Manchin, whose vote is crucial to passage of President Joe Biden’s domestic policy priorities in an evenly divided 50-50 Senate, has holdings valued at between $1 million and $5 million in Enersystems, Inc., the coal brokerage business he founded, according to his most recent financial disclosure form that covers 2020 activity.
And last year, he made more than $491,000 from his Enersystems holdings, the filings show. That’s more than twice his $174,000 annual Senate salary.
“Manchin is a walking conflict of interest,” said Craig Holman, a lobbyist for the liberal watchdog group Public Citizen. “And what makes it all the more troubling is that he’s the 50th Democratic senator, which gives him enormous sway over climate change policy.”
But the debate over Manchin’s coal interests also highlights what critics say are lax congressional ethics rules that give federal lawmakers broad leeway to regulate industries in which they have financial interests. In addition to his pivotal role on the sweeping domestic policy bill, Manchin helps set US energy policy as chairman of the Senate’s Energy and Natural Resources Committee. He has served on the panel since entering the Senate in November 2010, after he won a special election to replace the late West Virginia Sen. Robert Byrd.
Congressional rules also permit federal lawmakers to trade individual stocks — as long as they disclose the transactions and do not financially benefit from insider information.
“We have a system where a member of Congress can be invested heavily in, for example, the coal industry and then be responsible for overseeing climate policy,” said Delaney Marsco, senior legal counsel for ethics at the nonprofit Campaign Legal Center. “It doesn’t make sense.”
In a written statement, a Manchin spokesperson said the senator “is and has been in full compliance with Senate ethics and financial disclosure rules.”
“He continues to work to find a path forward on important climate legislation that maintains American leadership in energy innovation and critical energy reliability,” the statement added.
The fresh attention to Manchin’s energy interests comes as Biden and Democrats are racing this week to complete a framework for a domestic policy bill that includes many of the President’s priorities on the economy and climate. To avoid a filibuster by Senate Republicans, Democrats are relying on a budget process that requires the support of all 50 senators who caucus with them. That gives Manchin, a moderate member of the caucus, enormous sway over the negotiations.
Manchin has resisted climate provisions — including the so-called Clean Energy Performance Program. The program, which had been a cornerstone of Biden’s climate plan, aimed to reward utilities for switching to clean energy sources, such as wind and solar, and penalize those relying on coal and gas.
Manchin consistently opposed the program for months, saying he didn’t support a program that would push utilities to move to clean energy faster than they were already doing. Manchin had also cited concerns that switching to clean sources of energy could mean energy would be more unreliable than continued use of fossil fuel.
“The transition’s already happening,” Manchin told CNN recently. “So I’m not going to sit back and let anyone accelerate whatever the market’s changes are doing.”
The clean electricity program was Manchin’s biggest climate hang-up in the bill. But the West Virginia senator has also been pushing back on other provisions, including a methane fee that would be levied on oil and gas companies who let methane leaks escape into the atmosphere.
Manchin still is negotiating the proposed methane fee with his fellow Democratic lawmakers.

Energy interests

Manchin has never made any secret of his ties to coal. He’s a former governor of the country’s second-biggest coal-producing state, and he founded Enersystems before entering politics.
The senator also has a stake in another firm run by his son, Farmington Resources Inc. Its services include “support activity” for coal and metal mining and drilling oil and gas wells, according to corporate filings with the West Virginia secretary of state’s office.
Between 2011 and 2020, the Democrat made between $4.9 million and $5.1 million from coal-related enterprises, according to an analysis by Open Secrets, a nonprofit that tracks money in politics.
The organization also estimates Manchin’s net worth at anywhere from $4.3 million to $12.8 million. Lawmakers are only required to disclose their assets and liabilities in broad ranges, making it impossible to determine precise values.
Manchin’s Senate campaign also benefited from of a flood of political contributions from the energy industry in recent months. He took more than $400,000 from energy interests during the July-to-September fundraising quarter, according to a CNN review of his recent filing with the Federal Election Commission.
Donors in that period included billionaire oil tycoons Harold Hamm, the chairman of Continental Resources; Richard Kinder, the executive chairman of energy infrastructure company, Kinder Morgan; and Trevor Rees-Jones, who founded Chief Oil and Gas.
He also received donations from an array of energy-related political action committees in those months, including those affiliated with ConocoPhillips; utility companies such as Exelon and Dominion Energy; and Texas oil producer Pioneer Natural Resources.
Manchin, who isn’t up for reelection until 2024, raked in nearly $1.6 million in the third quarter — as he and another centrist Democrat, Arizona Sen. Kyrsten Simena, emerged as key players in the negotiations over their party’s sweeping domestic policy proposals.

