Gingrich's 'mind boggling' tax plan
Every Republican presidential hopeful has a plan to cut taxes.
But one candidate's plan has been described as so aggressive that it would blow a hole in the federal budget, lead to huge deficits and give the richest Americans a gigantic tax break.
That candidate is current frontrunner Newt Gingrich.
According a new analysis, Gingrich's tax plan would reduce government revenue by a staggering $1.3 trillion -- or 35% -- in 2015, the first year the plan could be fully implemented.
"It's mind boggling. It's a very large tax cut," said Roberton Williams, a senior fellow at the non-partisan Tax Policy Center, which performed the analysis.
What would Gingrich's plan do?
Gingrich wants to add to the current tax code by putting an optional 15% flat tax on income in place, with a $12,000 per-person deduction. And Gingrich would like to eliminate the estate and capital gains taxes.
Swing state economies complicate 2012 picture
For businesses, Gingrich wants to reduce the corporate tax rate from 35% to 12.5% -- a move that would take the rate from one of the highest in the industrialized world to one of the lowest.
All those tax cuts mean the federal government would take in much less money. In order to balance the budget -- or get even remotely close -- government spending would have to be slashed by huge amounts.
And that, as the current Congress has made clear, is near impossible.
The super committee, for example, was trying to find $1.2 trillion in savings over a ten-year period. They failed. The Gingrich plan would create a gap of $1.3 trillion in just a single year.
"This plan means big deficits," Williams said. "Or huge forced spending cuts. Or both."
But taxes would definitely go down. A lot.
Billionaires with 1% tax rates
A full 70% of Americans would pay lower taxes under the Gingrich plan, according to the analysis, an average savings of over $7,000 compared to current policy.
The highest-income individuals would see the greatest benefit. A full 99.9% of Americans with more than $1 million in income would get a tax cut. The average savings: $613,000, for an after-tax income boost of 28.7%.
The tax rate paid by those individuals would fall to 11.9%, a reduction of almost 20%. Meanwhile, Americans making less than $100,000 would see their rates drop by between 0.5% and 3.1%.
The Gingrich campaign did not respond to a request for comment.
The Gingrich tax plan was not heavily scrutinized when first released, but as the former long-shot candidate's fortunes have improved, his plans for the economy have received more attention.
The plan is similar in some respects to that of Texas Governor Rick Perry, but Gingrich's proposed rate cuts go even further.
For example, Perry would add a 20% optional flat tax and cut the corporate rate to the same level, while Gingrich wants to take the flat tax down to 15%, and the corporate rate to 12.5%.
Similar to the plan proposed by Rick Perry, taxpayers would be able to choose whether to pay the flat tax, or file under the existing tax code.
Both Perry and Gingrich have touted their optional flat taxes as a way to simplify the tax preparation process.
But tax experts have thrown cold water on that idea -- arguing that adding an additional tax option would necessitate the preparation of multiple returns to ensure the lowest rate.
"It's not tax reform," Williams said. "As long as you leave the old code in place, you're not doing tax reform. This would absolutely make it more complex."
And if Gingrich survives the primary process and emerges as the Republican nominee, his tax plan could provide ammo for the White House, which has signaled in recent days that income inequality will be central to its general campaign message.
After all, the top 1% of earners would get a tax break of more than $340,000 under Gingrich's plan, even if you assume the Bush tax cuts are extended.
CNN
Asian chipmakers fall after Intel cuts sales forecast
Shares in Asian makers of computer chips fell on Tuesday, after Intel cut its revenue forecast.
Intel, the world's largest maker of microprocessors, said on Monday it was due to a shortage of hard disk drives.
Severe flooding in Thailand, which has killed more than 600 people, has disrupted production there.
Shares in South Korea's Samsung Electronics fell by 1.29%, while Hynix Semiconductor was 2.02% lower.
In Japan, semiconductor shares were lower by 2% to 3%.
Disk shortage
Because of its size, Intel's forecasts often act as a bellwether for the entire sector.
Thailand is a manufacturing centre for technology and heavy industry.
The floods in the country have also affected global production of cars and personal computers.
Intel said its main customers, computer makers, were cutting orders because of the hard disk drive shortage.
