May 18, 2021

Even Research Into Tinkering With the Sky to Fight Climate Change Needs Public Support

[Cross-posted from Slate]

By Albert C. Lin

This summer, Harvard researchers working on a project called Scopex were supposed to fly a literal trial balloon over Sweden. This would have been the first step toward testing a potential method to moderate global warming by releasing small quantities of particles into the atmosphere. Early on, Harvard established an independent advisory committee to provide advice on the science and risks of the proposed experiment, as well as on the need for stakeholder engagement. Recently, however, the Swedish Space Corporation canceled the flight in the wake of opposition from Swedish environmentalists, scientists, and indigenous groups, even though the first flight would have involved no experimental release of particles.

Unprecedented wildfires, storms, and floods make it clear that climate change has arrived. And as climate change worsens, there is growing interest in researching solar geoengineering — a cluster of proposed strategies for reflecting sunlight to reduce the Earth’s warming. For instance, Congress has begun to provide modest funding for modeling and observing stratospheric conditions potentially relevant to solar geoengineering proposals.

The Scopex researchers, who are privately funded, have expressed support for suspending test flights to allow for robust public engagement, and the experiment may still go forward. Nonetheless, the recent cancelation demonstrates that we need more public engagement on solar geoengineering research. Opponents of the Swedish test flights appear more worried about where this research might lead than about any individual test flight — and those worries can’t be ignored. Solar geoengineering research cannot succeed without robust governance and public engagement.

Two of the leading solar geoengineering proposals are stratospheric aerosol injection (to which Scopex is relevant) and marine cloud brightening. Inspired by the cooling effects observed after major volcanic eruptions, stratospheric aerosol injection would attempt to reflect incoming sunlight by distributing small particles high in the atmosphere. Marine cloud brightening, which is patterned after the “tracks” formed when water vapor condenses on particles in ship exhaust, would seek to increase the reflection of sunlight by low-lying clouds.

Those are the goals — but solar geoengineering strategies are not well understood. Each proposed technique comes with substantial questions of feasibility. For stratospheric aerosol injection, these questions include: Which materials should be used and in what quantity? Where and how should materials be released? And what happens to materials after they are released? For marine cloud brightening, the questions include: How do tiny particles interact with clouds? How might clouds be modified to reflect more light? And in what regions might this technique be effective? Researchers also know little about potential impacts on health, ecosystems, and society. Might solar geoengineering reduce crop yields, interfere with Asian and African monsoons, harm biodiversity, or hamper solar energy production?

The many questions surrounding solar geoengineering —including those we haven’t even thought to ask yet—underscore the need for a broad inquiry into its social, political, economic, and scientific dimensions. Yet such research itself raises further questions. What role should the public have in research processes, especially in outdoor experiments that could affect human populations? Might research create momentum for solar geoengineering and lead to deployment before it is appropriate? And could research undermine efforts to reduce greenhouse gas emissions by offering the misleading prospect of a quick and easy solution to climate change?

The concerns associated with solar geoengineering, the controversy raised by outdoor experiments like Scopex, and the planetary implications of solar geoengineering all point to the need for governance of solar geoengineering research. In this context, the National Academies of Sciences, Engineering, and Medicine established a committee, on which I served, to develop a research agenda and recommend research governance approaches for solar geoengineering. Our recent report sets out recommendations geared toward facilitating the production of knowledge to reduce scientific and social uncertainties regarding solar geoengineering.

One key recommendation calls on the federal government, in coordination with other countries, to establish a transdisciplinary solar geoengineering research program that would develop knowledge to inform policy makers. At the same time, we also recommend that all solar geoengineering research be subject to robust governance—which is not the same thing as government. Funders of research, publishers of scientific journals, professional societies, international organizations, and solar geoengineering researchers themselves all have a role to play in attending to the physical and societal risks of research, fostering transparency, and enabling public engagement.

Mechanisms to govern solar geoengineering research should include permitting requirements for outdoor experiments, impact assessment and review processes, a research registry, public engagement efforts, and adherence by researchers and research sponsors to a code of conduct. Public engagement could take the form of citizen consultations in which nonexperts at various locations debate the same policy-related questions pertaining to solar geoengineering and individually vote for prepared answers to the questions posed. Code of conduct provisions should include commitments to make research activities and results public and to monitor and minimize potential adverse effects of research.  Furthermore, ongoing programmatic assessment of solar geoengineering research can evaluate the cumulative impacts of multiple experiments, consider the overall trajectory of research activities, and guard against the entrenchment of ineffective or dangerous technologies.

All of that will take time, money, and commitment. Unfortunately, the worsening impacts of climate change will only increase pressures on policy makers to consider solar geoengineering.

Robust governance is necessary both to facilitate solar geoengineering research and to curb its risks. Adherence to recommended procedures and limits on outdoor experiments can reduce physical risks. Transparency regarding the capabilities and limits of solar geoengineering can counter the potential for solar geoengineering research to detract from other climate efforts. And broad public engagement can improve the quality of research while building the social license to enable the research.

Ignoring solar geoengineering will not make it — or climate change — go away. Research — and robust governance of that research — are essential to making informed decisions about it.


Future Tense is a partnership of Slate, New America, and Arizona State University that examines emerging technologies, public policy, and society.


May 11, 2021

The Evolution of Risk Management Oversight by Indian Boards

[Cross-posted from IndiaCorpLaw]


By Afra Afsharipour & Manali Paranjpe


Across the globe, the focus on effective risk management has intensified over the past two decades as major corporations have experienced risk management failures due to excessive financial risk taking, environmental catastrophes, accounting and corruption scandals, and the like. The monitoring of risks is a significant priority for corporate managers and boards, as well as for regulators and investors. As the OECD states, “while risk-taking is a fundamental driving force in business and entrepreneurship, the cost of risk management failures is still often underestimated. . . . Corporate governance should therefore ensure that risks are understood, managed, and, when appropriate, communicated.”


The board of directors lies at the core of effective risk management. Directors are not responsible for the everyday management of risk. However, the board plays a critical role in overseeing and guiding the risk policy of a company, and in ensuring that appropriate systems of control are in place. Since the 2008 financial crisis, expectations around the board’s risk oversight responsibilities have become heightened as companies face increasingly complex business, regulatory and political environments. Thus, national legislation and corporate governance guidelines and codes by leading international organizations have evolved to stress the role of the board of directors in risk oversight.


