Category: Pocket Padding

The Trump administration wants to let bosses keep their workers’ tips

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The Trump administration has kept its promise to let companies do business with less government oversight. From the Environmental Protection Agency to the Department of Health and Human Services, the administration has rolled back rules on oil companies, banks, and health insurance companies.

Trump’s efforts could soon reach your neighborhood restaurant, barbershop, and nail salon. One of the administration’s major deregulation efforts is currently underway at the Department of Labor — and if implemented, it could potentially hurt millions of American workers who get tips as part of their jobs.

The agency is considering a new rule that would give employers unprecedented control over what to do with a worker’s gratuities. The rule, which the agency proposed in December, would repeal an Obama-era regulation that made official what had been the common view for decades: that tips are the sole property of the workers who earn them. It would essentially allow employers to use their workers’ tips for tip-pooling arrangements, provided their workers make the minimum wage.

If the new rule is finalized, it would be a boon to the restaurant industry, which has been fighting for years to control how servers’ tips are distributed.

“This is a major departure from how the DOL has always interpreted the law,” said Judith Conti, the federal advocacy coordinator for the National Employment Law Project. “It sets policy for all tipped workers: parking attendants, car washers, airport valets, taxi drivers, hotel bellhops.”

The rule would have an immediate effect in at least six states, including Arizona and Nevada, where employers are required to pay the full minimum wage to all tipped workers. (Under federal law, the minimum wage for tipped workers is only $2.13; the full minimum wage is $7.25.)

But even states that don’t require the full minimum wage for tipped workers will be affected. Workers who earn the full minimum wage but still count on tips to supplement their pay — such as barbers and nail technicians — could see their take-home pay affected. (According to one estimate, there are 4.3 million tipped workers in the US.)

The rule would also create an incentive for some restaurant owners in those states to pay servers the full $7.25 hourly minimum wage. That might sound like good news for servers who make only the tipped-worker minimum wage of $2.13 per hour — but if those workers normally make enough tips to push their pay above $7.25, the new rule would allow their employers to take any tips they earn above minimum wage, effectively lowering their take-home pay. Including tips, the average hourly wage for restaurant servers in the United States was $11.73 in 2016.

The new rule would allow restaurant owners to do two things in particular. First, it would let employers collect the servers’ tips into a pool that would be shared with back-of-the-house workers — dishwashers, cooks, etc. — who have to be paid the regular minimum wage and aren’t typically tipped. Restaurant owners say that back-of-the-house workers should get a share of the tips because they contribute to a customer’s overall experience, but labor rights groups and servers argue that restaurant owners should just pay those workers better, instead of using servers’ tips to subsidize their pay.

But the second way employers could use the tips goes even further than expanding this type of tip pooling. The rule lists examples of how else employers could use a worker’s gratuities: to renovate their restaurants, lower menu prices, or hire more workers. In other words, it allows restaurant owners to keep the tips for themselves.

The proposal immediately triggered outrage among restaurant servers and labor rights groups, who flooded the Department of Labor with thousands of comments.

The Economic Policy Institute, a left-leaning think tank, estimates that the rule would likely transfer about $5.8 billion in tips each year from workers to their bosses — about 16.1 percent of all their tips. Labor Secretary Alexander Acosta reportedly tried to hide an internal analysis showing that the rule could take $640 million from workers (an initial analysis showed it would actually take billions of dollars), according to a Bloomberg investigation. Now the agency’s inspector general is investigating the allegations.

“It’s really, really troubling,” said Sharon Block, a law professor at Harvard who worked at the Department of Labor under the Obama administration and who helped develop the Obama-era rule clarifying that tips were the property of the workers who earned them. “This is no small thing for people who really can’t afford to be subsidizing their employers.”

Despite the backlash, the Department of Labor is still considering implementing the new rule. A spokesperson for the department said the agency is currently in the process of reviewing more than 375,000 public comments it received.

