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Free Press Welcomes Proposed Lifeline Reforms
Urges FCC to go further in addressing the choice and affordability problems that prevent many from getting online
WASHINGTON
On Tuesday, Federal Communications Commission Chairman Tom Wheeler circulated a proposal to modernize the agency's Lifeline program to help low-income households gain access to high-speed Internet services.
In a blog post Chairman Wheeler and Commissioner Mignon Clyburn write that their proposal would enable Lifeline participants to use the program's $9.25 monthly subsidy for standalone mobile or fixed broadband, or a bundle of broadband and voice services.
This marks a significant reform of the program. Lifeline was created during the Reagan administration to help low-income families afford landline phone services. In 2008, the agency added mobile phone services to the subsidy. Since then, advocacy organizations including Free Press have supported an expansion to include broadband access.
"We're pleased to offer this plan to provide a pathway out [of] poverty for low-income consumers by modernizing Lifeline for the 21st Century," Wheeler and Clyburn wrote today.
Free Press Policy Director Matt Wood made the following statement:
"The FCC should be commended for taking the next steps to ensure low-income Americans have more affordable access to all telecommunications services, including broadband. While we're awaiting more details about the Lifeline proposal, this appears to be a welcome move that will help address the nation's digital divide.
"Since its inception, Lifeline has been indispensable in helping to achieve the Communications Act's goal of ensuring that low-income consumers, including those in communities of color and rural areas, have access to telecommunications services. This program is a proven success. It's prevented millions of low-income families from needlessly losing telephone service due to inability to pay, and it's protected these Americans from having to forgo other necessities in order to maintain access to this crucial service.
"Internet access is as essential to participating in today's economy and society as a landline phone was 30 years ago. It makes sense to give low-income Americans the ability to apply the Lifeline discount to broadband -- the defining communications service of the 21st century.
"However, we must stay vigilant if we truly wish to eradicate the digital divide. Lifeline is but one tool to address the issue of affordability. If the FCC's primary goal is to get as many people using broadband as possible, then the best thing it can do is take all possible steps to make all broadband services affordable.
"The issue of affordability is deeply intertwined with the challenging problem of insufficient competition. Letting a small handful of companies control last-mile access to Internet users drives the cost of a connection far beyond the reach of many lower-income communities. If the Commission wants to increase affordability, it must address the lack of competition."
Free Press was created to give people a voice in the crucial decisions that shape our media. We believe that positive social change, racial justice and meaningful engagement in public life require equitable access to technology, diverse and independent ownership of media platforms, and journalism that holds leaders accountable and tells people what's actually happening in their communities.
(202) 265-1490LATEST NEWS
G20 Leaders Reach 'Landmark Commitment' for Global Tax on Ultrarich
"Now is the time to turn words into action and launch an inclusive international negotiation, extending beyond G20 countries, on the reform of the taxation of the superrich," said economist Gabriel Zucman.
Nov 19, 2024
Acknowledging that "the era of the billionaire" is still in full swing across the globe, economic justice advocates on Tuesday applauded a "landmark commitment" by G20 leaders at the group's annual summit in Rio de Janeiro, where delegates agreed to cooperate on efforts to ensure the richest households in the world are taxed fairly.
The final communiqué out of the G20 Summit includes a commitment from 19 countries, the European Union, and the African Union, to "engage cooperatively to ensure that ultra-high-net-worth individuals are effectively taxed."
"Cooperation could involve exchanging best practices, encouraging debates around tax principles, and devising anti-avoidance mechanisms, including addressing potentially harmful tax practices," reads the communiqué. "We look forward to continuing to discuss these issues in the G20 and other relevant forums, counting on the technical inputs of relevant international organizations, academia, and experts."
The final text was brokered by Brazilian President Luiz Inácio Lula da Silva, commonly known as Lula, and the E.U. Tax Observatory noted that Argentina's right-wing president, Javier Milei, "failed to convince other G20 countries to block the communiqué."
The meeting took place less than a year after economist Gabriel Zucman, director of the E.U. Tax Observatory, published a report titledA Blueprint for a Coordinated Minimum Effective Taxation Standard for Ultra-High-Net-Worth Individuals, which informed G20 finance discussions leading up to the summit.
"A minimum tax on billionaires equal to 2% of their wealth would raise $200-$250 billion per year globally from about 3,000 taxpayers; extending the tax to centimillionaires would add $100-$140 billion," said Zucman, a leading expert on tax avoidance and reducing inequality, in the report.
Billionaires' effective tax rate is currently equivalent to 0.3% of their wealth, requiring them to pay a far lower rate than middle-class taxpayers.
Zucman hailed the agreement out of the summit in Rio de Janeiro as a "historic decision" and said concrete action by the world's governments must follow.
"Now is the time to turn words into action and launch an inclusive international negotiation, extending beyond G20 countries, on the reform of the taxation of the superrich," said Zucman.
