Tuesday, December 20, 2011
Saturday, October 1, 2011
This is a reprint of a 9/22/11 article I wrote for American Thinker
He's looking more like a bobblehead every time he speaks. From left to right, nose in the air, all the while talking down to those of us he views as stupid. Well, we may be stupid, but we certainly can add, subtract, multiply, and divide better than the POTUS can.
In Obama's fist-pounding, finger-pointing, bellyaching repeat of many previous speeches, he put forth a "plan" to bring down the deficit. And what an original non-plan it was. Raise taxes, fake spending cuts -- just like all his other non-plans. Nothing written, you understand, just promises to cut out fraud and waste. And, of course, tax the rich. This time he prefaced his "tax the rich" part by saying, "This is not class warfare; it's math." Math? Mrs. Davies, my 1st-grade teacher, would probably take exception to that. Now, it seems, even arithmetic has joined the sciences taken over and rearranged by the liberal left.
The president: "They should have to defend that unfairness -- explain why somebody who's making $50 million a year in the financial markets should be paying 15 percent on their taxes, when a teacher making $50,000 a year is paying more than that -- paying a higher rate."
Since we all have a tendency (yes, even conservatives) to rush to judgment before we know the facts and what we are talking about (and because I admit I don't believe anything this guy says anymore), I forced myself to have a conversation with my accountant before I went on my rant. He e-mailed me this:
I ran a 2011 tax projection for the two situations he outlines and this is what it shows:
-Taxpayer earning $50K - pays $4,156 in federal income taxes, or 8.3% effective tax rate (not higher than 15% as erroneously bellowed by the illustrious campaigner)
-Taxpayer earning $50M - pays $17,466,318 in federal income taxes or 34.9% effective tax rate (considerably higher than, well, you know)
Two questions for our brilliant Prez:
1. Where did you learn math?
2. Who in your example is paying their "fair share"? (Note: there are two potentially correct answers here for those challenged by the obvious -- certainly "the taxpayer earning $50M" is correct, but "both taxpayers" is also a correct answer.)
1. Mr. Obama should be "called out" for being an idiot.
2. What the heck, man?
Now I am sure my accountant doesn't really want Obama and others like him to learn how to read a tax table -- after all, they might start doing their own taxes. However, it seems reasonable to expect the president to check with his accountant (like I did) before he goes on national television and makes a fool of himself.
But then, he's used to that.
What? Pardon me? You are saying I misrepresented the whole thing by counting only ordinary income? Click here if you don't know the difference between ordinary income and capital gain and don't trust my synopsis. Otherwise, please accept my brief explanation.
Ordinary income is money earned from your job. This can be wages from cleaning windows to being the CEO of a major corporation. There are other inclusions, but it is essentially as I have described. Capital gain, on the other hand, is profit from invested capital. What's the difference, and why is there different tax treatment for the two?
First off, invested capital is, in itself, the remains of earned income after taxes have been removed. Get it? Taxes have already been paid on the invested income before the capital was invested.
Next, there is a possibility of incurring a loss when you invest your money, not something readily occurring with your job. Very few of us go to work, perform our duties, and lose money as a result.
Aren't those two issues enough justification for a different tax rate on capital gains versus ordinary income right there? Add this: capital gains are taxed at a lower rate as an incentive to invest. Without investment, we have no new jobs, and no increased productivity, which raises everyone's standard of living. We have no way to prepare for our retirement (other than to depend on Social Security!), and no way to make things better for our succeeding generations.
Investment is a good thing. If you do your job well, save some money, and invest it, it is good for you, the economy, and our country. Please, oh please, invest some money. We all depend on it.
