hallmark of the Biden White House, but the particular delay on student loans reflects the vexing challenge confronting him in fulfilling a key campaign promise.

The plan would likely eliminate student debt entirely for millions of Americans and wipe away at least half for millions more.

The nation’s federal student debt now tops $1.6 trillion after ballooning for years. More than 43 million Americans have federal student debt, with almost a third owing less than $10,000 and more than half owing less than $20,000, according to the latest federal data.

The continuation of the pandemic-era payment freeze comes just days before millions of Americans were set to find out when their next student loan bills will be due. This is the closest the administration has come to hitting the end of the payment freeze extension, with the current pause set to end Aug. 31.

Wednesday’s announcement was set for the White House after President Biden returns from vacation in Rehoboth Beach, Delaware. The administration had briefly considered higher education schools in the president’s home state for a larger reveal, but scaled back their plans.

President Biden was initially skeptical of student loan debt cancellation as he faced off against more progressive Sens. Elizabeth Warren, D-Mass., and Bernie Sanders, I-Vt., who had proposed cancellations of $50,000 or more, during the 2020 primaries.

As he tried to shore up support among younger voters and prepare for a general election battle against then-President Donald Trump, candidate Biden unveiled his initial proposal for debt cancellation of $10,000 per borrower, with no mention of an income cap.

President Biden narrowed his campaign promise in recent months by embracing the income limit as soaring inflation took a political toll and as he aimed to head off political attacks that the cancellation would benefit those with higher take-home pay. But Democrats, from members of congressional leadership to those facing tough re-election bids this November, have pushed the administration to go as broad as possible on debt relief, seeing it in part as a galvanizing issue, particularly for Black and young voters this fall.

The frenzied last-minute lobbying continued Tuesday even as President Biden remained on his summer vacation. Senate Majority Leader Chuck Schumer, D-N.Y., one of the loudest advocates in recent years for canceling student loan debt, spoke privately on the phone with Biden, imploring the president to forgive as much debt as the administration can, according to a Democrat with knowledge of the call.

In his pitch, Schumer argued to President Biden that doing so was the right thing to do morally and economically, said the Democrat, who asked for anonymity to describe a private conversation.

Inside the administration, officials have discussed since at least early summer forgiving more than $10,000 of student debt for certain categories of borrowers, such as Pell Grant recipients, according to three people with knowledge of the deliberations. That remained one of the final variables being considered by President Biden heading into Wednesday’s announcement.

Democrats are betting that President Biden, who has seen his public approval rating tumble over the last year, can help motivate younger voters to the polls in November with the announcement.

Although President Biden’s plan is narrower than what he initially proposed during the campaign, “he’ll get a lot of credit for following through on something that he was committed to,” said Celinda Lake, a Democratic pollster who worked with Biden during the 2020 election.

She described student debt as a “gateway issue” for younger voters, meaning it affects their views and decisions on housing affordability and career choices. A survey of 18- to 29-year-olds conducted by the Harvard Institute of Politics in March found that 59% of those polled favored debt cancellation of some sort — whether for all borrowers or those most in need — although student loans did not rank high among issues that most concerned people in that age group.

Some advocates were already bracing for disappointment.

“If the rumors are true, we’ve got a problem,” Derrick Johnson, the president of the NAACP, which has aggressively lobbied President Biden to take bolder action, said Tuesday. He emphasized that Black students face higher debut burdens than white students.

“President Biden’s decision on student debt cannot become the latest example of a policy that has left Black people — especially Black women — behind,” he said. “This is not how you treat Black voters who turned out in record numbers and provided 90% of their vote to once again save democracy in 2020.”

John Della Volpe, who worked as a consultant on President Biden’s campaign and is the director of polling at the Harvard Kennedy School Institute of Politics, said the particulars of President Biden’s announcement were less important than the decision itself.

“It’s about trust in politics, in government, in our system. It’s also about trust in the individual, which in this case is President Biden.”

Combined with fears about expanding abortion restrictions and Trump’s reemergence on the political scene, Della Volpe said student debt forgiveness “adds an additional tailwind to an already improving position with young people.”

Republicans, meanwhile, see only political upside if President Biden pursues a large-scale cancellation of student debt ahead of the November midterms, anticipating backlash for Democrats — particularly in states where there are large numbers of working-class voters without college degrees. Critics of broad student debt forgiveness also believe it will open the White House to lawsuits, on the grounds that Congress has never given the president the explicit authority to cancel debt on his own.

