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Bloomberg’s 2020 aides got an unwelcome surprise in their tax forms

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This Congress has a record number of women and people of color. But when it comes to the staff working behind the scenes, diversity is still a huge problem.

“That has large-scale implications for people’s eligibility for unemployment, for their eligibility for [Affordable Care Act] subsidies, for their eligibility for student loan forgiveness,” said one former Bloomberg staffer, who requested anonymity to be able to speak candidly. “I looked at the number of zeros and I couldn’t believe it. I thought it had to be a mistake,” the person added. “They’re just making my blood boil.”

Two other former aides also worried about their newfound income levels added it was unclear to them at the time that their salary included the bump for taxes, which are coming due a year later. Beyond the personal headaches, others viewed the tax issue as the latest indignity in a campaign experience filled with them.

Disputes over anticipated salaries and see-sawing health care benefits during the height of the pandemic left many of the aides feeling burned by their time with Bloomberg. They believe the candidate’s tax accounting decisions also ran counter to personal values he espoused, such as bestowing generous pay and benefits on his employees and taking care of the little guy.

“If you’re setting up an organization that is running for president and you think that our tax laws should be different, and our policies should be different, in order to better help people, then the way you treat people on the campaign and the way that you pay them should reflect that,” the same ex-staffer added.

Bloomberg’s operation did pay comparatively high salaries for political campaigns, in part to attract talent late in the 2020 season. Many of its hires came from Bloomberg companies or his larger orbit, other failed primary campaigns or private firms and organizations. Aides described the housing he provided as modest, which added to their surprise when they saw the line items for what it cost the campaign.

Tax experts said the IRS rules about what benefits are taxable to employees are exceedingly complex. In instances where an employee is working on an oil rig and must be housed, for example, that does not count as income to the worker, said Robert W. Wood, an attorney and tax law expert in San Francisco.

There are numerous tax regulations on food, housing and other benefits, he added. Another tax lawyer said there are ways to structure benefits so as not to burden employees.

But Bloomberg’s tax accountants determined there wasn’t a way for them to provide benefits—namely rent-free housing—without it being tagged as income for the employee. They pointed to an IRS publication stating that employer-provided lodging was only non-taxable if the housing met all three conditions: that it was on the premises of the employer, furnished for the convenience of the employee and a condition of employment — meaning they had to accept it to properly perform their job.

“We were proud to pay our campaign staff good wages, consistent with our team’s skill level and higher than what is typically—but shouldn’t be—a low-wage industry. And, if the employee opted in, we offered additional benefits like housing or relocation payments,” the Bloomberg campaign spokesperson said. “We don’t write the tax code, but we certainly follow it. Going beyond salary to pay employees’ taxes on benefits is not common, but something we were proud to do.”

Bloomberg spent more than $1 billion of his own money on a 104-day campaign in which he skipped out on the early states and threw all his weight into saturating television markets with ads ahead of Super Tuesday. It didn’t work. He dropped out after a disastrous March 3 showing and eventually decided to transfer $18 million to the Democratic National Committee.

The problems for aides escalated from there. Bloomberg’s outfit informed employees that their health care coverage was set to end after a series of layoffs when the campaign folded, only to reverse the decision under pressure. Instead, outgoing staffers were offered to have COBRA plans paid by the campaign.

Separately, Bloomberg is fighting several lawsuits from his aides, including a class action suit in which ex-field staffers claim they were fraudulently induced to accept jobs with promises of guaranteed pay through November 2020. Bloomberg’s attorneys are fighting in court to have the cases dismissed, writing in briefs that the aides signed offer letters and were provided employee handbooks stating they were “at will” workers and could be terminated at any time.

Organizers acknowledged signing at-will contracts. But they stated that they can bring such claims based on evidence that they were persuaded to accept their jobs because of lengthy promises Bloomberg’s top lieutenants made to them.

Last year, POLITICO reported that hiring materials aides described as coming from the Bloomberg New York City headquarters guaranteed work with “Team Bloomberg” through the end of the general election regardless of whether he became the Democratic presidential nominee, provided the aides were willing to relocate to other states.

