Search Results for: Debt

Highway Robbery: How the Port Trucking Industry is Rigged Against Drivers

Joe Raedle / Getty

Did you know that your Ralph Lauren polo shirt was driven to the warehouse by an indentured servant? At USA Today, Brett Murphy reports on how port truckers — required to lease their trucks from their companies — are working for pennies (or less) each week as they struggle to drive enough hours to appease their bosses and the public’s insatiable demand for merchandise from big chains like Target, Ralph Lauren, and The Home Depot. If a driver fails to log enough hours, falls behind, gets sick, or collapses from exhaustion, the company seizes their truck and they forfeit everything they’ve paid toward its purchase.

Samuel Talavera Jr. did everything his bosses asked.

Most days, the trucker would drive more than 16 hours straight hauling LG dishwashers and Kumho tires to warehouses around Los Angeles, on their way to retail stores nationwide.

He rarely went home to his family. At night, he crawled into the back of his cab and slept in the company parking lot.

For all of that, he took home as little as 67 cents a week.

Then, in October 2013, the truck he leased from his employer, QTS, broke down.

When Talavera could not afford repairs, the company fired him and seized the truck — along with $78,000 he had paid towards owning it.

Talavera was a modern-day indentured servant. And there are hundreds, likely thousands more, still on the road, hauling containers for trucking companies that move goods for America’s most beloved retailers, from Costco to Target to Home Depot.

A yearlong investigation by the USA TODAY Network found that port trucking companies in southern California have spent the past decade forcing drivers to finance their own trucks by taking on debt they could not afford. Companies then used that debt as leverage to extract forced labor and trap drivers in jobs that left them destitute.

Read the story

Inside the Canadian Credit Bubble, Where Too Many Canadians Live Beyond their Means

The credit cards that once empowered many Canadians are now allowing people to bury themselves in debt they can’t recover from. In The Walrus, Raizel Robin writes about this new middle class. It’s an aspirational one that lives paycheck to paycheck, is not always willing to give up certain lifestyle choices and luxury activities, and relies on Payday loans that only compound their problems. Some financial analysts warn that the day of reckoning is approaching.

Indeed, while the largest chunk of our household expenditures goes toward groceries, transportation, and shelter, many Canadians seem uninterested in prioritizing needs over wants—according to a recent cibc poll, only half of those surveyed were willing to cut spending on non-­essential items in order to keep up with bills. Our debt load is, in a sense, the result of an aspirational burden. “Middle class” once meant exactly that—the ­median in household net worth, or the point at which half the population has a higher income and the other half a lower one. A 2013 ­internal government document deemed middle-­class incomes to be anywhere between $54,000 and $108,000—that’s quite a spread. Middle-­class status has thus become more of a state of mind than a demographic bracket. Federal finance minister Bill Morneau recently admitted as much, defining middle-class Canadians, in part, according to the “lifestyle they ­aspire to.”

But it’s hard to deny the fact that such lifestyles tend to be defined by consumption, or what one American sociologist has dubbed “upscale emulation.” A bankruptcy lawyer I spoke with has helped clients in just this fix—clients such as the Toronto architect crushed by $105,000 in tax debt and $75,000 in credit card debt who still managed to vacation in the tropics four times a year with his wife. Or the divorced, ­self-employed Toronto chiropractor who made $4,900 a month and insisted that both her kids attend private school—until the Canada Revenue Agency froze her ­accounts. We spend our way into the standard of living we feel we deserve, buying stuff that makes us who we think we are, or want to be.

Read the story

Canada’s Middle Class Is on the Brink of Ruin

Longreads Pick

A new breed of hard-working Canadians are living aspirational lifestyles that push them beyond their means, and their credit card debt threatens to overtake them, and the country.

