Live from Music Row Monday morning on The Tennessee Star Report with Michael Patrick Leahy – broadcast on Nashville’s Talk Radio 98.3 and 1510 WLAC weekdays from 5:00 a.m. to 8:00 a.m. – host Leahy welcomed the original all-star panelist Crom Carmichael to the studio to outline tax rate structures, deficiencies, and counterproductive policies.
Leahy: And, of course, to make your Monday even more fun, today is the last day you can file your taxes.
Scooter: Some counties in Tennessee are going to get an extension.
Leahy: Oh, how about that? The federal deadline was May 17th that’s today. But why are we getting an extension?
Scooter: A severe storm.
Leahy: Of course! Of course! Crom, you were talking about taxes and various policies that are counterproductive.
Carmichael: They don’t accomplish what the policymakers claim they will. For example, and this is from the article, the 1986 Tax Reform reduced the top tax rate to a post-war low of 28 percent. Now, remember, earlier it got as high as 91 percent and as recently as 1980 it was 70 percent.
By 1986 it had been lowered to 28 percent. According to the so-called experts, if you lower the top tax rate from 70 percent to 28 percent, you’re going to see a dramatic drop in income. But the opposite was true. And the article says while the top marginal tax rate fell from 91 percent in 1962 to 28 percent in 1988.
The percentage of income actually paid in income and payroll taxes by the top one percent and the top 10 percent, these two groups rose to 21.5 percent and 19.6 respectively, from 16.1 and 14.4. In other words, the amount that the wealthy paid at a 28 percent rate versus a 91 percent rate actually went up by almost 25 percent.
Leahy: Because if knowing human nature and there’s a legal way to avoid paying 91 percent you will do that.
Carmichael: Right. Well, you’ll also change what you do. At 91 percent, let’s just say that’s at a million dollars of income in today’s dollars and it’s at 91 percent on amounts over a million dollars, you make a million dollars and you just quit.
You just decide I’m not going to make any more. I’m not going to make any more money that’s reported this year. Whatever it is I’m going to do, I’m going to do it in such a way so that the income comes to me next year.
Leahy: And that’s a logical way to go because why should you work more and get basically nothing for it?
Carmichael: It also gets to the question of equality and fairness, because if I’m not willing to pay 91 percent on the next dollar I earn, then why should I expect somebody else to pay 91 percent on the next dollar that they earn? Because we are talking about marginal tax rates. But I want to go back to this question of wealth.
And that is that what we don’t do as a society is we don’t tax unrealized gains. Let me just finish this one thought then you can jump in. There are good reasons to not tax unrealized gains, in my opinion, up to a point, because taxing unrealized gains at low levels, and when I say low levels, it can still be a very large number, like a billion dollars.
That’s a lot of money. Most people who start a business or invest in a business, they’re not investing so that they can make multiples more than a billion dollars. They might hope to. But that’s not why they do it. You’re not going to be changing the incentives to invest if you were to start taxing people’s unrealized gains above a certain value and whatever that value is.
But that is where the real money is in today’s economy because Jeff Bezos is worth $200 billion dollars. I’ll bet you he hasn’t paid two billion dollars in taxes. Two billion dollars in taxes sounds like a lot, but it’s one percent of what he’s worth.
Whereas if you are a doctor or a lawyer and you’re making a million dollars a year, and I’m just picking that number out of the year, I’m not saying that doctors and lawyers, there are not many who do that. But if they were to make a million dollars a year compared to Jeff Bezos, is net worth going up at five billion dollars a year, it’s not even close.
Yet the doctor who makes a million dollars, according to Elizabeth Warren and all these left-leaning Democrats ought to be paying 50 to 60 percent of that next dollar in taxes either at the federal or the state level. Whereas Jeff Bezos sees his net worth goes up to five billion dollars in a year or 10 billion dollars and he doesn’t pay anything. So what were you getting ready to say?
Leahy: Senator Elizabeth Warren is one of those people that believes we should have a tax on wealth, not just income.
Carmichael: Her’s starts at a very low level. Her’s are starting at about $50 million dollars. And there are a lot of people who have $50 million dollars that would be especially if it’s tied up in a privately owned business…
Leahy: They’d have to liquidate the business.
Carmichael: They have to liquidate the business. Her ideas, as is generally the case with her are ill-founded, stupid, and do not apply to her.
Leahy: Absolutely.
Carmichael: Let’s be sure about that last piece. Do not apply to her.
Leahy: She just actually got, apparently a $900,000. advance for this book she’s written called Persist instead of, How I Lost the Presidential Primary, by Elizabeth Warren.