Along with Milei, the Biden administration pushed back this year as the G20 weighed Zucman's tax proposal. Treasury Secretary Janet Yellen toldThe Wall Street Journal in May that the "notion of some common global arrangement for taxing billionaires with proceeds redistributed in some way—we're not supportive of a process to try to achieve that. That's something we can't sign on to."
As Common Dreamsreported Tuesday, the U.S. is one of eight countries that are contributing to an international loss of $492 billion in taxes each year as multinational corporations and ultrawealthy individuals underpay. The eight countries—which also include Australia, Canada, Israel, Japan, New Zealand, South Korea, and the U.K.—oppose a United Nations tax convention.
Jenny Ricks, general secretary of the Fight Inequality Alliance, said that particularly with U.S. President-elect Donald Trump set to take office in January, "we live in the era of the billionaire."
"We need to move to the era of the 99%," said Ricks. "This shift won't come easily. The U.S. elections have shown how the superrich can use their wealth and power to influence policies and shape the outcomes of elections. Leaders like Trump in the U.S. and Javier Milei in Argentina are actively working to derail international cooperation, while politicians around the world fail to oppose the vested interests that continue to benefit from such unequal societies."
"We will fight harder than ever before to transform the rhetoric on taxing the rich into a global reality," she added. "We need more equal societies in which the richest no longer hold all the power and wealth, with devastating consequences. We need to redistribute the wealth of the superrich to fund vital public services and the response to climate change. Such a transformation is essential to creating the alternative we seek to today's broken system."
Viviana Santiago, executive director of Oxfam Brazil, applauded Lula's government and the G20 leaders for responding "to people's demands worldwide to tackle extreme inequality, hunger, and climate breakdown, and particularly for rallying action on taxing the superrich."
"G20 governments deserve praise for their groundbreaking commitment to cooperate on taxing the world's superrich. But we won't rest until this delivers real change for people and planet," said Santiago, adding that governments now ostensibly supporting a tax on billionaires' wealth should also "be championing a $5 trillion climate finance goal at COP29," the U.N. summit set to wrap up in Baku, Azerbaijan this week.
"How can they argue that climate justice is unaffordable with a deal to raise trillions of dollars by taxing the superrich on the table?" she asked.
Quentin Parrinello, policy director at the E.U. Tax Observatory, asserted that negotiations on the tax proposal "must now extend to a much more inclusive space than the G20."
"Such reforms don't happen overnight, but time is pressing," said Parrinello. "This agenda is even more important today, with the risk of geopolitical fragmentation and looming wealth concentration fueling inequality and undermining democracy."
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Tax Dodging by Super-Rich, Big Corporations Costs Nations Half a Trillion Per Year: Study
"The U.K. and the U.S. are both among the biggest enablers and the biggest losers of this lose-lose tax system," said the chief executive of the Tax Justice Network.
Nov 19, 2024
A study published Tuesday estimates that tax dodging enabled by the United States, the United Kingdom, and other wealthy nations is costing countries around the world nearly half a trillion dollars in revenue each year, underscoring the urgent need for global reforms to prevent rich individuals and large corporations from shirking their obligations.
The new study, conducted by the Tax Justice Network (TJN), finds that "the combined costs of cross-border tax abuse by multinational companies and by individuals with undeclared assets offshore stands at an estimated $492 billion." Of that total in lost revenue, corporate tax dodging is responsible for more than $347 billion, according to TJN's calculations.
"For people everywhere, the losses translate into foregone public services, and weakened states at greater risk of falling prey to political extremism," the study reads. "And in the same way, there is scope for all to benefit from moving tax rule-setting out of the OECD and into a globally inclusive and fully transparent process at the United Nations."
The analysis estimates that just eight countries—the U.S., Canada, the U.K., Japan, Israel, South Korea, Australia, and New Zealand—are enabling large-scale tax avoidance by opposing popular global reform efforts. Late last year, those same eight countries were the lonely opponents of the United Nations General Assembly's vote to set in motion the process of establishing a U.N. tax convention.
According to the new TJN study, those eight countries are responsible for roughly half of the $492 billion lost per year globally to tax avoidance by the rich and large multinational corporations, despite being home to just 8% of the world's population.
"The hurtful eight voted for a world where we all keep losing half a trillion a year to tax-cheating multinational corporations and the super-rich," Alex Cobham, chief executive of the Tax Justice Network, said in a statement Tuesday. "The U.K. and the U.S. are both among the biggest enablers and the biggest losers of this lose-lose tax system, and their people consistently demand an end to tax abuse, so it's absurd that the U.S. and U.K. are seeking to preserve it."
"It's perhaps harder to understand why the other handful of blockers, like Australia, Canada, and Japan, who don't play anything like such a damaging role, would be willing to go along with this," Cobham added.