Patchwork of ethics laws

Manchin’s energy holdings — and his actions that benefit the coal industry — are legal under rules that police potential conflicts of interest in the Senate.
The rules differ dramatically, depending on the branch of government.
Executive branch employees, for instance, are generally required to recuse themselves from decision making when their financial interests conflict with their official duties. They face potential criminal and civil charges for failing to do so. Those appointees also must abide by additional ethics rules established by the President — such as not engaging in decisions involving their former employers. Appointees in the executive branch can and do seek and receive waivers of ethics rules in limited circumstances.
It is against the law for federal judges to hear cases in which they have any legal or financial interests, but the law doesn’t impose penalties for violations.
In Congress, meanwhile, lawmakers only must recuse themselves from taking official actions in a narrow set of circumstances: If they or their immediate family members are in a small group that would benefit from the legislative action.
But a lawmaker who owns a dairy farm, for instance, can still make policy decisions that affect the entire dairy industry because those actions “also have a broad, general impact on his state or the nation,” according to the Senate’s ethics manual.
And requiring lawmakers to recuse themselves from decisions that benefit certain industries could end up hurting their constituents “who are entitled to have their elected representatives represent them by voting and fully participating in all aspects of the legislative process,” the manual adds.
Watchdog groups are urging Congress to revisit its conflict-of-interest standards.
One bipartisan measure, authored by Democratic Rep. Abigail Spanberger of Virginia and Republican Rep. Chip Roy of Texas, would require House members, for example, to place a broad array of holdings in blind trusts. Investments in widely held funds, such as mutual funds, and Treasury bonds would be exempted.
“The rules are currently insufficient to meet the challenges, particularly if you take into consideration that the American people really view corruption as a huge problem,” said Dylan Hedtler-Gaudette of the Project on Government Oversight. His group supports the blind trust bill.
“The appearance of impropriety is just as bad as the real thing,” he added, “because that drives the way people feel about politics and government.”

Houston Mayor Sylvester Turner and Atlanta Mayor Keisha Lance Bottoms have made a friendly wager on the World Series between the Houston Astros and the Atlanta Braves, according to both mayors’ offices. 

If the Astros lose the World Series, Houston’s mayor would wear a Braves jersey and if the Braves lose, Bottoms would wear an Astros jersey, according to the news release from the Houston mayor’s office.

If the Braves lose, Bottoms would also “send Mayor Turner some award-winning peach cobbler from the historic Paschal’s restaurant, a case of Mayor Bottoms’ favorite Cherry Coke Zero, beer from Best End Brewing Company, and a hammer from Home Depot in honor of Atlanta’s home run hero Hammering ‘Hank’ Aaron,” her office said in a news release.

“If the Astros lose the World Series, the City of Houston will send Mayor Bottoms Brisket Fried Rice and Pork Ribs from Blood Brother’s BBQ, a case of “H-Town Pils” beer from St. Arnold’s Brewery and tamales and lemonade from Irma’s Original,” the news release said.