Euro pact faces UK hurdle, ebbing market faith
Doubts rebounded yesterday over Europe’s ability to solve its debt crisis and rescue the imperiled euro, as investors worried that plans for closer fiscal unity will bring little immediate relief and exposed the continent’s deep political divisions. British Prime Minister David Cameron was the only leader among the European Union's 27 members to refuse last week to join a plan under which nations submit their budgets for central EU review and limit the deficits they can run.
As the rift between Britain, which has its own currency, and the 17 nations that use the euro created uncertainty about the deal's implementation, ratings agencies Moody's and Fitch warned the plan did not even properly address the problem of lowering existing European debt.
Stocks and the euro fell sharply yesterday — to US$1.3183 from US$1.3370 — as market confidence in the plan and Europe's ability to end the crisis ebbed. In Italy, one of the continent's most troubled economies, workers angry about government austerity reforms went on strike and held nationwide rallies. Germany’s DAX ended the day 3.4 per cent lower, Milan's stock index was down 2 percent and Italy's borrowing rates rose, indicating growing fears about its financial future. (AP)
WTO brings changes to foreign trade companies
With both delicate hand-carving and efficient machinery, a Chinese furniture and arts and crafts exporting company is trying to shape the industry. After ten years in the business, the owner, Yu Heqin, is busy designing new products in the hope of becoming more competitive.
Yu Heqin, general manager of Beijing Heyixing Furniture Company, said, "Starting from the second half of 2008, we have encountered difficulties on the overseas market due to the financial crisis. So I decided to hire designers from Italy to make new designs, adding modern elements to the traditional chinese style. I think this would add extra value to our products and increase our competitiveness."
Mr Yu has also received advice from his long-time partner, Tian Wenhua. Mr Tian has been exporting products to Europe since 2001, when China first became a member of the WTO. He understands the need for change.
Tian Wenhua, general manager of Beijing Gongmei CO., Ltd, said, "The difficulty is that we are facing more and more direct challenges to meet the demand of consumers in the west. Also the technical standards for export products are getting tougher and stricter. So we must adjust to the new rules and standards of the countries we are exporting to."
In the hay days, Tian’s company saw its export volume triple, from 10 million US dollars before 2001 to 30 million in 2007. All this thanks to the WTO membership. But the 2008 financial crisis cut profit margins, and so it’s time to change business model, and that starts with improving designs.
Li Yong works for the China Association of International Trade and he agrees companies need to evolve.
Li Yong, vice chairman of China Association of International Trade, said, "The companies should focus on chang of their value-added process. For example, from the old equation of “raw material+labor+ manufacturing" process, to the new equation of "knowledge+innovation+design". The export should not be only low-cost product, but also service and solution. I think they should also consider a shift from their market focus to diversify from developed market to developing markets."
For Mr Yu, change means new modern assembly lines and facilities. With these, he can produce new products better adapted to the international markets.
China is now the world’s second largest economy, the biggest exporter and the second-biggest importer. Despite all the titles, Chinese traders and businessmen are still learning to fit in the global competition. As for the future, Mr Tian and his colleagues like to remain confident and cautious because the changing role from ’student’ to ’participant’ in the WTO requires knowledge and experience and it means a lot of work to do.
Occupy protests disrupt ports across US West Coast
Hundreds of anti-Wall Street protesters have blocked gates and delayed lorries at three ports on the US West Coast.
The partial shutdown of harbours in California, Oregon and Washington states resulted in a handful of arrests, but no major clashes.
From early on Monday, activists picketed gates, beat drums and carried signs with slogans such as "Shut Down Wall St on the Waterfront".
The rallies come a month after police dismantled Occupy camps across the US.
Demonstrators said they hoped to hit the profits of the corporations that run the harbours.
'Mission accomplished'
In Oakland, California, about 150 workers were sent home as a result of the demonstrations, effectively closing two terminals.
Scott Olsen, the Marine veteran who was injured during a clash between police and Occupy Oakland protesters in October, joined nearly 1,000 people marching to the city's port on Monday evening.
At Long Beach port, near Los Angeles, up to 300 protesters rallied at a terminal facility and scuffled with police.
Two terminals were also shut in Portland, Oregon, where two people carrying a gun and a sword were arrested. Occupy spokeswoman Kari Koch said they were not affiliated with the rallies.
Workers in Portland and at the port of Longview, Washington, were sent home over health and safety concerns.
The longshoremen's union did not officially back the protests, but employees were allowed to stay off the job if they felt conditions were unsafe.