[Vox]

Trump properties collect more than $271,000 in a single month from GOP donors

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The Republican National Committee spent a little more than $271,000 last month at properties owned by President Trump, new campaign filings show.

Most of the money — $205,021 — went to Trump National Doral in Miami, for “venue rental and catering,” according to the party’s monthly report filed Tuesday night with the Federal Election Commission.

The Republican National Committee’s February spending is on top of the $1.1 million that Trump’s campaign and other Republican political committees and candidates reported spending at his properties during his first year in office. Although Trump relinquished management of his real-estate empire when he became president last year, he did not give up his ownership. As a result, using political donors’ money to host events at Trump properties helps boost the president’s personal bottom line.

Tuesday’s filing makes clear that the RNC has plenty of money to spend.

The committee raised $12.8 million in February, bringing its total fundraising to $157.7 million for the election cycle. The record-breaking haul has helped the party build a voter-outreach operation that’s already active in 25 states, according to party chairwoman Ronna McDaniel.

The party started March with $42.4 million in cash reserves, a dramatic improvement from the $10 million the RNC had in reserves at this point in the 2014 midterm elections.

By contrast, the Democratic National Committee has total receipts of $80.7 million so far in the 2018 election cycle. The Democrats started the March with nearly $10.1 million remaining in the bank, but the DNC has more than $6 million in debts, including a $1.7 million loan it secured last month.

[USA Today]

Out of Public View, Trumps and Kushners Are Talking Business

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The Kushner and Trump families have both been in New York real estate for decades.

But until relatively recently, they didn’t work together on large projects.

That appears to be changing with a new Jeresy Shore development led by the Kushners, which the New York Times is reporting will have at least one hotel managed by the Trumps. According to the Times, there is a signed letter of intent.

“The long-running talks blur the line between family, business and politics in ways that lack precedent: Both Mr. Trump and Mr. Kushner, the president’s senior adviser and son-in-law, retain financial interests in their family businesses,” the Times writes. “The Trump Organization’s outside ethics adviser has raised questions about a potential deal—one reason the two-year-long discussions have not been completed.”

The report quotes an ethics advisor who points out that this conflict of interest may be the reason Trump hasn’t pushed his son-in-law out of the White House, despite Kushner losing his top-secret security clearance and reports that other nations were looking to exploit his massive debt load in negotiations.

“The concern is that the president might not want to do anything that would upset the Kushner family agreement to do business with his company,” said the ethics advisor.

The story goes on to detail all the places the Kushners have borrowed money and to discuss the rarely used emoluments clause of the Constitution.

[RawStory]

Eric Trump charity paid Trump Organization companies $150K during election

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Eric Trump’s charitable foundation paid nearly $150,000 to President Trump’s business during the 2016 presidential race, according to newly released tax documents reported by the Daily Beast on Thursday.

The younger Trump’s foundation, now called Curetivity, paid a total of $145,145 to four Trump companies in 2016, down from $322,000 the year before, according to the report.

Of that, $98,730 went to President Trump’s Westchester golf resort in New York, while smaller amounts were distributed to Trump’s clubs in Palm Beach, Fla., the Bronx and the Trump SoHo hotel.

Eric Trump’s charity regularly held charitable events at his father’s resorts and clubs, and the Trump Organization would then bill the foundation for services used.

Forbes reported last June that President Trump previously insisted that his son’s foundation pay the Trump Organization for the events, despite the fact that the services could be offered for free.

Forbes also reported that Eric Trump had in the past falsely claimed that his charity uses Trump Organization locations completely free of charge.

The foundation was holding events at Trump Organization properties as recently as September, when Forbes reported that Curetivity hosted a charitable event at the Trump National Golf Club in New York.

Eric Trump defended his foundation’s expenses in a statement to The Hill in September, noting the organization’s charitable work for St. Jude’s Children’s Hospital.