Source: The Walrus
Published: May 17, 2017
Length: 18 minutes (4,573 words)

Rich Teeth, Poor Teeth: Life Along the Dental Divide

A free, two-day clinic in Salisbury, Maryland drew thousands in desperate need of dental care. (Photo by Linda Davidson / The Washington Post via Getty Images)

She means well, but I dread the dental hygienist. The judgmental tone in her voice is probably just exhaustion; the only dentist I can afford to see has an office that’s a in perpetual spin of budget-seeking patients. I’m one of scores of people who’ll sit her the chair today, and whenever I leave, I hear someone standing at the dreaded reception desk trying to argue their way out of a bill in an embarrassed tone.

Sometimes I’m in that corner too, wheeling and dealing for a way to swing basic treatments with money I don’t have. To my shame, I often go months or even years between routine cleanings, opting to spend money on debt or bills or food instead.
Read more…

Millennial to Millionaire: Stop Blaming Avocado Toast for Why We’re Not Buying Houses

Photo Credit: T.Tseng/Flickr

Millennials rarely get a fair shake when it comes to, well, anything written about them, which is why it isn’t surprising to see a misguided post from TIME magazine today blaming the low rate of home ownership among millennials on their apparently voracious appetite for avocado toast.

“When I was trying to buy my first home, I wasn’t buying smashed avocado for $19 and four coffees at $4 each,” millionaire Tim Gurner says, also blaming millennials’ annual trips to Europe every year as the reason why they can’t afford to buy homes.

He continues, “The people that own homes today worked very, very hard for it, saved every dollar, did everything they could to get up the property investment ladder,” conveniently failing to mention the housing bubble and subsequent crash that occurred in the last decade due to poorly regulated banks that approved mortgages for millions of people who they knew could not afford to pay them back. For Gurner, it’s easier to blame rampant spending on avocados and lattes for today’s low home ownership rates than on post-recession regulation of predatory lending practices that have prevented banks from handing out mortgages like candy.

Guess what, Gurner: According to the New York Times, Federal Reserve data shows that the percentage of Americans under 35 who hold credit card debt has fallen to its lowest level since 1989, the year Taylor Swift was born into this world. If millennials are having trouble controlling their spending, the data does not show it. Read more…

The Pitfalls and Promise of the Horseshoe Crab, Unlikely Biomedical Hero

dozens of horseshoe crabs come ashore on a beach
Horseshoe crabs take over a Delaware beach, photo by the U.S. Fish and Wildlife Service via Flickr (CC BY 2.0).

If you’ve ever gotten a medication injected or had a medical device implanted (think artificial knee replacement), you owe a debt of gratitude to the horseshoe crab, whose bright blue blood is a magic bacteria-finding beacon used to detect sterilization-resistant toxins in injectables and implantables.

How do we get all this crab blood? By catching crabs, draining a third of their blood, and tossing them back into the sea. Is this sustainable? No one really knows, yet — but hopefully, we will soon. Caren Chesler, in Popular Mechanics, explores the plight of the humble horseshoe and the researchers trying to help.

To that end, these two scientists are putting this strange catch to the test. The pair took 28 horseshoe crabs from the Great Bay Estuary behind their lab, left them out in the heat, then drove them around in a car for four hours and then left them in containers overnight to simulate what might happen in a bleeding facility. Then they bled half the crabs (so they’d have a control group that wasn’t bled). All of the crabs remained in containers a second night, as would likely happen at a bleeding lab. The following day, Owings and Watson put $350 transmitters on their backs, attached them snugly with little zip ties, and put the crabs back into the bay to see if they could make their way. What they find might have a lot to say about the future of this odd routine.

Read the story

File, Deduct, Hide: Six Essential Stories About Taxes

A seasonal "Statue of Liberty" waver for Liberty Tax walks down the streets of Janesville, Wisconsin. (Anthony Wahl / The Janesville Gazette via AP)

Today is Day 85 of the Trump Administration, and like a sailor condemned to four years at sea we carry on, stooped and weary from the weight of this albatross around our necks—Donald Trump’s taxes.