The report from UNESCO found these sites can absorb approximately 190 million tons of carbon dioxide from the atmosphere each year — roughly half the amount of the United Kingdom’s annual fossil fuel emissions.
But in the past 20 years, many of these sites showed an increase in emissions, some even exceeded how much carbon they were removing from the atmosphere.
UNESCO researchers said two main factors are causing forests to flip from sinks to sources: climate change-fueled extreme weather events including wildfires, storm and drought; and human land-use pressures such as illegal logging, wood harvesting and agricultural practices such as livestock grazing.
Logs are piled high amid deforestation in the Makhonjwa Mountains near Barberton, Mpumalanga, in 2018.
Given the scale of these forests, Tales Carvalho Resende, project officer at UNESCO’s natural heritage unit and co-author of the report, says this is increasingly a global issue, meaning global action is needed.
“What the results revealed here is that it’s not necessarily an issue related to a specific country or region, but that it’s really a global issue,” Resende told CNN. “When we see where the 10 sites that have become carbon sources are, they are scattered all around the world, so the takeaway of the findings is that climate action is needed at a global level.”
A woman sits near Yavapai Point on the South Rim overlooking the Grand Canyon, one of three World Heritage sites in the US that UNESCO says has turned into a source of carbon emissions.A woman sits near Yavapai Point on the South Rim overlooking the Grand Canyon, one of three World Heritage sites in the US that UNESCO says has turned into a source of carbon emissions.
From the Congo Basin to the Redwood National and State Parks, the planet’s 257 World Heritage Forests cover more than 170 million acres of land, nearly twice the size of Germany.
But the report shows that since 2000, the threats of extractive industries, environmental degradation and climate change have been reported in roughly 60% of the World Heritage sites, which have lost more than 8.6 million acres of forests, larger than the size of Belgium. Out of 10 sites they found to have flipped to carbon emitters, three are located in the United States.
The authors point out that it’s the first time researchers have quantified how the world’s forests are sequestering atmospheric carbon dioxide. Over the centuries, the World Heritage Forests have stored approximately 13 billion tons of carbon, which exceeds the total amount of carbon in Kuwait’s oil reserves.
“We can now see the important role World Heritage forests play in stabilizing the global climate,” Nancy Harris, research manager for the World Resources Institute’s Global Forest Watch and co-author of the report, told CNN. “And the truth is, we are completely undervaluing and underappreciating them.”
Two people walk through a fire-ravaged area in the the Greater Blue Mountains World Heritage Area near the town of Blackheath, Australia, on February 21, 2020.Two people walk through a fire-ravaged area in the the Greater Blue Mountains World Heritage Area near the town of Blackheath, Australia, on February 21, 2020.
Most of the sites that sequester the most carbon dioxide were in tropical and temperate regions, such as South America and Australia. Although those sites are still sequestering carbon, researchers said there are signs that more of them could join the rest in becoming carbon sources.
Wildfires, in particular, have burned vast swaths of these forests in recent years. While fires are a critical part of the forest ecosystem, with many plant species relying on them to disperse their seeds, scientists say fires are intensifying which risks the potential of releasing the carbon long stored within the soil and trees.
A view of Half Dome from Glacier Point in Yosemite National Park. UNESCO says this World Heritage site has turned into a source -- rather than a sink -- of carbon emissions.A view of Half Dome from Glacier Point in Yosemite National Park. UNESCO says this World Heritage site has turned into a source -- rather than a sink -- of carbon emissions.
In the last decade, warming temperatures and dry conditions have primed much of the environment for wildfires to ignite. The report pointed to several examples of significant fires that have occurred in the last decade at World Heritage sites, including in Russia’s Lake Baikal in 2016, and Australia’s Tasmanian Wilderness and Greater Blue Mountains Area in 2019 and 2020.
“We have seen some wildfires in some sites that have emitted more than 30 million megatons of CO2 — that’s more or less what Bolivia emits in from fossil fuels in one single year,” Resende said.
“One single event can actually be the emissions of a whole country,” he added. “And bear in mind, the fact that the emissions that have been accounted for in the study are only within the limitations of the sites, so this means that they represent only a small portion of fires in the broader landscape.”
Emerald Pool and waterfall in Morne Trois Pitons National Park in Dominica.Emerald Pool and waterfall in Morne Trois Pitons National Park in Dominica.
The report builds on recently published maps that track the global exchange of carbon between forests and the atmosphere during the 2001 to 2020 period, using site-level monitoring to analyze the forests’ climate impacts as well as the consequences of human activities to these World Heritage sites.
“Our analysis illustrates how we can stop taking nature for granted and start putting a value on the climate benefits generated by these and other important forest sites around the world,” Harris said.
Forests play a vital role across societies. According to the International Union for Conservation of Nature, which also contributed to the report, nearly 25% of the world’s population — many in developing nations — depend on the forests for their livelihoods. Additionally, forests bring in up to $100 billion per year in goods and services. It’s also home to 80% of Earth’s land biodiversity.
Tourists take photos of Malaysia's Mount Kinabalu in 2015.Tourists take photos of Malaysia's Mount Kinabalu in 2015.
The forests’ ability to prevent the climate crisis from spiraling out of control makes the threats they face all the more concerning, Resende said.
World leaders will gather in Glasgow, Scotland, next week for the UN-brokered international climate negotiations, where the focus will be on getting countries to commit to stronger fossil fuel cuts and putting an end date on coal. They will also discuss stronger commitments to protecting and restoring the planet’s forests as carbon sinks and to ultimately halt deforestation.
“We hope to really trigger climate action, to safeguard these jewels that are World Heritage sites,” said Resende. “These are laboratories for environmental changes as a whole, not only related to climate but also biodiversity. We want to facilitate dialogues with the key stakeholders to actually fund and provide some sustainable investments to these sites.”
Speaking with CNN in an exclusive interview Tuesday, President Tsai Ing-wen said Taiwan, which is located fewer than 200 kilometers (124 miles) away from China’s southeastern coast, was a “beacon” of democracy that needed to be defended to uphold faith worldwide in democratic values.
“Here is this island of 23 million people trying hard every day to protect ourselves and protect our democracy and making sure that our people have the kind of freedom they deserve,” she said.
“If we fail, then that means people that believe in these values would doubt whether these are values that they (should) be fighting for.”
Taiwan and mainland China have been separately governed since the Nationalists retreated to Taiwan at the end of the Chinese civil war more than 70 years ago. Taiwan is now a flourishing democracy but the mainland’s ruling Chinese Communist Party (CCP) continues to view the island as an inseparable part of its territory — despite having never controlled it.
Today, relations between Taipei and Beijing are at their lowest point in decades. Earlier this month, China’s military sent a record number of warplanes into the air around Taiwan while diplomats and state-run media warned of a possible invasion unless the island toes the CCP line.
The displays of force are partly the result of strengthening ties between Taiwan and the United States under Presidents Donald Trump and Joe Biden. Large arms sales and high profile visits by US officials have bolstered Taiwan’s international standing and antagonized Beijing.
In her interview with CNN, Tsai became the first Taiwan President in decades to acknowledge the presence of US troops on the island for training purposes. The last official US garrison left in 1979, the year Washington switched formal diplomatic recognition from Taipei to Beijing, though last year media reports hinted at small deployments.
The US military posted and then deleted a video in early 2020 that showed US Army Special Forces training soldiers in Taiwan. In November 2020, Taiwan’s Defense Ministry announced and then denied to local media that US troops were training local soldiers on the island.
Tsai wouldn’t say exactly how many US military personnel are on the island at present but said it was “not as many as people thought.” “We have a wide range of cooperation with the US aiming at increasing our defense capability,” she said.