Certainly we remember Mr. Buffett's article stating that his secretary paid a higher tax rate than he did. I'd bet a prix-fixe dinner at Chez Panisse in Berkeley that his secretary has a few bucks invested in equities (maybe some in Berkshire-Hathaway), and I'd bet another dinner at the Clint Eastwood's Hog's Breath Inn down in Carmel-by-the-Sea that his secretary is paying no more taxes on her investment income than Mr. Buffett is -- and paying considerably less on her earned income than Buffet is. Buffet's argument was blatantly incorrect and deliberately misleading, which is surprising coming from a man with such seemingly good intentions as to leave large portions of his fortune to charitable causes when he croaks. And, just a hunch here, I'll go one more dinner anywhere that Buffett's capital employs more people than his secretary.
(By the way -- here's a tip for the IRS. Mr. Buffett's statements imply that he is really making more money from his job -- the managing of his money -- than he is claiming, preferring to receive his earnings as capital gains and not attributing a large enough amount to his labor and expertise. Do I get a reward for being a tax snitch?)
Here's the sad part: Obama doesn't know what to do. Neither do his advisors. They want to keep their jobs, but they have no idea what's going on. Obama's like a pitcher who has been lit up for 18 runs in one inning and thinks if he keeps throwing his fastball, eventually he'll get someone out. Unfortunately, the coach can't take him out until 2012, so he's going to keep on throwing that fastball.
And keep on bobbling that head.
This is a reprint from a 9/18/11 article I wrote for American Thinker
As President Obama said in his recent "Jobs" speech, "Yes, we are rugged individualists. Yes, we are strong and self- reliant. And it has been the drive and initiative of our workers and entrepreneurs that has made this economy the engine and the envy of the world." Truthful words. Why, then, do so many in Washington operate as though we are weak and incapable of taking care of ourselves?
Our history is stuffed to the brim with stories of bravery and self-reliance. Our early ancestors braved the seas to come to America and start a new life. We fought the War of Independence so we could be our own nation and govern ourselves as we saw fit. We didn't need to be coddled by Britain -- and we did not want to be told what to do or how to live our lives. We did not want a government that required our enslavement. We wanted our freedom and the responsibility that came with it. We wanted independence.
Independence. Think of what that means. A common definition is freedom from the control, influence, support, aid, or the like, of others. I would be surprised if most Americans didn't agree wholeheartedly with every aspect of the definition.
This doesn't mean we don't feel a commonality with our fellow countrymen; obviously we do. But the most wonderful aspect of American freedom is that we voluntarily come together to help each other in times of need. Our country's common spirit is fueled by this voluntary bond: a sense of togetherness, shared values, and a common history; past, present and future. If we feel any sort of obligation or commitment to our fellow citizens, it has always been for the above reasons -- not a sense of governmental obligation or requirement. We have worked together towards common goals with respect for each other as equal citizens and partners.
Possibly the most special part of this American unity is that it pops up when needed, and not just at the national level. When a local community is hit by a flood or an entire region is hit by a hurricane, Americans from near and far can't wait to assist. A number of my friends in California who were chomping at the bit to get to New Orleans and the Gulf Coast to lend a helping hand. And when tornadoes hit Joplin, Missouri, the evening news shows were replete with stories of selfless individuals who, even though they had problems of their own, were right there pitching in to help others. Local news programming frequently covers less noticeable events with the same impact, and, occasionally of volunteers who regularly put in their time to help with local causes during non-emergency times.
And need I mention 9/11? National unity soared after those tragic moments that are forever seared into our memories. For a while, divisiveness was forgotten and unity was the reality of the day.
Today, politicians, pundits and work-a-day citizens continually call for a return to that "unity," instead of the divisiveness that infects our country. Carl Cannon in an article recently posted on RealClear Politics laments the lack of civility in American politics. He quotes Richard Norton Smith as blaming our divisiveness on our "refusal to get serious, no matter what the challenge," implying that we put our political ideologies ahead of national interest. I disagree. It is precisely that both sides see their view of the national interest to be so important that it's worth fighting for. But with the advent of the internet and proliferation of the number of television channels available, the pot is constantly stirred heightening viewpoints and irritation in those who disagree. The airport, restaurants, you name it -- there is always a television with someone spouting their point of view. Contributing to this divisiveness is the fact that the MSM no longer has a lock on the news that's distributed. As a result, many more viewpoints are expressed other than those that were spoon-fed to us by liberal outlets year after year. (As an aside, you might want to read my blog post "Is Fox News Divisive? Well ... Sort Of.)
