Insider Report
Headlines (Scroll down for complete stories):
1. Obama Tax Proposal Would Slash Charitable Donations
2. Household Debt Climbs to $11.8 Trillion
3. Immigration Has Outpaced Job Creation
4. Beheadings Spotlight Persecution of Coptic Christians
5. New Jersey Home to America's Most 'Diverse' City
6. Atheists Scold Schools for 'Illegal' Bible Distribution
1. Obama Tax Proposal Would Slash Charitable Donations
President Barack Obama has once again proposed to limit the value of the charitable tax deduction for high-income contributors — a move that would cut charitable giving by nearly $10 billion and in the end hurt those it is intended to aid.
Obama in his budget asked Congress to limit the value of a deduction for a charitable gift made by high-income households to 28 percent, even though the top tax rate this year is 39.6 percent for those with taxable income of at least $464,850.
The administration claims the proposal would "make the tax code more equitable" because the value of the tax deduction is proportional to one's tax bracket "so it is less valuable to those in the lower brackets."
But the proposed limit would have negative and possibly unforeseen effects, according to a Forbes.com article by Howard Husock, vice president for policy research at the Manhattan Institute.
Husock cites research showing that in one recent year, just 2.6 percent of American households had an adjusted gross income of more than $200,000. These households accounted for 25.1 percent of all income and 29.5 percent of the total value of charitable donations made by all households.
Because the high earners account for such a large proportion of charitable giving, imposing "what amounts to a tax increase on such giving would, not surprisingly, reduce charity overall," Husock states.
He notes that economist Arthur Brooks, head of the American Enterprise Institute, has estimated that the decline would be around $9.4 billion, out of annual donations of some $220 billion.
But the impact would be greatest in the blue states where the high-income donors are concentrated. Of the 4.5 million high-net-worth itemizers in the country, nearly half are concentrated in nine blue states, ranging from 708,000 in California to 100,000 in Connecticut. All these states voted for Obama in 2012.
And since charitable contributions tend to focus on organizations close to home, Husock observes, charities in these states would suffer the most.
In a further irony, the proposed change in the tax code would impact lower-income Americans as well as the wealthy contributors. Around 80 percent of high-income donors make donations to organizations that provide for the "basic needs" of the poor in education, healthcare, the economy, and other areas.
So the proposed tax code change would ultimately cost the very people it is designed to benefit.
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2. Household Debt Climbs to $11.8 Trillion
Americans' total household debt, including mortgages, credit cards, and auto and student loans, rose $117 billion in the last quarter of 2014 to reach $11.8 trillion — and two types of loans are increasingly delinquent.
The percentage of auto loans that were more than 90 days overdue rose to 3.5 percent from 3.1 percent the previous quarter, according to figures released Tuesday by the Federal Reserve Bank of New York.
One reason for the rising delinquency rate in auto loans is that lenders have been taking on riskier borrowers over the past year, The Wall Street Journal reported. Overall auto loan debt rose $21 billion to $955 billion by the end of last year.
Delinquency on student loans also rose during the last quarter, to 11.3 percent from 11.1 percent the previous quarter. Total student loan debt rose $31 billion and hit $11.16 trillion by the end of last year. That's up $77 billion from the last quarter of 2013.
"Although we've seen an overall improvement in delinquency rates since the Great Recession, the increasing trend in student loan balances and delinquencies is concerning," said Donghoon Lee, research officer at the Federal Reserve Bank.
"Student loan delinquencies and repayment problems appear to be reducing borrowers' ability to form their own households."
And the Journal observed: "The New York Fed data fuel concerns that the recent boom in vehicle loans, especially to Americans with weaker credit histories, along with a steady rise in student-loan debt, is resulting in an increase in struggling borrowers."
Mortgage balances rose $39 billion to $8.17 trillion during the last quarter of 2014, while credit card debt increased $20 billion, for a total of $700 billion.