Carmichael: And what is she say in it?
Leahy: A couple of things. Politico has a story about her where she said she’s going to run for the Senate in 2024. She’s 71 now, she’ll be 74 then. She would be, of course, the prohibitive favorite to win the Democratic primary there and the general election.
But she was talking about her presidential campaign and her decision to take a DNA test to show the depth of her Native American roots. In her book, she said that was a mistake to take that test. What she didn’t say was why was it a mistake.
Carmichael: Well, it was a mistake because it showed that she had been lying for her entire adult life.
Leahy: It showed what the DNA test showed that she had less than one-tenth of one percent of DNA that was consistent with residents of Peru, Mexico, and Columbia. The reason that there was no DNA, there is no DNA database for Native Americans in the United States because they don’t comply. They refused to cooperate with the DNA testing companies.
Carmichael: I can certainly understand that.
Leahy: Absolutely.
Carmichael: I don’t want to have my DNA in some federal database.
Leahy: Absolutely. And increasingly, people are seeing that. But again, there’s zero zip nada documentary evidence that she has Native American ancestry. And the average American has more than one-tenth of one percent of DNA consistent with. And the proxy they use as residents of Peru, Mexico, and Columbia.
Carmichael: But what was interesting was her reaction to the results of the DNA test. She says, case closed. I’m a Native American. That’s so typical. It’s also the same thing Biden does. If you ask Biden the question, I mean nowadays I just can’t imagine that he’ll do press conferences because the press is now beginning to ask him fairly simple questions, like, should Americans be concerned about inflation?
Leahy: The answer is yes of course.
Carmichael: The answer is yes but he walked away from the microphone. Another one is, are you concerned about the violence in the Middle East? No comment. (Leahy chuckles) What violence?
Leahy: Violence? What violence? C’mon man! (Laughs)
Carmichael: What about the crisis at our Southern border?
Leahy: There is no crisis.
Carmichael: And so it looks kind of silly. The other thing about Elizabeth Warren, Michael, I want to point out, is Elizabeth Warren now wants to take away the IP pharmaceutical companies intellectual property because she says drug costs are too high.
Now, I agree with the last statement. Drug costs are too high. But if you take away the IP of pharmaceutical companies, you will end all research and development. There won’t be any new drugs because there’d be no reason to make the substantial investment. Drug prices are high for two other reasons.
One is and I’m convinced, and I cannot prove it but based on this. When Trump set up his Operation Warp Speed program to bring a vaccine to the market he went around the FDA. He appointed somebody outside of the government to run the program and they had a vaccine.
In fact, they had three vaccines in nine months from the time that he initiated Operation Warp Speed. The bureaucrats, like Anthony Fauci and the other bureaucrats, said it would be three years. The reason that they said it would be three years, at least is they know how the FDA works and they know how slow that process is.
And they agree with that process, by the way. So they were very angry when Trump went around the FDA and he brought the drugs to market. I think that there is an incestuous relationship between Big Pharma and the FDA to make bringing a drug to market very expensively in a lot of time so that drug companies can buy fledgling pharmaceutical companies that show promise before they get to market.
Leahy: To maintain their differentiation.
Carmichael: And then the second one is our third-party payment system also lends itself toward exorbitant drug price.
Listen to the full show here:
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Tune in weekdays from 5:00 – 8:00 a.m. to the Tennessee Star Report with Michael Patrick Leahy on Talk Radio 98.3 FM WLAC 1510. Listen online at iHeart Radio.
Photo “Crom Carmichael” by Crom Carmichael.
Live from Music Row Tuesday morning on The Tennessee Star Report with Michael Patrick Leahy – broadcast on Nashville’s Talk Radio 98.3 and 1510 WLAC weekdays from 5:00 a.m. to 8:00 a.m. – host Leahy welcomed Tim Pagliara CIO of Cap Wealth Management to the studio to discuss the Supreme Court case that will address violations of the Administrative Procedures Act and the two issues of constitutionality and whether it will go back to the trial court for damages that shareholders are entitled to.
Leahy: Our guest is Tim Pagliara, author of Another Big Lie: How the Government Stole Billions From The American Dream of Homeownership and Got Caught. By the way, Tim, thanks so much for coming down to our Studios on Music Row. It’s kind of fun, isn’t it?
Pagliara: It’s a blast.
Leahy: I know you love radio, t0o. Everybody loves the radio.
Pagliara: I got a face for radio.