In our article, forthcoming in the National Law School of India Review, we analyze India’s evolving framework for board oversight of risk management. With the transformation of corporate governance practices in India, the legal and regulatory regimes governing risk management have progressed to largely resemble international standards, with an emphasis on the risk oversight function of boards. The Companies Act, 2013 addresses the board’s risk oversight responsibilities. For listed companies, the Securities and Exchange Board of India (SEBI) has issued regulations that require the largest listed companies to form a risk management committee. The emphasis on the board’s oversight of risk management is in line with the corporate governance transformations that have taken place in India which increasingly stress a monitoring role for directors.


Despite the shift in the regulation of risk management, studies and surveys suggest that risk management has yet to become a priority at many Indian companies. Furthermore, recent high profile risk management crises highlight the importance, and challenges, of board oversight of corporate risk. While India’s legal framework for board oversight of risk has evolved, two recent crises — the collapse of IL&FS and management failures at ICICI Bank — demonstrate the barriers that directors of Indian companies continue to face in overseeing increasingly complex risks. Our article uses both crises as case studies to reflect on risk management lessons for boards of Indian firms more generally.


In addition to corporate crises, the COVID-19 pandemic has brought the issue of board oversight of risk management to the forefront. India as a nation was underprepared to prevent, detect and respond to a pandemic, and the crisis has been a significant one for nearly every board of directors in India. In such a crisis, companies with good governance and risk management systems may be better able to address stakeholder concerns than companies whose boards have not prepared for such calamities.


As companies face increasing risk complexity, boards must continually assess the structure of a company’s risk management policies and procedures. Not only are boards charged with overseeing an increasingly complex set of risks, but directors of Indian firms, particularly independent directors, face a variety of barriers in effectively overseeing risk management. Most Indian firms are controlled companies, with board members beholden to controllers and management for access to information. Limited access to independent external advisors such as lawyers, consultants, accountants, and the like, as well as significant dependence on management for obtaining information on business plans, strategies and risk preparedness of the company, can hamper the ability of boards to adequately monitor the company’s risk management policies and procedures. These issues intensify in boards with many outside independent directors.


Nevertheless, the barriers faced by directors of Indian firms are not insurmountable. The article’s case study of how the board of Infosys, one of India’s leading technology companies, addressed red flags raised by whistleblowers, illustrates how an empowered board can respond to risk management issues effectively. Actions by the Infosys board provides lessons on how transparent processes and clarity regarding the company’s investigation process allowed the board to assess, identify and manage risks raised by serious allegations. Furthermore, following the crisis, the Infosys board undertook additional steps to strengthen and revise its applicable policies. By responding and taking charge of the governance challenge facing the company, the Infosys board was able to prevent further harm to stakeholder interests as well as its own reputation.


Drawing lessons from these case studies, the article concludes with suggestions on how to further enhance the board’s risk oversight function. Stronger governance, more robust risk management strategies and capable board leadership and oversight will make priceless contributions to both Indian companies and to the Indian economy.

[Afra Afsharipour is Senior Associate Dean for Academic Affairs & Professor of Law at UC Davis School of Law and Manali Paranjpe a Research Associate at The Conference Board, India]

May 11, 2021

RIP Cruz Reynoso, First Latino Justice on California Supreme Court

[Cross-posted from ImmigrationProf Blog]

By Kevin Johnson 


We have lost a civil rights icon and immigration reformer.  The first Latino on the California Supreme Court, Cruz Reynoso, passed away yesterday after a long illness. He celebrated his 90th birthday last weekend. 

Here is a story on Cruz's passing in the Los Angeles Times.


The Reynoso family, through son Len ReidReynoso, released the following announcement:

"On May 7, 2021, former California Supreme Court Associate Justice, law professor, and civil rights activist Cruz Reynoso passed away at age 90, surrounded by his family. Reynoso was born on May 2, 1931 in Brea, California, to Francisca Ramirez Reynoso and Juan Reynoso. Cruz was one of eleven children. Cruz along with his father and brothers worked as migrant farm workers. After high school, Cruz decided to go to college and attended Fullerton Community College, and then Pomona College. After graduation, Cruz was drafted into the U.S. Army where he served on the Counterintelligence Corp. While serving in the Army, Cruz was stationed in Washington D.C., where he met his first wife, Jeannene Harness. They married in 1956 and raised four children together. Jeannene passed in 2007, and in 2008 Cruz married Elaine Rowan. Elaine passed in 2017.

Cruz earned his law degree from Boalt Hall at UC Berkeley in 1958. After which he practiced law in El Centro, California. In 1968 Cruz became the director of California Rural Legal Assistance, the first state-wide legal services program. In 1972 Cruz became a law professor at University of New Mexico. In 1976, Governor Brown appointed him to be a Justice of the 3rd District Court of Appeals. In 1982, Brown appointed Cruz to be the first Mexican American to serve on the State Supreme Court. After leaving the Court in 1987, Cruz practiced law once again. In 1991 Cruz began teaching law at UCLA. In 2001 UC Davis offered Cruz the Boochever and Bird Chair designed to promote freedom and equality. Cruz accepted and taught at UC Davis until 2017.

Cruz worked for the Equal Employment Opportunity Commission under the Johnson administration, and was appointed by President Carter to serve on the Congressional Select Commission on Immigrant and Refugee Policy. President Clinton appointed Cruz to be the vice-chair of the U.S. Commission of Civil Rights and in 2000 gave Cruz the Presidential Medal of Freedom for his work in Social Justice.  Cruz also served on Barack Obama’s transition team.

Cruz’s life passion was creating a more just society. He fought for equal rights for under-represented populations, legal access for the poor, workers rights, immigration reform, and voting rights. When not fighting legal battles, Cruz loved working on his ranch in Sacramento County. Cruz also loved reading about history and loved to draw. Abby Ginzberg produced an award-winning film about Cruz’s life titled “Sowing the Seeds of Justice.”

Cruz is survived by four brothers, four sisters, his four children and their spouses (Trina and Duane Heter, Ranene and Bob Royer, Len and Kym ReidReynoso, Rondall and Pamela Reynoso) along with two stepchildren and their spouses (Dean and Laudon Rowan, Hali Rowen and Andy Bale), seventeen grandchildren, three step-grandchildren and two great grandchildren. Cruz is greatly loved and will be greatly missed. In lieu of flowers feel free to donate to the Cruz and Jeannene Reynoso Scholarship for Legal Access.

