Progressive Breakfast for November 24

Morning Message

Pfizer Buying Allergan So It Can Pretend To Be Irish In Tax Scam

The pharmaceutical corporation Pfizer will acquire pharmaceutical corporation Allergan in a deal valued at $160 billion. My colleague Richard Eskow called this combination of Pfizer (the maker of Viagra) and Allergan (the maker of Botox) “a merger of false desire and false beauty.” ... the resulting merged company will make and sell products in the same places it makes and sells them now. The same executives will occupy the same buildings. It will receive the same taxpayer-funded U.S. services, infrastructure, courts and military protection that it receives now. But the company will now claim it is “based” in tax-haven Ireland and thereby dodge U.S. taxation.

Pfizer Merger Prompts Tax Reform Talk

Dem candidates oppose Pfizer merger. The Hill: “The $160 billion deal, announced Monday, would be the largest-ever corporate inversion … Clinton said that in the coming weeks she will ‘propose specific steps to prevent these kind of transactions …’ … Sanders added that the Obama administration should exercise its authority to halt the merger … O’Malley called the merger ‘fundamentally unfair.'”

Republicans use merger to push corporate tax reform. The Hill: “‘So let’s stop the political hand-wringing and get to work creating a U.S. tax code that’s built for growth,’ said new House Ways and Means Committee Chairman Kevin Brady.
 White House Press Secretary Josh Earnest, meanwhile, said it was Republicans to blame for blocking legislation on inversions.”

Jared Bernstein laments the “cramped tax debate” in the W. Post: “If you’re a Republican running for president, you can’t raise taxes. If you’re a Democrat running for president, you can’t raise taxes on 97 percent of households … [We] need more revenue than we’re set to collect simply to keep up with population growth, demographics and interest on the debt.”

Conservatives For Bernie?

Some Republicans are switching registrations to vote for Sanders. The Atlantic: “These Republicans for Sanders defy neat categorization. Some are fed up with the status quo in Washington … Others have voted Republican for years, but feel alarmed by what they see as the sharp right turn the party has taken … Sanders’s promise to wrest power away from Wall Street and return it to the American middle class taps into the same vein of populist anger that fueled the rise of the Tea Party.”

Sanders gets support from rapper Killer Mike. The Hill: “The rapper endorsed Sanders for president in June after the candidate cited his support for restoring the Voting Rights Act … Killer Mike also touted Sanders’ stance on health care being a right of every citizen, ending the war on drugs, and that education should be free for every citizen.”

Ethanol rule could hamper Clinton in Iowa. Politico: “The [upcoming] decision, concerning how many billions of gallons of the corn-based biofuel must be blended into the nation’s gasoline supply, threatens to create a political bind for Democratic front-runner Hillary Clinton, who may have to decide once again how far to distance herself from President Barack Obama…”

Breakfast Sides

Stress tests may get tougher. NYT: “A senior official at the Federal Reserve … said on Monday that the Fed was discussing changes to the test that could make it harder for banks to pass … banks would have to have a higher amount of minimum capital left after suffering the theoretical losses envisioned in the stress tests.”

China and US talk trade. NYT: “…the United States and China said on Monday that they had made progress on sticking points, including preventing the theft of trade secrets and opening the Chinese market more broadly to American multinationals. [But there was a lack of larger breakthroughs on bigger issues — like negotiations for a broad trade deal…”