“In the 10 years of operation, the Eric Trump Foundation [raised] over $16.3 million for St. Jude and maintained an expense ration of less than 10 percent,” Trump said in September.

The foundation’s dealings have come under some scrutiny. Last June, New York Attorney General Eric Schneiderman’s (D) office opened an investigation into whether Trump’s foundation improperly funneled money to the Donald J. Trump Foundation.

[The Hill]

Trump Administration Waives Punishment For Convicted Banks, Including Deutsche — Which Trump Owes Millions

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The Trump administration has waived part of the punishment for five megabanks whose affiliates were convicted and fined for manipulating global interest rates. One of the Trump administration waivers was granted to Deutsche Bank — which is owed at least $130 million by President Donald Trump and his business empire, and has also been fined for its role in a Russian money laundering scheme.

The waivers were issued in a little-noticed announcement published in the Federal Register during the Christmas holiday week. They come less than two years after then-candidate Trump promised “I’m not going to let Wall Street get away with murder.”

Under laws designed to protect retirement savings, financial firms whose affiliates have been convicted of violating securities statutes are effectively barred from the lucrative business of managing those savings. However, that punishment can be avoided if the firms manage to secure a special exemption from the U.S. Department of Labor, allowing them to keep their status as “qualified professional asset managers.”

In late 2016, the Obama administration extended temporary one-year waivers to five banks — Citigroup, JPMorgan, Barclays, UBS and Deutsche Bank. Late last month, the Trump administration issued new, longer waivers for those same banks, granting Citigroup, JPMorgan, and Barclays five-year exemptions. UBS and Deutsche Bank received three-year exemptions.

In the year leading up to the new waiver for Deustche Bank, Trump’s financial relationship with the firm has prompted allegations of a conflict of interest. The bank has not only sought the Labor Department waiver from the administration, it has also faced Justice Department scrutiny and five separate government-appointed independent monitors. Meanwhile, the New York Times recently reported that federal prosecutors subpoenaed Deutsche for “bank records about entities associated with the family company of Jared Kushner, President Trump’s son-in-law and senior adviser.”

All of these interactions with the Trump administration and the federal government are transpiring as Deutsche serves as a key creditor for the president’s businesses.

Trump owes the German bank at least $130 million in loans, according to the president’s most recent financial disclosure form. Sources have told the Financial Times the total amount of money Trump owes Deutsche is likely around $300 million. The president’s relationship with the bank dates back to the late 1990s, when it was the one major Wall Street bank willing to extend him credit after a series of bankruptcies. In 2016, the Wall Street Journal reported Trump and his companies have received at least $2.5 billion in loans from Deutsche Bank and co-lenders since 1998.

The relationship has had problems. After the financial crash, Trump defaulted on a $640 million loan from the bank. Deutsche brought Trump to court, and the famously litigious real estate mogul countersued for $3 billion in damages, claiming the financial crisis was a “force majeure” event that Deutsche Bank helped create. But the rift was short-lived: the parties settled, the loan was repaid, and Deutsche was soon lending to Trump again.

In December, Bloomberg and others reported the bank had turned over financial records to special prosecutor Robert Mueller after his office subpoenaed the records as part of his investigation into possible collusion between the Trump campaign and Russia during the 2016 election. Trump’s lawyers have called that reporting inaccurate.

“We have confirmed that the news reports that the Special Counsel had subpoenaed financial records relating to the President are false,” Trump attorney Jay Sekulow said in a statement. “No subpoena has been issued or received. We have confirmed this with the bank and other sources.”

Less than three weeks later, the New York Times reported federal prosecutors had subpoenaed Deutsche Bank records related to White House senior adviser and Trump son-in-law Kushner and his vast business holdings. There is no evidence those subpoenas were related to Mueller’s investigation.

The subpoenas come less than a year after Deutsche Bank was fined $425 million by New York State for laundering $10 billion out of Russia.

