American Forum

California Businesses Need Stronger Federal Clean Water Rules By Steve Frisch You don't have to be a native Californian to know how important water is to our state, especially in light of the current record-breaking drought. The total cost of this drought is already running into the billions of dollars, and could end up costing us thousands of jobs. Water is an economic necessity, and we need to protect it. That's why a law like the Clean Water Act, designed to protect our waterways from harmful discharges, is so important -- not just for agriculture, but also to industries like tourism, fishing, manufacturing and even technology. With water so scarce in California, and the state expected to grow to 50 million people by 2050, we need to make sure we re protecting every drop. Unfortunately, a pair of Supreme Court decisions in 2001 and 2006, made Clean Water Act enforcement confusing. The Environmental Protection Agency (EPA) has proposed a new "Waters of the U.S." rule to address this confusion. We need Senator Dianne Feinstein to join us in supporting that rule. "Waters of the U.S." makes clear that most seasonal and rain-dependent streams, as well as wetlands near rivers and streams, are and have always been protected waterways. About 60 percent of streams in the US flow seasonally or following rainfall, and about 117 million Americans -- one in three of us -- get drinking water from public systems that rely at least in part on these streams. Contrary to what many opponents have claimed, these rules would not give the EPA any new authority under the Clean Water Act. No new types of waters would get protection, and -- despite some particularly strange claims -- irrigation ditches would not be covered. All the rules would do is more clearly define the waterways the EPA can protect. They will also give the business community the certainty they have been asking for since the Supreme Court's decisions a decade ago. This aligns with Senator Feinstein's demonstrated support for California businesses and her efforts to address the drought-induced state of emergency declared by Governor Jerry Brown in January. Small business owners are in favor of these protections. A national scientific poll recently released by the American Sustainable Business Council found that a whopping 80 percent of small business owners support the protections described by the proposed "Waters of the U.S." rule. And that includes strong majorities of Republicans, as well as Democrats and Independents. They understand that without clean water, many companies cannot operate. As water costs go up, supply chain materials either disappear or cost substantially more to obtain, and potential customers feel the pinch and spend less on goods and services, existing businesses suffer -- and more of them shut down. Big business isn't different. One reason Silicon Valley soared as a technology manufacturing hub was its access to clean water from the Sierra Nevada. That growth has had a tremendous positive impact on our state's economy, to the point where Silicon Valley accounts for 28 percent of our income tax base. And smart water regulations can do wonders for economic development. In localities like Placer County, for example, regulators have been working to identify and plan for protection of water and other resources under a project called "Placer Legacy," which speeds permitting processes and reduces carrying costs on investments. It's just smart business. Then there's the flip side. If we don't protect our waterways, our local economies will suffer. The Elk River spill earlier this year cost $19 million a day. Our economy doesn t need that kind of damage. No business benefits from contaminated water, and for many industries, it's potentially devastating. We need to act now to protect them. That's why we hope Senator Feinstein will help protect this precious resource by supporting this new EPA rule. Frisch is President of the Sierra Business Council, a non-profit network of more than 4,000 businesses, community organizations, local governments and individuals working to foster thriving communities in the Sierra Nevada.

Walgreens' Founder Wouldn't Approve Company's Unpatriotic Tax Dodge 

By Jim Burke



Charles Walgreen Sr., founder of the nation's biggest drugstore chain, would not approve of what the management of his company is planning. He would never have considered moving his headquarters address to a foreign country just to avoid paying the company's fair share in U.S. taxes. He loved his community and country too much.

How do I know? Because I'm the mayor of the small city in Illinois where Charles Walgreen spent his formative years, went to public school and had his first experience working in a drugstore. Later, after Walgreens bought a pharmacy in Chicago and grew it into a hugely successful chain, he became a major benefactor of the city of Dixon because he believed that a good business gives back. Now, instead of giving back, the company he founded soon may turn its back on our nation.

Walgreens' management may decide by the end of July whether to renounce its corporate "citizenship" in the United States.

To be clear: the corporation wouldn t move any of its 8,200 U.S. stores overseas. It likely would not move its management, employees, or headquarters offshore. Just its corporate address would change -- on paper -- from Deerfield, Illinois to somewhere in Switzerland, a tax haven country. With that simple switch, the company would avoid $4 billion in U.S. taxes over the next five years, according to a recent analysis.