The Republican National Committee on Tuesday blasted President Biden’s expected announcement as a “handout to the rich,” claiming it would unfairly burden lower-income taxpayers and those who have already paid off their student loans with covering the costs of higher education for the wealthy.

“My neighbor, a detective, worked 3 jobs (including selling carpet) & his wife worked to make sure their daughter got quality college degree w/no student debt,” Rep. Kevin Brady, R-Texas, the top Republican on the House Ways and Means Committee, tweeted Tuesday. “Big sacrifice. Now their taxes must pay off someone else’s student debt?”

President Biden’s elongated deliberations have sent federal loan servicers, who have been instructed to hold back billing statements while he weighed a decision, grumbling.

Industry groups had complained that the delayed decision left them with just days to notify borrowers, retrain customer service workers and update websites and digital payment systems, said Scott Buchanan, executive director of the Student Loan Servicing Alliance.

It increases the risk that some borrowers will inadvertently be told they need to make payments, he said.

“At this late stage I think that’s the risk we’re running,” he said. “You can’t just turn on a dime with 35 million borrowers who all have different loan types and statuses.”

Additional reporting by The Associated Press.

Source: newsy.com

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Prince William Charity Invests With Bank Tied To Dirty Fuels

Financial experts say investments like those of the prince’s conservation foundation can be blind spots for charities and philanthropies.

The conservation charity founded by Prince William, second in line to the British throne and who launched the Earthshot Prize, keeps its investments in a bank that is one of the world’s biggest backers of fossil fuels, The Associated Press has learned.

The Royal Foundation also places more than half of its investments in a fund advertised as green that owns shares in large food companies that buy palm oil from companies linked to deforestation.

“The earth is at a tipping point and we face a stark choice,” the prince, a well-known environmentalist, is quoted saying on the websites of the Earthshot Prize and Royal Foundation.

Yet in 2021, the charity kept more than $1.3 million with JPMorgan Chase, according to the most recent filings, and still invests with the corporation today. The foundation also held $2 million in a fund run by British firm Cazenove Capital Management, according to the 2021 filing. As with JPMorgan, it still keeps funds with Cazenove, which in May had securities linked to deforestation through their use of palm oil. The foundation invested similar amounts in both funds in 2020, its older filings show. As of December 2021, the charity also held more than $12.1 million in cash.

The investments, which the Royal Foundation didn’t dispute when contacted by the AP, come as top scientists repeatedly warn that the world must shift away from fossil fuels to sharply reduce emissions and avoid more and increasingly intense extreme weather events.

Financial experts say investments like those of the foundation can be blind spots for charities and philanthropies. As climate change is an increasing area of attention for foundations and others, organizations have sometimes struggled to recognize where their own investments lie and align them with more environmentally friendly choices, despite growing numbers of ways to steer clear of funds linked to fossil fuels.

Like the Royal Foundation, in recent years other foundations, including high profile British charities like the National Trust and Wellcome Trust, also have faced criticism for investments with strong connections to fossil fuels or environmentally harmful practices. Microsoft co-founder and philanthropist Bill Gates announced that he divested his foundation’s direct oil and gas holdings in 2019.

Charities that are talking the talk “also need to walk the walk,” said Andreas Hoepner, professor of Operational Risk, Banking and Finance at University College Dublin, who helped design several European Union climate benchmarks and has sat on its sustainable finance group.

“There are funds that are more sustainably oriented,” Hoepner added, pointing to a dozen alternatives to the JPMorgan product that are marketed as sustainable.

There are also alternatives to Cazenove’s sustainability fund. For example, funds manager CCLA caters to churches and charities and does not invest in businesses that get more than 10% of their revenue from oil and gas. Another option is Generation Investment Management, founded in part by former U.S. Vice President Al Gore.

The Royal Foundation said by email that it had followed Church of England guidelines on ethical investment since 2015, and goes beyond them.

“We take our investment policies extremely seriously and review them regularly,” the statement said.

The foundation said management fees paid to JPMorgan were small, but declined to provide a figure.

It’s not clear what role, if any, Prince William had in investment decisions, as he did not respond to AP requests for comment. JPMorgan Asset Management in an email declined to comment on questions about charities investing in their products despite its record of financing fossil fuels.

Bloomberg data show JPMorgan has underwritten more bonds and loans for the fossil fuel industry and earned greater fees than its competitors in the five years up to 2021.

