Category Archives: In the News

DEVELOPERS, ADMINISTRATION CHOP DOWN FOREST FRAGMENTATION BILL

VTDIGGER: Mar. 19, 2014, 7:35 PM John Herrick

 

A proposal to limit forest fragmentation was thwarted by developers who oppose using the state’s land use and development laws as a tool to keep woodlands intact, according to the lead sponsor of the bill that was gutted on the Senate floor Wednesday, March 19, 2014.

“There are developers in a certain corner of the state that are very concerned that nothing gets in the way of their planned development,” said Sen. Peter Galbraith, D-Windham.

Click to link to the full article

 

 

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Former US Diplomat Provides Overview of Kurds in Middle East

By MUTLU CIVIROGLU 18/2/2014

WASHINGTON DC – At a seminar titled “Kurds and Kurdistan,” former US diplomat and onetime adviser to the Kurdistan Regional Government (KRG) Peter Galbraith provided an overview of the Kurdish situation in Iraq, Turkey, Syria and Iran.

Click here to read the whole article

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Drawing the Line: East Timor & Australia

Monday 17th March 2014

Late last year the office of Canberra lawyer Bernard Collaery was raided by agents from ASIO and the Federal Police.

 

East Timor’s advisors are now arguing Australia spied for commercial reasons. Former treaty negotiator Peter Galbraith tells Four Corners: “the Australian Government was shockingly close to the oil companies.”

 

‘Drawing the Line’ is a revealing insight into national security in the post-Cold War environment. Do governments too freely use espionage for economic advantage? And is it in the national interest?

 

Click to watch the video.

 

 

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Campaign Finance Reform bill

Senator Galbraith statement on the Vermont Senate floor on the conference report on S. 82, the Campaign Finance Reform bill

January 17, 2014

As compared to the version of S. 82 approved by the Vermont Senate, this bill more than triples the amount of money an individual can contribute to a political party, from $3000 to $10,000. And it redefines a political party so that a state party and its national affiliate are considered two separate parties. Under existing law, the state party and its national affiliate are a single party. As a result of the changes proposed by this bill, an individual or corporation can contribute $10,000 to a state party and $10,000 to its national affiliate and then the state and national party can each make unlimited contributions to a Vermont candidate. And, there is nothing in this bill to prohibit or restrict a donor who wants to circumvent the limitations on contributions to individual candidates from using the state and national parties as a pass through for contributions totaling $20,000. Such coordination is completely legal and there is no reason to think parties won’t do it.

The effect of these changes is a nearly four times increase in the amount that a single donor can contribute to a political party as compared to the bill passed by the Senate and a ten-fold increase as compared to existing law.

These new limits make it incredibly easy to evade any limits at all. According to Senator White, the justification for raising these limits is to allow parties to compete with Super PACs. But, the history of campaign finance reform is that each supposed remedy triggers its own abuse and this bill is no exception.

These new limits for parties are the a response to the fact that a single wealthy individual spent $1 million in 2012 through a Super PAC to promote a candidate for Treasurer and a candidate for Governor. In fact, this money had no discernible impact on the election, except as a welcome addition to the revenues of our local broadcast media. Undoubtedly, the same money would have been much more effectively spent had it gone directly to the candidates, but the donor could only contribute $2000 to each of her candidates as well as $2000 to their political party.

Under this bill as reported by the conference committee, she will easily be able to contribute hundreds of thousands of dollars right into the campaign coffers of her preferred candidates. How?

Vermont law considers each individual and each corporation as a separate “single source” for the purpose of making campaign contributions. Very wealthy people almost always hold part of their wealth through corporations and LLCs that they control. For the purposes of this example, I assume that someone who can afford to spend one million dollars on a political campaign has at least 10 such entities. Thus, the donor could contribute $10,000 herself and $10,000 from each of her LLCs or corporations to the state political party of her preferred candidate. She could, of course, condition her contribution to the state party on it giving the entire $110,000 to her chosen candidate. But, that is not all. She could do the same thing with the national party affiliated with the state party.   By using the state and national parties as pass through she increases the amount of her contribution to $220,000.

