Temporarily Inconvenienced Millionaires

Yesterday, the Patriotic Millionaires, a growing group of wealthy individuals who are demanding that Congress raise their taxes, went to Congress and pestered the offices of Senators John Kyl, R-AZ, and Pat Toomey, R-Pa., Reps. Nancy Pelosi, D-Calif., minority leader, Xavier Becerra, D-Calif., and Jim Clyburn, D-S.C., assistant democratic leader.

They were led by entrepreneur and former AOL exec Charlie Fink who apparently didn't get the memo that innovators and the wealthy are under attack by vicious government regulators and idiotic moochers all bent on taking the fruits of their hard earned labor with the butt of a gun. Shit, man, didn't this Fink guy see what happened to Steve Jobs and Apple? The US federal government destroyed him.

Fink, who lives in Washington, D.C., said if the Bush tax cuts do not expire, the country "is digging itself a big hole by foregoing revenue." "Without revenue, we will never solve the problem by giving tax cuts to the wealthy while supporting two foreign wars," he said.

Patriotic Millionaire Robert Johnson, former chief economist of the U.S Senate banking committee, said that the current economic system is not broken, but it is "working on behalf of those who designed it in their favor."

"America is no longer based on markets and capitalism, instead our economy is designed as 'socialism for the rich' – it is designed to ensure that the wealthiest people take all of the gains, while regular Americans cover any losses," he said at a press conference this afternoon in Washington, D.C.

"It's a Las Vegas economy where regular Americans put their money on the table and the richest 1 percent own the house," he said. "And if the 1 percent happen to lose money, the 99 percent bails them out – covers their losses and then stands by watching while the house does it all over again."

Amen, brother.

Of course, the response to these simple facts usually consists of any or all of four of the following. First, the wealthy pay more than half of the total taxes. Second, their portion or responsibility of total revenue has doubled over the last 30 years. Third, half of Americans pay no taxes. Fourth, the wealthy pay a higher ratio of taxes paid to income earned than any other country.

All of their points are true but, as is usually the case, they leave out information and don't tell the whole story. A recent article in The Christian Science Monitor explains all of this in a very balanced way. Here are four graphics that take a serious and critical look at the whole picture.

In looking at all of this information, it's obvious that the various cheerleaders for the wealthy (or at least only some of them now that Buffet and the PMs are out lobbying to have their taxes raised) are not being honest. No one is denying that the half of the story they are telling is true. It's the other half that brings out the technicolor and shows us that we have some very serious problems with the way our country is being run by both public and private leaders. As Mr. Johnson said above, it's "socialism for the rich" and no longer capitalism. But why is it this way? How can people (and I'm speaking specifically of a few my regular commenters here in addition to the 40 percent of this country who votes GOP) who aren't wealthy continue to support Bizarro Capitalism? Sadly, the answer is simple.

Because they view themselves as temporarily inconvenienced millionaires.

The Turning Tide

I saw this recently and just about fell out of my chair.

A new survey from Spectrem Group found that 68% of millionaires (those with investments of $1 million or more) support raising taxes on those with $1 million or more in income. Fully 61% of those with net worths of $5 million or more support the tax on million-plus earners.

Holy Shee-aht! My initial shock was that it was even published at all in the Wall Street Journal. After that wore off, I was pleasantly surprised to see that two thirds of the wealthy now think that raising taxes is a good thing. But why do they support this?

Explains George Walper of Spectrem: “What this tells us is that there are a number of wealthy folks who said: ‘Gee, we need to increase taxes to stimulate the economy. No one likes to be taxed more, but the reality is maybe it has to be done.’ ”

Yep.

Here are some of the comments from the supporters of this increase.

“When you have someone who made four and a half billion pay fifteen percent, and because it’s a hedge fund, I have a problem with that.”

“Quite frankly if Warren Buffett gets taxed an extra fifty thousand dollars or your typical investor of two hundred and fifty [thousand] or larger has to pay an extra thousand dollars in tax; It’s not gonna change his lifestyle. Whatever he or she was gonna buy, he or she is gonna buy.”