Environmental NGO Rainforest Action Network looked at direct loans and stock ownership along with bonds and estimated that between 2016 and 2021, JPMorgan’s banking arm financed fossil fuel companies with some $382 billion. This was more than any other bank.

“Major investors have their pick of companies to manage their assets, and mission-driven institutions have options well beyond the world’s worst fossil fuel bank,” said Jason Disterhoft, senior energy campaigner with Rainforest Action Network.

As one of the world’s biggest banks, JPMorgan is also a leading financier of green projects, and has set a target of investing $1 trillion in these over the next decade. However, it made about $985 million in revenue from fossil fuels compared to $310 million from green projects since the Paris Agreement in 2015, about three times more, according to Bloomberg Data.

Compared to some other charities, the Royal Foundation’s investments are small, with little impact on climate change. But they are not in line with the ethos of the foundation, which lists conservation and mental health as main points of emphasis, or Prince William’s public statements. His Earthshot Prize, a “global search for solutions to save our planet,” awards grants of up  to $1.2 million each year to projects confronting environmental challenges, according to the charity’s website, which suggests banks as among potential recipients. In July, the Royal Foundation announced that the Earthshot Prize had become an independent charity and Prince William would be its president.

Through launching and awarding the prize and in other public appearances, Prince William has been outspoken on the environment for years. He has argued that entrepreneurs should focus their energies on saving the Earth before investing in space tourism, encouraged parents to consider how their children don’t have the same outdoor opportunities they had and urged conservation.

“Today, in 2022, as the queen celebrates her Platinum Jubilee, the pressing need to protect and restore our planet has never been more urgent,” the prince said in June during Queen Elizabeth II’s Platinum Jubilee.

The policies of the Royal Foundation do not allow ownership of stock in oil companies, tobacco or alcohol. But profits from the Royal Foundation’s account could enable JPMorgan to loan more money to the many oil companies it backs, allowing their expansion. In the same way, investing in companies tied to problems with palm oil supply could help fund unsustainable practices.

While the Cazenove fund is marketed as “sustainable,” as of May 31 the fund held almost $6 million of shares in Nestlé, and shares worth $8.1 million in Reckitt Benckiser, according to Morningstar Direct data. Both Nestlé and Reckitt Benckiser have faced controversy over their palm oil supply. Clearing rainforests to make way for palm oil plantations is one of Southeast Asia’s biggest drivers of deforestation.

Nestlé is the world’s largest food and beverage manufacturer, while Reckitt manufactures popular U.S. brands including Lysol and Woolite, and Vanish and Dettol, familiar in the U.K.

A 2021 investigation by the environmental NGO Global Witness said both companies were sourcing palm oil via intermediaries from illegally deforested areas in Papua New Guinea. The plantations responsible were also accused of corruption, use of child labor and paying police to attack protesters.

Another 2021 report, by sustainability analysts Chain Reaction Research, said both companies purchased palm oil from an Indonesian firm that has an affiliated mining project accused of deforestation in an orangutan habitat.

An investigation in 2020 by Chain Reaction Research found that more than 1,235 acres — over 1,000 American football fields — of rainforest in Indonesia’s Papua province were felled by a supplier to Wilmar, a giant food and oils producer, from which both source their palm oil.

David Croft, head of sustainability at Reckitt, said no tainted palm oil entered its products from the Papua New Guinea properties, while conceding their mills were previously in its supplier list. An intermediary company linked Reckitt to the Indonesian mining conglomerate in its supply chain, he said, and it was investigating. Croft said they have had “active discussions” with Wilmar, which stopped sourcing from the Papua plantation in January 2022. In a public statement published in response to Chain Reaction’s investigation, Wilmar disputed the cleared area was high conservation value forest.

Despite being a “relatively small user of palm oil,” Reckitt knows there is more to do, said Croft, and is accelerating its progress. Croft said Reckitt could not get all the product it needs from certified producers before 2026.

Emma Keller, head of sustainability at Nestlé U.K. and Ireland, said the Wilmar case was to be investigated. Nestlé engages with suppliers that fall short to help them change and monitors performance, she said.

Sixty percent of Nestlé’s palm oil supply was certified as sustainable by the Roundtable on Sustainable Palm Oil, an industry-organized effort, in 2021, according to the World Wide Fund for Nature. For Reckitt, that figure was 15.3%.

Keller said that by winter 2021, more than 90% of Nestlé palm oil was deforestation-free and it will achieve zero-deforestation status by the end of 2022. It uses supply chain maps, on-the-ground verification and satellite monitoring for verification. Nestlé was moving toward “a model for conserving and restoring the world’s forests,” Keller said.