Demonstrators have previously targeted companies such as port operator SSA Marine, in which Goldman Sachs holds a large stake, and grain exporter EGT.
In Vancouver, Canada, about a dozen people protested at that city's port and a handful of people in Anchorage, in the US state of Alaska, also held a demonstration.
Monday's demonstrations were the largest co-ordinated action by the Occupy movement since encampments were removed in cities across the US in recent weeks.
Although they attracted far fewer people than the 10,000 who turned out at the beginning of November to shut Oakland's port, organisers declared victory.
Protester Boots Riley said. "We shut down the Port of Oakland for the daytime shift and we're coming back in the evening. Mission accomplished."
But others said the action would hurt workers.
"Disrupting port activities makes it harder for US manufacturing, the farm community and countless others to sell to customers and contribute to our nation's economic recovery," said EGT chief executive Larry Clarke.
And Christian Vega, 32, who was stuck with a lorry-load of recycled paper at the port of Oakland, said the disruption would cost him several hundred dollars.
"It only hurts me and the other drivers," he told the Associated Press news agency.
"We have jobs and families to support and feed. Most of them [protesters] don't."
New Zealand in thrilling Test victory over Australia
New Zealand recorded their first Test victory in Australia for 26 years with a thrilling seven-run win in Hobart, to draw the two-match series 1-1.
It was only their third Test victory in 28 matches on Australian soil.
The Australians resumed on day four needing only 169 more runs with all 10 wickets intact, but lost Phil Hughes in the second over of the morning.
Seamer Doug Bracewell took 6-40 as Aussie opener David Warner carried his bat for a maiden Test century.
Left-hander Warner, previously thought to be a Twenty20 specialist, was playing in only his second Test, and after adding 72 with Hughes he put on another 50 with Usman Khawaja (23) to leave Australia in relative command at 122-1.
But Bracewell, the nephew of former New Zealand spinner and coach John Bracewell and himself playing in only his third Test, turned the game.
He had Ricky Ponting caught at extra cover, and in his next over, with the score still on 159, dismissed Australia captain Michael Clarke and obdurate middle-order batsman Mike Hussey with successive deliveries.
Clarke was caught at first slip while Hussey departed via video referral, after umpire Asad Rauf had originally rejected the appeal for lbw.
Tim Southee and Bracewell took two wickets each in two overs to leave the Australians on the brink of defeat at 199-9.
Man of the match Warner and last man Nathan Lyon added 34 inside eight overs but Bracewell nipped one back off the seam to breach Lyon's defences and signal the start of the celebrations for the Kiwis.
"We believed in ourselves that we could win this match, we knew we had to fight, we knew we had to play a lot better than we did in Brisbane," New Zealand skipper Ross Taylor said, referring to the team's nine-wicket defeat in the first match of the series.
Counterpart Michael Clarke was critical of his batsmen and said: "Obviously disappointed, no doubt.
"The way we played in Brisbane was outstanding and I thought we were pretty inconsistent throughout this Test match.
"I want to pay credit to David Warner for his first Test century and also to Nathan Lyon for the way he hung in there.
"I think if a few of us batters had shown the character and courage he showed, we wouldn't be standing here with the same result."
Paul trade talks back on with Clippers
The Chris Paul trade show continued anew on Monday night, when a source confirmed an ESPN.com report that the Hornets and Clippers re-engaged in discussions to send the four-time All-Star point guard to L.A. It was the latest revelation in a wild day for the Clippers, who matched a four-year, $43 million offer sheet from Golden State for center DeAndre Jordan and picked up veteran point guard Chauncey Billups via the league's new amnesty waiver wire.
The renewed discussions come just hours after a proposed deal fell apart because, according to sources, the NBA's asking price for Paul was simply too steep.
The dynamics of a possible deal have clearly changed now, with one source close to the situation saying the league has taken over almost all negotiations while Hornets general manager Dell Demps has been relegated to a minimal role. The ripple effect around the league could be great, as teams steadily grow wary of dealing with the Hornets and many executives become convinced the league won't deal fairly.
SI.com reported Monday that the deal was in the "final stages" of completion after the teams re-engaged in discussions Sunday afternoon. The Los Angeles Times first reported Sunday night that the near deal would give the Hornets second-year Clippers guard Eric Bledsoe, veteran center Chris Kaman, second-year forward Al-Farouq Aminu and the Clippers' unprotected 2012 first-round draft pick that they received from Minnesota. One source close to the talks, however, told SI.com that shooting guard Eric Gordon could be part of the deal as well.