I had the honor of being Cruz's colleague for years at UC Davis.  We first met when he was a Justice on the California Supreme Court and I was a newly-minted attorney working in San Francisco.  Later, I had a chance to get to know him as a colleague at UC Davis School of Law, where Cruz ended his illustrious and path-breaking career.  As two early risers, we talked in the mornings regularly about current events, law, politics, families, taquerias, and the like.  As Cruz often said, he had a "justice bone" that was quick to challenge injustice.  He was as decent and genuine as anyone I have ever known and will be missed dearly.

Cruz came to UC Davis after a stint at UCLA School of Law.  Then-Dean Rex Perschbacher made it his mission to bring Cruz to UC Davis.  Besides teaching and writing (including a partially completed autobiography), Cruz was active in the UC Davis and greater community.  He, for example, chaired a task force reviewing the police use of pepper spray against protesters. Cruz also investigated the killing of a farmworker by  Yolo County law enforcement.  Cruz once told me that he found civil rights work more rewarding than the "boring" work of completing his autobiography.  

Upon Cruz's retirement, I had a fascinating interview with him for the UC Davis archives.  Here is the video.

RIP Cruz Reynoso.


May 10, 2021

Justice Cruz Reynoso's Rural Life

By Lisa Pruitt

Cruz Reynoso, former California Supreme Court Justice and my colleague at UC Davis School of Law for two decades, died a few days ago at the age of 90.  Many are offering remembrances of Reynoso -- who the faculty and staff at the law school knew as just "Cruz"-- and it's interesting for me as a ruralist to see the number of references to "rural" in his life's story.  

Of course, Reynoso famously led California Rural Legal Assistance (CRLA), the "first statewide, federally funded legal aid program in the country."  That was during the heyday of Cesar Chavez and Dolores Huerta's organizing in the 1960s.  CRLA provides free legal services to farmworkers.  In California, "rural" is largely conflated with agriculture in the popular imaginary (though there are far less densely populated and more remote California locales than its agricultural valleys), and the organization's website articulates its mission as helping “rural communities because those communities were not receiving legal help.” 

The tumultuous history of that organization under Reynoso's leadership is recounted in a Los Angeles Times story

Then-California Gov. Ronald Reagan repeatedly vetoed federal funds for the California Rural Legal Assistance while Reynoso headed the office and even signed off on an investigation that accused the nonprofit of trying to foment murders and prison riots (the investigation went nowhere).

Among other achievements during his leadership, Reynoso "oversaw eventually successful efforts to ban the short-handled hoe, which required farmworkers to stoop and led to debilitating back problems, and DDT, the deadly agricultural chemical."  

The Sacramento Bee reports on one of CRLA's big litigation victories under Reynoso's leadership, Diana v. California State Board of Education:  

It centered on Latino children who were incorrectly assessed by their school and labeled mentally challenged. The pupils were funneled into special education classes when, in reality, they were simply new English learners. CRLA lawyers filed a class-action lawsuit on behalf of students in the Monterey County town of Soledad.

“CRLA won a consent decree that allowed non-Anglo children to choose the language in which they would respond on IQ tests,” wrote the Salinas Californian in 2016. “It banned verbal sections of the test. It also required state psychologists to develop an IQ test appropriate for Mexican Americans and other non-English-speaking students.”

This column by Gustavo Arellano in the Los Angeles Times recounts Reynoso's childhood -- including early activism -- in Orange County, which then included significant rural stretches: 

[Reynoso's] family lived in a rural part of La Habra, where the Ku Klux Klan had held the majority of City Council seats just a decade earlier and Mexicans were forced to live on the wrong side of the tracks. Reynoso’s parents and neighbors had to travel a mile to the post office for their mail because the local postmaster claimed it was too inconvenient to deliver letters to their neighborhood.

Reynoso didn’t question this at first — “I just accepted that as part of the scheme of things,” he’d tell an oral historian decades later, in 2002.

But one day, a white family moved near the Reynosos and immediately began to receive mail. The teenage Cruz asked the postmaster why they were able to receive mail, but his Mexican family couldn’t. If you have a problem with this, the postmaster replied, write to her boss in Washington D.C.

And write a letter to the U.S. Postmaster General is exactly what Reynoso did.  According to a story released by UC Davis on the occasion of Reynoso's death: 

He wrote out a petition, gathered signatures, and successfully lobbied the U.S. Postmaster General in Washington, D.C., for rural mail delivery.

The obituary in the Los Angeles Times notes that Reynoso continued to live a rural life, even while working in Sacramento and Davis.  He "had a 30-acre spread in the agricultural Sacramento County town of Herald," population 1,184.The L.A. Times also reports that, as children, Reynoso and his 10 siblings worked summers in the fields with their parents. 

But the rural fact that leapt out at me most prominently was this line from the UC Davis story about what Reynoso did after finishing law school at UC Berkeley:

Justice Reynoso and his wife, Jeannene, moved to El Centro, in California’s Imperial Valley, where he started his own practice.

Today, Imperial County and El Centro, its county seat, are legal deserts--and they probably were back then, too.  Just imagine a UC Berkeley Law or UC Davis Law grad going to El Centro and hanging out a shingle in 2021?  It's nearly unthinkable, though a few probably go there each year to work for legal aid organizations like CRLA.  If it were more common to follow such a career path -- and for legal educators to prommote and honor those paths -- the Golden State would not be facing a rural lawyer shortage, with impoverished communities of vulnerable workers like the Imperial Valley suffering most as a consequence of that deficit.    

A Sacramento Bee column about Reynoso by Marcos Breton on the occasion of Reynoso's death features several remarkable photos.  These include one of Reynoso at the Herald property in 2000 with his then-young grandchildren; Reynoso was wearing overalls, a signifier of his rural authenticity.  The photo was taken by a Bee reporter the year he was awarded the Presidential Medal of Freedom and previously published as part of the paper's reporting on that honor.  

Speaking of that authenticity, I always appreciated Cruz's frequent use of the word "folk" to refer to groups of people, or the populace generally. Indeed, I see the Spanish translation is "la gente," meaning "people, town, dweller."  For me, his use of "folk" provided implicit permission to use that word and its plural, both terms I'd grown up with but later excised from my professional vocabulary becuse I had thought them too colloquial.  

Cruz was as approachable to students as he was to faculty and staff.  We often saw him walking to the Silo (an eatery on campus) with a group of students for lunch.  And in my first year at UC Davis, 1999-2000, when Cruz was visiting from UCLA's law school, he gamely agreed to participate in a student-sponsored moot court event called "Battle of the Giants," which featured two professors playing the role of advocates in a mock appellate argument.  It took a while for the student organizers of the event to get someone to agree to be the opposing "giant" (eventually, I reluctantly agreed), but Cruz had not hesitated to take on this time-consuming task, one little valued by the law school administration.