I have to say that I am fairly elated that wealthy people in this country are saying things like this. The tide is turning, folks, and it honestly can't happen too soon.

Ah, Gip...

I came across this video recently and couldn't help but shake my head. Pay close attention to his story of the bus driver at around 12:30 and his question to the crowd at around 15:30.



I guess when Reagan calls for it, then it's not socialism:)

His caution at the end (about 17:30) sadly was not heeded.

People Invest To Make Money

Back in the 1980s and 1990s, tax rates for the rich were far higher, and my percentage rate was in the middle of the pack. According to a theory I sometimes hear, I should have thrown a fit and refused to invest because of the elevated tax rates on capital gains and dividends.

I have worked with investors for 60 years and I have yet to see anyone — not even when capital gains rates were 39.9 percent in 1976-77 — shy away from a sensible investment because of the tax rate on the potential gain. People invest to make money, and potential taxes have never scared them off. And to those who argue that higher rates hurt job creation, I would note that a net of nearly 40 million jobs were added between 1980 and 2000. You know what’s happened since then: lower tax rates and far lower job creation.

We hear a lot of garbage from the right about how higher taxes will lead to lack of investment and job losses. These same people lapse into their ridiculous hubris and assume that anyone left of center doesn't know anything about how business works. They do, of course, despite all evidence to the contrary. The above quote is from someone who knows business a great deal more than most and has the wealth to prove it. Before I get to who it is, let's take a look at some more facts from his recent piece.

Since 1992, the I.R.S. has compiled data from the returns of the 400 Americans reporting the largest income. In 1992, the top 400 had aggregate taxable income of $16.9 billion and paid federal taxes of 29.2 percent on that sum. In 2008, the aggregate income of the highest 400 had soared to $90.9 billion — a staggering $227.4 million on average — but the rate paid had fallen to 21.5 percent.

So, their taxes have gone down and their wealth has gone up.Why they are bitching is a complete mystery. Why people who make 40K a year are proxy bitching for them is borderline insanity.

Last year about 80 percent of these revenues came from personal income taxes and payroll taxes. The mega-rich pay income taxes at a rate of 15 percent on most of their earnings but pay practically nothing in payroll taxes. It’s a different story for the middle class: typically, they fall into the 15 percent and 25 percent income tax brackets, and then are hit with heavy payroll taxes to boot.

Some of us are investment managers who earn billions from our daily labors but are allowed to classify our income as “carried interest,” thereby getting a bargain 15 percent tax rate. Others own stock index futures for 10 minutes and have 60 percent of their gain taxed at 15 percent, as if they’d been long-term investors.

The taxes I refer to here include only federal income tax, but you can be sure that any payroll tax for the 400 was inconsequential compared to income. In fact, 88 of the 400 in 2008 reported no wages at all, though every one of them reported capital gains.

Hmm...Nikto and I have been saying the same thing.

So who is the author who has clearly and factually related this information? It's Warren Buffett, one of the three richest men in the world.  Now, given that he is a shining example of success in the world of investments and business as well as knowing a thing or two about jobs, it follows logically that we should heed his advice: let's stop coddling the super rich....as in right fucking now.

If we are going to make spending cuts, we have to follow with an overhaul of how we collect revenue. That means no more subsidies, tax shelters for the wealthy, and the end of the Bush tax cuts for the wealthy. In short, a complete overhaul of the tax system. This is what has to be done to seriously address the issue of our debt and prop up the overall health of our economy.

The time for make believe and managing fantasies is over. We need to destroy the bizarre myths that the right have created regarding taxes. They must be exposed as the catechisms of true believers that they are and have no place in reality. They are holding us back from fixing our country and propelling us in a positive direction towards the future.

Take a look at his chart.

The right is constantly telling us that higher taxes means job killers. But the United States has lower taxes (as a percentage of GDP) than many other countries as we can clearly see here and many of them have lower unemployment rates. Denmark, for example, has close to 50 percent taxes to GDP and yet unemployment stands at 6 percent. From the Heritage Foundation:

With its economy open to global trade and investment, Denmark is among the world leaders in business freedom, investment freedom, financial freedom, property rights, and freedom from corruption. The overall regulatory and legal environment, transparent and efficient, encourages entrepreneurial activity. Banking is guided by sensible regulations and prudent lending practices. Monetary stability is well maintained, with inflationary pressures under control.