Lily Tomson, of the responsible investment charity ShareAction, said Cazenove had shown some leadership on sustainable investing, but there “remain areas charities such as the Royal Foundation can push them on.”

Investors can vote on key environmental issues in companies where they hold shares, for example setting targets to align with the Paris Agreement, or on climate lobbying. Yet Cazenove’s parent company, Schroders, voted against 22% of environmental resolutions last year, ShareAction research has found.

Kate Rogers, head of sustainability at Cazenove Capital, said the company engaged with Nestlé and Reckitt, and has seen progress on deforestation.

Environmental factors are ingrained in the company’s decision-making, she said, every investment assessed for sustainability. Cazenove has committed to eliminating commodity-driven deforestation from its investments by 2025 and said a new voting policy meant that as of June 2022, the firm had voted against 60 directors of companies it invests in over a lack of climate action.

Dr. Raj Thamotheram, former head of responsible investing at both a $109 billion British university pension fund and AXA Investment Managers, said foundations should be better regulated, with annual reports made to detail how well their investment strategy aligns with their mission.

Thamotheram, now an independent adviser, called unsustainable investments a “cultural and governance blind spot of huge proportions,” and said they were endemic in the charity sector.

“It’s the status quo approach and it needs shaking up,” he said.

Additional reporting by The Associated Press.

Source: newsy.com

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Google Workers Demand Abortion Protections, Data Privacy

By Associated Press
August 18, 2022

A letter signed by more than 650 employees calls for the inclusion of contractors in benefits for employees seeking an out-of-state abortion.

Hundreds of Google employees are petitioning the company to extend its abortion health care benefits to contract workers and to strengthen privacy protections for Google users searching for abortion information online.

Google parent company Alphabet had pledged to pay travel and other health care costs for employees seeking an out-of-state abortion and to help some workers relocate after the U.S. Supreme Court repealed the constitutional right to an abortion. The June decision overturning 1973’s Roe v. Wade ruling has paved the way for severe abortion restrictions or bans in nearly half of the U.S. states.

The benefits for abortion services offered by Google and other tech companies don’t cover contract workers, who are common in the tech industry and often get paid less and have fewer perks than full-time employees.

A letter signed by more than 650 employees and sent this week to Google CEO Sundar Pichai and other Alphabet executives calls for the inclusion of contractors in those benefits.

It also demands that the company cease any political donations or lobbying of politicians or organizations “responsible for appointing the Supreme Court justices who overturned Roe v. Wade and continue to infringe on other human rights issues related to voting access and gun control.”

The employees seek additional protection for Google users, such as by blocking advertisements that misleadingly direct users to anti-abortion “pregnancy crisis” centers.

The petition was organized by members of the Alphabet Workers Union, a labor union that’s been trying to gain traction inside the company.

Google didn’t immediately respond to a request for comment about the petition Thursday. The company said in July it would start automatically purging information about users who visit abortion clinics or other places that could trigger legal problems. Users have always had the option to edit their location histories on their own, but Google said it will proactively do it for them as an added level of protection.

The employees’ petition said the company should also institute immediate data privacy controls for all health-related activity, including abortion information, so that it “must never be saved, handed over to law enforcement, or treated as a crime.”

Additional reporting by The Associated Press.

Source: newsy.com

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Sen. Sinema Took Wall Street Money While Killing Tax On Investors

The revelation comes after Sen. Sinema single-handedly thwarted her party’s long-standing goal of raising taxes on such investors.

Sen. Kyrsten Sinema, the Arizona Democrat who single-handedly thwarted her party’s longtime goal of raising taxes on wealthy investors, received nearly $1 million over the past year from private equity professionals, hedge fund managers and venture capitalists whose taxes would have increased under the plan.

For years, Democrats have promised to raise taxes on such investors, who pay a significantly lower rate on their earnings than ordinary workers. But just as they closed in on that goal last week, Sinema forced a series of changes to her party’s $740 billion election-year spending package, eliminating a proposed “carried interest” tax increase on private equity earnings while securing a $35 billion exemption that will spare much of the industry from a separate tax increase other huge corporations now have to pay.

The bill, with Sinema’s alterations intact, was given final approval by Congress on Friday and is expected to be signed by President Joe Biden next week.