Cruz was very gentle in how he engaged and educated people, which I believe often rendered him particularly persuasive. Many years ago, I heard him say to a group of students, in his typical, soft-spoken way, "No human being is illegal." This was at a time whne the phrases "illegal alien" and "illegal immigrant" were still widely used. Expressed in his calm, avuncular, matter-of-fact way, I'm sure he won over many, got them to think about the significance of language. It's quite a contrast with the ways in which so many in our educational institutions today "call out" or "cancel" each other in shrill and judgmental fashion, a tactic that often serves primarily to aggravate divisions.   


Given Cruz's commitment to students and education, it's not surprising that his family has asked that, in lieu of flowers, donations be made to the UC Davis student scholarship fund "for legal access" that honors him and his wife

May 6, 2021

Former President Bush Optimistic About Immigration Reform

[Cross-posted from the ImmigrationProf Blog]

By Kevin Johnson

As previously announced on this blog, the George W. Bush Presidential Center co-sponsored a virtual program on "Immigrants and the American Future: A Conversation with President George W. Bush, Dr. Russell Moore, and Yuval Levin."

The George W. Bush Institute, National Immigration Forum, and the Ethics & Religious Liberty Commission of the Southern Baptist Convention co-sponsored the conversation with President George W. Bush on his book, Out of Many, One: Portraits of America’s Immigrants, a powerful collection of 43 portraits painted by President Bush and accompanying stories that exemplify the promise of America and our proud history as a nation of immigrants.

President Bush was joined by Dr. Russell Moore, President of the Ethics & Religious Liberty Commission of the Southern Baptist Convention, and Yuval Levin, Director of Social, Cultural, and Constitutional Studies at the American Enterprise Institute. Together they discussed the value of immigrants to our nation and the faith and culture of our increasingly diverse country. The conversation touched on the stories in Out of Many, One: Portraits of America's Immigrants, including Levin’s personal experience as an immigrant.  

I watched the event, which was a bit over one-half hour in length.  I was impressed by the humanity that the speakers, including President Bush, brought to the discussion of immigration.  The dialogue was civil and hopeful in articulating the need for reasonable and practical approaches to immigration.  President Bush expressed the view that immigration reform in small "bits" of legislation at the time might be achievable.  Besides the human aspects of immigration, President Bush noted the economic benefits of immigration.  He also stated that the current immigration system is "broken."  In contrast to the harsh treatment of asylum seekers embraced by the Trump administration, President Bush suggested the need for more immigration judges to decide asylum claims.

The event opened with remarks from Holly Kuzmich, Executive Director of the George W. Bush Institute and Ali Noorani, President and Chief Executive Officer of the National Immigration Forum. 



May 6, 2021

Episode 52: 'Pattern and Practice'

[Cross-posted from]

By Elizabeth Joh

What can Joe Biden or any U.S. president do when it comes to reforming the approximately 18,000 locally governed police departments around the U.S.? The infamous Rodney King video showing him being graphically beaten by police officers helped catalyze a giant 1994 crime reform bill that brought the pattern and practice of local police departments under federal scrutiny. How does it work? Listen to episode 52 of What Trump Can Teach Us About Con Law.

May 3, 2021

Breaking News: Supreme Court Finds for Noncitizen in Relief From Removal Case -- Niz-Chavez v. Garland

[Cross-posted from ImmigrationProf Blog]

By Kevin R. Johnson

On April 29, the Supreme Court in Niz-Chavez v. Garland held that a notice to appear sufficient to trigger the “stop-time” rule for measuring the time for cancellation of removal relief must be a single document containing all the information about the noncitizen's removal hearing.  The case involved the application of the Court's 2018 decision in Pereira v. Sessionswhich held that A putative notice to appear that fails to designate the specific time or place of the noncitizen’s removal proceedings is not a notice to appear under the statute , and does not trigger the "stop-time rule."

Justice Gorsuch delivered the majority opinion.  Justices Thomas, Breyer, Sotomayor (who wrote for the Court in Pereira), Kagan, and Barrett.  Justice Kavanaugh filed a dissenting opinion, in which Chief Justice Roberts and Justice Alito joined.

As described by the syllabus to the opinion, the majority held that "[a] notice to appear sufficient to trigger the . . . stop-time rule is a single document containing all the information about an individual’s removal hearing . . . . "

In recapping the argument, Jayesh Rathod is spot on in predicting the outcome:

"By the end of the hour, four justices – Breyer, Gorsuch, Kagan and Sotomayor – had openly expressed skepticism about the government’s reading of the statute. Roberts and Barrett revealed less, but seemed persuaded that the government could sidestep this entire issue by modifying some agency practices. Although few of the justices invoked Pereira as controlling precedent, the court’s decision there – coupled with its seeming reluctance to indulge bureaucratic inefficiencies – could very well lead to another lopsided decision in favor of noncitizens."

Here is the SCOTUSBlog collection of materials and commentary on the case.

We will post analysis of the Court's decision as it becomes available.

UPDATE (April 30):  The title of Mark Joseph Stern's article in Slate ("Neil Gorsuch’s Persnickety Libertarianism Gave Immigrants a Win at the Supreme Court") offers a good hint of his analysis of the Court's decision in Niz-Chavez.  The punch line:

"On Thursday, Agusto Niz-Chavez received the benefit of the written word. He can now petition for the ability to remain in the United States with his three children, all American citizens. The decision may not be an earth-shaking victory for immigrants’ rights. But it vindicates a principle that has been badly damaged in recent years: Immigration officials can’t cheat non-citizens out of a right guaranteed to them by the plain language of the law."

May 3, 2021

How Andrew Cuomo Exploits Public Confusion Over the Definition of Sexual Harassment

[Cross-posted from NBC News]

By Vicki Schultz and Brian Soucek

Reporters finally had a chance this week to ask New York Gov. Andrew Cuomo about “all the groping, the sexual harassment” that current and former staffers have alleged in recent months. “I didn’t do anything wrong,” Cuomo insisted, despite having apologized in March for “acting in a way that made people feel uncomfortable." He also denied even engaging in the underlying acts several women have reported.

How can all these claims be true?

Cuomo seems to be following the tried-and-true playbook used by powerful men accused of sexual harassment throughout modern history.