Even with all of those taxes? Wow, that doesn't really fit the fictional narrative at all, does it? In fact, it ranks one spot higher than the US on the Economic Freedom matrix set up by the Heritage Foundation.

Let's take a look at Sweden. Sweden has slightly lower taxes (47 percent of GDP) yet has 8 percent unemployment). According to the Heritage Foundation, Sweden also has an "efficient regulatory framework strongly facilitates entrepreneurial activity, allowing business formation and operation in Sweden to be dynamic and innovative" earning it a score of 95 percent in regards to business freedom. Sweden has all of this despite higher taxes.

Higher taxes do not necessarily mean job killers. This is a lie that really needs to put in the fucking ground. It's sole purpose is meant to bamboozle frightened people out of their vote. I have no problem giving on the spending side of the equation. It's time for you folks on the right to give on the revenue side so we can adequately address our debt issues.

What Would Ronald Reagan Do?

Well, it's pretty easy to find out.

Ghost of Gipper looms over GOP

More importantly, what does his top economic guy say now?

Americans Support Higher Taxes. Really.

Get the message yet?

About Time

Most of the time, I get nauseated when the left bitches about President Obama. They really have no fucking clue what kind of country we live in today. For the most part, this is especially true when they whine about the president not being tough enough.

But today, I have to say, I was very happy to see the president call the right on their bullshit during his press conference today. The position the right has taken on taxes is so ludicrous that it's embarrassing given reality. Thankfully, most Americans are not with them.

Politifact has an iPhone app, b to the w, which is pretty mega and only $1.99.

And check out this poll.

26 percent blame President Bush, 25 percent blame Wall Street, 11 percent blame Congress and just 8 percent blame President Obama. In all honesty, this poll is just about the right distribution for blame. The other 30 percent could probably be a variety of other sources including the American people themselves.

All of this tells me that the doom and gloom about the president and the Democrats losing in 2012 is terribly short sighted. Most Americans aren't buying the narrative that the GOP and other parts of the right are peddling. It doesn't add up. They simply don't have any solutions for our problems and it's very clear that their past efforts have completely failed.

All they really have left is the media which they fake scorn every chance they get. Without them, I doubt anyone would pay attention to what anyone says on the right. They'd have their own little world where they could blow bowels about fake problems and the rest of us can get on with actually making this country a better place.

Sunday Blessings

I wanted Georgia to be known as a state that was friendly and welcoming to people. And while I absolutely believe in the rule of law and that people should be here legally, I think we should be hospitable and kind and compassionate. There’s a real legitimate worker shortage where there is a real fear and perception that Georgia is probably not a state to be seen in if you’re of a different color. And I don’t think that’s what Georgia wants to be known as.

---Former Governor of Georgia, Sonny Perdue,Republican

Between now and the next year, as we go to solve this problem, everybody knows there’s going to have to be a compromise on some sort of revenue increases. Grover’s old news. It doesn’t matter what he says, it doesn’t matter what he wants.

---Senator from Oklahoma, Tom Coburn, Republican

Praise Jesus, they are out there after all. I am happy to be wrong and if this sentiment continues it may be more often...which means I might not have much to bitch about, right? Hope springs eternal!

A Most Excellent List

Apparently, we have Christian teenagers reading Notes From the Front. Should I be worried? Ah, maybe not.

One of them sent me an email with a link which contained this wonderful list.

102 Things NOT To Do If You Hate Taxes.

Nikto was recently taken to the mat for saying this:

It is a staple of conservative dogma that government can do no right.

Well, take at look at the list of 102 things and count how many you think are legitimate functions of government and are worthy of your tax dollars. I could only find two items on the list that should not be government funded (#74 and #75). Because of my bias against fish (the smell is simply disgusting) and animals (giant pain in the ass) I have to recuse myself from being able to think rationally about either of those expenditures. I'm completely fine with all the rest.

I'd say if you disagree with a majority of them, you pretty much fall in line with Nikto's statement.