Overall household debt in the United States rose $306 billion over the year ending on Dec. 31, 2014. It peaked at $12.7 trillion in 2008.
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3. Immigration Has Outpaced Job Creation
The number of immigrants who arrived in the United States since 2000, both legally and illegally, is nearly twice the number of new jobs created over that period.
A report from the Center for Immigration Studies (CIS), based on Census Bureau data, discloses that 18 million immigrants arrived in the U.S. since 2000 but just 9.8 million jobs were added over those 14 years.
The CIS released the report as Congress is considering legislation to boost legal immigration to deal with what some allege are labor shortages.
"It is a mistake to think every job taken by an immigrant is a job lost by a native, but it is equally wrong to think that adding this huge number of immigrants has no implications for American workers," said Steven Camarota, co-author of the report and the director of research at the CIS.
The CIS reported that 89 percent of those 18 million immigrants are potential workers who are at least 16 years old.
In addition to the 18 million immigrants, the native-born population of working-age adults grew by 16.5 million since 2000.
But long-term job growth has not come close to matching the increases in immigrants and native-born workers, and as a result the labor force participation rate of native-born Americans aged 16 to 65 has been in decline. The rate was 77 percent in December 2000 and 72 percent in December 2014.
Meanwhile the number of working-age natives not in the labor force — neither working nor looking for work — rose by 13 million from December 2000 to last December.
"The key question for policymakers is whether it makes sense to allow in this number of legal immigrants and tolerate this level of illegal immigration when long-term job growth has not come close to matching these numbers," the CIS stated in the report.
"Unfortunately, policymakers have given little thought to the absorption capacity of the U.S. labor market when formulating immigration policy."
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4. Beheadings Spotlight Persecution of Coptic Christians
The recent video showing ISIS beheading 21 Coptic Christians in Libya has focused renewed attention on the threats and persecution they face in Egypt and other Muslim countries.
Islamic State (ISIS) social media said the beheadings were carried out in revenge, referring to Islamists’ claims that two Christian women who supposedly converted to Islam had been tortured or captured by the church.
But Coptic Christians have long faced prejudice in the Middle East, an article by Ariel Cohen in the Jerusalem Post pointed out.
A 2013 Amnesty International report charged that the Egyptian government has failed to protect Christian schools and churches. Coptics comprise about 10 percent of Egypt's population, but no Christians serve as governors, presidents of public universities, or deans, and there are few Christians in the upper ranks of the security services and armed forces.
Islamic groups including the Muslim Brotherhood have carried out attacks against Coptic Christians and their facilities, and are likely to continue the violence as long as Coptic Christians support the anti-Brotherhood government of President Abdel Fattah al-Sisi.
To make matters worse, al-Sisi capitalizes on the violence politically.
The Sisi regime "claims that its increasing restriction of personal and civil liberties is necessary because the nation must stand united against terrorism. Any acts of violence that can be blamed on the Muslim Brotherhood or other Islamist groups help to renew this line of argument," said Sebastian Elsasser, assistant professor of Middle Eastern Studies at the University of Kiel in Germany.
The Coptic Church was founded by Saint Mark the Apostle, who took Christianity to Egypt in the first century during the reign of the Roman emperor Nero, according to tradition. There are also Coptic Christians in Syria, Jordan, and Lebanon.
Responding to the beheadings in Libya, Pope Francis said in his native Spanish during an address on Monday: "The blood of our Christian brothers and sisters is a testimony which cries out to be heard. It makes no difference whether they be Catholics, Orthodox, Copts, or Protestants. They are Christians."
A Vatican spokesman said Francis was sharing the pain caused by the "barbaric murder of Christian Copts by Islamic fundamentalists."
The Coptic Christian Orthodox Church has its own "pope" in Alexandria.
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5. New Jersey Home to America's Most 'Diverse' City
A new report examines 350 of America's most populous cities in terms of their "ethno-racial and linguistic diversity," and finds that Jersey City, N.J., is the nation's most diverse.