Sinema has long aligned herself with the interests of private equity, hedge funds and venture capital, helping her net at least $1.5 million in campaign contributions since she was elected to the House a decade ago. But the $983,000 she has collected since last summer more than doubled what the industry donated to her during all of her preceding years in Congress combined, according to an Associated Press review of campaign finance disclosures.

The donations, which make Sinema one of the industry’s top beneficiaries in Congress, serve a reminder of the way that high-power lobbying campaigns can have dramatic implications for the way legislation is crafted, particularly in the evenly divided Senate where there are no Democratic votes to spare. They also highlight a degree of political risk for Sinema, whose unapologetic defense of the industry’s favorable tax treatment is viewed by many in her party as indefensible.

“From their vantage point, it’s a million dollars very well spent,” said Dean Baker, a senior economist at the Center for Economic and Policy Research, a liberal-leaning think tank. “It’s pretty rare you see this direct of a return on your investment. So, I guess I would congratulate them.”

Sinema’s office declined to make her available for an interview. Hannah Hurley, a Sinema spokesperson, acknowledged the senator shares some of the industry’s views on taxation, but rebuffed any suggestion that the donations influenced her thinking.

“Senator Sinema makes every decision based on one criteria: what’s best for Arizona,” Hurley said in a statement. “She has been clear and consistent for over a year that she will only support tax reforms and revenue options that support Arizona’s economic growth and competitiveness.”

The American Investment Council, a trade group that lobbies on behalf of private equity, also defended their push to defeat the tax provisions.

“Our team worked to ensure that members of Congress from both sides of the aisle understand how private equity directly employs workers and supports small businesses throughout their communities,” Drew Maloney, the organization’s CEO and president, said in a statement.

Sinema’s defense of wealthy investors’ tax treatment offers a jarring contrast to her background as a Green Party activist and self-styled “Prada socialist” who once likened accepting campaign cash to “bribery” and later called for “big corporations & the rich to pay their fair share” before launching her first campaign for Congress in 2012.

She’s been far more magnanimous since, praising private equity in 2016 from the House floor for providing “billions of dollars each year to Main Street businesses.” After her election to the Senate, Sinema interned during the 2020 congressional recess at a private equity mogul’s boutique winery in northern California.

The soaring contributions from the industry to Sinema trace back to last summer. That’s when she first made clear that she wouldn’t support a carried interest tax increase, as well as other corporate and business tax hikes included in an earlier iteration of President Biden’s agenda.

During a two-week period in September alone, Sinema collected $47,100 in contributions from 16 high-ranking officials from the private equity firm Welsh, Carson, Anderson & Stowe, records show. Employees and executives of KKR, another private equity behemoth, contributed $44,100 to Sinema during a two-month span in late 2021.

In some cases, the families of private equity managers joined in. David Belluck, a partner at the firm Riverside Partners, gave a $5,800 max-out contribution to Sinema one day in late June. So did three of his college-age kids, with the family collectively donating $23,200, records show.

“I generally support centrist Democrats and her seat is important to keep a Democratic Senate majority,” Belluck said, adding that his family has known Sinema since her election to Congress. “She and I have never discussed private equity taxation.”

The donations from the industry coincide with a $26 million lobbying effort spearheaded by the investment firm Blackstone that culminated on the Senate floor last weekend.

By the time the bill was up for debate during a marathon series of votes, Sinema had already forced Democrats to abandon their carried interest tax increase.

“Senator Sinema said she would not vote for the bill .. unless we took it out,” Senate Majority Leader Chuck Schumer told reporters last week. “We had no choice.”

But after private equity lobbyists discovered a provision in the bill that would have subjected many of them to a separate 15% corporate minimum tax, they urgently pressed Sinema and other centrist Democrats for changes, according to emails as well as four people with direct knowledge of the matter who requested anonymity to discuss internal deliberations.

“Given the breaking nature of this development we need as many offices as possible weighing in with concerns to Leader Schumer’s office,” Blackstone lobbyist Ryan McConaghy wrote in a Saturday afternoon email obtained by the AP, which included proposed language for modifying the bill. “Would you and your boss be willing to raise the alarm on this and express concerns with Schumer and team?”

McConaghy did not respond to a request for comment.

Sinema worked with Republicans on an amendment that stripped the corporate minimum tax on private equity from the bill, which a handful of vulnerable Democrats also voted for.

“Since she has been in Congress, Kyrsten has consistently supported pro-growth policies that encourage job creation across Arizona. Her tax policy positions and focus on growing Arizona’s economy and competitiveness are longstanding and well known,” Hurley, the Sinema spokesperson, said.

