Saturday, November 13, 2004
The New Tax Burden
(or The Republican Tax Shell Game)
Mr. Bush and Co. will be working hard to keep reducing taxes. (Do I hear a collective sigh of relief?) Before you crack open the champagne and work on buying that second house, let me explain some fun details.
Their primary agenda will be threefold; kill the alternative minimum tax which corporations and billionaires pay, eliminate the capital gains tax, and eliminate the estate tax. How will they sell it? Well, it'll help families that have investments in the stock market, and poor farmers who give their hard earned land to their children when they pass away. (Can you hear the violins?) And killing the alternative minimum tax (AMT) which Reagan himself put in place, that'll help create jobs.
If you're feeling a bit optimistic, let me add to your enthusiasm. Bush & Co. are proposing eliminating the income tax and replacing it with a flat tax type system. (You're shouting for joy right now, aren't you?)
Well, when you finish jumping around the room and singing "Happy Days Are Here Again," to your friends and family, let me give you the drawbacks to all these tax cuts.
Say you happen to be Paris Hilton. Your daddy and mommy leave this world to meet their maker. You inherit a multi-billion dollar hotel empire, and you won't pay a penny in taxes. From all the shares of stock you have and inherit, you won't pay a penny on that or future earnings, either. Since you pay yourself a base salary, you won't have to pay income tax. Yep you guessed it, you'll have tons more free cash just sitting around waiting for you to spend.
The same thing will happen for other sons and daughters of privilege. Can you just imagine the bountiful and prosperous time ahead for them? Can you just see how they'll invest it and create a utopia for everybody? Now you could say its their right to inherit this vast level of wealth, but how will empowering a minority of rich people, who are already empowered to start, be a benefit to the majority of people who work for a living? Republicans will say, this new aristocracy will be very charitable since they'll have so much extra money. To which I respond, have you looked at a Third World country lately? They have super rich and super poor, with very few in-betweens. That's what America will look like within a decade of Mr. Bush's tax strategy.
What about the poor farm families, and those families that have money invested in the stock market. Surely, they'll prosper along with the Bill Gates Jr.s and Paris Hiltons, right? Not so fast.
I'll get anecdotal for a second. I listened to a caller on the Rush Limbaugh show one day. The caller was crying about how the estate tax was going to destroy her family, since she and her family inherited a multi-million dollar farm from their departed father. They'd have to pay burdensome taxes on inheriting the estate. Limpig (It's ok to call him names, he does it to others, and he lives with the "eye for an eye" mentality,) goes on a tirade about how the estate tax is destroying the fabric and foundation of America. Blah, blah, blah... The Regressive Republicans under Gingrich's Contract on America decide to start the battle against the estate tax, using a pseudo-populist attack angle.
Think for a moment. You inherit a million dollar estate. You have to pay an estate tax of say, $100,000. Pretty steep, but you now own a million dollar estate. OK now, say the following in your best Dr. Evil voice, "ONE MILLION DOLLAR ESTATE." After you've said that, think about the fact that you now own something worth at least one million dollars, which will increase in value.
Since you own something worth one million dollars, it wouldn't be a problem for you to borrow $100K from a bank. I mean, you own a one millon dollar estate. One million dollars, muh-hahahahaha!!! Anyway, if you don't want to own it, you can sell it. Heck, it might not have any value except sentimental value to you. Sell it. You'll get one million dollars for it, minus the sales tax. Even if they take 30% of the estate value in taxes. you still walk away with $700K. You can then pay the paltry $100K in cash. You are left with $600K. (This paragraph is an example, only. I would check the details if someday I actually have the problem of inheriting a million dollar estate.)
Now going back to the lady's sob story on Rush Pigbow, I don't feel too sorry for her having to pay taxes on an expensive estate. We live in a world of freely available credit. In fact, if the lady wanted to really make some bucks, rather than sell the estate, turn it into a strip mall or apartment complex, and lease and/or rent the land. She'll make a fortune way beyond the value of the property. (Didn't she ever play Monopoly growing up?)