"High immigration rates, a surge in native births, and a rise in the number of interracial partnerships have significantly altered the social fabric — and economic landscape — of America," noted WalletHub.com, which released the report on diversity.
"Since 2011, more than half of all babies born in the U.S. have belonged to an ethnic or a racial minority."
WalletHub, a personal finance social network, examined 350 U.S. cities in terms of their racial and ethnic diversity, language diversity, and region of birth diversity, giving the most weight to racial and ethnic diversity.
Overall No. 1 Jersey City ranks third of the 350 for racial and ethnic diversity, fourth for language diversity, and seventh for region of birth diversity.
No. 2 is Germantown, Md., followed by Hayward, Calif., New York City, and Carson, Calif.
Tops in the racial and ethnic diversity category is Vallejo, Calif., followed by Oakland, Calif.
No. 1 for language diversity is Glendale, Calif., followed by Freemont, Calif., while tops for region of birth diversity is El Monte, Calif., followed by Daly City, Calif.
Placing last, at No. 350, for overall diversity is Billings, Mont., which has a low ranking in all three categories, followed in ascending order by Cedar Rapids, Iowa; Jackson, Miss.; Springfield, Mo.; and Evansville, Ind.
Other disclosures in the WalletHub report include:
- The city with the highest concentration of Hispanics is East Los Angeles, Calif., 97.4 percent, and the lowest is Jackson, Miss., 1.5 percent.
- Livonia, Mich., has the highest concentration of whites, 89.3 percent, while East Los Angeles has the lowest, 1 percent.
- Detroit has the highest concentration of blacks, 80.7 percent, while the lowest is in Brownsville, Texas, 0.16 percent.
- Daly City, Calif., has the highest concentration of Asians, 57.2 percent, and Jackson has the lowest, 0.26 percent.
- Flint, Mich., has the highest concentration of English-speaking residents, 97.3 percent. In Hialeah, Fla., it's just 8.6 percent, compared to 90.5 percent Spanish-speaking, No. 1 in that category.
- Flint is also the city with the highest concentration of native-born residents, 98.3 percent.
- New Bedford, Mass., has the highest concentration of residents born in Europe, 11.3 percent, and Brockton, Mass., has the highest concentration of those born in Africa, 9.9 percent.
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6. Atheists Scold Schools for 'Illegal' Bible Distribution
An atheist group has sent letters to 26 school districts in Oklahoma demanding that they halt the "illegal" distribution of Bibles by The Gideons International.
The Freedom From Religion Foundation (FFRF) claims the schools are violating the U.S. Constitution by allowing the Christian group, known for placing Bibles in hotels around the world, to bring Bibles into classrooms, CNS News reported.
"It is unconstitutional for public school districts to permit the distribution of Bibles as part of the public school day," wrote Andrew Seidel, an attorney with the FFRF. "Courts have uniformly held that the distribution of Bibles to students in public schools is prohibited."
FFRF co-president Annie Laurie Gaylor said in a release: "It's time for schools officials in Oklahoma to do their job, enforce the law, and protect students from the Gideons."
The Insider Report disclosed in January that the FFRF had played a role in a decision by a Florida school district to ban the distribution of Bibles in area schools.
Orange County Public Schools had for three years allowed the Christian group World Changers of Florida, along with the Florida Family Policy Council, to distribute Bibles on Jan. 16, National Freedom of Religion Day.
Last year, the FFRF sued for the right to distribute its own literature in the schools. One of the groups' proposed pamphlets was titled "An X-Rated Book: Sex and Obscenity in the Bible."
The school system gave the group permission to pass out the materials. But this year, the Satanic Temple also announced plans to distribute literature in the high schools.
As a result, the school system said it would not permit any outside materials to be distributed, including atheist and Satanist literature — and Bibles.
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