Leahy: So do I. I mean, you know, I get here at 5:05 a.m. in the morning. I don’t look, you know, not ready for prime-time cameras. I’ll tell you that for sure. So we’re talking about this case. Your book fantastic book – doing very well. It’s on Amazon and is number one in banking and finance right now.
Pagliara: Yes.
Leahy: And by the way, go get the book right now at Amazon.com. Just check out Another Big Lie. You’ll be able to order it and have it in your house in a day or two.
So what I find interesting about this: September 2008 is when the government, George W. Bush made the bad decision, as you said, to place Freddie Mac and Fannie Mae the mortgage purchasing institutes of qualified governmental institutes into conservancy. Then in 2013, ’14, the Feds say, ‘Let’s keep it in the conservancy,’ and misrepresented really how well those organizations were doing.
Pagliara: Yes.
Leahy: The lawsuit doesn’t get filed until 2015 because the people that had their money basically taken away the investors.
Pagliara: Actually, the first lawsuit was filed in June of 2013, the Collins case.
Leahy: So there was a whole bunch of cases. Now, how much money do the plaintiffs, how much have they had to spend to get this case up to the Supreme Court? And how long is it? What’s the path been?
Pagliara: If you take all of the lawsuits collectively, my estimate is those plaintiffs have spent almost 100 million dollars.
Leahy: And just in legal fees.
Pagliara: Just in legal fees.
Leahy: How much of their money has been taken by the federal government, would you guess?
Pagliara: $350 billion?
Leahy: $350 billion?
Pagliara: Yes.
Leahy: Wow.
Pagliara: Big numbers.
Leahy: And going to, I don’t know, fund Obamacare? Things like that”
Pagliara: That’s one of the places that the money went. Treasury Secretary Mnuchin on Maria Bartiromo show admitted that. He wouldn’t pinpoint exactly where the money was spent. But it went for a variety of non-budget, appropriated purposes.
Leahy: Wherever they wanted to just have their little…fund not known to the public go.
Pagliara: That’s right. Exactly. And they were battling Grover Norquist. They were battling the constraints of the Budget Control Act, and they acted in their best interest in violation of the property rights of shareholders. This is a big case. They can take the assets of Fannie Mae and Freddie Mac. You can imagine what Elizabeth Warren can concoct with wealth taxes and just taxing individuals.
Leahy: That’s all in the works right now. These are the kinds of things that they’re contemplating, right?
Pagliara: Yes.
Leahy: So in this particular case, Collins versus Yellen. And Yellen versus Collins.
Pagliara: This case came to the United States Supreme Court after an en banc hearing in the Fifth Circuit.
Leahy: So the first step is to go to a district court.
Pagliara: That’s right.
Leahy: Then it goes to the Fifth Circuit court.
Pagliara: It went to the Court of Appeals. So the plaintiff lost at the district court level. They went to the court of appeals, and it was a split decision. The plaintiffs appealed to the entire circuit in an en banc hearing.
Leahy: So the way it works is in the Fifth Circuit, they would assign what, three judges to look at it?
Pagliara: Yes.
Leahy: And they lost there.
Pagliara: It was a mixed decision. So there was enough confusion between the three judges.
Leahy: So the Fifth Circuit, we have 11 circuits courts of appeal in the country, of course, the worst being the ninth out in California, where they’re all a bunch of lefties. It’s getting better. Tell us a little bit about the Fifth Circuit Court of Appeals here in our federal court system. Pretty good reputation?
Pagliara: Excellent reputation. They addressed civil rights in the 60s. They’ve had a reputation for taking on tough issues, being leaders, and thinking outside the box. And they decided to take this on in an En banc hearing.
Leahy: Now Let’s just stop and explain what an en banc hearing is for the Circuit Court of Appeals. What is that?
Pagliara: That’s when you take all of the justices and the different circuits, and they all come together collectively as a group, and they will hear additional arguments following a court hearing.
Leahy: So an en banc hearing of the Fifth Circuit would include 20 judges or something like that?
Pagliara: 16.
Leahy: 16 judges. And the Fifth Circuit covers Texas…
Pagliara: Parts of Louisiana.
Leahy: So here we go. There’s a sort of a split decision when the three-judge panel first reviews in the Fifth Circuit Court of Appeals, it goes en banc to all 16. What happens there?
Pagliara: Well, there are two issues before the court. One was whether or not the federal housing finance administrator, which was overseeing the conservatorship of Fannie Mae and Freddie Mac whether he was appointed constitutionally. Whether it was a constitutional appointment. And the Consumer Finance Protection Board case, which occurred earlier. The court found that that was unconstitutional.