OK, what about those savvy families that have money invested in stocks and other capital gains? Not to sound callous, but if families have money invested in stocks and other capital gains, they have enough money to live on. I make this statement based on the fact that they don't have to use every penny they earn on their survival expenses. I'll add another fact for you, 80% of the stocks owned, are owned by 1-2% of the population.
When the Republicans are talking about helping those families out, who do you think they mean? Gives a new understanding of their "family values" initiatives. They aren't talking about the average American family, they're talking about the Bush's, Rockefeller's, Gates', and other wealthy to super wealthy families. Inherited wealth is not the same as earned or created wealth. Where's the incentive to make more money? Sure a few in the upper middle class will benefit, but what about those in the middle down to those on the bottom?
Eliminate the income tax and replace it with a federal flat tax and federal sales tax. Replace it social services with privatized versions. Sounds great, everyone pays the same percentage of their income, and everyone pays the same percentage of sales tax. Consider this. What percentage is a fair percentage for a flat tax? 15%?
Let's go with 15% as a fair percentage.
You earn $30,000 per year. You pay $4,500 in taxes. You take home $25,500.
You earn $1,000,000 per year. You pay $150,000 in taxes. You take home $850,000.
Do you see a problem with this? We could see a couple off the bat. First millionaires pay more in taxes. $150K is a pretty sizeable sum. Second, the millionaire takes home way more money than their median income earner making $30K.
Now before we shed a tear for the millionaire, consider the following:
If you taxed a millionaire 90% of their income, they still walk away with $100K. Almost four times the amount of the median income earner making $30K. In other words, millionaires can afford to pay a higher percentage of income than a median income family. (I'm not advocating a 90% tax on millionaires income. It's there as an example.) So, using a percentage as a basis for a flat tax, creates an unfairness of tax burden.
For a median income earner, 15% of their income is a lot of money to them. For a millionaire, they would barely feel the pinch. This basis of the graduated income tax was founded in the idea that millionaires and billionaires can afford to pay a higher percentage of their income.
Now, lets add the federal sales tax. Say it's 10%. If you live in Chicago, where sales tax is 9%, you add 10% to the cost in federal sales tax. So, you make a $100 purchase, you pay $119 after taxes. You buy a car for $20,000, you'll pay $23,800 after taxes. See a problem yet? Here it is, the cost of buying things will go up, due to increased taxes on sales.
Who will be effected the most by the increased expense? The rich? The middle class? The poor? What about businesses? Now, businesses can write things off as tax write offs, but they still have to pay for things to make things. The increased expenses will have one to two bad effects; slow job growth and or increased prices of goods/services.
The middle class will feel good at the increase in take home pay, but will cry about the increased cost to buy things. The poor will be hurt the most. The rich, won't feel anything, since they'll have more money than they'll know what to do with.
The ultimate, underlying purpose of all these tax changes is to destroy the power of the federal goverment. A weak federal government cannot go after businesses and trusts engaging in anti-trust activities. It can't go after investors and businesses that engage in fraudulent and deceptive activities. It can't protect consumers who are victims of price gouging. It can't stop manufacturers from making harmful or lethal products. It will be limited in how punitive it can be against multi-national corporations. (Why do you think Bush is geeked about tort reform?)
The worst effect will be the absolute collapse of America's infrastructure. Roads, electricity, schools, police, fire departments, hospitals, a clean environment, will be things only the very wealthy will enjoy.
When Bush talks about "not instituting class warfare," what he means is, anyone who isn't rich should just shut up, go to sleep, and let the wealthy elite have their way.
How do they get away with this? With wedge issues, and a blind and an arrogant mainstream media. Gay marriage, abortions, gun control, are some examples of wedge issues. A wedge issue is an emotionally charged issue, which really has little to no effect on the Average American. It's primary function is to get people charged up to vote Republican so they can be protected from gays, single mothers, and liberal Democrats who want to take away their freedoms. (read guns.)