Cuomo seems to be following the tried-and-true playbook used by powerful men accused of sexual harassment throughout modern history: deny and obfuscate. Use your public stature to reinforce a flat denial of sexual assault or other unwanted sexual advances. And seize on definitional ambiguity to deny that any other actions “that made people feel uncomfortable” count as sexual harassment.

A lawyer for Cuomo has defended the governor’s unsolicited kisses and “ciao bellas” by saying that he’s not a sexual harasser — he’s just “old-fashioned.” But what’s actually old-fashioned, and obsolete, is the definition of sexual harassment used by many popular media outlets and workplace harassment trainings where most people get their understanding of what sexual harassment is. For decades, legal cases have made clear that sexual harassment includes sexist insults and gendered demands, not just sexualized advances. But most people get their understanding of sexual harassment from the stories told in the news and at work, not from esoteric legal sources. Cuomo is taking advantage of people’s confusion about the nature of the problem — and what needs to be done about it.

Take the news media. Even The New York Times has promoted an overly narrow sexualized conception of sexual harassment in its reporting, as we explained in a 2019 article. In 2017, the Times helped ignite the #MeToo movement with its Pulitzer prize-winning reporting on alleged harassers like Harvey Weinstein and Bill O’Reilly. The coverage followed a familiar pattern: A powerful man in an influential field is accused of making unwanted sexual advances with women whose careers depend on him. The harassment is top-down, male-to-female, and, most important, sexualized. The Times even defines sexual harassment this way, as “a range of behaviors that are sexual in nature and nonconsensual.” Most other media outlets have viewed and covered sexual harassment in a similar way.

So, too, have employer policies and training programs, the sources designed to inform people about their rights. More Americans probably receive training on sexual harassment than any other legal topic, except perhaps drivers’ education. Yet, a comprehensive survey one of us conducted many years ago found that, without exception, employer policies defined harassment exclusively as unwelcome sexual advances and other sexual conduct, including sexual jokes and remarks. A more recent study found that little had changed. In an extensive analysis of sexual harassment trainings up to 2016, the vast majority of companies continued to define harassment in purely sexual terms.

As a legal matter, the sexualized definition of harassment contained in these everyday sources is over 20 years out of date. Worse, this definition leaves out most of the harassment women (and others) actually face on the jobStudy after study shows that most harassment doesn’t involve sexual advances or coercion. More often, harassment involves nonsexualized acts that demean, exclude, sabotage, assault or otherwise mark women as unwelcome, incompetent, insignificant or just “different,” because of their sex. Sexist put-downs are more common, and just as illegal, as sexual come-ons.

The Supreme Court recognized this broader conception of sexual harassment as far back as 1998, in an opinion by Justice Antonin Scalia involving a man harassed by his male co-workers on an oil rig. The court ruled that “sexual harassment” doesn’t have to be sexual in motivation or content to constitute unlawful workplace sex discrimination; the misconduct simply has to occur “because of sex.” So, harassment rooted in stereotypes about what constitutes proper work or behavior for men or women violates the law, just like male-female sexual advances. Gay men and others seen as not “man enough,” like women who take on traditionally male jobs or in other ways don’t keep to what some see as “their place,” frequently are harassed in both nonsexual and sexualized ways, more often by their co-workers than their bosses. The conduct is legally considered sexual harassment nonetheless.

But what does this have to do with Cuomo? Former aides have accused him of unwanted kissing and touching, ogling and commenting on their appearance, asking about their sex lives, and otherwise suggesting he wants to have sex with them. So, the allegations against him fall squarely within the popular understanding: A powerful man makes unwanted sexual advances toward the women who work for him. No need for a clearer or expanded definition, right?

Wrong. If we focus solely on sexual advances and misconduct, we fail to see that these behaviors are typically part of a broader pattern of sex-based and generalized harassment, and often other abuses of power, too. We also fail to see the deeper motivations behind the abuse and the institutional structures that enable it. For even when it does consist of gross sexual advances, sexual harassment is less about securing sexual gratification than it is about enacting a sense of macho authority and superiority over working women and others. It’s a way of reinforcing gender hierarchy.

We saw this with Harvey Weinstein, where media coverage that focused on his awful sexual transgressions obscured the fact that he wasn’t just a sexual predator. According to the New York attorney general, he was also engaged in a gross pattern of sexual and nonsexualized harassment against female and gay male employees, alongside misuse of corporate resources. Tying it all together was an outsize sense of entitlement, enabled by an industry and institutional position that gave Weinstein unchecked discretion to make or break other people’s careers and lives. And a sense of impunity about flatly (and in Weinstein’s case, falsely) denying the allegations, like other powerful harassers before him.

So too with Cuomo. Instead of debating how many uninvited gropes or lewd advances it takes to establish a sexual harassment claim, we need to see these stories within a larger pattern of reported verbal abuse, gendered dress codes, demeaning nicknames and threats of career-ending ruin, both by Cuomo and by others in his orbit. All are part of Cuomo’s projection of patriarchal power and authority. And it all constitutes sexual harassment, under the law, whether it fits the narrow popularized definition or not.

Ultimately, no one should be surprised that Cuomo, like so many other powerful alleged sexual harassers before him, has also been accused of broader misconduct, including lying about the death toll in New York’s nursing homes and using campaign money to promote his book. Research shows that the more unfettered the institutional power that bosses and leaders are given, the freer they feel to lord it over others and use it in abusive ways. To end sexual harassment and abuse, then, we can’t just remove individual harassers. We have to remake the structural positions they occupy, constraining unnecessary, arbitrary discretion and imposing public accountability. Properly understanding sexual harassment is just the necessary first step.

May 3, 2021

Exploring the Meaning of and Problems With the Supreme Court’s (Apparent) Adoption of a “Most Favored Nation” Approach to Protecting Religious Liberty Under the Free Exercise Clause: Part One in a Series

[Cross-posted from Justia]


By Alan E. Brownstein and Vikram David Amar

About three weeks ago, in a per curiam (that is, unsigned) opinion in a case that was not fully briefed and argued at the Supreme Court, a majority of Justices (Justices Thomas, Alito, Gorsuch, Kavanaugh and Barrett) announced a potentially game-changing approach to processing claims brought under the Free Exercise Clause of the First Amendment. Since 1990, and the decision in Employment Division v. Smith, the Court has read that Clause not to require accommodation of religious activity via exemptions from religion-neutral and generally applicable laws and regulations, but it does mandate that government not target or discriminate against religion. The Court’s decision earlier this month in Tandon v. Newsom provides some powerful evidence about what constitutes impermissible discrimination against religion in the eyes of the new Court majority.

