Thursday in Whitewater will be partly sunny with a high of 91. Sunrise is 5:59 AM and sunset 8:00 PM, for 14h 00m 52s of daytime. The moon is a waxing crescent with 17.1% of its visible disk illuminated.
On this day in 1981, IBM releases the IBM Personal Computer.
Over at ProPublica, Secret IRS Files Reveal How Much the Ultrawealthy Gained by Shaping Trump’s “Big, Beautiful Tax Cut.” Their exhaustive reporting reveals the zealous role that Sen. Ron Johnson played in getting tax breaks for his campaign donors.
The story helps answer part of the question on Johnson’s motivations (U.S. Sen. Ron Johnson: Ambitious, Compromised, or Crackpot?). Johnson may be all three, but he’s plainly beholden to a few donors by ideology or ambition. The entire story is recommended in full. Excerpts on Johnson’s role for two big donors appear below:
Johnson’s demand was simple: In exchange for his vote, the bill must sweeten the tax break for a class of companies that are known as pass-throughs, since profits pass through to their owners. Johnson praised such companies as “engines of innovation.” Behind the scenes, the senator pressed top Treasury Department officials on the issue, emails and the officials’ calendars show.
Within two weeks, Johnson’s ultimatum produced results. Trump personally called the senator to beg for his support, and the bill’s authors fattened the tax cut for these businesses. Johnson flipped to a “yes” and claimed credit for the change. The bill passed.
Confidential tax records, however, reveal that Johnson’s last-minute maneuver benefited two families more than almost any others in the country — both worth billions and both among the senator’s biggest donors.
Dick and Liz Uihlein of packaging giant Uline, along with roofing magnate Diane Hendricks, together had contributed around $20 million to groups backing Johnson’s 2016 reelection campaign.
The expanded tax break Johnson muscled through netted them $215 million in deductions in 2018 alone, drastically reducing the income they owed taxes on. At that rate, the cut could deliver more than half a billion in tax savings for Hendricks and the Uihleins over its eight-year life.
Johnson’s intervention in November 2017 was designed to boost the bill’s already generous tax break for pass-through companies. The bill had allowed for business owners to deduct up to 17.4% of their profits. Thanks to Johnson holding out, that figure was ultimately boosted to 20%.
That might seem like a small increase, but even a few extra percentage points can translate into tens of millions of dollars in extra deductions in one year alone for an ultrawealthy family.
The mechanics are complicated but, for the rich, it generally means that a business owner gets to keep an extra 7 cents on every dollar of profit. To understand the windfall, take the case of the Uihlein family.
Dick, the great-grandson of a beer magnate, and his wife, Liz, own and operate packaging giant Uline. The logo of the Pleasant Prairie, Wisconsin, firm is stamped on the bottom of countless paper bags. Uline produced nearly $1 billion in profits in 2018, according to ProPublica’s analysis of tax records. Dick and Liz Uihlein, who own a majority of the company, reported more than $700 million in income that year. But they were able to slash what they owed the IRS with a $118 million deduction generated by the new tax break.
Liz Uihlein, who serves as president of Uline, has criticized high taxes in her company newsletter. The year before the tax overhaul, the couple gave generously to support Trump’s 2016 presidential campaign. That same year, when Johnson faced long odds in his reelection bid against former Sen. Russ Feingold, the Uihleins gave more than $8 million to a series of political committees that blanketed the state with pro-Johnson and anti-Feingold ads. That blitz led the Milwaukee Journal Sentinel to dub the Uihleins “the Koch brothers of Wisconsin politics.”
Johnson’s campaign also got a boost from Hendricks, Wisconsin’s richest woman and owner of roofing wholesaler ABC Supply Co. The Beloit-based billionaire has publicly pushed for tax breaks and said she wants to stop the U.S. from becoming “a socialistic ideological nation.”
Hendricks has said Johnson won her over after she grilled him at a brunch meeting six years earlier. She gave about $12 million to a pair of political committees, the Reform America Fund and the Freedom Partners Action Fund, that bought ads attacking Feingold.
In the first year of the pass-through tax break, Hendricks got a $97 million deduction on income of $502 million. By reducing the income she owed taxes on, that deduction saved her around $36 million.
See also Johnson & Fitzgerald: Betrayers of Wisconsin, Ron Johnson Reads Lies about the Capitol Riot, Sen. Ron Johnson: ‘An all-access purveyor of misinformation,’ and Famous Moments in Climatology: Sen. Ron Johnson Shares His Insights.