A source close to Bledsoe said late that night that he was under the impression a deal had been agreed upon and that he would likely be traded to the Hornets. When reached by phone late Sunday and asked if an agreement in principle had been reached, Clippers president Andy Roeser declined comment to SI.com.
The proposed deal was submitted to the league's front office for approval Monday morning. In any other case, it would have been a mere formality that the deal be presented to the team's owner. But having commissioner David Stern as the Hornets' de facto owner added a strange twist to the story, especially after the NBA vetoed the team's first attempt at dealing Paul, to the Lakers.
Paul is known to be open to joining the Clippers long-term, but the supporting cast was likely taken into consideration when engaging in discussions with a franchise that has been a laughingstock for so long. While reigning Rookie of the Year Blake Griffin is the centerpiece of the team's new core, Gordon -- whom the Clippers did not want to give up when the two teams talked last week, according to the L.A. Times -- and restricted free agent center Jordan are also key components.
On Sunday, Jordan signed a four-year, $43 million offer sheet from Golden State, giving the Clippers three days to match the offer. SI.com confirmed Monday evening that the Clippers matched the offer and retained their center.
Also on Monday, Billups became the first player to be won off amnesty waivers under the new collective bargaining agreement. Billups was waived by the Knicks on Sunday with the new amnesty provision, giving teams under the salary cap the chance to bid for services. The Clippers won the bidding at $2 million, meaning they'll pay only that portion of his $14.2 million salary this season while the Knicks foot the rest. Under the amnesty rules, Billups can't be traded before July 1, so the Clippers can't use him as bait in a deal for Paul.
Source-sportsillustrated
Magic CEO meets with Howard
The relationship between Dwight Howard and the Orlando Magic appears to be improving - at least a bit.
Magic chief executive officer Alex Martins said he sat down with the All-Star center Monday morning, a day after Howard said he hadn't spoken to general manager Otis Smith since asking the team to be traded,.
Martins said he remains confident things still can be done to convince Howard that Orlando can build a championship team.
"We have to continue to do what's right for this organization to win a championship and the first piece of that is keeping Dwight," Martins said at the team's annual media day. "And we're doing everything we can to ensure that we do that. All I would say from a fan's standpoint is I believe, I want them to believe and I think we need to continue to show Dwight that we do want him here. ... Our fans need to make sure that we show him the love."
Then, after speaking at length for two straight days about all that was wrong with management, Howard said that the door remains open for him to re-sign.
"As of a right now, I have on a Magic uniform. ... If it's meant for me to stay here, then I'll stay," Howard said. "I love this city and there's no place I'd rather be than Orlando. I just want to make sure that we have the right things here so we can win a championship. And I'm all about change. If you're willing to change and willing do what it takes to win, then you've got me.
"You only get one time around the track. There's no reset button. You don't want to miss out on any opportunity to win," Howard added. "You gotta do what it takes to win."
Howard can opt out of his current contract in July 2012. Smith has previously given his agent, Dan Fegan, permission to speak with New Jersey, Dallas and the Los Angeles Lakers about possible trades.
Martins said that despite Howard's claim Sunday that none of his input has been taken into account by management in regards to what changes he'd like to see the Magic make, that the trade for Boston big man Glen "Big Baby" Davis was one they did do.
"It's a conversation," Martins said. "It's not a be all, end all. And I do think that Dwight's input is important and we're gonna continue to solicit Dwight's input. But, the final decisions rest on Otis. Otis is the head of this basketball operation. And he is the only one that knows how all the pieces will fit together properly. And he can solicit input from anyone and he will solicit input.
"But at the end of the day, it's Otis' decision to make," he said.
A trade of forward Brandon Bass for Davis and guard Von Wafer was officially announced Monday afternoon, a few hours after both took pictures in their new Magic uniforms. Shooting guard Jason Richardson, who was an unrestricted free-agent, also re-signed.
Davis, who played against Howard on the AAU circuit growing up and opposite him in the 2004 McDonald's All-American Game, said he understands the kind of passion Howard has in this situation.
"We've talked and I understand where he's coming from," Davis said.
Asked if he thinks he can talk Howard into staying, Davis was jokingly optimistic.
"Probably can," he said. "I'll probably have crumpets and tea tomorrow and hopefully talk things out and see what's up."