Leahy: And by the way, it’s just for our listeners, the Consumer Financial Protection Board.
Pagliara: That’s a mouthful.
Leahy: It really was unconstitutional when passed in the Dodd-Frank Bill 2010 – the brainchild of wait for it – our favorite Native American Senator, Elizabeth Warren. That’s her brainchild. And so that key element of that particular law was found unconstitutional.
Pagliara: And so they did the same thing. The director of the Federal Housing Finance Administration, which was overseeing the conservatorship, was appointed in exactly the same way as the CFPB.
Leahy: Got it.
Pagliara: And this is where you get into that fourth branch of government. The issue there was they wanted to create an agency that the executive branch of government couldn’t remove the director. That’s what they did with the CFPB. That’s what they did with FHFA. And in the CFPB, the court ruled that that was unconstitutional. It had to be removable.
Pagliara: That’s right.
Leahy: And that’s why when Biden got elected, they got a new head of the CFPB.
Pagliara: So with the Fifth Circuit, the first issue is constitutionality. The Fifth Circuit already ruled that it was unconstitutional. They were split on the remedy. The issue before the Supreme Court is whether or not the plaintiffs are entitled to prospective or retroactive relief. If retroactive relief…
Leahy: It’s a lot of money.
Pagliara: It’s a lot of money.
Leahy: It’s like $350 billion.
Pagliara: Most legal scholars don’t believe that the plaintiffs, the shareholders, will get retroactive relief. They’ll get prospective relief and the President will be able to remove the Director immediately at will. It will be an at-will appointment like any other cabinet appointment.
Leahy: Too bad this case wasn’t decided before January of 2021, I think.
Pagliara: Well, President Trump honored the rule of law, and he waited for this to happen. And so he actually did a very good job with that. Now, the second issue before the court is called the Administrative Procedures Act [APA].
Leahy: 1950 act that sort of was the beginning of the decline of the legislative branch here in America because it’s been abused so much by the rulemaking procedures of various departments, cabinets, and agencies.
Pagliara: And so the violation of the APA, this is the governor that regulates the 10,000-pound gorilla being the federal government. the federal government tends to crush everybody that they get into litigation with. In fact, you can’t even get an injunction against it.
Leahy: So if the Department of Justice decided to go after somebody, for whatever reason, just even if you were totally innocent of any of these charges or claims, your legal fees would be, what? A half a million bucks, at least a million to defend?
Pagliara: Millions.
Leahy: Not exactly a fair deal.
Pagliara: It’s not a fair deal. So the court ruled that the government violated the APA, violated the very statute that they’re supposed to enforce that has been remanded to the trial court.
Leahy: Sent back.
Pagliara: And so the Supreme Court intervened, and they’re going to weigh in on this. So they got the two issues. They got constitutionality, and they have the whole issue of whether this goes back to the trial court for damages that the shareholders are entitled to.
Leahy: This will be fascinating to follow when we get back. I know you’re not in the land of being a predictor, but we’ll want to look at a couple of the possibilities that will come down in this very interesting Supreme Court decision.
Listen to the full third hour here:
Tune in weekdays from 5:00 – 8:00 a.m. to the Tennessee Star Report with Michael Patrick Leahy on Talk Radio 98.3 FM WLAC 1510. Listen online at iHeart Radio.
Live from Music Row Thursday morning on The Tennessee Star Report with Michael Patrick Leahy – broadcast on Nashville’s Talk Radio 98.3 and 1510 WLAC weekdays from 5:00 a.m. to 8:00 a.m. – host Leahy welcomed all-star panelist Clint Brewer to the studio to weigh in on John Kerry’s no mask flight and Senator Elizabeth Warren’s irresponsible and historically inaccurate rhetoric to remove the filibuster.
Leahy: We are talking with all-star panelist and recovering journalists Clint Brewer about our big story at The Tennessee Star with a picture of John Kerry on a commercial flight yesterday not wearing a mask. That story has gone all over the place. It was a lead story at Fox News.com all yesterday. It was on Brett Beers and Fox News, followed by Tucker Carlson, followed by Sean Hannity, followed by Shannon Bream. All these stories last night. Breitbart has covered it. The Dail Mail has covered. The Daily Caller has covered it. TheBlaze has covered it.
Brewer: They’re crediting you guys appropriately?
Leahy: All of them. Crediting The Tennessee Star.
Brewer: Good.
Leahy: A couple of questions from Breitbart that boil my friends on the editor at Breitbart. John Kerry said to Tweet about the photographic evidence about this clear violation of the Federal Order and American Airlines policy that it was ‘momentary.’ He was not eating or drinking. He does not claim that he was.