Despite all this, Americans still feel connected when necessary, as witnessed by the aforementioned examples. What worries me, however, is that the cement of our unity is under attack -- notably our historical philosophy of "rugged individualism and self-reliance." When we respect each other and see that the other guy is "doing his part," we help each other; and we do it with affection and a sense that we need to do it for them and for our own well being as well as theirs.Currently, the iconic concept of American generosity is under attack from a ravenous federal government that wants to take over our consciences -- both individual and collective -- and make decisions for us as to who pays and who receives, who wins and who loses, and who we are as a people.
Even well-meaning people like Warren Buffett are in on this. It is apparent he is a conscientious man given his promises of donations to charitable organizations. But even though he declares in his recent article Stop Coddling the Super-Rich, Buffett's Berkshire-Hathaway has striven to minimize its tax obligation. Why the disparity? Simple: Buffett would prefer to have a say as to where his money goes. I wonder if he would agree to pay more in taxes if he knew it was going to causes he doesn't support. I bet not.
I agree with Mr. Buffett: stop coddling the super rich. Stop coddling everybody, including the poor, the unions, the banks, General Motors, the ethanol industry, the solar industry -- anyone who is being coddled. Coddling has no place in a strong, capitalistic economy.
Capitalism and free markets have always been an important part of this voluntary pact. In America, self-support or convincing others to work with you or use your services provided your livelihood. Inventions, new ways of doing things to increase productivity, life-saving medical advances, and everything from developing the world's best agricultural techniques to home construction were a result of a system that was steadfast in rewarding people for their ideas, labor, investment of their capital, and for taking a risk.
Capitalism and free markets fostered an environment for people to choose their line of work if they had the basic skills and determination to be successful. Capitalism and free markets allow people to know the joy of being self-sufficient and viable, and foster a self-image of individualism and importance.
Capitalism undoubtedly was the driving force behind the greatest economic machine in the world. I believe in capitalism, freedom, and the responsibilities that come with the benefits. I do. I cherish it. I can't conceive of living any other way. And I know I am not alone.
Yet all we hear of these days from our Washington politicians, mostly Democrats, is how the government wants to destroy the most important aspect of our treasured culture: our requirement to ourselves and our fellow citizens that we pull our own weight and prosper or fail because of our own efforts. Choking regulations on business, taxing the people and entities that drive our system, and taking from the producers to give to the non-producers is threatening not only our economic well being, but our morality and our entire social order and conscience as well.
No, we shouldn't be coddling anyone. Everyone should pull their own weight. And anyone who does not should feel horrible about leeching off this great society. Instead, however, Washington has encouraged this belief that government is the answer to all our problems, whether it be GM's, a union's, or the guy who reuses to accept responsibility for his self-supporting productivity.
A common thread in President Obama's speeches is that despite our political differences, we are all Americans, and we are all in this together, yet his words are hollow because he doesn't understand the essence of America -- or because he does and wants to "fundamentally change" it. When he speaks his words, he means two things; that we should see things his way, and in a general sense that we should all be sharing everything. He calls on our history that we have always been there for each other, and that we have always pitched in together. I agree. Most of us agree. Where we disagree is in the interpretation of what those statements mean going forward. Mr. Obama and his fellow progressives believe we should be tethered together by governmental obligations. One of the main planks of progressive politics is to have government be the common bond between everyone. They would destroy many of the very things he touts as American. As an example, he wants to reduce tax deductions to charitable institutions. Why? He wants to take the money generous Americans give to churches and non-profit community groups and let the government receive it instead. He wants to decide who gets help and who does not. In short, he wants to take away the volunteer spirit that has been America, even as he touts volunteering as a good and beneficial thing. This can only reduce the amount that charitable entities receive -- mostly efficient, honest and effective organizations -- and instead leave it up to notoriously wasteful government agencies.