All five of the banks granted waivers from the Obama and Trump administration were fined for their involvement in the LIBOR scandal that led to $9 billion worth of fines from regulators around the world. Deutsche Bank has paid $3.5 billion for its role in the scandal, more than any other bank. The scandal involved illegally manipulating the London Interbank Offered Rate or LIBOR, which is used to set the cost of borrowing for a variety of financial transactions.

In 2015, Deutsche Bank pled guilty in the U.S. to wire fraud for its role in the scandal. Less than two years later, in the final hours of the Obama administration, Deutsche Bank agreed to a $7.2 billion settlement with the Justice Department for misleading investors in mortgage-backed securities between 2006 and 2007.

[International Business Times]

White House defends Trump claim tax plan will cost him ‘a fortune’

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The White House defended President Trump’s assertion that the forthcoming tax reform bill will cost him a “fortune,” while admitting he could benefit from cuts to corporate taxes.

Press secretary Sarah Huckabee Sanders responded to repeated questions from reporters during Tuesday’s briefing about Trump’s assertion, which he made during a Nov. 29 speech in Missouri.

Sanders defended the president by arguing that he hasn’t been focused on himself, but instead on the impact the bill would have on everyday Americans.

“In some ways, particularly on the personal side, the president will likely take a big hit. But on the business side, he could benefit,” she said.

“The biggest focus for this White House is to makes sure all Americans are better off today when this tax package passes than they were before hand. We really focused on invigorating the middle class and making sure they get more of their hard-earned money.”

Multiple independent analyses show that Trump, whose net worth is pegged by Forbes at $3.1 billion, stands to benefit from GOP tax plan.

When reporters noted that the overall impact on Trump’s bottom line is unclear because he has not released his tax returns, Sanders said that Trump will not release his tax returns while they are under audit, which is the line that Trump took during the presidential campaign too. The IRS, however, has said an audit does not prevent an individual from releasing personal tax information.

Using information from a leaked portion of Trump’s tax returns from 2005, NBC News quoted a tax expert estimating that the combined estates of both Trump and first lady Melania Trump would save about $1 billion from the repeal of the estate tax. The expert also estimated that Trump would save $22.6 million thanks to the repeal of the alternative minimum tax, after capital gains taxes were taken into account. But without Trump’s most recent tax returns, or a more full glimpse at the 2005 return, the full impact couldn’t be nailed down.

The House passed the final version of the plan Tuesday afternoon, with the Senate expected to vote on the bill later that same day.

[The Hill]

Graham tweets about ‘spectacular’ Trump golf course

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Sen. Lindsey Graham (R-S.C.) tweeted about golfing with President Trump at one of Trump’s courses shortly after the pair wrapped up their round.

“Trump International Golf Club is a spectacular golf course,” Graham tweeted.

“Great day of fun playing with @POTUS @realDonaldTrump.”

The pair golfed at the Trump International Golf Club in West Palm Beach, Fla., on Sunday.

“The president is playing a round of golf with Sen. Lindsey Graham, where the two are discussing the tax cuts and reform legislation and the importance of fully funding our national security needs in upcoming government spending negotiations,” said White House spokesman Raj Shah.

Walter Shaub, the former head of the Office of Government Ethics, quickly replied to Graham’s tweet promoting Trump’s for-profit business.

Graham and Trump have golfed together before at Trump’s course in Virginia.

Graham told GOLF Magazine that Trump had shot a 73 during their game in October, a score the publication called “unlikely, to say the least.”

[The Hill]

Trump’s team insists he has a ‘full schedule’ an hour before he goes golfing

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President Trump is at Mar-a-Lago, his resort in Palm Beach, Fla., for the Thanksgiving holiday. It’s the Wednesday of Thanksgiving week, a day that can generally be fairly described as low-key for most people. In fact, you’re not even reading this right now; you’re driving to a relative’s house or you’re trying to remember what you need to get at the grocery store.

“Low-key” is also how deputy White House press secretary Lindsay Walters described the day to the press pool Wednesday morning. Trump would make a few calls this week, she said, but otherwise not much going on.