Rising China-Taiwan tensions

A former trade negotiator and law professor, Tsai became Taiwan’s first female president in 2016, a historic win, which came after large student protests on the island against her Nationalist predecessor’s move to form closer ties with mainland China.
When Tsai took CNN for a walk around Taipei earlier this week, hundreds of local citizens waved and called out to her, thanking her for her hard work and asking to pose for selfies.
But Tsai’s presidency has been relentlessly attacked and ridiculed from across the Taiwan Strait — since Tsai took office, relations between Beijing and Taipei have fast deteriorated.
China isn't about to invade Taiwan. But the two sides are on a dangerous path
The Chinese government believes Tsai and her party, the Democratic People’s Party, are in favor of formal Taiwan independence, despite her public statements favoring the status quo — an arrangement by which Taiwan remains self-ruled, without an official declaration.
Economic and diplomatic ties with China, developed over previous governments, have frayed, and the Chinese military has ramped up its pressure on the island.
In the first five days of October alone, Beijing flew a total of 150 fighter jets, nuclear-capable bombers, anti-submarine aircraft and airborne early warning and control planes, into Taiwan’s Air Defense Identification Zone, according to the island’s Defense Ministry.
It was a carefully executed show of force by the Chinese government — straying into areas where it would provoke a response from Taiwan but not entering the island’s airspace.
Chinese President Xi Jinping delivers an important speech at the Great Hall of the People in Beijing, on October 9.Chinese President Xi Jinping delivers an important speech at the Great Hall of the People in Beijing, on October 9.
The maneuvers came after further signs of warming US-Taiwan ties, including a $750 million arms sale announced by Washington in August and a statement by the US-led Quad foreign policy group in favor of supporting the island the same month.
In a major speech on October 8, Chinese President Xi Jinping again pledged “peaceful reunification” between Taiwan and the mainland. Although he made no mention of an invasion in the speech, Xi has previously refused to rule out military action.
A spokesman for China’s Taiwan Affairs Office confirmed Wednesday that Beijing reserved the right to use force to pursue “reunification.”