TJN released its study as G20 nations—a group that includes most of the "hurtful eight"—issued a communiqué pledging to "engage cooperatively to ensure that ultra-high-net-worth individuals are effectively taxed." Brazil, which hosted the G20 summit, led the push for language calling for taxation of the global super-rich.
The document drew praise from advocacy groups including the Fight Inequality Alliance, which stressed the need to "transform the rhetoric on taxing the rich into global reality."
The communiqué was released amid concerns that the election of far-right billionaire Donald Trump in the U.S. could derail progress toward a global solution to pervasive and costly tax avoidance.
The new TJN study cites Trump's pledge to cut the statutory U.S. corporate tax rate from 21% to 15% and warns such a move would accelerate the global "race to the bottom" on corporate taxation.
"People in countries around the world are calling in large majorities on their governments to tax multinational corporations properly," Liz Nelson, TJN's director of advocacy and research, said Tuesday. "But governments continue to exercise a policy of appeasement on corporate tax."
"We now have data from these governments showing that when they asked multinational corporations to pay less tax, the corporations cheated even more," Nelson added. "It's time governments found the spines their people deserve from their leaders."
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Senate Finance Chair Says GOP Push for Medicaid Cuts Spotlights 'Real Trump Agenda'
"The votes are tallied and Trump is headed back to the White House, so his campaign trail populism is over and done with," said Sen. Ron Wyden.
Nov 19, 2024
The Democratic chairman of the Senate Finance Committee said Monday that GOP plans to target Medicaid and federal nutrition assistance to help offset the huge cost of their tax agenda encapsulates the economic agenda of the incoming Republican trifecta led by President-elect Donald Trump, who postured as a working-class champion during the 2024 race.
"You couldn't come up with a better distillation of the real Trump agenda than paying for tax breaks for the rich by gutting Medicaid and increasing child hunger," Sen. Ron Wyden (D-Ore.) said in a statement after a Washington Postreport detailed internal Republican discussions on a possible Medicaid work requirement, cuts to the Supplemental Nutrition Assistance Program (SNAP), and other potential changes to the programs that provide health insurance and food aid to tens of millions of Americans.
"Following through on this plan would cause real hardship and increase the cost of living for millions of working families, but the votes are tallied and Trump is headed back to the White House, so his campaign trail populism is over and done with," said Wyden. "Ultra-wealthy political donors want their massive tax handouts, and as far as Trump and Republicans are concerned, everybody else can go pound sand."
The Trump-led Republican Party has made clear that a new round of tax cuts is at the top of its agenda as it prepares to take control of the House, Senate, and White House in January. In recent weeks, the GOP has discussed using the filibuster-immune reconciliation process to ram tax legislation through Congress before individual provisions of the party's 2017 tax cuts expire at the end of next year.
Trump also campaigned on slashing the corporate tax rate, even as he appealed to working-class voters who aren't reaping the benefits of record corporate profits.
Such tax cuts would likely add trillions to the U.S. deficit, according to the nonpartisan Congressional Budget Office, leading the GOP to seek out offsets in programs they've long demonized.
"Trump wants to strip healthcare from poor people and increase grocery bills."
Sen. John Cornyn (R-Texas) suggested to reporters last week that Republicans could aim to transform Medicaid's funding structure by instituting block grants—a change that analysts say would likely result in devastating cuts.
Edwin Park, research professor at Georgetown University's Center for Children and Families, wrote Monday that under a block-grant structure, states would "either have to dramatically raise taxes and drastically cut other parts of their budget including K-12 education or, as is far more likely, institute deep, damaging cuts to Medicaid eligibility, benefits, and provider and plan payment rates."
"That includes not just dropping the Medicaid expansion, which covers nearly 20 million newly eligible parents and other adults," Park wrote, "but gutting the rest of state Medicaid programs that serve tens of millions of low-income children, parents, people with disabilities, and seniors."
The Post reported that Republicans are also looking to curb SNAP benefits in the face of a nationwide hunger crisis. According to the latest federal data, 75% of households receiving SNAP benefits live at or below the poverty line and nearly 80% include either a child, an elderly person, or a person with a disability.
Sen. Elizabeth Warren (D-Mass.) wrote on social media Monday that members of her party "must unite and fight back" against the GOP's push for draconian cuts to SNAP and Medicaid.
"Trump wants to strip healthcare from poor people and increase grocery bills," Warren wrote. "Here's the new Republican plan to pass tax giveaways for Trump's billionaire backers and giant corporations on the backs of struggling Americans."
Sen. Ed Markey (D-Mass.) added that "making it even more difficult for people to get healthcare or afford food in order to give tax cuts to the same greedy companies that are driving up healthcare and food costs is disgusting."
"We were elected to serve the American people," wrote Markey, "not feed corporate America's bottom line."
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