If that is okay for John Kerry to do, can anyone else have “momentary slip of the mask?” This was a question to American Airlines. Second, what is an acceptable amount of time for someone to have their mask slip off their nose and mouth for a momentary period? Has John Kerry been disciplined in any way for violation of this health order? Will American Airlines allow John Kerry to continue to fly or ban him from future flights for this violation?
Brewer: Does President Biden have a press briefing today? I kind of think he does.
Leahy: He has like a March 25 press conference. Somebody will ask him about that.
Brewer: As an avowed, dedicated mask-wearing American (Leahy laughs) during this pandemic and as a Republican I wish Czar Kerry would set a better example for the American
Leahy: A pretty bad example. Let me tell you what the consequences of this is. I suppose at the Tennessee Star we will be responsible for more global warming because clearly what John Kerry is going to do now is he’s going to go to the President and say, Mr. President obviously, I cannot fly commercial flights anymore because they’re going to take pictures of me not wearing my mask. I need to use my private plane now.
Brewer: Mike, you’re in talk radio, all the hot air alone is hurting the climate. (Leahy laughs)
Leahy: That’s good. Speaking of hot air in Washington, DC, Senator Elizabeth Warren is generating a lot of hot air with her desire to get rid of the filibuster. You just saw this the story come out. Tell us about it, Clint.
Brewer: There’s a story on Axios about her saying that the filibuster is racist because it is used based on what I read, she seems to believe it’s used primarily by Southern politicians to hold back advances and civil rights legislation. Now, I hate to sound like a musty old historian here, but let’s get our facts straight. The filibuster is not something created in the Constitution, but it has existed as a rule of the Senate since 1806.
Leahy: That was before civil rights legislation, I would think, right?
Brewer: Yes.
Leahy: It’s 150 years before.
Brewer: And it was not used until 18 37 but it has been used ever since then. And I’m pretty sure that Democrats have had the majority in the U.S Senate several times since 1837. now, Yes, it is correct that the longest and most famous filibuster was sent by the late Senator Strom Thurmond fighting the federal Civil Rights Act. That is accurate.
But to put it in a modern-day context and say that it only exists for Southern politicians to hold back civil rights, first of all, it’s irresponsible rhetoric. Second of all, it paints a large group of very dedicated public servants from one part of the country with a broad brush that is unfair and inaccurate. And it’s just more of the same from Elizabeth Warren. It just feels like her usual level of attention-seeking and grandstanding.
She couldn’t get nominated president, and she’s not in the cabinet, and it’s just gross and it’s irresponsible. And it’s the kind of partisan hackery we don’t need in this country right now. We’ve got bigger problems to deal with. But this is like the whole talk about packing the court. And this flies all over me as a taxpayer and as a voter with both parties. Just because you’re either out of power or in power, you don’t change the institutional rules of something like the U.S. Senate just to suit your immediate purposes.
Go win some elections. Quit trying to move the goalposts to suit your agenda. Work within the system that has brought this country along successfully for 200 plus years. You don’t just flip the paradigm in an institution like the Senate because right now it suits your purposes. That’s very short-sided. It’s not good for the Republic, and it’s not good for the American people.
Leahy: Isn’t that what the Democratic Party is about right now, though? Will for power? Having power and exercising it with no regard for the institutions of the American country?
Brewer: What you’ve got in the senators is a very thinly, divided Senate with a couple of very moderate Democratic senators who are siding as much with Republicans as they are with Democrats. That’s uncomfortable for progressives like Elizabeth Warren. Now in the House, it’s less struggle because they got more of a majority.
Progressives like Warren in the Senate are feeling the heat because they can’t move the ball for their particular agenda. And so what’s the answer? Well, we’ll just change the rules that have existed since 1806. It’s cheap, I guess, is the best way to say it. It’s a cheap attempt at moving the goalposts. And other than that, it’s also just inaccurate.
Leahy: Yes. But you’re talking Senator Elizabeth Warren, who’s been known for being inaccurate about her own personal heritage and other things. I look at Democrats, and I think they are generally a bunch of insane liars who hate the country. But that’s just my view.
Brewer: Look, I know plenty of good people who are Democrats. I just don’t think Elizabeth Warrens one of them.
Leahy: I’m with you on that.
Listen to the full third hour here:
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Tune in weekdays from 5:00 – 8:00 a.m. to the Tennessee Star Report with Michael Patrick Leahy on Talk Radio 98.3 FM WLAC 1510. Listen online at iHeart Radio.