We know they exist—but what does their existence even mean any more? We’ve seen a few pages here and there, sent as proof of life to the New York Times and waved around by Rachel Maddow. In a bid to bring attention to President Trump’s noteworthy silence on his financial position, a tax march will take place on April 15 worldwide in response to a single tweet by a Vermont law professor.

Taxes are at once no one’s business and everyone’s business. We all pay them: how we pay them, what they are used for, what we want them to be used for, and what the government would rather do with them instead, is the Great American Story.

1. “Tax Time” (Jill Lepore, The New Yorker, November 2012)

Lepore takes the long view on taxes with a history of how the U.S. decided to levy an income tax. It’s easy to dismiss taxes, she argues, and much harder to defend them. But that’s not a problem our ancestors shared—despite opposition to King George’s levy on goods like tea, the founding fathers had no problem squeezing the rich with large indirect taxes for market exchanges such as imports. More than a century later, the constitutional amendment that made income tax the law of the land wasn’t even an issue in Congress. But taxes have since become a bone of endless contention, especially as they concern how much rich and poor should pay. Lepore weaves a deft story to tell us exactly why.

Taxes dominate domestic politics. They didn’t always. Since the nineteen-seventies, almost all of that talk has been about cuts, which ought to be surprising, because more than ninety per cent of Americans receive social or economic security benefits from the federal government. Americans, though, find it easier to see what they pay than what they get—not because they aren’t paying attention but because the case for taxation is so seldom made.

2. “Too Rich to Live?” (Laura Saunders and Mary Pilon, The Wall Street Journal, July 2010)

One of the most hotly contested forms of taxation is the estate tax, when a dead person’s estate is transferred to another person. Though the idea is thousands of years old and the American permutation has been around in some form or another for a century, the tax was gradually phased out starting in 2001. But when it came back in 2011—the product of impermanent legislation—the rich who stood to lose the most from the transfer of their substantial assets bucked.

It didn’t matter; the tax became permanent in 2013. But when Saunders and Pilon interviewed dying people and their potential heirs on the eve of the tax’s return, they found a strange phenomenon—people who make life-or-death decisions about their health and end-of-life care based on the potential of saving their heirs money on taxes.

In 2009, more than a few dying people struggled to live into 2010 in hopes of preserving assets for their heirs. Clara Laub, a widow who helped her husband build a Fresno, Calif., grape farm from 20 acres into more than 900 acres worth several million dollars, was diagnosed with advanced cancer in October, 2009. Her daughter Debbie Jacobsen, who helps run the farm, says her mother struggled to live past December and died on New Year’s morning: “She made my son promise to tell her the date and time every day, even if we wouldn’t,” Mrs. Jacobsen says.

In New York the lapsing tax spawned a major family conflict, according to one attorney. As a wealthy patriarch lay dying at the end of the year, it became clear that under the terms of the will his children would receive more if he died in 2010, while his wife (not the children’s mother) stood to benefit if he died in 2009. The wife then filed a “do not resuscitate” order and the children challenged it. The patriarch lived a few days into 2010, but his estate, like Mrs. Laub’s, remains unsettled given the legislative uncertainty.

3. “The Throwaways” (Melissa Chadburn, The Rumpus, January 2012)

Taxes are a matter of life and death not just to the wealthy, but to the people who need tax-funded social services to survive. Chadburn, who endured horrific abuse and a traumatic stint in foster care, considers what taxes mean to the people she calls “the throwaways,” those who depend on the small sums of money that anti-taxation advocates fight not to have to pay. As disparities between poor and rich grow, she argues, taxation can be seen as a revolutionary lifesaving act, a statement about the very worth of the people it helps.

Strangely, it was for dreams like these—the simplest dreams of rest, of feeling, of safety—that I first began to look at taxes. Taxes are the tool that makes these dreams of ours possible. Shelter for everyone, food for everyone, taxes ensure public safety. And what about love? Love is given and received. Love is not a solitary act. Love requires people to commune with one another.