Less than 10 minutes later, though, the White House asked the press pool for a correction.

“While the White House communications staff expects the press pool to have a ‘low-key day,’” the update from The Washington Post’s Jenna Johnson wrote, “the president will NOT have a low-key day and has a full schedule of meetings and phone calls.”

Got that? Not Trump on vacation at Mar-a-Lago. Trump working hard at what he calls the “Winter White House.” Trump tweeted to that effect Wednesday morning.

Trump calls it the “Winter White House” so that people will see his time there as an extension of his normal work life. In one sense it is: A president is never actually off-duty. In most senses, though, it isn’t. Trump’s calendar is generally clear when he’s at Mar-a-Lago (or at his club in Bedminster, N.J.), with time instead reserved for playing golf.

But Trump consistently wants to give Americans the impression that he’s working when he’s at one of his private clubs. This is the president, after all, who on the campaign trail insisted that he probably wouldn’t have time to play golf if elected. It’s why he always talks about phone calls and meetings that aren’t on his official calendar, taking advantage of the public’s assumption that a president is working 24/7 to provide cover for the time he spends at leisure.

So we get a parade of tweets like these.

[Washington Post]

Taxpayers pay legal bill to protect Trump business profits

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Taxpayers are footing the legal bill for at least 10 Justice Department lawyers and paralegals to work on lawsuits related to President Trump’s private businesses.

Neither the White House nor the Justice Department will say how much it is costing taxpayers, but federal payroll records show the salaries of the government lawyers assigned to the cases range from about $133,000 to $185,000.

The government legal team is defending President Trump in four lawsuits stemming from his unusual decision not to divest himself from hundreds of his companies that are entangled with customers that include foreign governments and officials.
In the cases, Justice Department attorneys are not defending policy actions Trump took as president. Instead, the taxpayer-funded lawyers are making the case that it is not unconstitutional for the president’s private companies to earn profits from foreign governments and officials while he’s in office.

The government lawyers and Trump’s private attorneys are making the same arguments — that the Constitution’s ban on a president taking gifts from foreign interests in exchange for official actions does not apply to foreign government customers buying things from Trump’s companies. The plaintiffs, including ethics groups and competing businesses, argue the payments pose an unconstitutional conflict of interest.

The Justice Department for weeks refused to answer questions about how many employees were working on the cases and for how long, falsely saying the agency doesn’t track such information. USA TODAY identified the government legal staff who are defending Trump’s business profits using the agency’s own internal case-tracking database, obtained under the Freedom of Information Act.

The Justice Department traditionally defends the office of the president and its occupants’ rights in court, sometimes under novel circumstances. However, the cases about Trump’s businesses create a historically awkward and unusual position for the public lawyers: the result of their arguments in court is to protect the president’s potential customer base.

“We’ve never before had a president who was branded and it’s impossible to divorce from that brand,” said Stuart Gerson, who served as chief of the Justice Department’s civil division for Presidents George H.W. Bush and Bill Clinton. “It’s blurring the lines because it’s so unusual. I can’t think of a precedent where another civil division lawyer has been called on to defend the president under these circumstances.”

[USA Today]

Trump plugs his Bedminster golf club in speech to South Korean National Assembly

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During a speech on Tuesday before the South Korean National Assembly, Donald Trump could not help but plug his golf course to the delegation gathered for his address.

Trump was discussing Korean golfers being “some of the best” in the world when he boastfully brought up his Bedminster Golf Club.

“In fact—and you know what I’m going to say—the women’s U.S. Open was held this year at Trump National Golf Club in Bedminster, New Jersey,” Trump said as the audience applauded. “And it just happened to be won by a great Korean golfer, Park Sung-hyun, and eight of the top players were from Korea, and the top four golfers, one, two, three, four, the top four were from Korea.”

“So, congratulations,” Trump added.

[Raw Story]

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