But many in her party disagree. They say the favorable tax treatment does little to boost the overall economy and argue there’s little compelling evidence to suggest its benefits are enjoyed beyond some of the wealthiest investors.

Some of Sinema’s donors make their case.

Blackstone, a significant source of campaign contributions, owns large tracts of real estate in Sinema’s home state, Arizona. The firm was condemned by United Nations experts in 2019 who said Blackstone’s financial model was responsible for a “financialization of housing” that has driven up rents and home costs, “pushing low-income, and increasingly middle-income people from their homes.”

Blackstone employees, executives and their family members have given Sinema $44,000 since 2018, records show.

In a statement, Blackstone called the allegations by the U.N. experts “false and misleading” and said all employee contributions are “strictly personal.” The firm added that it was “incredibly proud of its investments in housing.”

Another significant financial services donor is Centerbridge Partners, a New York-based firm that buys up the debt of distressed governments and companies and often uses hardball tactics to extract value. Since 2017, Sinema has collected at least $29,000 from donors associated with the firm, including co-founder Mark Gallogly and his wife, Elizabeth Strickler, records show.

In 2012, Centerbridge Partners purchased Arizona-based restaurant chain P.F. Chang’s for roughly $1 billion. After loading the struggling company up with $675 million of debt, they sold it to another private equity group in 2019, according to Bloomberg News. The company received a $10 million coronavirus aid loan to cover payroll, which the federal government later forgave, but shed jobs and closed locations as it struggled with the pandemic.

Centerbridge Partners was also part of a consortium of hedge funds that helped usher in an era of austerity in Puerto Rico after buying up billions of dollars of the island government’s $72 billion debt — and filing legal proceedings to collect. A subsidiary of Centerbridge Partners was among a group of creditors who repeatedly sued one of the U.S. territory’s pension funds. In one 2016 lawsuit, the group of creditors asked a judge to divert money from a Puerto Rican pension fund in order to collect.

A Centerbridge representative could not provide comment.

Liberal activists in Arizona say they plan to make Sinema’s reliance on donations from wealthy investors a campaign issue when she is up for reelection in 2024.

“There are many takes on how to win, but there is no universe in which it is politically smart to fight for favorable tax treatment of the wealthiest people in the country,” said Emily Kirkland, a political consultant who works for progressive candidates. “It’s absolutely going to be a potent issue.”

Additional reporting by The Associated Press.

Source: newsy.com

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How a New Corporate Minimum Tax Could Reshape Business Investments

WASHINGTON — At the center of the new climate and tax package that Democrats appear to be on the verge of passing is one of the most significant changes to America’s tax code in decades: a new corporate minimum tax that could reshape how the federal government collects revenue and alter how the nation’s most profitable companies invest in their businesses.

The proposal is one of the last remaining tax increases in the package that Democrats are aiming to pass along party lines in coming days. After months of intraparty disagreement over whether to raise taxes on the wealthy or roll back some of the 2017 Republican tax cuts to fund their agenda, they have settled on a longstanding political ambition to ensure that large and profitable companies pay more than $0 in federal taxes.

To accomplish this, Democrats have recreated a policy that was last employed in the 1980s: trying to capture tax revenue from companies that report a profit to shareholders on their financial statements while bulking up on deductions to whittle down their tax bills.

reduce their effective tax rates well below the statutory 21 percent. It was originally projected to raise $313 billion in tax revenue over a decade, though the final tally is likely to be $258 billion once the revised bill is finalized.

would eliminate this cap and extend the tax credit until 2032; used cars would also qualify for a credit of up to $4,000.

Because of that complexity, the corporate minimum tax has faced substantial skepticism. It is less efficient than simply eliminating deductions or raising the corporate tax rate and could open the door for companies to find new ways to make their income appear lower to reduce their tax bills.

Similar versions of the idea have been floated by Mr. Biden during his presidential campaign and by Senator Elizabeth Warren, Democrat of Massachusetts. They have been promoted as a way to restore fairness to a tax system that has allowed major corporations to dramatically lower their tax bills through deductions and other accounting measures.

According to an early estimate from the nonpartisan Joint Committee on Taxation, the tax would most likely apply to about 150 companies annually, and the bulk of them would be manufacturers. That spurred an outcry from manufacturing companies and Republicans, who have been opposed to any policies that scale back the tax cuts that they enacted five years ago.