And, that is not all. Vermont has many minor political parties, some of which are affiliated with the major national parties. For example, the Working Families Party often endorses Democratic candidates. Thus, the wealthy donor could contribute $110,000 personally and from her 10 corporate accounts to an allied minor party both at the state level and at the national level for a total of $440,000. This is money that goes to the candidate, and not to an uncoordinated and often ineffective independent expenditure.

Under existing law, the same donor can also evade the limits on contributions by individuals by using her corporate entities. But because of the limits on the size of contributions and because national and state parties are currently one entity, the maximum that this donor could contribute under my example is $44,000—or one tenth of what she can contribute under the new law.

Finally, this bill said to increase transparency. But increasing the number of reports does not increase transparency if we don’t know who the contributors are. I have asked both the Attorney General and Legislative Council to review transparency under this bill and existing law. Vermont Law permits a “single source” to make a campaign contribution and a single source is defined as an individual, corporation, partnership, association, organization, or group of individuals. There is no way the public can reliably find out who owns or controls a private corporation, a LLC, an unregistered partnership or who runs or belongs to an organization or association. And this bill actually reduces transparency because the conferees dropped the requirement that in the senate bill that campaign finance reports include information on the occupation and employer of a donor contributing over $100, even though both bills required listing the occupation of the donor.

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Senator Galbraith explained his bill to fund Vermont’s single payer health care system

In a floor speech in the Vermont Senate on March 27, 2014, Senator Galbraith explained his bill to fund Vermont’s single payer health care system and why the delay in coming up with a financing plan is unjustified and damaging to Vermont’s economy.

 

Remarks on S.252

Senator Peter Galbraith

March 27, 2014

Mr. President:

S. 252, as introduced, is a financing plan for Green Mountain Care. I have distributed a handout describing the provisions of the bill. I will briefly explain the bill and then explain why I introduced this bill.

In its January 2013 Act 48 report, the Administration estimated that Green Mountain Care would cost $1.6 billion and so S.252 seeks to raise that amount. Since then the estimate has risen to $2 or 2.2 billion and I will discuss later how that might be raised.

Both the underlying bill and the committee amendment establish a number of principles for a Green Mountain Care financing plan. These include the principle that everyone contributes according to her or his ability to pay and that payments should be related to service received. In short, that no one should see a $100,000 tax bill to pay for health care.

The underlying bill has three taxes:

  • A payroll tax of 11% on the employer and 2% on the employee. This raises about $1.45 billion.
  • A 10 % tax on the amount of non-wage income that exceeds wage income. This intended to capture income from individuals who live on unearned or out of state income but who will be included in GMC. This raises about $100 million.
  • The elimination of the pass through of federal itemized deductions to Vermont taxes. The pass through primarily benefits high-income taxpayers and most states with an income tax do not allow the pass through. This raises about $65 million.

Most of the revenue in the underlying bill is raised by the payroll tax. There are two reasons for this. First, a payroll tax divided between employers and employees mimics the current system of financing health care where both employers and employees pay premiums. Thus, a payroll tax causes less disruption than any other revenue source.

But, the second reason for choosing a payroll tax is more important. A payroll tax paid by the employer is a deductible business expense to the employer. Depending on the tax status of the employer, the value of this deduction could range from nothing (if the business were never profitable) to 39%. Overall, it is a fair estimate that, if we go with a payroll tax, the federal government will pick up at least 25% of cost to Vermont employers of Green Mountain Care. Thus an 11% payroll tax would have an effective rate to employers on average of 8.25%. No other revenue source has this implicit federal subsidy.

 

Now, let me turn to the question of why I introduced the bill.

Green Mountain Care is biggest and most expensive project ever undertaken by the state of Vermont. It is an undertaking on the order of magnitude of creating from scratch a public education system or the social security system. To pay for Green Mountain care, Vermont will have to enact the largest tax increase in Vermont history but it is a tax increase that will save Vermonters money. Overall Vermonters will save more in premiums and expensive services (such as emergency room care for the uninsured) than they will pay in taxes.

Raising the approximately $2 billion needed for Green Mountain Care is a big decision, but not necessarily a complicated one. In fact, the very size of the amount that needs to be raised greatly reduces our options and therefore simplifies our choices.

