The Daily Parker

Politics, Weather, Photography, and the Dog

Mostly tangential news

Today I'll try to avoid the most depressing stories:

  • The North Shore Channel Trail bridge just north of Lincoln Avenue opened this week, completing an 11 km continuous path from Lincoln Square to Evanston.
  • Experts warn that herd immunity (a) is an economic concept, not a health concept and (b) shouldn't apply to humans because we're not herd animals.
  • Wisconsin remains in total chaos today after the state supreme court terminated Governor Tony Evans' stay-at-home order, approximately two weeks before a predictable, massive uptick in Covid-19 cases.
  • Delta Airlines has decided to retire its fleet of 18 B777 airplanes years ahead of schedule due to an unexpected drop in demand for air travel.
  • The pro-contagion, rabid right-wingers flashing placards saying "Be Like Sweden" clearly have no comprehension of Sweden's efforts to slow the spread of SARS-CoV-2.
  • US retail sales declined 16.4% in April, pushing the total decline since February to nearly 25%, the worst decline in history.
  • Wired has a portrait of Marcus Hutchins, the hacker who stopped the WannaCry virus from killing us all and then went to jail for his previous activities designing and spreading malware.
  • Andrew Sullivan tells the story of Samuel Pepys, "the very first pandemic blogger."

Finally, Vanity Fair has reprinted its 1931 cover article on Al Capone, which seems somehow timely.

Happy birthday, DuSable Bridge!

The bascule bridge over the Chicago River at Michigan Avenue turned 100 today. The Chicago Tribune has photos.

Also:

And the New York Times interviewed science-fiction author John Scalzi, whose The Last Emperox came out two weeks ago.

Wednesday, 74 March 2020

Just when you thought the Republican Party couldn't become more anti-science and pro-profit (at the expense of workers), the Wisconsin Supreme Court just struck down Wisconsin's stay-at-home order on a 4-3 party-line vote.

If only that were all:

Someday, we'll all look back on this time, laugh nervously, and change the subject.

That's not how this works

This is a wonky post about tax law and at the same time a pissed-off post about political advocacy under cover of "neutral" commentary that takes advantage of people's ignorance of a nuanced area of law.

Bruce Willey, an Iowa-based tax lawyer, claims in a pearl-clutching post on Kiplinger that recent IRS guidance on Paycheck Protection Program (PPP) loan forgiveness "could bankrupt small businesses:"

On April 30, late in the evening — when few people were likely paying attention — the IRS released guidance that essentially nullified much of the benefit of the Paycheck Protection Program (PPP) created under the CARES Act. It stated that those who receive PPP may not receive tax deductions for using those funds to pay expenses. That includes expenses like payroll and rent, the very point of the PPP.

Let’s say a small-business owner requests and receives $600,000 to cover payroll for the 10 weeks where he or she is covered by the PPP. If they can’t deduct that amount as expenses, that means their federal tax burden clocks in at a rate of 37%.

That equates to a $222,000 increase in their taxable income. Meaning the effective tax-free benefit of the loan is $378,000, not the $600,000 intended by the law.

No, no, no, it does not. And it's easy to see why.

Let's say that the small business takes $600k in PPP loans and pays out $600k in payrolls (including employer payroll taxes) in 2020. Let's also say the business takes in $600k in sales revenue, and that their total 2020 deductible expenses would be $1.2m regardless of the PPP.

So: Under the CARES act, they have $600k in taxable income and $1.2m in deductible expenses. But, since 50% of their 2020 books income was the $600k grant, they can only deduct 50% of that $1.2m—i.e., $600k. Result: $0 adjusted gross income and $0 taxes.

Now let's look at what happens if Bailey's wish comes true, and why the IRS said no. If the business can deduct the full $1.2m, they will have a net operating loss (NOL) of $600k, that they can use to offset future income. And that can generate future NOLs until they finally have enough AGI to offset the full NOL. A $600k NOL for a $1.2m-a-year business would probably wipe out their income tax burden for many years.

In other words, the result of the IRS guidance isn't that the IRS would cost the business money; it's that it would prevent the business from avoiding legitimate taxes in future years. And Willey knows this; he's just hoping you don't.