Although many Democrats acknowledge that the corporate minimum tax was not their first choice of tax hikes, they have embraced it as a political winner. Senator Ron Wyden of Oregon, the chairman of the Senate Finance Committee, shared Joint Committee on Taxation data on Thursday indicating that in 2019, about 100 to 125 corporations reported financial statement income greater than $1 billion, yet their effective tax rates were lower than 5 percent. The average income reported on financial statements to shareholders was nearly $9 billion, but they paid an average effective tax rate of just 1.1 percent.

“Companies are paying rock-bottom rates while reporting record profits to their shareholders,” Mr. Wyden said.

told the Senate Finance Committee last year. “This behavioral response poses serious risks for financial accounting and the capital markets.”

Other opponents of the new tax have expressed concerns that it would give more control over the U.S. tax base to the Financial Accounting Standards Board, an independent organization that sets accounting rules.

“The potential politicization of the F.A.S.B. will likely lead to lower-quality financial accounting standards and lower-quality financial accounting earnings,” Ms. Hanlon and Jeffrey L. Hoopes, a University of North Carolina professor, wrote in a letter to members of Congress last year that was signed by more than 260 accounting academics.

the chief economist of the manufacturing association. “Arizona’s manufacturing voters are clearly saying that this tax will hurt our economy.”

Ms. Sinema has expressed opposition to increasing tax rates and had reservations about a proposal to scale back the special tax treatment that hedge fund managers and private equity executives receive for “carried interest.” Democrats scrapped the proposal at her urging.

When an earlier version of a corporate minimum tax was proposed last October, Ms. Sinema issued an approving statement.

“This proposal represents a common sense step toward ensuring that highly profitable corporations — which sometimes can avoid the current corporate tax rate — pay a reasonable minimum corporate tax on their profits, just as everyday Arizonans and Arizona small businesses do,” she said. In announcing that she would back an amended version of the climate and tax bill on Thursday, Ms. Sinema noted that it would “protect advanced manufacturing.”

That won plaudits from business groups on Friday.

“Taxing capital expenditures — investments in new buildings, factories, equipment, etc. — is one of the most economically destructive ways you can raise taxes,” Neil Bradley, chief policy officer of the U.S. Chamber of Commerce, said in a statement. He added, “While we look forward to reviewing the new proposed bill, Senator Sinema deserves credit for recognizing this and fighting for changes.”

Emily Cochrane contributed reporting.

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Sunak And Truss Face Runoff To Become U.K.’s Next Prime Minister

By Associated Press

and Newsy Staff
July 20, 2022

Rishi Sunak and Liz Truss are the two finalists campaigning to replace current Prime Minister Boris Johnson, who resigned after months of scandals.

Britain’s Conservative Party chose former Treasury chief Rishi Sunak and Foreign Secretary Liz Truss — a fiscal moderate and a low-tax crusader — as the two finalists in an election to replace departing Prime Minister Boris Johnson. The result came on the day the divisive, unrepentant Johnson ended his final appearance in Parliament as prime minister with the words “Hasta la vista, baby.”

Sunak and Truss came first and second respectively in a secret vote by Conservative lawmakers. Trade Minister Penny Mordaunt came in third and was eliminated.

The race, which has already produced bitter Conservative infighting, pits Sunak, who steered Britain’s economy through the pandemic before quitting Johnson’s government this month, against Truss, who has led the U.K.’s response to Russia’s invasion of Ukraine.

The two contenders will spend the next few weeks campaigning for the votes of about 180,000 Conservative Party members around the country, who will vote by postal or online ballot. The winner of the party leadership vote will be announced Sept. 5 and will automatically become Britain’s next prime minister.

Sunak won all four rounds of elimination votes by lawmakers, but is less popular with the party’s grassroots, partly because of his previous job as Britain’s chief taxman.

Truss, who has taken a tough line against Russian President Vladimir Putin — and with the European Union — is a favorite of the Conservatives’ right-wing.

Truss said if she becomes prime minister “I would hit the ground running from day one, unite the party and govern in line with Conservative values.”

Sunak’s campaign said “the choice for members is very simple: who is the best person to beat Labour at the next election? The evidence shows that’s Rishi.”

The winner of the Tory contest will not have to face Britain’s general electorate until 2024, unless they choose to call an early general election.

The campaign has already exposed deep divisions in the Conservative Party at the end of Johnson’s scandal-tarnished three-year reign. Truss has branded Sunak a “socialist” for raising taxes in response to the economic damage wrought by the coronavirus pandemic and the war in Ukraine. Sunak has hit back, saying that rivals including Truss were peddling economic “fairy tales” to British voters as the country faces soaring inflation and economic turbulence.