"No single individual built America on their own. We built it together. We have been -- and always will be -- one nation, under God, indivisible, with liberty and justice for all, a nation with responsibilities to ourselves and with responsibilities to one another." Precisely. Responsibilities to one another. Responsibility to do our best to take care of ourselves and not burden our fellow citizens, and to contribute to others when it is necessary.
"These are difficult years for our country, but we are Americans. We are tougher than the times that we live in, and we are bigger than our politics have been. So let's meet the moment, let's get to work, and let's show the world once again why the United States of America remains the greatest nation on Earth." Obama stole my line. Of course, I would have meant it.
Monday, August 8, 2011
Dems say the GOP was holding America hostage. No, Really.
“In other words, the Democrats are not standing pat. They are responding to changes in the electorate and finding means of compromising in order to move the dialogue forward and meet the pragmatic needs of the country.” A common view amongst many MSM people and the left. In addition to the ridiculous assertion that Dems are attempting to meet the “pragmatic needs of the country,” the statement implies that Dems were bring solutions to the table. In reality, they brought nothing to the table (except speeches) and did nothing but respond to proposals with venom.
“…the President, as leader of the Democrats, has constantly moved his position on taxation to the right until he agreed to a cuts-only budget in order to reach a debt-ceiling agreement.” No, he has never moved his position on taxes. He signed some compromise legislation, but that does not mean he moved his position. Quite the contrary. He has continued to excoriate “corporate jet owners,” and wealthy people for not paying “their fair share.”
From the National Taxpayers Union
Tax Year 2008
Percentiles Ranked by AGI
AGI Threshold on Percentiles
Percentage of Federal Personal Income Tax Paid
Note: AGI is Adjusted Gross Income Source: Internal Revenue Service
Am I missing something, or are the top earners already paying considerably more than their fair share. Look, if you want to say they should pay more, that is an arguable point. But saying they are not paying their “fair share” is complete nonsense.
No, Obama has not moved his position. However, here is where his pragmatism comes in. He wants to get reelected.
“… it is the President and the Democrats who have done all the heavy lifting in the debt ceiling negotiations…” What? WHAT? WHAT?!?!?. Again – all they did was sit back and let the GOP do the “heavy lifting.” They just waited until the last minute when they thought they had gotten all they could and said “okay.” Count up the concrete proposals the Dems put forward. Oh, that’s right – there weren’t any.
“Obama governs as a classic centrist politician who understands the art of compromise. He seeks to bring us back to "the center", while the Republicans have seemingly been seduced (or bludgeoned) by the Tea Party, and they cannot or will not find their way back to the middle with their current leadership.” First, the “middle” as he puts it is his position. Lefties all think their position is the correct one, so it is the middle. I, of course, think that my position is the middle, and that the essential core of the tea-party arguments are centrist. Take, for instance, the balanced-budget amendment, which is a tea party plank. A CNN/ORC poll – question 25 -- showed 74% of people favor a balanced budget amendment, while 24% opposed. Everyone has an opinion of how to balance it, but a huge majority thinks it is a good thing. In my view, this makes it centrist. Dems call it “whacko” and “extremist.” Time to reconsider what is considered left, right and center.
Now, let’s not get confused about the definition of gridlock. The end result isn’t the issue; it is the process leading up to it. The gridlock occurs because nobody will budge and do anything. So the process drags on and on, creating the gridlock. The process is ended at the moment the gridlock is broken. Everything that happened prior to the agreement was, in fact, the gridlock. Let me remind of a few things the Dems “would not budge” on prior to the agreement, thus the gridlock-
Raising taxes was a must. They ultimately did agree on a short-term basis. Short term – because if nothing is done, the tax increases by letting the Bush tax cuts expire will go into effect. So, no, they did not really “cave,” they just allowed the tax issue to be put on hold, knowing that if nothing changes, they will get their way. Agree or not, their insistence on raising taxes was definitely part of the gridlock.