(Also, the IRS releases guidance every Friday night, which he also knows. But people who don't deal with income tax regularly probably don't, which he's counting on.)

Today's...uh, yesterday's articles

My day kept getting longer as it went on in a way that people living through the pandemic will understand. So I didn't have time to read any of these yesterday:

Finally, Jon Oliver has put out a line of Last Week Tonight stamps to help support the US Postal Service. So naturally I bought some.

All-or-nothing doesn't work

Harvard Medical School epidemiologist Julia Marcus argues that "quarantine fatigue is real," and it may be healthier to start relaxing self-isolation (for many people) than to continue it:

Public-health experts have known for decades that an abstinence-only message doesn’t work for sex. It doesn’t work for substance use, either. Likewise, asking Americans to abstain from nearly all in-person social contact will not hold the coronavirus at bay—at least not forever.

I’m not talking about the people who are staging militaristic protests against the supposed coronavirus hoax. I’m talking about those who are experiencing the profound burden of extreme physical and social distancing. In addition to the economic hardship it causes, isolation can severely damage psychological well-being, especially for people who were already depressed or anxious before the crisis started.

[T]he choice between staying home indefinitely and returning to business as usual now is a false one. Risk is not binary. And an all-or-nothing approach to disease prevention can have unintended consequences. Individuals may fixate on unlikely sources of contagion—the package in the mail, the runner or cyclist on the street—while undervaluing precautions, such as cloth masks, that are imperfect but helpful.

[A]s years of research on HIV prevention have shown, shaming doesn’t eliminate risky behavior—it just drives it underground. Even today, many gay men hesitate to disclose their sexual history to health-care providers because of the stigma that they anticipate. Shaming people for their behavior can backfire.

Scientists still have a lot to learn about this new virus, but early epidemiological studies suggest that not all activities or settings confer an equal risk for coronavirus transmission. Enclosed and crowded settings, especially with prolonged and close contact, have the highest risk of transmission, while casual interaction in outdoor settings seems to be much lower risk. A sustainable anti-coronavirus strategy would still advise against house parties. But it could also involve redesigning outdoor and indoor spaces to reduce crowding, increase ventilation, and promote physical distancing, thereby allowing people to live their lives while mitigating—but not eliminating—risk.

Of course, the Trump Administration's abject failure to provide adequate testing and safety guidance will only prolong our anxiety and isolation. But right-wing governments never make the trains run on time, no matter what their propaganda says.

Disbar Barr

I read the news today, oh boy:

Finally, the USS Nevada, a battleship that survived World War I and Pearl Harbor until the Navy scuttled her in 1948, has been found.

The plan is to have no plan

So believes NYU media professor Jay Rosen about how President Trump will try to win this fall:

The plan is to have no plan, to let daily deaths between one and three thousand become a normal thing, and then to create massive confusion about who is responsible— by telling the governors they’re in charge without doing what only the federal government can do, by fighting with the press when it shows up to be briefed, by fixing blame for the virus on China or some other foreign element, and by “flooding the zone with shit,” Steve Bannon’s phrase for overwhelming the system with disinformation, distraction, and denial, which boosts what economists call “search costs” for reliable intelligence.

Stated another way, the plan is to default on public problem solving, and then prevent the public from understanding the consequences of that default. ... The manufacture of confusion is just the ruins of Trump’s personality meeting the powers of the presidency. There is no genius there, only a damaged human being playing havoc with our lives.

In other fun stories:

Oh, and 151 years ago today, the Union Pacific and Central Pacific railroads completed the Transcontinental Railroad.

Fifty days in

Illinois has had a stay-at-home order in effect for over seven weeks now, though last week the state and county opened up forest trails and other outdoor activities that allow for proper distancing and discourage people clumping together in groups. So today I drove up to the northern suburbs to the site of the largest Civilian Conservation Corps project undertaken during the agency's run from 1933 to 1940.

It was good to get outside. Not my fastest-ever pace, but still respectable, and somehow I got over 10,000 steps just on the walk.

And when I got back, this was waiting in my inbox: