Insider Report
Headlines (Scroll down for complete stories):
1. Gutierrez: If Obama Wins, GOP Will Yield on Immigration
2. Canada's Low Corporate Taxes a Lesson for US
3. Kissinger: No More Israel in 10 Years
4. Student Debt: 'The Next Bubble'
5. We Heard: Obama Documentary, Poll Goof, Katie Couric
1. Gutierrez: If Obama Wins, GOP Will Yield on Immigration
Congress' leading Hispanic lawmaker, Rep. Luis Gutierrez, predicts that if President Barack Obama is re-elected, a weakened Republican Party will strike a deal with him on immigration reform next year.
The Illinois Democrat says he has received no promises from the Obama administration on immigration reform, but he tells The Hill he is "absolutely positive" that Obama will make immigration reform a priority in a second term.
President George W. Bush could not overcome GOP opposition to his comprehensive reform plan. But Gutierrez, chairman of the Congressional Hispanic Caucus Immigration Task Force, says an Obama win in the November election would prove a game changer.
"The sheer number of Latinos voting against Mitt Romney will force GOP leaders to support reforms for fear of alienating those voters indefinitely," The Hill observes.
The Romney campaign has said he needs 38 percent of the Latino vote to defeat Obama. But a recent poll by Latino Decisions had Obama leading Romney 68 percent to 26 percent, and by a whopping 74 percent to 21 percent among Hispanic women.
Obama won points among Hispanics this summer by launching a new program forgoing deportations for qualified illegal immigrants who were brought to this country as children.
Gutierrez believes that following an Obama victory, Republican leaders will heed Sen. Marco Rubio and former Florida Gov. Jeb Bush, who are calling on the GOP to agree to immigration reform or risk losing Latino voters for years to come.
In a recent interview with Univision, Obama blamed Republicans for blocking immigration reform during his first term, but added that he shared some of the blame, calling the issue his "biggest failure."
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2. Canada's Low Corporate Taxes a Lesson for US
The United States has the highest corporate tax rate among major industrial nations, prompting many to call for lowered rates to improve American competitiveness.
Opponents charge that a reduction would shrink government revenue. But the United States can look to our largest trading partner, Canada, and see that lowering corporate rates has little or no effect on revenue.
A report from the Cato Institute calculated the marginal effective tax rates on corporate investment around the world, taking into account statutory rates plus items such as deductions for capital depreciation and interest expenses.
The overall U.S. rate, 35.6, is higher than every other country with the exception of Argentina (43.2 percent), Chad (36.4 percent), and Uzbekistan (35.7 percent).
That compares to a rate of 29.9 percent in South Korea, 24.6 percent in Germany, 18.5 percent in China, 11.1 percent in Taiwan, and 3.9 percent in Hong Kong.
The U.S. rate is nearly twice the 18.2 percent average of the 90 countries in the study, and far surpasses the 19.4 average for the 34 Organization for Economic Cooperation and Development nations.
Moreover, America has a combined federal-state rate of about 40 percent, the highest in the world.
"These results underscore the need for U.S. policymakers to tackle corporate tax reform," say report authors Duanjie Chen and Jack Mintz of the University of Calgary's School of Public Policy.
They point out that Canada instituted corporate tax reform in 2000, including lowering the federal statutory rate from 29.12 percent to 15 percent and cutting the average provincial rate from 13.3 percent to 11.1 percent.
Despite the reductions, tax revenues as a share of gross domestic product have remained roughly constant due to rising corporate taxable income, the authors point out. Revenues represented 3.7 percent of GDP in 2000, actually rose to 3.8 percent in 2006, and stood at 3.4 percent in 2010.
"Reductions in corporate tax rates can help boost domestic investment and spur inflows of foreign investment," the authors conclude, adding that "corporate tax rate cuts in high-rate countries will probably not cause substantial revenue losses. Keeping the corporate rate competitive reduces profit shifting by multinational companies to low-tax jurisdictions.
"Reducing the U.S. corporate tax rate would spur capital investment and the shifting of profits into the United States, which in turn would generate economic growth and additional tax collections."
President Obama has proposed cutting the rate to 28 percent, while Mitt Romney says he would cut the rate to 25 percent.
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3. Kissinger: No More Israel in 10 Years
New York Post columnist Cindy Adams asserts that former Secretary of State Henry Kissinger predicted the end of the state of Israel within 10 years.
Adams does not specify when or where Kissinger made that statement. But she writes: "Middle East horror. Democratic Party dissing Jerusalem. DC's anti-Israel mentality. Obama, busy raising re-election funds, no time for beleaguered Netanyahu. The Oval Office attitude versus the Red Line. Iran's oath to destroy our only friend in that part of the world.