There are four taxes — and only four taxes — that can raise $2 billion. These are (1) a payroll tax, (2) the income tax, (3) the sales tax, and (4) a capitation tax, or mandatory premium. I asked the Joint Fiscal Office (JFO) to prepare a chart showing how much each tax would have to go up to raise $2 billion:

  • Using just the payroll tax, we would need a rate of 17%.
  • If we used just the income tax, we would have to start the tax with a 33% bracket and a top rate of 39%.
  • If we used just the sales tax, we would have to expand the tax to cover food and clothing and we would need to set the overall rate at 29%.
  • If we use just premiums, every Vermonter not excluded from Green Mountain Care will have to pay an annual premium of $5200.
  • If $500 million were raised from each source, it would require a payroll tax of 4.25%, a public premium of $1,325, a 7.5% increase in the marginal rates in the income tax, and a 5.75% hike in the sales tax to 11.75%

Because there are so few choices, it is not hard to come up with a workable plan to finance Green Mountain care. The hard part is having the political will to do it.

If the experience of every other industrialized country is a guide, universal publicly financed health care will be significantly less expensive than our current system of paying for health care. But, it will be substantially more expensive for some people and that is the dilemma.

If we use just the payroll tax, we will add 17% to the bottom line of the many Vermont businesses that do not now offer health care. We will alienate our largest employers, who are self-insured and who would see their costs rise as their employees get the superior Green Mountain Care benefits. If we hike the income tax by adding 30% to each tax bracket, we will alienate almost everyone. We will certainly alienate the state’s highest earners who could face a combined state and federal tax rate of 78%. European countries have a sales tax (called the VAT) that ranges from 20 to 25%, so a 29% sales tax is not impossible — except that we are not our own country. Vermont retailers will fiercely oppose a hike in the sales tax. Everyone who has good health care will oppose the mandatory premiums.

I see no sign that Administration or the legislature is prepared to support tax hikes of the kind I have outlined. The Administration declined to present the plan required by Act 48 in January 2013 and more recently the Governor declined to share his administration’s ideas with the legislature, although he had said he would do so.

I have sympathy for our executive. There is no financing plan that will not alienate large parts of our business community and many other Vermonters. Around Montpelier, the raised voices of a disaffected minority always seem to count for more than those of a silent majority who might benefit. In the case of any plan to pay for Green Mountain Care, the disaffected minority is sure to be numerous and loud. So, it is easy to understand why no plan has been put forward.

But, Mr. President, not having a financing plan also has economic consequences.

I have spoken with several of our largest employers. They say that uncertainty about what they will have to pay for health care affects their investment decisions for Vermont. Imagine a company with a $200 million payroll. That company doesn’t know whether or not it will have to pay $34 million in taxes on a $200 million in payroll is not likely to make new investments in Vermont. That is a lot of uncertainty. And, the company might be reluctant to invest in a state if it doesn’t know the income tax rate on its highest paid employees — the very ones who make investment decisions.

Many of my constituents strongly support universal publicly financed health care. But, they are anxious about how it might affect them and this is especially true of older Vermonters who live on fixed incomes. We have an obligation as public servants to alleviate that anxiety, and we can alleviate it.

We should end the uncertainty that is undermining our economy. Green Mountain Care might make Vermont attractive to certain kinds of companies, indeed to the socially responsible companies that we would love to have here. But, it is hard to make investment decisions if you don’t know whether if there will be Green Mountain Care and how it will be paid for.

Let us be honest with our constituents. If we are not willing to raise $2 billion — if we are not ready for a payroll tax, for a doubling of the income tax, for a doubling of the sales tax and for a premium tax — let’s say so.

Pretending we don’t know how to raise $2 billion is a poor excuse for ducking a tough decision and disservice to the people of Vermont.

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The Phnom Penh Post: Big Brother is watching closely

Peter Galbraith is quoted in this article. Please go to The Phnom Penh Post to read the article.

As Peter Galbraith, a former US ambassador, wrote in The Guardian: “How serious is the invasion of privacy? The NSA can vacuum up huge quantities of data, but that does not mean it is useful.”

He added: “Most of us lead lives that are of no interest to any intelligence agency and, even for people of interest, most conversations and email are of no intelligence value.”

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