Taiwan President open to China talks

Although a self-confessed introvert, Tsai is a passionate defender of her island and a fierce advocate for her people.
On Taiwan’s National Day on October 10, in response to growing Chinese military action, President Tsai said Taiwan could not be forced to follow “the path China had laid out for it.”
“There should be absolutely no illusions that the Taiwanese people will bow to pressure,” she said.
Speaking to CNN Tuesday, Tsai called on regional democratic partners, including Japan, South Korea and Australia, to help support the island.
“When authoritarian regimes demonstrate expansionist tendencies, democratic countries should come together to stand against them. Taiwan is on the front lines,” she said.

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“When authoritarian regimes demonstrate expansionist tendencies, democratic countries should come together to stand against them”Tsai Ing-wenTaiwan President

Tsai was re-elected in 2020 with a larger percentage of the vote and as part of her second term, she told CNN she wanted to rapidly modernize Taiwan’s military.
In August, Taiwan announced it would spend $1.4 billion on new fighter jets, likely F-16s. In December 2020, the island’s military began construction on a fleet of eight domestically produced submarines.
Tsai told CNN the government needed to better tailor its military to defend a small island, rather than a conventional fighting force.
“We have a system that is inherited from China, which is a very different country … The way you defend a big piece of land is different from the way you protect a small island, so we have to change the traditional thinking about how a military should be structured,” she said.
However, Tsai added that she was not abandoning the possibility of improved relations with Beijing, saying she would sit down with Chinese leader Xi for talks — if he was willing.
I (would) encourage him to have more dialogue with the government and people here in Taiwan, and to get a better feel of what it’s like in Taiwan … And, of course, we would do more in terms of understanding the situation in China,” she said.
“We have said again and again that we want to have dialogue with China and this is the best way to avoid misunderstanding, miscalculation and misjudgment in the management of the cross-strait relations,” she added.
China-Taiwan tensions are raising fears of a conflict. In Taipei, however, people don't seem worriedChina-Taiwan tensions are raising fears of a conflict. In Taipei, however, people don't seem worried

Tsai: US would come to our defense

There are no treaties between the US and its regional partners that would guarantee assistance to Taiwan in the event of an attack. But as tensions have risen between Taipei and Beijing, some countries have expressed support for the island.
Japan’s Defense Minister Nobuo Kishi told CNN in an interview in mid-September that “what’s happening in Taiwan is directly linked to Japan,” and Tokyo would respond to any threats to the security of trade routes in the region.
In a town hall hosted by CNN on Thursday, US President Biden was firm on the question of whether the US would defend Taiwan in the event of a Chinese invasion.
Biden vows to protect Taiwan in event of Chinese attackBiden vows to protect Taiwan in event of Chinese attack
“Yes, we have a commitment to do that,” he said. The White House subsequently played down his comments and, speaking to CNN, Tsai said people have “different interpretations” of what the US President meant.
However, Tsai said she believed if Taiwan came under attack from mainland China, the US and other regional democracies would come to its aid, “given the long-term relationship we have with the US.”
“Taiwan is not alone because we are a democracy, we respect freedom and we are peace lovers. And we share values with most of the countries in the region and geographically we are of strategic importance,” she said, pointing to the island’s leading role in the global semiconductor supply chain and adding regional powers had a “common interest” in keeping the island safe.
When asked if Taiwan could defend itself without military assistance, Tsai said the island would defend itself “as long as we can…But let me reiterate, it’s important that we have the support of our friends, and also like-minded countries,” she said.
Defending Taiwan doesn’t just involve military might. As part of the growing US support for Taiwan, Washington has started pushing for greater participation by Taipei in international governing bodies, especially the United Nations.
US Secretary of State Antony Blinken said on his official Twitter Monday that Taiwan was a “critical partner and a democratic success story” and called for it to have a greater role at the UN. Beijing, which took Taipei’s seat at the UN in 1971, has since been successful in largely squeezing the island off of the international stage.
Tsai said it has long been the policy of all sides of Taiwan’s politics for the island to take a greater role at the UN. She said she wasn’t concerned about aggravating Beijing.
“We have expressed our hope that we want to be part of the UN system. And China has their story to tell. And it’s for the international community to judge,” she said.