Take into account that 85% of Americans DO NOT have a college education. Of the 15% that are college grads, only 20-25% of them have any sense about business and economics. Add to that, the fact that the average college graduate reads less than one book a month after graduating. In fact, fewer Americans are reading anything at all.
Most people get their information today from television and radio. TV and radio is primarily controlled and owned by 5-6 multinational corporations. Do you really think that the main function of the mainstream media (tv and radio) is to keep you informed about critical things going on in America?
If you do, let me explain something. CNN is owned by TimeWarner. ABC is owned by Disney. CBS is owned by Viacom. NBC is owned by General Electric. Fox is owned by News Corporation. The last bastion of the mainstream media is PBS, which is heavily subsidized by companies like TimeWarner, Disney, Viacom, General Electric, and other multi-national corporations. Yes, they receive some federal funding, but its not enough. (Why do you think they have those incessant pledge drives.)
The primary function of the mainstream media is not to turn the world into a bastion of liberal elitism as Rush Pigbow, Sean Hannity, Fox News, the Republican Party, and so forth would have you believe. It's primary function is to make money. By law, they have to provide news as a public service, since the airwaves are still the property of the people, but there is no law that says they have to tell you the truth. (Check out bovine growth hormone, BgH, at google.com, for example.)
Let me repeat, their primary purpose and function is to make money. A company that gives you the news is not going to do anything or say anything that will hurt a sponsor. Monsato, for example, makes bovine growth hormone. This is put into dairy cows, which produce the milk people drink and consume. BgH could be a potential carcinogen.
Here's another thing to think about, sugary carbonated soft drinks are terrible for your dental health, and most likely are a major contributor to the obesity epidemic in our country today. I don't want to knock the companies or the products, but could you imagine the scandal that would be caused if Dan Rather or Tom Brokaw read a report that said drinking carbonated beverages contributes to obesity and tooth decay on national television? Coca-Cola and Pepsi would pull their advertising away from the mainstream media so fast the next day you'd hear reports about how Coke and Pepsi cure cancer. Brokaw and Rather might be lucky to have jobs, if they defied their bosses and reported anything that went against the company line.
The media moguls want you and me to be pacified sheep. Keep the sheep fearful and entertained with the programming. Don't let them see anything that goes on "behind the scenes." Ignore that man behind the curtain.
Currently, as of this writing, the verdict of Scott Peterson is the top news story added to the Battle of Fallujah in Iraq. The unreported story is the fact that there was most likely massive vote tampering on the Diebold machines used in states like Florida and Ohio. (Old news and unimportant, as the mainstream media would tell you.) How the hell did George Bush win?
HOW? Americans felt so strongly about gay marriage that they had to have Bush for four more years? They believed that Bush was great on terrorism with Bin Laden still running around freely three years after 9/11? They believed the war in Iraq is justifiable and that we're doing a great job there? They believe that Bush is great for the economy with around 900,000 jobs lost during his first four years in office. The first president to lose jobs since Herbert Hoover. Americans believe that Bush is great with the environment by ignoring all the reports about global warming and rolling back enviromental laws and restrictions, and adding more mercury and other pollutants into the environment?
I could name around a hundred reasons Bush should not be president. He received the most votes against him of any sitting president, and still won. HOW? How in the name of all that's good did he win? The mainstream media has given the most historical election a pass, so we can find out how the Scott Peterson trial came out, and watch the US pound the hell out of poor Iraqis in Fallujah.
Something is terribly wrong in America today. Its going to get a whole hell of a lot worse before it gets better. Things look very dark to those of us that want to live in a free, prosperous, and progressive society. I share the pain of the 55 million that voted against Bush.
We need to take back the media, the government, and create a better educated society. Great societies have been brought down by the greed and lust for power of their societies' elites who were more concerned about themselves than the people in their civilizations.
