President Donald Trump began the new year with an apocalyptic Twitter outburst, taunting the North Korean leader, Kim Jong Un, that “I too have a Nuclear Button, but it is a much bigger & more powerful one than his, and my Button works!”
Meanwhile, like an adult trying to carry on an intelligent conversation while a child is having a tantrum, President Moon Jae-in of South Korea has tried to resume direct engagement with Pyongyang, which was cut off nearly two years ago. It provided at least a dim glimmer of hope that the North Korean nuclear arms crisis can be resolved peacefully.
It’s a move that requires patience and humility, qualities Trump generally lacks. The North Koreans have long made clear that they view South Korea as a lackey of their chief adversary, the United States. Yet since his inauguration in May, Moon has called for dialogue with the North, which severed all communications with Seoul in 2016 after Moon’s conservative predecessor shuttered an industrial complex in the North.
Moon has been pressing Pyongyang for months to send a delegation to the Winter Olympics his nation is hosting next month. The proposal was effectively ignored until Kim used his annual New Year’s Day speech to signal he was “open to dialogue” with the South to discuss easing military tensions on the Korean Peninsula, as well as to sending North Korean athletes to join the games.
Moon quickly took advantage of the opening, proposing that high-level negotiators meet next Tuesday at the village of Panmunjom at the Demilitarized Zone on the border. On Wednesday, the North agreed to South Korea’s suggestions to reopen a hotline at the DMZ, restoring a communications channel that let the two sides talk directly if tensions rose. The need has never been clearer than now, as Trump and Kim trade threats and inflame regional tensions.
There is reason to be wary of Kim’s intentions, given his history of ruthlessness and threats to launch a weapon against the United States, including the rant that preceded Trump’s belligerent tweet. By expressing interest in talks with South Korea, Kim may be trying to drive a wedge between Moon and Trump, who has largely rejected negotiations in favor of crippling sanctions and dangerous bombast against the North. But that is a situation that Trump has put himself in, and from which he could extricate himself.
Moon is right when he insists that sanctions alone will not end the North’s nuclear weapons program and when he objects to pre-emptive military action against North Korea, which Trump is reportedly considering at the risk of unleashing a full-scale war that would cause vast numbers of deaths.
But while dialogue between North Korea and South Korea is crucial to peacefully resolving the issues that divide the two countries, the United States, which defended South Korea in the Korean War and has nearly 30,000 troops on the Korean Peninsula, is also central to any solution, and needs to closely coordinate with its ally.
The South Koreans have asked the Americans to defer joint military exercises to ensure calm during the Olympics. This makes sense. So would a decision by North Korea to forgo any nuclear or missile testing. Whether those temporary measures could be extended beyond the Olympics would depend on whether negotiations prove fruitful.
Some fear that as part of any dialogue, South Korea could make too many concessions, like agreeing to end military exercises with the United States or no longer participating in sanctions. Still, dialogue is a risk worth taking.
Robert Carlin and Joel Wit, former American negotiators with North Korea who have analyzed Kim’s New Year speech as well as a separate government statement, believe that North Korea’s interest in discussions with South Korea is serious. The only way to know that is to test it, with the United States leading the way on a comprehensive strategy integrating sanctions, prudent statements and negotiations.
It wasn’t until the end of his State of the State address that Gov. Andrew Cuomo mentioned President Donald Trump by name. But the president was unmistakably in Cuomo’s sights Wednesday nearly from the start of the 92-minute speech, which served as both a blueprint for his own re-election campaign this year and as a possible outline for 2020 should he seek the White House.
First came the state’s 2018 realities, including how to make up for lost revenues — $2 billion worth, the governor said — from a federal government he called “the most hostile and aggressive toward New York in history.” But more than money was at stake. He suggested that the nation’s very soul was imperiled by this national administration. “It’s always pitting one group against the other,” he said. “It’s always conflict. It’s always either-or.” And in case there was conceivably anyone unclear about whom he meant, he praised New York’s diversity and evoked the Latin motto “e pluribus unum” — out of many, one — embedded in a flag “right behind President Trump’s desk.”
“To find the way forward, the president only needs to turn around,” he said to loud applause as he wound up. “That, my friends, is the true formula for what makes America great.”
As he seeks a third term, Cuomo cast himself as a political progressive, but one more pragmatic than some others in his Democratic Party. (Might he have been thinking of you, Mayor Bill de Blasio?) “Progressive leaders must be dreamers and doers, visionaries and achievers,” he said, adding that people “don’t need theoretical progressive politics — they need practical politics, actual politics that makes a difference in their lives.”
Cuomo stuffed so many proposals into his speech that it veered toward dirigible size. He touched on issues from environmental protection to economic development, from anti-terrorism policing to coping with the opioid crisis, from enhancing workers’ rights to restructuring the state’s tax code to offset the fiscal threat potentially created by the Republicans’ tax changes.