Tsai: Xi’s China ‘more ambitious’

Tsai’s time in office has coincided with the rise of a more assertive Beijing, with Xi now considered the most powerful Chinese leader in decades.
During his second term in power since 2017, Xi has begun to change how China positions itself globally. Under Xi, the country’s military has grown larger and more advanced, with China’s naval fleet overtaking that of the US in terms of size.
Just this week, Xi told a conference the military needed to “break new ground” in weapons development.
At the same time, Xi’s foreign policy goals have led to the promotion of fiercely nationalistic diplomats, known as “wolf warriors,” inside the Foreign Ministry, who are willing to vocally defend China’s positions of highly controversial and sensitive issues — with Taiwan often being called the reddest of Beijing’s “red lines.”
Tsai said she recognizes the threat from the island’s increasingly powerful neighbor. “(They’re) more ambitious, more expansionist. And therefore things that were acceptable to them, may not be acceptable to them now,” she said.

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“Democracy sometimes is chaotic. It’s messy, confrontational, but at the end, you find the best way to govern”Tsai Ing-wen Taiwan President

However, Tsai said she believed the two governments could still live together in peace despite the differences in their political systems.
“If we can sit down and talk about our differences and try to make arrangements so we can coexist peacefully? I think that is the expectation of our people here, and the people in China, as well as the people in the region,” she said.
Tsai said the time was approaching for the Chinese Communist Party to decide what sort of relationship it wanted to have with the region and with the rest of the world.
US has few good options if China seizes islands close to Taiwan, war game concludesUS has few good options if China seizes islands close to Taiwan, war game concludes
“Does Xi want to have a peaceful relationship with everybody in the region or in the world, or does he want to be a in a dominant position so that everybody listens to him, listens to China?” she said.
Tsai hasn’t given up hope for democracy in China though, despite moves towards greater authoritarian control under Xi.
“Democracy sometimes is chaotic. It’s messy, confrontational, but at the end, you find the best way to govern, the best way to establish a social order so that people can live together peacefully,” she said.
By law, Tsai can only serve two terms but, with just two-and-a-half years left in office before she steps down in January 2024, she still has a lot to get done.
Her priorities include connecting Taiwan to the world and shoring up its community against attempts by other governments to divide it.
Tsai said she hopes that she is remembered as a leader who left her people more “united.”
“I hope they will remember me as someone who made the utmost effort to protect this place, to make this place more secure and more resilient,” she said.
A version of this story appeared in CNN’s What Matters newsletter. To get it in your inbox, sign up for free here.
Tesla was built on government cash. For years it used government incentives for people to buy electric vehicles. Much of its current profits are thanks to the sale of government regulatory credits to other, traditional automakers, which allowed them to keep making gas-guzzling pickups and SUVs rather than reduce their emissions.
Investors think it’s a good scheme, which is why Tesla is worth three times more than Toyota but sells far fewer vehicles. CNN’s Chris Isidore has written repeatedly about Tesla’s various tax credits and incentives.
Its founder, the most epically rich billionaire Elon Musk, has also been known to avoid paying personal income taxes, according to ProPublica.
Amazon, another massive company, has similarly been known to avoid paying corporate income taxes.
Its founder, the just slightly less epically rich billionaire Jeff Bezos, has also been known to avoid paying personal income taxes, according to ProPublica.
The twin solution from Democrats — who want money to fund universal pre-K, a Medicare expansion and a host of other priorities — would seek some redress from the men as well as their companies:
  • A corporate minimum tax to make big corporations pay alongside their workers into federal coffers.
  • And a billionaire tax to make sure the very richest Americans don’t hide their wealth from the tax man.
Musk is no fan. “Eventually, they run out of other people’s money and then they come for you,” he said on Twitter of the billionaire tax proposal. He did not mention Tesla’s reliance on government help.