In Tandon, religious individuals challenged California’s COVID-inspired rule that limits all gatherings in homes to no more than three households. The challengers argued that since in other places, such as hair salons, retail stores, movie theaters, private suites at sporting events and concerts, and indoor restaurants, more than three households were allowed to come together at a time, in-home religious gatherings were being treated in an inferior and discriminatory manner. Accordingly, they argued, California’s rule could survive only if the inferior treatment of in-home religious gatherings were narrowly tailored to further a compelling government interest. In validating this challenge, a five-person majority ruled that “government regulations are not neutral and generally applicable, and therefore trigger strict scrutiny under the Free Exercise Clause, whenever they treat any comparable secular activity more favorably than religious exercise” (emphasis in original). For purposes of our analysis here, we call the Court’s major innovation in Tandon “Most Favored Nation” (MFN) reasoning, drawing from international trade lingo, in which some nations are entitled to be treated at least as well as any other nation is being treated, and borrowing from the work of other scholars who have suggested this language and advocated for an MFN approach in free exercise cases.

As Justice Kagan’s powerful dissent (for herself and Justices Breyer and Sotomayor — Chief Justice Roberts dissented without opinion) pointed out, an MFN-style analysis always requires deciding what the relevant “comparators” are — just like in traditional MFN arenas we always need to understand how other entities are being treated for trade purposes in particular, and whether those entities are indeed nations. For Justice Kagan, the case for upholding California’s rule was strong and clear: “California limits religious gatherings in homes to three households [but if] the State also limits all secular gatherings in homes to three households, it has complied with the First Amendment. And the State does exactly that: It has adopted a blanket restriction on at home gatherings of all kinds, religious and secular alike. California need not, as the per curiam insists, treat at-home religious gatherings the same as hardware stores and hair salons—and thus unlike at-home secular gatherings, the obvious comparator here.” Justice Kagan went on to point out (as the lower courts had) that commercial gatherings are qualitatively different from in-home gathering in several respects, including the length of time people sit or stand near each other talking, the size and ventilation of the buildings, and the ease of enforcing social-distancing and mask requirements. At a minimum, the problem Justice Kagan identifies about deciding whether another activity is a fair comparator for determining whether religion is less favored is challenging (something we take up at various points in this series of essays.)

Given the practical and doctrinal difficulty courts implementing an MFN approach will encounter, we first need ask from where in prior cases this MFN notion might have emerged and what is behind it.

One possible explanation is that MFN reasoning is a plausible extension and extrapolation of Justice Scalia’s majority opinion in Employment Division v. Smith, the 1990 case we adverted to earlier, in which the Court first held that under the Free Exercise Clause, government is generally not required to grant religious accommodations to neutral laws of general applicability. But the notion that MFN reasoning is simply an explication of what Justice Scalia’s majority opinion had in mind as to the meaning of “neutral” and “generally applicable” is unpersuasive. The primary rationale the Smith majority offered to support its holding was that alternative approaches to free exercise were, as a practical and doctrinal matter, untenable. If courts applied strict scrutiny with full rigor to all laws that substantially burdened religious exercise and conferred accommodations whenever judges honestly concluded this rigorous test was not satisfied, society would devolve into anarchy as religious individuals could avoid complying with any law that allegedly interfered with their beliefs or practices. And if strict scrutiny was applied more leniently, judges would have to engage in a subjective, indeterminate balancing of interests; a task for which the judiciary is ill suited (and which lies outside its proper institutional role) and which, accordingly, is better assigned to the political branches of government.

But an MFN approach creates, indeed exacerbates, the very problems that Scalia and the four other Justices joining his opinion in Smith were trying to avoid. Interpreted and applied broadly, MFN reasoning requires rigorous strict scrutiny review of any law that includes at least one secular exemption. Under this analysis, the scope of rigorous review required by an MFN test is at least as broad as existed in the pre-Smith free exercise doctrine—the very problem the Court was trying to remedy in making the major doctrinal shift it did in Smith. And If an MFN approach is applied narrowly by aggressively limiting the scope of relevant secular comparators, courts will be engaged in the kind of subjective indeterminate quagmire Scalia wanted so much to avoid.

Whatever one thinks about merits of the Smith decision, and one of us has been harshly critical of its holding for 30 years, it is inconceivable that the majority in that case intended that the concept of general laws of neutral applicability be interpreted in a way that completely undercut the goals that the Court was trying to achieve.

Perhaps a more likely doctrinal predecessor of Tanden is not found within Supreme Court case law, but instead in a Third Circuit opinion Justice Alito authored when he sat on that court prior to being elevated. In Fraternal Order of Police v. City of Newark, about two decades ago, then-judge Alito wrote for a Third Circuit panel applying heightened scrutiny and requiring the Newark Police Department to grant an accommodation from its no-facial-hair grooming policy for police officers to an individual officer who wanted to maintain a beard for religious purposes. The fact that the Department granted exemptions to officers for whom facial hair was medically beneficial (i.e., for whom regular shaving created skin or other health problems) meant, to the Third Circuit, that religious requests for exemptions also had to be granted. Religious claims for exemption could not be treated less favorably than secular claims for exemption, when both claims interfered with the goals of the Department’s grooming standards — in this case uniformity of appearance — unless the Department could satisfy a heightened-scrutiny standard of review. More on this case a bit later.

Moving beyond case law foundations, what theoretical arguments are there to support an MFN approach? The substantive justification offered by some jurists and scholars supporting an MFN analysis is that the MFN principle is grounded on the notion that government cannot devalue religion by treating any secular interest, including public health and access to medical care, more favorably than an allegedly comparable religious belief or practice. This idea that for a right to be taken seriously its exercise can never be devalued in a relative sense—that is, can never be afforded less value than some other activity — is not generally recognized, partly for commonsense reasons. Applied to free exercise of religion in an energetic way, MFN analysis can often seem counterintuitive in the extreme. Assume a court upholds a city ordinance requiring private parades traveling through city streets to obey traffic rules and stop at stop signs and red traffic lights. Assume also that the court has recognized that ambulances driving patients to the hospital are not subject to these limitations. Certainly the Free Speech Clause would not require that a caravan of car protestors receive the same favored traffic-law treatment provided to ambulances. Yet under a MFN approach, if the caravan consisted of religious worshippers—say, on the way to a funeral—would we conclude that unless the hearse and other mourners were allowed to speed through red lights that their religious liberty would be constitutionally disrespected and impermissibly demeaned on account of the relatively superior treatment of emergency medical vehicles?

