Economics

Checks and Balance: The 50-year plan

Published

2 months ago

October 26, 2024

This is the introduction to Checks and Balance, a weekly, subscriber-only newsletter bringing exclusive insight from our correspondents in America.

James Bennet, our Lexington columnist, considers a possible Democratic election defeat.

If you’re feeling a bit stressed about politics these days, I recommend watching this clip of Barack Obama rapping out some lyrics from “Lose Yourself” by Eminem during a rally in Detroit on Tuesday. It’s a reminder that even in this most fevered stage of the election cycle, people are having fun out on the campaign trail, connecting through music and laughter and not just the grim warnings that dominate news reports.

I guess every presidential campaign I’ve covered has had an apocalyptic phase as election day approached, with candidates declaring it the most important contest of anyone’s lifetime. And maybe this time that is so. Certainly the warnings are the most dire. Vice-president Kamala Harris is calling Donald Trump a “fascist”—citing the conclusion of people who served him in office—and the stakes to some supporters of Mr Trump are even higher. As my colleague Kennett Werner reported this week, to them this struggle is not about democracy and the rule of law versus authoritarianism but about good versus evil, a word Mr Trump himself has taken to using to describe his opponents. For some evangelicals, Mr Trump, chosen by God, represents the last chance to rid America of demonic influence.

Even for less eschatologically minded Republicans, Mr Trump’s I-alone-can-fix-it message means the possibility he might lose is devastating. Ms Harris makes no such vaulting claim for herself, to be not just this campaign’s best candidate but the last hope for the nation. In turning out voters, this extreme claim may help Mr Trump, so from his perspective it makes a lot of sense. As Eminem puts it in “Lose Yourself”, “You only get one shot. Do not miss your chance to blow.”

Yet as a party the Republicans will have future chances to blow, and whether Mr Trump’s approach will serve them well over the longer term is a different question. As I wrote this week in Lexington, I was struck by the exhilaration of the thousands who thronged to see Ms Harris when I was down in Atlanta on Saturday. Among the people I bumped into in the crowd was Mario Van Peebles, a director and actor whom I recognised from another Generation X cultural touchstone, his film “New Jack City”. I asked him the question most on my mind: what would happen to all that excitement if Ms Harris lost?

As the DJ up on stage blasted “September” by Earth, Wind & Fire, Mr Van Peebles smiled and nodded, as though he expected the question. What mattered, he said, was to do something you believed in and loved, which was why he was there. “The win is an extra.” He went on, “Sometimes America moves two steps forward, one step back…In the ten-year plan, you can get disheartened. But over the 50-year plan, black folks got the right to vote. Over the 50-year plan, women got the right to vote. Over the 50-year plan, you could love who you want to love.” He gestured at some little girls dancing in the crowd and noted they were being introduced to a big idea of what was possible. “The optics are winning,” he said.

Economics

BOI Reporting and the impact of the recent Federal Injunction

Published

2 days ago

December 21, 2024

Business Finance News

The Corporate Transparency Act (CTA) is a legislative measure designed to enhance financial transparency and mitigate risks such as money laundering, terrorist financing, and other illicit financial activities. The CTA aims to close loopholes and create a fairer business environment by requiring certain entities to disclose their beneficial ownership information. However, recent legal developments have temporarily impacted compliance requirements, bringing attention to the act’s ongoing litigation and implementation.

Federal Court Decision and Its Implications

On December 3, 2024, the U.S. District Court for the Eastern District of Texas issued a preliminary injunction in the case of Texas Top Cop Shop, Inc., et al. v. Garland, et al. (No. 4:24-cv-00478). This injunction temporarily halts the enforcement of the CTA, specifically its beneficial ownership reporting requirements. Additionally, the court order stays all deadlines for compliance.

As a result, reporting companies are currently not obligated to submit beneficial ownership information (BOI) reports to the Financial Crimes Enforcement Network (FinCEN). During the injunction, these entities are also shielded from liability for non-compliance with CTA mandates.

Despite this pause, FinCEN has clarified that companies may still voluntarily submit their BOI reports. This voluntary reporting option remains available for businesses that wish to align with the CTA’s transparency goals.

Overview of the Corporate Transparency Act

The CTA mandates that certain entities provide information about their beneficial owners—individuals who own or control a business. The act is intended to increase transparency, enhance national security, and reduce the anonymity that can facilitate financial crimes.

While the CTA has garnered support for its objectives, it has also faced legal challenges questioning its constitutionality. Courts in different jurisdictions have issued varying rulings, with some upholding the law and others granting temporary injunctions. For example, district courts in Virginia and Oregon have ruled in favor of the Department of the Treasury, asserting the CTA’s alignment with constitutional principles.

Compliance During the Injunction

Currently, the federal injunction exempts businesses from mandatory BOI filing requirements nationwide. This temporary halt will remain in place until further developments, such as a decision by an appellate court or a reversal of the injunction.

In response to the ruling, the Department of Justice, representing the Department of the Treasury, has filed an appeal. While the case proceeds through the legal system, FinCEN has confirmed its compliance with the court order.

Looking Ahead

The legal proceedings surrounding the CTA highlight the evolving nature of financial regulation. As courts continue to deliberate, businesses should monitor updates to remain informed about their obligations. By staying informed and prepared, businesses can effectively manage their compliance responsibilities and contribute to efforts that promote financial integrity and transparency.

Economics

After a chaotic scramble, Congress strikes a budget deal

Published

2 days ago

December 20, 2024

Business Finance News

Donald Trump is the most powerful Republican politician in a generation, but the president-elect is still no match for the most nihilistic members of his own party. The budget chaos that unfolded on Capitol Hill as the Christmas break approached is only a preview of the difficult realities Mr Trump will face when he starts to govern next month.