Walgreens would still derive almost all of its $72 billion in annual revenue from loyal American customers. A quarter of that income comes from public sources -- Medicare and Medicaid prescription payments. Even if you don't shop at Walgreens, as a taxpayer, you're aiding its bottom line.

Even with its new offshore address, Walgreens would still benefit from all the services U.S. taxes pay for -- from roads to education to stable markets to our legal system to national defense. But it would pay far less for that privilege, leaving American taxpayers to pick up the tab.

I'm not anti-business. I'm a small business owner myself. I believe in free enterprise. As mayor, I encourage economic development and the jobs it creates. But I also believe that Americans have the right to expect that the corporations they support with their patronage should return their loyalty.

That's how it worked here in Dixon -- and we can thank Charles Walgreen in large part for that. He saved the Dixon National Bank during the Depression, donated 100 acres to create Dixon s public golf course, established our municipal airport and even helped erect a statue to another Illinois success story, Abraham Lincoln.

Like Lincoln, Walgreen rose from humble origins. Charles R. Walgreen, Sr., was born to Swedish immigrants on a farm near Galesburg. At 14, he moved with his family to Dixon, where he attended public school, played sandlot baseball and swam in the Rock River. He worked in a local shoe factory, general store and finally found his true calling in a drug store.

He started his business after moving to Chicago as a young man, but soon returned to Dixon. And as his business thrived, he made sure its home thrived as well. Now his successors want to abandon that ideal by abandoning our country.

Walgreens wouldn't be the first corporation to try this change-of-address tax dodging trick -- more than 75 others have done it since 1983. And at least a dozen other companies -- including AbbVie, Medtronic, Mylan and others -- are quietly planning to announce their own plans to abandon America.

If Walgreens becomes the first big retailer to abandon the United States, it could start an even larger tide of corporate defections that could cost U.S. taxpayers almost $20 billion over the next 10 years according to the non-partisan Joint Committee on Taxation. More and more U.S. corporations will unscrew the nameplate on their U.S. headquarters building, tack it up in a tax haven offshore and dodge billions in U.S. taxes -- all while continuing to receive all the privileges and benefits of operating here in America.

Where is their sense of shame? Where is their patriotism? Where are the morals that guided Charles Walgreen?

Unless Congress acts, we won't be able to block these shady maneuvers. But I expect that many Walgreens' customers may vote with their feet and pocketbooks, passing by the local Walgreens to shop at another drugstore chain or a neighborhood pharmacy that is paying their fair share.

Walgreens executives say they still haven't decided whether or not to pull off this accounting sleight-of-hand. Before they decide, they should give some thought to their founder -- and also to a young kid who used to caddy for him at that public golf course he built. The caddy's name was Ronald Reagan, another Dixon native, whose patriotism and sense of public duty were surely encouraged by the example of Charles Walgreen.

Burke is mayor of Dixon, IL.



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The Smart Money is on Energy Efficiency

By Russell Cann 

Time to Stop Corporate Defections

By Frank Clemente 

By Denise Bowyer 

By Frank Knapp  President Obama is right to address the urgent need to modernize our once grand infrastructure. Unfortunately, the president's corporate tax reforms would leave us in a deeper hole down the road. The President's plan to cut corporate tax rates responds to the tireless mantra of U.S. multinational corporations that America's tax rates hurt their global competitiveness. In reality, American corporations are enjoying their highest level of profits in 60 years while their federal income taxes are close to the lowest level. The Government Accountability Office recently reported that large profitable U.S. corporations paid an effective federal tax rate of just 12.6 percent in 2010, a rate lower than many small businesses and middle-class families. Large corporations like Pfizer, Bank of America and Google have avoided paying their fair share of U.S. taxes by abusing offshore tax havens and using accounting gimmicks to disguise U.S. profits as foreign profits. U.S. corporations are holding about $2 trillion offshore to shield it from U.S. taxation. These corporations have gamed the tax system, contributing mightily to the deficit while leaving small businesses and households to pick up a greater share of the cost of public services and infrastructure -- from schools and police to roads and safe drinking water. While the details aren't clear, the President's plan includes a one-time fee on offshore profits -- much lower than the regular corporate tax rate -- that he wants to use for investing in our country's aging infrastructure and other priorities. Small businesses applaud increased investment in bridges, ports and other needed infrastructure that will also create jobs and put money on Main Street. However, history shows that rewarding corporate tax dodgers with hundreds of billions of dollars in tax breaks -- as happened with the 2004 tax holiday that promised job creation and delivered a windfall to CEOs and shareholders instead -- only accelerates tax haven abuse in the future. It would incentivize the armies of corporate accountants and lobbyists to create and exploit new loopholes even as old ones may be closed. Ending corporate tax dodging is not a Republican issue or a Democratic issue; it's an American issue. In a nationally representative poll, in which Republicans outnumbered Democrats, more than 90 percent of small business owners said it is a problem when large corporations use accounting gimmicks to shift their U.S. profits to foreign tax havens in order to avoid taxes pay. Whether called a one-time fee or a tax holiday, a corporate tax amnesty policy is completely unacceptable to small businesses. The President could close offshore tax loopholes without temporarily or permanently cutting corporate tax rates through a number of bills currently pending in Congress. These include bills to end deferral of taxes on corporate profits held offshore so that corporate income is taxed as it is earned and requiring offshore transactions to have an economic purpose beyond simply avoiding taxes. Moreover, lobbyists who could not prevent the top-bracket Bush tax cuts from being reversed are saying that the President's plan for reducing corporate tax rates to 28 percent, with a lower 25 percent rate for manufacturers, should be accompanied by a reduction in top tax rates for individuals in order to be fair to small business owners -- most of whom report their business profits on their personal tax returns. This is another effort to use middle-class small business owners as a foil to help hedge fund managers, wealthy lawyers and big businesses like Bechtel, the nation's largest engineering firm, that are formed as pass-through income organizations. These are the two to three percent of high-income "small business" owners who would reap a big windfall if income tax rates for those at the top were reduced; the rest of the real small business owners would not be affected. The reality is that what small businesses really need is dependable modern infrastructure and more demand for their goods and services, not tax breaks for big corporations and wealthy individuals. We can strengthen this demand by making big corporations pay their fair share of taxes and investing the new revenue in economic development. Tax reform should be about building a vibrant 21st century economy for all businesses, not rewarding big corporations for free loading on the rest of us. Knapp is the president and CEO of the South Carolina Small Business Chamber of Commerce and Co-Chair of the American Sustainable Business Council Action Fund.

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American Forum  By Sandy Pappas April 15 is Tax Day. As we race to get our taxes filed, lets consider what we actually get for our tax dollars. In Minnesota, we are putting together our state budget for 2014 which we intend to reflect our values as a state. While every state faces its own budget challenges, we share a common challenge: crafting state budgets as our nation struggles with economic challenges and federal budgeting uncertainties. The roller coaster ride of fiscal cliffs, indiscriminate automatic cuts, debt ceilings, and other Washington shenanigans has been distinctly unhelpful. In Minnesota, we cut back on crucial investments in education and infrastructure as tax revenues plummeted during the recession. Now with a slow recovery, we need to re-invest in our priorities around safety, security and productivity. Looming uncertainty makes it more difficult to commit to those investments. Here are a few suggestions for how Congress can reshape the federal budget to help the states continue to pull through the recession and emerge stronger and more economically competitive than ever. First, Congress must find a way to bring more certainty back to the budget process. No more phony "fiscal cliffs" that get solved at the last moment. No more threats of government shutdowns. Second, Congress needs to learn to make strategic budget priorities just as we have to do in our states. Each year over half of the discretionary spending Congress appropriates goes to Pentagon and war spending. Meanwhile the Pentagon is the only governmental agency that cannot pass an audit to show how it uses our tax dollars. Congress cannot continue to exempt the Pentagon budget from scrutiny while making deep cuts to other programs. About one-third of non-defense discretionary spending (the spending Congress votes on every year) goes to the states, so overspending at the Pentagon inevitably squeezes funding for programs on which our states rely. Third, Congress continues to fund out-of-date weapons systems that we may never need or use. The F-35 is a perfect example. It is over budget, behind schedule, and plagued with technical problems. The future of America's security will not be determined by aerial combat between fleets of opposing aircraft, but by things like cyber security, counterterrorism and investing in economic competitiveness. Fourth, we are scheduled to spend billions of dollars over the next 10 years for nuclear weapons that were designed to fight the wars of the last century. For the cost of just one new nuclear submarine, we could provide body armor and bomb-resistant Humvees to all our troops overseas, house and treat every homeless U.S. veteran, and still have $2.2 billion left over to pay down our debt. Congress should focus on protecting the nation from 21st century threats and rebuilding our nation's economy, not paying for pork barrel nuclear weapons projects. Finally, many Pentagon contractors have successfully lobbied for generous tax breaks. We all use our nation's roads, count on schools to educate our future workforce, and rely on public safety workers like firefighters, so why should Pentagon contractors get a break on their taxes? Citizens for Tax Justice found that aerospace and defense firms paid an effective tax rate of 17 percent from 2008 to 2010, lower than the average of 18.5 percent paid by all industries. It's especially galling when these same contractors are seeing big profits and executive pay on par with Wall Street executives. We all do our part by paying our taxes every April. As Supreme Court Justice Oliver Wendell Holmes remarked, "Taxes are what we pay for civilized society." Now we need Congress to do its part by putting together a civilized budget for our society that invests our tax dollars wisely and reflects our values as a nation. We cannot afford to keep spending on out-of-date, unnecessary Pentagon programs. We must reshape the Pentagon budget to respond to 21st century threats, we must repair our economy, and we must start investing in the future. Let's send this message to our representatives in Congress! Pappas is the President of the Minnesota Senate and vice president of the Women Legislators' Lobby, a program of Womens Action for New Directions.