AP
Aussies different to Windies warns Gambhir
While expressing happiness over India’s 4-1 series win against the West Indies here on Sunday, stand-in captain Gautam Gambhir cautioned that the forthcoming tour of Australia would be a “different ball game” that will put to test both the technique and mental toughness of the players. “It always helps to get runs under your belt, but in Australia, those are different conditions,” said Gambhir, who led India to a 34-run win over West Indies in the fifth and final One-Day International. “We all know this is not what we are going to get in Australia. The Australians are tough nuts to crack and will come hard at us. “In Australia, your mental toughness will be tested the maximum.
You will be getting a quality attack and they will be coming hard at you. I think one good thing is the guys that have gone early [to Australia] will be able to acclimatise [to the conditions]. And we’re playing two practice games this time.” India are the reigning World champions while West Indies are ranked number eight in the ICC one-day grid. Gambhir also sought to play down his captaincy record of six wins out of six by saying that he was only as good as the teams he had. “I’ll stick to the saying that the captain is as good as his team. One captain can’t win you the game; it is still 11 people on the park,” he pointed out. “I am lucky to have such teammates, during the series against New Zealand, I was lucky to have Yuvraj Singh. Today the team-mates stood up and delivered.”
Pollard's 119 Falls Short
Kieron Pollard lashed a sensational maiden one-day international century but West Indies crashed to a 34-run defeat to India in the fifth and final game here yesterday.
The big-hitting Trinidadian, who had gone 46 innings without a triple figure score, ended his drought by pummelling a boundary-filled 119 from 110 balls to put the Windies within sight of victory.
However, their target of 268 proved too much in the end and they were bowled out for 233 in the 45th over, as India won the series 4-1.
Manoj Tiwary had earlier put India on their way with a superb 104, a knock that hauled the hosts out of a hole in the first over where they rocked precariously at one run for two wickets.
Pacer Kemar Roach (2-46) removed opener Ajinkya Rahane and Parthiv Patel without scoring to the second and third balls of the innings, to leave the Windies on top.
Partnerships
However, Tiwary inspired two partnerships to instigate India's recovery, putting on 83 for the third wicket with captain Gautam Gambhir (31) and a further 117 for the fourth wicket with Virat Kohli whose 80 required just 85 balls.
Seamers Abhimanyu Mithun (2-32) and Irfan Pathan (2-42) then wiped out the West Indies top order, to lay waste the innings at 36 for five in the 10th over.
In-form opener Lendl Simmons fell to the first ball of the innings, lbw on the backfoot to left-armer Pathan, and his opening partner Kieran Powell stroked three fours in 15 before also playing back to Pathan and going bowled off the inside edge at 23 for two in the fifth over.
Marlon Samuels was controversially adjudged caught at the wicket for six off Mithun, a decision given by umpire Sudhir Asnani even before the bowler had appealed.
When debutant Jason Mohammed played across to Mithun and was lbw for two in the 10th over, West Indies needed something special and they found it in Pollard.
The right-hander first added 42 off 37 balls for the fifth wicket with Denesh Ramdin (14) but when the wicketkeeper became the first of left-arm spinner Ravindra Jadeja's (3-62) three wickets starting in the 16th over, Pollard took matters into his own hands.
Four fours
Striking the ball cleanly and with astonishing ease, he counted four fours and 10 massive sixes, to leave the MA Chidambaram Stadium in awe.
He reached his half-century off 43 balls by hitting Jadeja straight for his fourth six and then brought up his first ever ODI century with a four in fortuitous circumstances, when Kohli dropped a simple chance at long-off leg-spinner Rahul Sharma, and the ball crossed the ropes.
Along the way, Pollard shared 89 for the sixth wicket with all-rounder Andre Russell who belted five fours and three sixes in a marvellous 42-ball 53.
Together, they threatened to uncork a Windies win but Russell was eventually run out in the 29th over by a direct hit from Gambhir at short third man, sparking a decline which saw the last five wickets tumble for 66 runs.
Pollard was last out, drilling off-spinner Suresh Raina down the throat of Rahane at long-off, to end a scintillating innings.
Earlier, it was Tiwary who put India back on course after Roach's two early strikes. Rahane was lbw on the back foot to one that kept low, while Patel played on next ball.
The right-handed Tiwary then stroked 10 fours and a six off 126 balls with support from Kohli who hit five fours.