Proposed Tax Policy Pivots Previous Stimulus Measures

On September 7, 2010 the Obama administration proposed a new tax program addressing capital investments.  Under the proposal, US businesses would be allowed to deduct from their Federal taxes the full value of new equipment purchased through 2011.  This proposal would build on the stimulus measures enacted in 2008 and 2009 allowing businesses to depreciate 50% of their capital investments.  The Senate rejected this proposal, however, it did initiate two programs that may have an impact on business tax liability. First, rather than allowing 100% depreciation on new equipment purchased by businesses, the Senate reinstated the 50% depreciation bonus for 2010.  Second, the Senate authorized an increase IRS Code Section (“Section”) 179 expensing levels to from $250,000 to $500,000 and the phase-out threshold amount from $800,000 to $2,000,000 for 2010 and 2011.

Public Safety Exception to Miranda Used for Terror Suspects

Justin Elliot over at Talking Points Memo reports on the Obama administration’s use of an exception to Miranda that’s being used in an effort to gain admissible evidence during interrogations of terror suspects before the suspects are read the Miranda warning. TPM reports:

Federal agents questioned both Faisal Shahzad, the man accused of planting a makeshift bomb in Times Square, and Umar Abdulmutallab, the failed Christmas Day bomber, under the so-called public safety exception to the Miranda rule for substantial periods before informing the men of their right to remain silent, and to an attorney.

While the “public safety exception” is grounded in a 1984 Supreme Court decision, the Obama administration’s reliance on the exception in an attempt to obtain admissible evidence over hours of pre-Miranda interrogation appears to be unprecedented.

How Much Does It Cost To Pay Employees?

With all of the federal programs in place to stimulate hiring, it is baffling that the unemployment rate is so stagnant. A recent CNN Money story sheds light on the tough situation that employers are facing. Basically, employers do not see hiring a single $14/hour employee as just taking on the obligation to pay the employee that rate. Instead, other factors such as tax treatment and insurance jack the price up to around $20/hour. To top it off, the new employee is not nearly as useful during the first few weeks since he is being trained.

Employers must, therefore, make a huge initial investment in the new employee which will only pay off if the employee remains with the company long term and does good work. Otherwise, the employer has lost out on this initial investment in human capital and must begin again, already in the red. Clearly, it is a difficult decision. Though President Obama has tried to create different federal incentives to push employers into making this investment, Congress has derailed many of them. Eventually, when business picks up, employers will feel safe in taking on new employees. But this begs the question: Will business pick up if employment is still in a slump or do people need work in order to drive business?

Constitutionality of the Individual Mandate to Buy Health Insurance

The attorneys general of thirteen states have filed a complaint in the Northern District of Florida challenging the constitutionality of the newly enacted health care reform bill.[1] While the complaint launches a variety of challenges against the bill, many based on notions of state sovereignty, the most interesting argument focuses on whether the Commerce Clause empowers Congress to require all Americans to obtain health insurance.

The Patient Protection and Affordable Care Act, signed by President Obama on March 23, requires all individuals to purchase health insurance if it is affordable and if the individual does not fall into any exception.[2] According to the attorneys general, the individual mandate to buy insurance exceeds the scope of Congress’s power under the Commerce Clause. This argument may have seemed laughable a mere twenty years ago; however, recent Supreme Court decisions limiting the scope of the Commerce Clause, coupled with an activist conservative majority on the Court, may breathe life into this seemingly inane argument.

The Increase In Concealed Weapons

President Obama’s term in office was accompanied with an outcry by gun lovers that the President was going to severely limit their Second Amendment rights.  These staunch Second Amendment supporters flooded gun stores in an attempt to buy as many guns and as much ammunition as possible before the Presidential crackdown on gun rights.  However, any limitation on a person’s right to bear arms has not been limited; rather, in many instances gun rights have been expanded rather than limited.

Justice Roberts on The State of The Union

Seen here in this MSNBC article, Justice Roberts discusses the annual State of the Union address and the Supreme Court’s role in attending. He finds that it has become a “political pep rally” and does not see the point of Supreme Court justices attending the speech. What really upset him was that President Obama took out some of his anger with the Citizens United case on the justices in attendance.

Justice Scalia has gone so far as to not even show up anymore. He says that the justices sit there like “bumps on a log.” This is because the justices are supposed to be non-partisan and find it difficult to mute their feelings during the speech. The highly partisan event places them in the uncomfortable position of having to pretend to be non-partisan when they in fact have feelings on the issues being presented. Justice Alito recently dealt with this issue firsthand. While President Obama chided the Citizens United decision, Justice Alito shook his head and mouthed the words “not true”. This was replayed multiple times the next day in the media. It seems the justices feel it is easier to not show up at all then to show up and be stone-faced.