Bloomberg originally pledged to maintain and pay for offices staffed by his own employees in the swing states to help the Biden campaign. His in-house digital firm also made a play to work for the Democratic nominee. But the arrangements didn’t materialize. Instead, Bloomberg paid for the offices via the transfer to the DNC. The digital firm also did some work with the DNC. States like Florida, where Bloomberg spent much of his money, were nevertheless won by Trump.

Peter Romer-Friedman, an attorney in one of the lawsuits, called the surprise tax documents “unfortunate and especially burdensome for staffers who have been unemployed since last March.” But he said it doesn’t compare to the collective tens of millions of dollars that “Bloomberg and his campaign misleadingly promised to pay field staffers through the general election.

“We, of course, hope that Mike Bloomberg will eventually see the light and make good on his promises,” he added.

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Opinion | With No Votes to Spare, Biden Gets a Win Obama and Clinton Would Have Envied

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Opinion | With No Votes to Spare, Biden Gets a Win Obama and Clinton Would Have Envied

Before you join the chorus, you might want to check in with the last two Democratic presidents. Bill Clinton and Barack Obama both landed in office with much bigger majorities, and ended up taking it on the chin anyway. Despite the narrowest of majorities to get anything done, Biden, in fact, may be in a much better position.

When Clinton came to power in 1993, he had wide majorities in both houses: 57 Democrats in the Senate, and 258 Democrats in the House. But the resistance to his key economic package was so intense within his own party that his plan passed by just a single vote in both the House and the Senate, and only after important elements of that plan—like a gasoline tax—were thrown over the side to win the votes of suburban Democrats.

When Obama was inaugurated in 2009, Democrats and their independent allies held 59 seats in the Senate, and when Al Franken finally claimed his seat months later, they had a supermajority of 60—enough to overcome a filibuster. But in order to hold those votes, the Obama Administration had to keep the cost of its Great Recession stimulus package under $1 trillion—an amount, his team later conceded, was too small to trigger a robust recovery. Similarly, in order to get reluctant Democrats like Joe Lieberman to vote for the Affordable Care Act, the White House had to kill the public health-insurance option, which left progressive Democrats disheartened. (As Obama accounts in his memoir, “A Promised Land,” the handwringing from members of his own party took much of the shine off his signature achievement as president, the biggest expansion of health care since Medicare.)

The two ex-presidents also share a common, painful experience with the political consequences of their battles. Clinton’s tax and budget initiatives were aimed at reducing the then-unacceptable budget deficit of some $250 billion—a deficit that helped propel independent candidate Ross Perot to 19 percent of the vote in 1992. (I hope you realize we’ve become Eisenhower Republicans, Clinton groused to his staff.) The policy ultimately worked—Washington was running a huge surplus by the end of the Clinton years—but in the short term it was a political liability, leading to the loss of both houses of Congress in 1994.

For Obama, the slow pace of the recovery and the Republicans’ relentless political attacks on Obamacare led to massive midterm losses in 2010 at every level. The House turned Republican, the Democrats lost their filibuster-proof majority in the Senate and 18 state legislatures turned red—a political upheaval that is still tormenting Democrats as they watch those legislatures push through voter suppression laws that will shape American elections for years to come.

But this time, Democrats may be able to provide a more upbeat answer to a question the approach of Passover inspires: “Why is this one-vote victory different from the other one-vote victories?”

This time, the benefits to tens of millions of Americans will be clear: $1,400 in bank accounts; extended jobless benefits; expanded childcare help. Donald Trump understood the impact of such assistance when he insisted his name be on the checks sent to American households. Joe Biden won’t be as blatant, but the direct aid will be a sharp contrast to what happened under Obama’s stimulus, when most Americans didn’t even realize they were getting a tax cut. It’s a sharp departure as well from the impact of Obamacare, where the benefits did not begin until long after the bill was passed, and after the midterm elections as well.

And this time, the bill that was passed was backed by enormous majorities of the citizenry—polls suggest that as many as 75 percent support the Covid plan, including clear majorities of Republicans. This suggests that the unanimous opposition to the plan by Congressional Republicans may leave the party with a political posture at a polar extreme from where they were in 1994 and 2009. The GOP was able to (inaccurately) pin Clinton with the “largest tax increase in history”; they were able to characterize the Obama stimulus and the Affordable Care Act as a giveaway to “those people.” But if the polls are right, Republican efforts to paint the Covid relief as a “blue state bailout” or a “Pelosi payoff” aren’t working.