It’s easy to imagine one’s own parade (no pun intended) of horribles. But the problem with the MFN principle extends far beyond counterintuitive examples of its application. The MFN analysis in many ways fundamentally misunderstands and mischaracterizes the very nature of constitutional religious liberty. There are, to be sure, some fundamental rights that we protect because we value the social utility of the exercise of the right. Voting is an obvious example. But it is far less clear that the free exercise of religion fits securely within this category of protection on account of clear social utility. Instead, we protect the free exercise of religion because we do not want the state, and that includes judges, to interfere with religious choice and the voluntary association—the autonomy, if you will—of religious individuals. As a constitutional matter, we protect religious exercise because we do not trust the state to make judgments about religion. The reason that religious exercise receives constitutional recognition and protection is not because the Constitution assigns some heightened value to religious belief and practices over and above the wide range and majority of secular interests the state may deem worthy of protection.

This key distinction becomes particularly clear when we try to account for why religious majorities commit themselves to constitutional doctrine that protects minority beliefs the majority considers false and even dangerous. As one of us has explained this phenomenon in academic writings:

Religious individuals who support religious liberty for adherents of faiths they believe to be false do not do so because they believe that the faith communities receiving protection are moral or correct. The justification for protecting false faiths does not depend on the accuracy or value of what is believed. At its core, religious liberty recognizes the deeply felt need of individuals to determine religious truth for themselves and the right to live one’s life authentically in accordance with one’s religious identity.

The difference between protecting religion because of the value the state assigns to its exercise and protecting religious liberty to prevent the state from having any meaningful say in what religion requires or the importance of religiously grounded beliefs and practices is further demonstrated by the way courts define and identify religion for constitutional purposes. If we protect religion because of its relative and high value, one would think courts would carefully define what religion is so that they would be only protecting those interests that deserve special constitutional attention and protection. But that is not the case. There is no working operational definition of religion in free exercise jurisprudence. The lack of a definition reflects the courts’ concern that by attempting to identify and distinguish religion from non-religion, judges would get impermissibly caught up in involving themselves with the nature, value, and meaning of religion. That this is forbidden territory reinforces the idea that we protect religion by keeping it free from state involvement, not by assigning relative value to its exercise.

Even if one were to support the idea that we protect the free exercise of religion because the Constitution requires government to value religion at least as much it not more than secular interests the state deems worthy of protection, the lack of a working definition of religion, indeed the intrinsic fluidity of religious belief in a pluralistic society, makes the kind of comparison envisioned by MFN jurists and scholars particularly challenging. Exemptions from legal requirements may be extremely desirable because they free claimants from burdens they would find to be especially disturbing or because in obtaining the exemption the claimant receives something of secular material value. Consider, for example, that being exempted from the military draft might enable someone to avoid a crisis of religious conscience, but it also confers a material benefit—freedom from the risk of getting killed in a war zone—that many would desire. Or consider that the entitlement to be free from work on the Sabbath (either Saturday or Sunday) permits more than the freedom to go to religious services in the morning; it also allows someone the latitude to spend more time with their family and to engage in whatever non-vocational activities their faith permits. These secular-benefit externalities also figured prominently in the decision made by the Court in Smith, and they could easily bedevil courts seeking to undertake an MFN approach.

One reason for this has to do with how, as a matter of evidentiary sincerity, claims for religious accommodations are asserted. Claims for secular exemptions can often be grounded on objectively verifiable evidence. Medical issues experienced by people receiving vaccines or complying with facial shaving requirements or seeking 4F exemptions from conscription can be clinically evaluated. The evaluation of religious claims for exemption have no such basis for objective evaluation and depend on a subjective determination of the claimant’s sincerity. This means that there are risks of sham claims when religious claims of secular value are asserted, a concern that the state may not need to be as worried about when secular exemptions are granted.

It is not clear how the potential for sham claims should be taken into account in engaging in an MFN analysis. What should happen when the state explains that it grants a secular exemption but not a religious exemption because there is much less risk of false assertions for medical exemptions than for religious ones? The problem here is not simply the difficulty of drawing comparisons, a problem that confuses and undermines MFN analysis as a general matter. When constitutionally mandated religious exemptions result in secular benefits being made available to virtually all religious claimants, and only a few secular claimants are equally eligible for such benefits, the MFN framework can be challenged as unfairly privileging religion.

There is a deeper concern here that also must be addressed. When the courts require the granting of religious exemptions that also have secular value, they not only might be thought to improperly privilege religion, they create an incentive for individuals to affiliate with a faith and to use that as a basis for asserting the right to an exemption. The creation of such incentives is anathema to the constitutional mandate that religion should be a matter of voluntary choice without state action promoting individual beliefs and practices. Unless MFN analysis can respond to this concern, it raises problems that deserve serious attention.

We see no evidence that MFN is up to the task. In the Fraternal Order of Police case described earlier, for example, what would prevent a police officer who thought he was much better looking with facial hair to assert a sham religious liberty claim grounded on the exemption provided to officers who suffered medical consequences if they complied with the Police Department’s grooming standards?

We want to be clear here. The possibility of free exercise claimants asserting sham claims should not preclude the development of free exercise jurisprudence recognizing the legitimacy of free exercise exemptions in appropriate circumstances. But the risks of sham claims are not immaterial.  And if the MFN framework has legs in the eyes of a majority of Justices, this framework would need to innovate doctrinal tools for evaluating them.

One final example involving secular externalities and fluid religious commitments further illustrates the complexity involved here. If conscription was reinitiated, individuals who were otherwise eligible to be drafted might be granted a secular deferment because of medical limitations that interfered with their ability to participate effectively in combat, a status historically called 4F. Under accepted law, religious pacifists whose beliefs would interfere with their ability to participate effectively in combat would also be granted conscientious objector (CO) status. It has long been recognized, however, that the beneficiaries of CO status can be required to perform alternative service. This requirement operates as a check on sham claims for exemption and it places some civic obligation on claimants who avoid the serious burden of military service.