On the progressive front, the governor seized the #MeToo moment, demanding that public funds no longer be used to pay for claims of sexual harassment by government officials. On criminal justice, he said that bail policies had to be reformed so that the accused — disproportionately blacks and Latinos — are not unfairly kept behind bars because they don’t have the money. On campaign financing, he called for its overhaul and urged the advent of early voting and same-day registration for a New York electoral system that is notoriously regressive.
Whether these appeals become reality remains, of course, to be seen. More than a few of them have been heard before to no avail. Some seemed beyond fanciful, like his proposal of a new subway tunnel connecting Red Hook in Brooklyn to Manhattan.
As for New York City’s troubled subways, the governor promised new ideas will be coming. He refrained from using the term “congestion pricing,” which he’d favored in the past, as a way to pay for desperately needed improvements. Instead, he referred to some sort of “exclusive zone in Manhattan where additional charges could be paid,” presumably by drivers. It sounded like congestion pricing, though. And he may have thrown an elbow at de Blasio’s preference for a “millionaires tax” to support mass transit when he vaguely mentioned those offering “cheap political slogans.”
Not for the first time, Cuomo’s father, Mario Cuomo, loomed large for him, an object of both veneration and challenge. If he wins in November, he will have matched his father’s three terms as governor. Not that he would ever compare himself to his father, Cuomo insisted; it would upset his mother, Matilda, who sat in the Albany audience. “It would be no meatballs for Andrew,” he said to laughter. The real question, though, is not dinner chez Cuomo, but will the son take the step that the father contemplated and ultimately skipped: a run for president.
Some conservatives have been almost gleeful that the Republican tax overhaul will hurt people who live in high-cost states like California, New Jersey and New York. An economist who has advised President Donald Trump called it “death to Democrats.”
But their celebrations may have been premature. In their rush to enact tax cuts before the end of 2017, Trump and Republican leaders in Congress created a legislative monster riddled with flaws and loopholes that even they don’t fully understand. They have offered up a bonanza to tax lawyers and accountants looking for provisions that can be exploited to lower taxes for clients.
Add to that list state officials like Gov. Andrew Cuomo of New York and Kevin de León, president pro tem of the California Senate, who say they are working to negate the damage from a part of the tax law that limits the deduction for state and local taxes to $10,000 a year. To put that number into context, the average deduction in California, New Jersey and New York was more than $17,000 in 2015, according to the Government Finance Officers Association. More than a third of taxpayers in those states claimed the deduction.
There are three approaches state officials could use to undercut the tax law. First, they could encourage families to donate money to the state government by offering them a credit for those gifts against state income taxes. The idea would be to turn state taxes into charitable donations that are deductible against the federal income tax. This might sound like a gimmick that the IRS could easily shut down. But David Kamin, a law professor at New York University, says there is precedent supporting such a policy. For example, some states offer tax credits to people who donate money to private schools, and these donations also qualify for the federal charity deduction.
Under the second approach, which is advocated by economist Dean Baker, state governments would replace their income taxes with payroll taxes paid by employers. Those kinds of taxes — like the one for unemployment insurance coverage — are deductible for businesses under the Republican tax law. That switch would mean that employers could pay their workers less, but take-home pay would stay the same because employees wouldn’t be on the hook for paying state income taxes.
But other experts warn that switching to a payroll tax would be complicated and could have unintended consequences if states don’t put in place other safeguards. For example, it might not be possible for employers to reduce the wages of workers who are covered by union contracts or who earn the minimum wage. A switch to a payroll tax might also tempt some businesses to move to nearby states that do not have such a tax.
The third approach is for states to file a lawsuit challenging the constitutionality of the tax law. Cuomo said Wednesday that he would file such a suit, claiming that the provision limiting deductibility of state and local taxes amounts to double taxation. Other officials, including the governor-elect of New Jersey, Phil Murphy, are considering similar legal action. But experts say that such lawsuits are unlikely to succeed because they ask courts to read the 16th Amendment, which authorized the federal income tax, very broadly. Further, Congress already restricts the use of the state and local tax deduction through the alternative minimum tax, says Kim Rueben of the Urban-Brookings Tax Policy Center. The new law will reduce the number of people who end up paying the alternative minimum tax.
It is hard to say if any of these maneuvers would be successful. But they could potentially cost the federal government billions of dollars in tax revenue. No doubt Republicans in Washington would be peeved and might try to pass legislation that seeks to outlaw or reduce the effectiveness of these state policies. But that might not be an option if Democrats gain House seats or take control of one or both chambers of Congress in the November election — an outcome that has probably become more likely thanks to the tax law.
None of this should come as a surprise. Republican leaders invited taxpayers and state governments to play tax avoidance games by rushing through an unpopular mess of a tax bill that, over time, will benefit few and hurt many.
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