"Reported to me, Henry Kissinger has stated — and I quote the statement word for word: 'In 10 years, there will be no more Israel.'
"I repeat: 'In 10 years, there will be no more Israel.'"
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4. Student Debt: 'The Next Bubble'
Student debt passed the $1 trillion mark in March, increasing speculation that college debt is "the next bubble" after housing — the latest sector in which prices leap above real value.
New York University sociologist Richard Arum tells Bloomberg Businessweek that "the question isn't the debt per se, it's what the students are getting in return, because for many students an education isn't worth it from a strictly financial viewpoint."
The United States now has more than 100,000 janitors with college degrees, and 16,000 graduates are working as parking lot attendants, according to Richard Vedder, director of the Center for College Affordability and Productivity.
One graduate who accumulated some $100,000 in student debt and spent two years waiting tables said: "I've come to the conclusion that it's an obsolete idea that a college education is like your golden ticket. It's an idea that an older generation holds on to."
Businessweek offers some sobering facts about student debt:
- In 2010, student debt exceeded credit card debt for the first time.
- It surpassed auto loans in 2011.
- Debt has grown $300 billion from the third quarter of 2008 while other forms of debt dropped by $1.6 trillion.
- Two-thirds of graduating seniors in 2010 had student debt, and on average they owed $25,250.
- Many debtors with student loans on the books default within two years, and if loans aren't paid, the government can garnish wages or Social Security.
- Most debtors in 2011 were under age 40, but 16 percent were aged 40 to 49, 11 percent were 50 to 59, and 4 percent were 60 or over. That oldest group owes $43 billion in student loans.
"It's not clear how much is from their own studies and how much because they co-signed on their children's loans, but whatever the case it's no way to head into retirement," article writer Peter Coy states.
Meanwhile, college tuition continues to increase, rising 16 percent or more in four states in 2011 alone, according to the College Board. Tuition has soared 1,120 percent since 1978, while the Consumer Price Index has risen less than 300 percent. Recent hikes are attributable in part to state governments — whose schools educate seven in 10 students — boosting tuition to battle financial shortfalls.
Coy points to several steps that could be taken to ease the debt problem. One huge step would be to allow bankruptcy judges to wipe out education debt, which for the most part they have been unable to do since 1976.
Another step would be to devise repayment plans that make monthly payments based on a percentage of the debtor's income rather than a certain dollar amount, and to forgive outstanding debt after 20 or 25 years, a move the Obama administration has promoted.
But GOP presidential candidate Mitt Romney charges that Obama encourages students to take on more debt.
Coy puts a human face on his article by citing a graduate who found out her payment on school loans would be $1,400 a month.
"I just went into the car and started sobbing," she said. "It was more than my paycheck at the time."
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5. We Heard . . .
THAT conservative businessman and philanthropist Foster Friess has sent out an email urging Americans to view the documentary film "2016: Obama's America."
The movie, directed by conservative political commentator Dinesh D'Souza, based on his 2010 book "The Roots of Obama's Rage," has become one of the top-grossing documentaries of all times, bringing in more than $32 million.
In his email, Friess — a stock market maven and major backer of conservative Christian causes — states: "Obama's life and philosophy have remained largely a mystery, with most of the media blissfully refusing to do their job.
"As D'Souza explains and provides evidence for, anti-colonialism is a pervasive resentment for the West that can be felt in the air of destitute nations and appears to have followed Barack Obama all the way to the White House."
D'Souza's film will be released on DVD on Oct. 16.
THAT readers of a Texas newspaper must have been taken aback by the results of a poll on the presidential election.
The Round Rock Leader asked readers: "If the election was today, would you vote for Obama or Romney?"
The published results: "Yes," 44 percent, "No," 56 percent.
"Usually we just have a yes or no question and we forgot to plug in the names," said editor Brad Stutzman.
THAT CBS News anchor Katie Couric has won the dubious honor of being named the "Worst Reporter in the History of Man" at a conservative roast in Washington, D.C.
The "Dishonors Awards" roast was hosted by the Media Research Center on Thursday night.
Couric's competition for "worst reporter" included Dan Rather, Bryant Gumbel, and Brian Williams.
Other "Dishonors" award winners — selected by a panel including Ann Coulter, Rush Limbaugh, and 10 other conservative luminaries — included Sean Penn, who received "The Barbra Streisand Political IQ Award for Celebrity Vapidity."
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