Entitlement reform. Until the eleventh hour, they would not budge on that (identical to the GOP’s position on defense spending). Entitlement reform is, of course, the largest elephant in the room. Dems say they are in favor of entitlement reform, but they have not put a proposal on the table, and have opposed anything in that arena proposed by Republicans.
Obamacare. That, of course, is off the table. But that’s not being stubborn, that’s merely good sense, right?
Paul Ryan proposed a plan that would go a long way towards fixing things. Dems don’t like it because they think the “rich” should pay more taxes. That is their opinion; and while I disagree wholeheartedly, their opinion is still an (ugh) valid one. However, NO plan had been put forward by the Dems. None. For over two years. Two Years! And they had the Presidency, the house, and the senate! They could have done anything they wanted! (Oh, how silly of me to forget. Even though all parties and the rating agencies agree we need to cut the deficit by $4T, Obama did put forth a plan that failed to get a vote in the Senate from the GOP or the Dems and would have raised the debt. I carelessly forgot about that one.) Why? Because they won’t cut anything. Because they simply cannot make tough choices. Because they are all fluff and no foundation.
The clear (and currently successful) plan by the Dems is this: Don’t cut anything. Wait until the GOP gets some power here, and let them do the dirty work by suggesting cuts, i.e., let them suggest cutting Medicare by $1T, and they will look like meanies. Then when we get $500B back so the total cut is only $500B, we will look like heroes. Mission accomplished, we get a cut -- the GOP gets the blame. “Whew, looks like we won’t get Greeced after all, and the GOP is getting the blame. Boy did that work out swell.”
And this nonsense about Obama being a centrist. He may be as you say responding to the public (others call it flip-flopping), but he is no centrist. From his famous interview with Charles Gibson-
"Well, Charlie, what I've said is that I would look at raising the capital gains tax for purposes of fairness.” When Gibson responded that lowering the tax rate can increase revenues to the government, Obama replied "Well, that might happen, or it might not. It depends on what's happening on Wall Street and how business is going..." Again indicating he didn't care about the actual revenues received, only the principle of fairness.
That is not a centrist. The revenue itself was not important. Only the “fairness” of the situation.
I could go on and on about this "centrist" stuff such as his dictatorial views on green energy, the EPA, the justice department...but that is another whole subject that can't be handled here.
Back to the budget debate; everyone agrees that spending cuts are necessary. Everyone agrees that entitlement reform is necessary. Although, in my opinion, Dems reluctantly agree to this only because it is so blatantly obvious that they can’t get away with their normal whipped-cream analysis.
On the other hand, conservatives do not agree with tax cuts. As a businessman, I know that permanently cutting taxes to businesses and relaxing regulations would stimulate the economy (the private sector, which is what is important) enormously. Others may have a different view.
So, we all agree to cut spending, but we don’t all agree to raise taxes. What is the obvious choice here? Cut spending now and keep talking about the taxes (tax reform, etc.).
The tea part “extremists” (those wild-eyed people who represent the views of over half the American public) and the left-wing ideologues are sent to congress to do what their constituents want. If there are not enough votes for agreement on an issue, then you don’t get agreement and you accept the consequences. The tea party guys were willing to accept the consequences. So were the left-wingers. So, again, the “middle” got enough votes to hammer out something. That’s the way it is supposed to work.
I don’t have any problem with someone claiming that both sides are responsible for the gridlock. But don’t blame just the GOP. That’s preposterous. In fact, a clear look at evidence tilts the scale in the opposite direction.
Besides, gridlock isn’t always bad. Too bad we didn’t have gridlock when Obamacare was proposed. We would be far better off.
Article referrenced http://www.caivn.org/article/2011/08/08/gridlock-myth
Mercer Tyson StaightThinker.com