My previous associations with taxes were shame and guilt and trickery. Then I looked at my history with money and public funding in general. Some people have argued that we are a nation of self-interested people. People who only care about themselves. Their own well-being.

I disagree. I think we are better than that but have been assaulted by the overwhelming personification of Greed….It’s our first lesson in pain.

4. “Tax Hero” (Planet Money, NPR, March 2017)

Despite the stakes of taxation, the act of filing taxes can be unbearably mundane. But there’s a darker side to doing taxes—the poor pay a disproportionate amount to tax preparation firms that gouge them on relatively simple filings. Enter Joseph Bankman, a Stanford tax law professor who thought he’d figured out a simpler way. But as Planet Money reveals, simpler isn’t always better for those who benefit from the current, complex system. His fight for painless filing became a legislative battle—and his opponents were a strange coalition of their own.

5. “Mossack Fonseca: Inside the Firm That Helps the Super-Rich Hide Their Money” (Luke Harding, The Guardian, April 2016)

While your average Joe struggles to pay the tax preparers, there’s a shadowy world of ultra-wealthy corporations and individuals who’ll do anything they can to not pay taxes at all. Last year, the lid on one of these complex tax-avoidance schemes blew open when 11.5 million documents—now known as the Panama Papers—were leaked, revealing inside information on over 200,000 offshore shell corporations that exist to help the one percent sidestep their tax obligations.

The Guardian won a Pulitzer for their groundbreaking investigation of the Panama Papers (Here’s a breakdown of how they got the scoop—and an in-depth podcast that tells the entire sordid story behind their award-winning investigation.) One of their most fascinating stories was about Mossack Fonseca, the Panamanian law firm that helped the rich find tax-friendly parking places for their cash. Harding tells the story of a company that’s part financial services provider, part peddler of international intrigue—one that’s marketed directly to Americans with money to hide.

Mossack Fonseca’s leaked emails reveal the extraordinary measures that some of its well-heeled clients took to keep their financial affairs secret. Especially the Europeans and Americans, who have latterly found themselves under scrutiny from their own governments.

One theme that emerges is anxiety. Wealthy individuals with “undeclared” offshore bank accounts are afraid they might get rumbled.

Another theme is victimhood. The super-rich, it appears, feel they are being unfairly picked on—persecuted even.

6. “Donald Trump Tax Records Show He Could Have Avoided Taxes for Nearly Two Decades, The Times Found” (David Barstow, Susanne Craig, Russ Buettner, and Megan Twohey, The New York Times, October 2016)

What happens when a tax evader is not an average citizen but the President of the United States? Of course, the answer is “we don’t know yet,” because we have no idea what’s in Donald Trump’s personal tax returns. Despite Rachel Maddow’s overhyped scoop on a few pages from Trump’s 2005 return, nobody’s been able to get ahold of what could be the most sought-after documents in modern history. And thus, we don’t know what wealth the President has to brag about—or hide.

After receiving several pages from Trump’s 1995 returns from an anonymous source, Barstow, Craig, Buettner, and Twohey hypothesized that back when he was a mere real estate mogul, the president used a $916 million business loss to cancel out his tax debt for decades. Is it true? Until Trump comes forward with his tax returns, there’s no way to know. But journalists won’t stop piecing the story together—and if the tax march is any indication, citizens won’t stop insisting that he tell the truth about his financial situation.

But the most important revelation from the 1995 tax documents is just how much Mr. Trump may have benefited from a tax provision that is particularly prized by America’s dynastic families, which, like the Trumps, hold their wealth inside byzantine networks of partnerships, limited liability companies and S corporations.

The provision, known as net operating loss, or N.O.L., allows a dizzying array of deductions, business expenses, real estate depreciation, losses from the sale of business assets and even operating losses to flow from the balance sheets of those partnerships, limited liability companies and S corporations onto the personal tax returns of men like Mr. Trump. In turn, those losses can be used to cancel out an equivalent amount of taxable income from, say, book royalties or branding deals.