If we now add MFN analysis to the mix, does it become unconstitutional to impose alternative service on CO beneficiaries if we require no comparable civic obligation from individuals receiving medical deferments? Obviously, the CO beneficiaries (who are required to perform alternative service) are receiving exemptions of lesser value than individuals receiving medical deferments (who are not). Does that constitute the devaluing of religion? Or is it simply the state’s recognition that religious exemptions and medical exemptions are sufficiently different (in terms of proof of validity and necessity) for constitutional and public policy purposes that they do not need to be treated the same way — even if that seems inconsistent with MFN analysis.

In our next installment, we continue to try to locate an MFN approach in the larger constitutional context to permit careful analysis.


May 3, 2021

GILTI and California: Show Me the Money Edition

Back of the envelope calculations indicate significant revenue can be raised if California conforms to GILTI.


[Cross-posted from Medium]

By Darien Shanske

The California Legislature is considering a bill (AB 71) that would subject 50% of a category of income derived from federal tax law, known as Global Intangible Low-Taxed Income (GILTI), to California’s corporate income tax. In short, GILTI represents an attempt by the federal government to estimate, by formula, how much income — really earned in the US — has been shifted to low-tax jurisdictions to avoid US tax.

I have written extensively about what GILTI is, why states should tax it, why they can tax it and even why this is likely to raise a lot of revenue.


The current serious consideration of including GILTI in the California corporate income tax base merits a deeper dive into the data in order to arrive at a necessarily rough range of estimates. To be clear, I am not an economist and am not offering a model. Rather, I am extrapolating from publicly available information provided by leading economists through the use of what I believe to be reasonable assumptions.

On the high side, I will start with an analysis done by the Penn Wharton Business Model (PWBM), based primarily on IRS data. According to the PWBM, the GILTI formula should produce $388 billion of GILTI at the national level in 2021. This number, not surprisingly, reflects a good estimate as to the total amount of income shifted by US-based MNCs. Based on this number, the California proposal would raise about $1.7 billion in revenue per year. To arrive at this estimate, I am assuming that 10% of (50%) GILTI would be apportioned to Ca, which is a reasonable guess based on recent reports issued by the FTB (average factor of about 11% in 2017, 8% in 2018).

New Jersey has seen its CIT flourish after conforming to GILTI (and making several other substantive changes in 2018, including a rate increase and taxing 5% of the repatriation) and so the notion that GILTI conformity can yield substantial revenues is not outlandish.

The steadily declining yield of California’s corporate income tax similarly suggests there is a substantial upside to reforming the corporate income tax base. (Observe that the small reduction in rates on its own does not look like a good explanation for such a steep decline.)


[See chart on page 3 of this document:]

(Note that this high-end estimate derived from PWBM might actually be conservative if one believes that there is going to be an economic boom over the next few years.)


What of the low end of the range? We do have one piece of actual data on the amount of GILTI that has actually been reported to the IRS, which is that 81 of the largest corporations, with ¼ of total corporate income, reported about $100bn in GILTI in 2018. Note that if we just multiply 100bn by 4, then we are back to our high-end estimate of about $400bn in GILTI per year. Yet one might reasonably believe that these large companies represent a disproportionate amount of GILTI. One might also believe that these sophisticated taxpayers have found numerous ways to reduce their tax liability — perhaps by gaming the formula or by transmuting GILTI income into something else (e.g., so-called subpart F income). In California, it might turn out that some of the taxpayers with GILTI are already not taking a water’s edge election, which take them out of the GILTI inclusion proposal because, as to these taxpayers, income shifting is being countered in another way.

Note that California conformity proposal is written in such a way that it does not conform to federal regulations governing the GILTI calculation that are very likely to undermine it further. And, California already includes a different kind of suspect income (subpart F) into which GILTI income can be transformed in its tax base and so that particular stratagem will not reduce California revenue.


And so I think a lower bound of 200bn in GILTI at the national level for 2021 is reasonable — that means that between the vagaries of revenue estimation and taxpayer strategies, aggressive and benign, the estimate from PWBM is about 100% too high. In that case, conforming to GILTI would raise about $850 million/year.

This would mean a range of between $850mn and $1.7bn annually, subject to substantial caveats.

AB 71 would also subject the deemed repatriation of IRC 965 to taxation. This is another topic I have written about. The amount of revenue that could be raised by this change is also hard to estimate. It is not clear how much revenue was deemed repatriated, how much might have already been subject to California tax and how much corporations have chosen to pay on a deferred schedule (which is what AB 71 would tax). First, as to the repatriation that was formally subject to California tax already because the revenue was actually repatriated (about $1 trillion — again, based on FTB data), I think that not much tax was already paid on this revenue because so many of these same taxpayers had (and have) a surfeit of tax credits to use against the California corporate income tax. AB 71 caps the use of these credits against the repatriation (or GILTI) at $5mn. Second, I think a conservative estimate of how much of the repatriation taxpayers chose to defer is about $1.6 trillion. This takes into account the original $2.4 trillion estimate for the total amount of revenue to be repatriated, as well as the reported fact that 2/3 of taxpayers with repatriated tax liability chose to defer their tax liability on the repatriation (and only these deferrals would be taxed). Note we do not know how much of the repatriation those taxpayers represented.

Based on these reasonable, but rough, assumptions, taxing the repatriation would result in roughly $4.3 billion in taxes paid to California over the next 5 years. Acknowledging the significant uncertainties here, starting with the original estimate of how much revenue there was to be repatriated, a lower bound of figure of $2 billion over 5 years seems reasonable or again discounting by a factor of 2.

A final note on the larger bill. One of AB 71’s core policy insights is that the state needs to provide a stable stream of revenue to combat homelessness. Tying the state’s contribution to the vagaries of how much taxpayers pay on their GILTI income would undermine that stability. What is most important about the revenue estimates is that making a change to California’s corporate tax that should have been made anyway is reasonably likely to roughly pay for the state’s revenue commitment to combat homelessness over time so that these new programs are not taking away from other essential programs.


To make this point more concrete, consider that we want taxpayers to have less GILTI because we want them to shift less income. California’s conforming to GILTI could contribute to taxpayers changing their tax structures in this way. Indeed, the Biden Administration is proposing to strengthen the GILTI regime in various ways. Suppose then that there is less GILTI income because less income is being shifted. If that were to occur, then that would mean there is more tax paid on ordinary corporate income and so California would still receive more revenue from GILTI inclusion, but not with the GILTI label.


Accordingly, it makes sense to appropriate about $2 billion/year to homelessness mitigation programs, knowing that the GILTI conformity and repatriation provisions are at least reasonably likely to roughly cover these expenditures over time if one takes a broad view of how these provisions are meant to operate.