About that billionaire tax. It appeared like an elegant, if hastily thrown together, solution Tuesday and was already in serious jeopardy Wednesday.
Instead of being stuck behind their moderates, now Democrats are stuck between them.
  • Sen. Kyrsten Sinema of Arizona won’t accept tax rate hikes, even for corporations, which saw a massive cut in the Trump years.
  • Manchin thinks a tax on the wealth of billionaires, which Sinema supports, is divisive.
So Democrats are still working on a way to tie their caucus together, deliver President Joe Biden his promised platform and sew up the expanded social safety net for all Americans.
The tax on billionaires could be a game-changing concept in a country where income inequality has been a top issue. Most new wealth is concentrated among the very rich.
Why is a billionaire tax necessary? The biggest billionaires often don’t appear to live off their own billions. Rather, they keep value in their companies or assets, avoid taxes by never selling them and instead borrow spending money from creditors. When they die, their heirs pick up where they left off.
The method, as described on CNN.com by the University of Southern California law professor Edward J. McCaffery, is simple: Buy. Borrow. Die. And avoid a lot of income tax in the process. McCaffery argues the plan released by Sen. Ron Wyden of Oregon should not be viewed as a wealth tax but rather as the closing of a gaping and very lucrative loophole not available to the vast majority of Americans. Read his description here.
How would a billionaire tax work? It’s complicated. Wyden’s plan stretches to 107 pages.
CNN’s Tami Luhby summarizes: “For tradable assets, such as stocks, billionaires would pay capital gains tax, currently 23.8%, on the increase in value and take deductions for losses annually. They’d be able to carry forward the losses to offset future taxable income and capital gains, and in certain circumstances, to carry back losses for three years.”
Billionaires could spread a first whammy tax bill in 2022 over five years and there’s a method to let them claim losses. Wyden has a clever way to handle billionaires transferring wealth to real estate and other non-tradable assets, not taxing them annually but rather applying an additional interest charge when they are sold.
What happens to billionaires who lose money? If they fell on hard times, they’d revert to the regular tax system. Billionaires do lose money. West Virginia’s Gov. Jim Justice was the state’s only billionaire until his UK-based lender went belly up.
That’s an interesting side point, actually: The senator sticking up for billionaires to avoid income taxes is Manchin, whose state of West Virginia does not currently house any billionaires, according to Forbes.
Is a tax on billionaires legal? It would be if Congress passed a law. Billionaires have plenty of lawyers. They’d argue it violates the Constitution. The case would go to court.
Who would the billionaire tax affect? Not many people, comparatively. There are just about 333 million people in the US, according to the US Census Bureau. A little more than 700 are billionaires. The proposal would also place new taxes on those who declare more than $100 million in income for three straight years.
How come people say billionaires don’t pay the same tax rate? We already know how billionaires skirt the tax code. Former President Donald Trump carried one year’s massive loss to avoid paying much or any income tax for 10 of 15 years, according to tax documents leaked to The New York Times.
Billionaires’ wealth is often tied to company stock. Rather than sell it and pay capital gains, they borrow huge amounts of tax-free funds against their stock value. They live off the borrowed cash while their bottom lines grow and pay much less in interest than they’d pay to the IRS.
ProPublica reported this year on IRS files that show how Bezos, Musk and others use this method to avoid paying much or any income tax compared with their wealth.
When they need new loans, there are banks waiting in line.
Bezos does regularly sell billions in Amazon stock and uses those funds for things like his Blue Origin space tourism company.
Where are the billionaires? California has the most billionaires, even though it lost two of its richest people in the last year: Musk and Oracle’s Larry Ellison moved to Texas and Hawaii, respectively. But California still gained 24 billionaires in the past year, according to Forbes.
New billionaires are popping up all the time. Moderna wasn’t the first Covid-19 vaccine out of the gate and it benefited from government help, but multiple people with money in the biotech firm cross over into billionaire land. They, too, could be taxed to expand the social safety net if Democrats can find a path Manchin agrees with.