 

The Immigration-Obsessed, Polarized, Garbage-Fire Election of 1800

John Adams and Thomas Jefferson. Images via Wikimedia Commons

A. Roger Ekirch | American Sanctuary: Mutiny, Martyrdom, and National Identity in the Age of Revolution | Pantheon | February 2017 | 33 minutes (8,149 words) 

Below is an excerpt from American Sanctuary, by A. Roger Ekirch.

For background, it is important to know that a seaman named Jonathan Robbins participated in a mutiny on the HMS Hermione in 1797, the bloodiest mutiny in British naval history. Afterward, he joined the American navy, but he was eventually recognized and jailed. To justify his actions, Robbins claimed he was an American citizen who had been impressed—that is, captured and forced into servitude—by the British navy. However, his American citizenship was disputed. The British sought his extradition, which the president, the Federalist John Adams, granted—an action which had disastrous political consequences for his party. Robbins was found guilty by a British naval court and hanged from the yardarm of the HMS Acasta in 1799.

This story is recommended by Longreads contributing editor Dana Snitzky. Read more…

Falling in Love with Words: The Secret Life of a Lexicographer

Kory Stamper | Word by Word: The Secret Life of Dictionaries | Pantheon Books | March 2017 | 24 minutes (6,691 words)

 

We’re proud to feature “Hrafnkell,” the first chapter of Word by Word: The Secret Life of Dictionaries, by Kory Stamper. Thanks to Stamper and Pantheon for sharing it with the Longreads community.

* * *

Hrafnkell

On Falling in Love

 

We are in an uncomfortably small conference room. It is a cool June day, and though I am sitting stock-still on a corporate chair in heavy air-conditioning, I am sweating heavily through my dress. This is what I do in job interviews.

A month earlier, I had applied for a position at Merriam-Webster, America’s oldest dictionary company. The posting was for an editorial assistant, a bottom-of-the-barrel position, but I lit up like a penny arcade when I saw that the primary duty would be to write and edit English dictionaries. I cobbled together a résumé; I was invited to interview. I found the best interview outfit I could and applied extra antiperspirant (to no avail).

Steve Perrault, the man who sat opposite me, was (and still is) the director of defining at Merriam-Webster and the person I hoped would be my boss. He was very tall and very quiet, a sloucher like me, and seemed almost as shyly awkward as I was, even while he gave me a tour of the modest, nearly silent editorial floor. Apparently, neither of us enjoyed job interviews. I, however, was the only one perspiring lavishly.

“So tell me,” he ventured, “why you are interested in lexicography.”

I took a deep breath and clamped my jaw shut so I did not start blabbing. This was a complicated answer. Read more…

The Slave Who Outwitted George Washington

The Washington Family, by Edward Savage, c. 1789 / Wikimedia

Erica Armstrong Dunbar | Never Caught: The Washingtons Relentless Pursuit of Their Runaway Slave Ona Judge | Atria / 37 Ink | March 2017 | 19 minutes (5,244 words)

***

MOUNT VERNON

Two years after the death of her owner, Betty learned her mistress was to remarry. She most likely received the news of her mistress’s impending second marriage with great wariness as word spread that Martha Custis’s intended was Colonel George Washington. The colonel was a fairly prominent landowner with a respectable career as a military officer and an elected member of the Virginia House of Burgesses. His marriage to the widowed Martha Custis would offer him instant wealth and the stability of a wife and family that had eluded him.

A huge yet necessary transition awaited Martha Custis as she prepared to marry and move to the Mount Vernon estate, nearly one hundred miles away. For Betty, as well as the hundreds of other slaves that belonged to the Custis estate, the death of their previous owner and Martha’s marriage to George Washington was a reminder of their vulnerability. It was often after the death of an owner that slaves were sold to remedy the debts held by an estate. Read more…