Johnson allies have been accused of lobbying against Sunak, whose resignation helped bring the prime minister down, and in favor of Truss, who remained loyal. That impression was cemented Wednesday when Johnson said his advice to his successor would be not always to listen to the Treasury.

All the contenders —- there were 11 to start — sought to distance themselves from Johnson, whose term in office began boldly in 2019 with a vow to “get Brexit done” and a resounding election victory, but is now ending in disgrace.

Johnson quit July 7 after months of ethics scandals but remains caretaker leader until the party elects his successor.

Additional reporting by The Associated Press.

Source: newsy.com

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The Fight Over Truth Also Has a Red State, Blue State Divide

To fight disinformation, California lawmakers are advancing a bill that would force social media companies to divulge their process for removing false, hateful or extremist material from their platforms. Texas lawmakers, by contrast, want to ban the largest of the companies — Facebook, Twitter and YouTube — from removing posts because of political points of view.

In Washington, the state attorney general persuaded a court to fine a nonprofit and its lawyer $28,000 for filing a baseless legal challenge to the 2020 governor’s race. In Alabama, lawmakers want to allow people to seek financial damages from social media platforms that shut down their accounts for having posted false content.

In the absence of significant action on disinformation at the federal level, officials in state after state are taking aim at the sources of disinformation and the platforms that propagate them — only they are doing so from starkly divergent ideological positions. In this deeply polarized era, even the fight for truth breaks along partisan lines.

a nation increasingly divided over a variety of issues — including abortion, guns, the environment — and along geographic lines.

a similar law in Florida that would have fined social media companies as much as $250,000 a day if they blocked political candidates from their platforms, which have become essential tools of modern campaigning. Other states with Republican-controlled legislatures have proposed similar measures, including Alabama, Mississippi, South Carolina, West Virginia, Ohio, Indiana, Iowa and Alaska.

Alabama’s attorney general, Steve Marshall, has created an online portal through which residents can complain that their access to social media has been restricted: alabamaag.gov/Censored. In a written response to questions, he said that social media platforms stepped up efforts to restrict content during the pandemic and the presidential election of 2020.

“During this period (and continuing to present day), social media platforms abandoned all pretense of promoting free speech — a principle on which they sold themselves to users — and openly and arrogantly proclaimed themselves the Ministry of Truth,” he wrote. “Suddenly, any viewpoint that deviated in the slightest from the prevailing orthodoxy was censored.”

Much of the activity on the state level today has been animated by the fraudulent assertion that Mr. Trump, and not President Biden, won the 2020 presidential election. Although disproved repeatedly, the claim has been cited by Republicans to introduce dozens of bills that would clamp down on absentee or mail-in voting in the states they control.

memoirist and Republican nominee for Senate, railed against social media giants, saying they stifled news about the foreign business dealings of Hunter Biden, the president’s son.

massacre at a supermarket in Buffalo in May.

Connecticut plans to spend nearly $2 million on marketing to share factual information about voting and to create a position for an expert to root out misinformation narratives about voting before they go viral. A similar effort to create a disinformation board at the Department of Homeland Security provoked a political fury before its work was suspended in May pending an internal review.

In California, the State Senate is moving forward with legislation that would require social media companies to disclose their policies regarding hate speech, disinformation, extremism, harassment and foreign political interference. (The legislation would not compel them to restrict content.) Another bill would allow civil lawsuits against large social media platforms like TikTok and Meta’s Facebook and Instagram if their products were proven to have addicted children.

“All of these different challenges that we’re facing have a common thread, and the common thread is the power of social media to amplify really problematic content,” said Assemblyman Jesse Gabriel of California, a Democrat, who sponsored the legislation to require greater transparency from social media platforms. “That has significant consequences both online and in physical spaces.”

It seems unlikely that the flurry of legislative activity will have a significant impact before this fall’s elections; social media companies will have no single response acceptable to both sides when accusations of disinformation inevitably arise.

“Any election cycle brings intense new content challenges for platforms, but the November midterms seem likely to be particularly explosive,” said Matt Perault, a director of the Center on Technology Policy at the University of North Carolina. “With abortion, guns, democratic participation at the forefront of voters’ minds, platforms will face intense challenges in moderating speech. It’s likely that neither side will be satisfied by the decisions platforms make.”

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