CNN’s Jake Tapper asks Speaker of the House Rep. Nancy Pelosi (D-CA) about how she feels about two Senate Democrat holdouts, Sen. Kyrsten Sinema (D-AZ) and Sen. Joe Manchin (D-WV), who are essential to pass a large social safety net bill without Republican support through a process called reconciliation.

Joint Chiefs of Staff Chairman Gen. Mark Milley, speaking to Bloomberg Television, stopped short of calling the test a “Sputnik moment” but he did acknowledge “it’s very close to that.” He called the test of the weapon “a very significant technological event” that is just one element of China’s military capabilities.
It was the first official acknowledgment of the test from the Pentagon, which has so far declined to comment.
“The Chinese military capabilities are much greater than that” single test, Milley said. “They’re expanding rapidly in space, in cyber and then in the traditional domains of land, sea and air.”
“China is very significant on our horizon,” Milley added.
Latest US military hypersonic test fails
Earlier this month, the Financial Times reported about a Chinese test of a hypersonic glide vehicle launched from a rocket in low-Earth orbit that could theoretically be capable of evading US missile defense systems. The speed with which the Chinese developed the system surprised US national security officials.
Defense Secretary Lloyd Austin has repeatedly emphasized that China is the pacing challenge for the Pentagon as Beijing races to modernize its military. And last week, CIA director Bill Burns said China is the greatest technological threat to the United States
“I think in terms of broad capacity, across the range of emerging technologies, I think China probably today is,” Burns said, speaking at Stanford University.
On Wednesday, Pentagon press secretary John Kirby declined to comment further on the test.
“I don’t think it does any good for us to characterize this and put a label on it, this advancement of capabilities,” Kirby said during a news briefing at the Pentagon on Wednesday.
He said the department has been “clear” about its concerns regarding China’s advancements in “certain capabilities.”
“We’ve been very clear about our concerns over China’s advancements in certain capabilities, a wide range of capabilities, capabilities that the secretary noted himself do very little to help decrease tensions in the region and beyond, and they’re paired with, these advance military capabilities are paired with a foreign and defense policy approach that uses intimidation and coercion of neighboring nations to yield to China’s interests,” Kirby said.
He said the hypersonic missile test is one of a “suite of concerns” relating to China in the Indo-Pacific region.
“There’s a suite of issues with respect to China from the security perspective that deeply concern us about the trajectory about where things are going in the Indo-Pacific,” Kirby said. “Taken together, all of those things are reason for concern and are being used to inform the operational concepts that we want to be able to employ.”
“I saw Ivanka Trump and Jared Kushner sitting toward the back,” McCain, the youngest daughter of the late Arizona Sen. John McCain, recounts. “As far as I knew, they had not been invited by the family, but they showed up anyway. … It never even crossed my mind that they would come. Why would you go to something like that? It seemed audacious even for them.”
Which, well, yes!

Lindsey Graham gets involved

Except, according to South Carolina Sen. Lindsey Graham (R), that’s not what happened.
“[Meghan] was upset they were there — I understand that, and she has hard feelings but I know what happened and nobody showed up uninvited,” Graham told The Washington Post this week. “I love Meghan McCain and I understand how stressful all this has been for her and those who attack her dad will never be forgiven by her.”

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McCain took umbrage at Graham’s denial. Bigly.
“Lindsey Graham may consider himself a member of my family, but he is not and hasn’t been for a very long time,” she tweeted on Wednesday morning. “He certainly doesn’t speak for me or my life experiences. Full stop. The media should stop treating him like he is an expert on anything McCain related.”
Which, well, rough.
It’s not likely that we ever get to the bottom of the were-they-invited-or-were-they-not controversy. Unless the person managing the funeral attendees list decides to speak out. Which, unlikely.
But the broader point here is just how much Trump (and his offspring and allies) continues to divide the Republican Party. So much so that John McCain’s daughter feels compelled to tell her father’s onetime closest ally in the Senate — and now a major Trumper — that he isn’t part of her family “and hasn’t been for a very long time.”
The Point: Trump may no longer be president. But the impacts of the divisiveness he willingly fomented continue to be felt on a near-daily basis within his party.