American Forum  By Lisa Maatz  As someone who has spent the better part of my life fighting for fair pay for women, I believe it s always a good time to talk about the pay gap. But the topic is especially important now -- and the timing has little to do with Equal Pay Day on April 9. Equal Pay Day is the symbolic date when women's wages finally catch up to men's from the year before -- this year, it just happens to fall amid sequestration and passage of Rep. Paul Ryan's (R-Wisc.) budget in the House. Both disproportionately slash programs that help women and their families. Women already earn less on average than men, and now programs they depend on to help make ends meet are being cut. These seemingly never-ending budget battles are compounding what is already a pernicious problem. Yet somehow the pay gap went largely overlooked as the dramatic spending cuts known as sequestration went into effect. Sequestration harms women and girls through cuts to K 12 funding, higher-education programs, work-force training, funding for agencies that enforce civil rights protections like equal pay, women's health programs, and programs that promote getting more women into high-wage science, technology, engineering and mathematics careers -- just to name a few. How is the average woman who loses out on thousands of dollars in wages each year due to the gap supposed to make up for cuts to these programs? Easy answer: She can't. And neither can her family. Make no mistake, equal pay is a family issue. And then we have the Ryan budget, which slashes nondefense spending by trillions of dollars, mostly by cutting programs that benefit women, students and families. Ryan's budget cuts Pell Grants and other college aid, Head Start, job training, Medicare, Medicaid, and funding for civil-rights enforcement. And it repeals the Affordable Care Act, which provides critical, no-cost preventive benefits for women. I recognize that Congress is grappling with tough budgetary tradeoffs, but our ability to access basic education and health care cannot be sacrificed. As American Association of University Women research shows, women already have a harder time paying back student loans because of the pay gap. Now the aid they depend on to go to college is in jeopardy. We mark Equal Pay Day as an opportunity to educate the public and demand action. This year, Congress took action on policies that exacerbate the pay gap's impact and put the economic security of American families at risk. Thankfully, Sen. Patty Murray s (D-Wash.) budget blueprint took the Senate in a more moderate direction, sharing the sacrifice and working to help the most vulnerable among us. Sen. Barbara Mikulski's (D-Md.) budget amendment insists we make equal pay a budgetary priority, but we still need stronger laws to fulfill that promise -- laws like the still un-passed Paycheck Fairness Act. I can't state it more plainly: The pay gap hasn't budged in 10 years. And when you compare women and men in the same job doing the same work, we still find a gap. This inequality affects women's wages today and their retirements tomorrow, and it weakens our national economy. It's past time for real change. This Equal Pay Day, ask your politicians one question: Will you finally take action to fix a problem that affects women and their families every day? Make the answer good. Women are watching, and we're tired of waiting. Maatz has served as AAUW's director of public policy and government relations since 2003.

VIRGINIA FORUM


By King Salim Khalfani and Stephen A. Northup

According to the most recent polling data, public support for the death penalty is at its lowest level in decades. Four states have ended capital punishment since 2007 and strong abolition efforts are underway in a number of other states.

So where is Virginia in this current national debate?

Virginia has a long and dark history with the death penalty. The first execution in the New World took place here in 1608 when Captain George Kendall was executed in Jamestown for spying. Throughout its history, Virginia has executed more than 1,300 people, more than any other state. Virginia has executed more women and the youngest children of any state. Since the resumption of capital punishment in the late 1970s following a de facto moratorium imposed by the courts, Virginia has executed 109 people, second only to Texas.