More significant, if the impact of $1,400 payments, the vaccination assistance and the other elements of the plan are really felt back home—by voters, who notice the difference in their bank accounts and their health—it is actually conceivable that the line “I’m from the government and I’m here to help” could become something other than the punchline of a joke.

It is, of course, possible that all those proposals that fell by the wayside—the $15 minimum wage, higher income limits on the stimulus checks, bigger jobless benefit—will trigger so much grousing from progressives that Biden has trouble keeping his own side of the aisle in line. If they’re thinking about 2022, they should be careful how much complaining they do. With the slimmest possible of majorities, Biden managed to push through something whose potential political payoff his two Democratic predecessors would have envied.

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The Democrats who could take Cuomo’s place

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The Democrats who could take Cuomo's place

Sen. Alessandra Biaggi or another state legislator

Why they can win: Democrats have an extremely deep bench in the state Legislature. Dozens of their 150 members are more viable than state Sen. George Pataki was 20 months before the 1994 election, when he beat Mario Cuomo, and it’s certainly possible that some unexpected rank-and-file member will launch a serious campaign.

The two legislators who are mentioned most often are Biaggi and state Sen. Jessica Ramos. Both are part of the young freshman class that helped their party take an operative majority in their chamber in 2018. And both would have a good chance at winning the support of the Ocasio-Cortez wing of the party. Biaggi has already been acting like a primary candidate, spending recent weeks at the forefront of opposition to the Cuomo administration.

One wild card: Senate Majority Leader Andrea Stewart-Cousins, the highest-ranking lawmaker in the state Senate. Nobody would have a better chance at clearing the room with a campaign declaration than Stewart-Cousins, whose tenure leading the historically factional Democratic conference has been met with rave reviews from moderates and socialists alike.

Why they can’t win: Pataki was able to win by latching onto then-Sen. Al D’Amato’s statewide campaign apparatus. There are some groups with a statewide presence with whom candidates like Biaggi or Ramos can ally — most prominently, the Working Families Party. But their major successes in recent years have come in legislative or congressional campaigns, and they’ve yet to prove they can be the decisive factor in a statewide race.

Candidates can, of course, build their own networks. But particularly for those who have minimal name recognition outside of a district that represents less than 2 percent of the state, that’s the type of organizing they would need to get started on very soon.

As for Stewart-Cousins, the biggest obstacle standing in her way is that she’s never given the slightest hint that she’s interested in statewide office.

Ithaca Mayor Svante Myrick

Why he can win: Myrick might be in a unique position. At 33, he’s already been the focus of numerous effusive national profiles for topics like his recent efforts to enact the most sweeping police reforms in the country, and he would have as good a chance as anybody to win over the newly energized young leftists.

Unlike other progressive candidates who are similarly well-positioned, his tenure as the mayor of an upstate city — albeit a small and atypical one — would put him less at risk of laying an egg north of Yonkers.

Why he can’t win: While he might be able to avoid the attacks that he’s a “New York City socialist,” he’s still pretty far to the left. Democrats might have shifted in that direction in recent years, but there’s still not a lot of evidence that positions like defunding the police and establishing heroin injection sites will win over voters in Hempstead.

New York City Mayor Bill de Blasio

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Trump’s last national security advisor to return to LA law firm

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Trump’s last national security advisor to return to LA law firm

Robert O’Brien, who was former President Donald Trump’s last national security advisor, is rejoining the law firm he co-founded in Los Angeles, according to a person familiar with the matter.

O’Brien recently moved back to LA and is returning to Larson LLP, a litigation firm, with around 30 lawyers, that he started in 2016 with former federal judge Stephen G. Larson. O’Brien will be Of Counsel to the firm and will have an international practice on arbitration. Last month, the Nixon Foundation announced that O’Brien would co-chair its foundation’s monthly foreign policy seminar with former Secretaries of State Mike Pompeo and Henry Kissinger.

O’Brien, who arguably had the lowest public profile of Trump’s four national security advisors, prioritized focusing on America’s geostrategic competition with China and also worked on the Abraham Accords and economic normalization between Serbia and Kosovo, among other foreign policy issues. A fierce advocate on television for Trump’s policies, he also downsized the NSC’s staff. He also drew negative attention in two complaints filed by whistleblowers.

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