Unless you want to see America become a Banana Republic...
DON'T MOURN. ORGANIZE!!!
A few links to check out: foxbghsuit.com, thenation.com, mediamatters.org, airamericaradio.com, about the flat tax fiasco, adbusters.org, and thismodernworld.com
We don't have to stand and be bullied by an ignorant media, Flat Earth Christians, or Regressive Republicans. The time to act is now. You can make a difference.
(or The Republican Tax Shell Game)
Mr. Bush and Co. will be working hard to keep reducing taxes. (Do I hear a collective sigh of relief?) Before you crack open the champagne and work on buying that second house, let me explain some fun details.
Their primary agenda will be threefold; kill the alternative minimum tax which corporations and billionaires pay, eliminate the capital gains tax, and eliminate the estate tax. How will they sell it? Well, it'll help families that have investments in the stock market, and poor farmers who give their hard earned land to their children when they pass away. (Can you hear the violins?) And killing the alternative minimum tax (AMT) which Reagan himself put in place, that'll help create jobs.
If you're feeling a bit optimistic, let me add to your enthusiasm. Bush & Co. are proposing eliminating the income tax and replacing it with a flat tax type system. (You're shouting for joy right now, aren't you?)
Well, when you finish jumping around the room and singing "Happy Days Are Here Again," to your friends and family, let me give you the drawbacks to all these tax cuts.
Say you happen to be Paris Hilton. Your daddy and mommy leave this world to meet their maker. You inherit a multi-billion dollar hotel empire, and you won't pay a penny in taxes. From all the shares of stock you have and inherit, you won't pay a penny on that or future earnings, either. Since you pay yourself a base salary, you won't have to pay income tax. Yep you guessed it, you'll have tons more free cash just sitting around waiting for you to spend.
The same thing will happen for other sons and daughters of privilege. Can you just imagine the bountiful and prosperous time ahead for them? Can you just see how they'll invest it and create a utopia for everybody? Now you could say its their right to inherit this vast level of wealth, but how will empowering a minority of rich people, who are already empowered to start, be a benefit to the majority of people who work for a living? Republicans will say, this new aristocracy will be very charitable since they'll have so much extra money. To which I respond, have you looked at a Third World country lately? They have super rich and super poor, with very few in-betweens. That's what America will look like within a decade of Mr. Bush's tax strategy.
What about the poor farm families, and those families that have money invested in the stock market. Surely, they'll prosper along with the Bill Gates Jr.s and Paris Hiltons, right? Not so fast.
I'll get anecdotal for a second. I listened to a caller on the Rush Limbaugh show one day. The caller was crying about how the estate tax was going to destroy her family, since she and her family inherited a multi-million dollar farm from their departed father. They'd have to pay burdensome taxes on inheriting the estate. Limpig (It's ok to call him names, he does it to others, and he lives with the "eye for an eye" mentality,) goes on a tirade about how the estate tax is destroying the fabric and foundation of America. Blah, blah, blah... The Regressive Republicans under Gingrich's Contract on America decide to start the battle against the estate tax, using a pseudo-populist attack angle.
Think for a moment. You inherit a million dollar estate. You have to pay an estate tax of say, $100,000. Pretty steep, but you now own a million dollar estate. OK now, say the following in your best Dr. Evil voice, "ONE MILLION DOLLAR ESTATE." After you've said that, think about the fact that you now own something worth at least one million dollars, which will increase in value.
Since you own something worth one million dollars, it wouldn't be a problem for you to borrow $100K from a bank. I mean, you own a one millon dollar estate. One million dollars, muh-hahahahaha!!! Anyway, if you don't want to own it, you can sell it. Heck, it might not have any value except sentimental value to you. Sell it. You'll get one million dollars for it, minus the sales tax. Even if they take 30% of the estate value in taxes. you still walk away with $700K. You can then pay the paltry $100K in cash. You are left with $600K. (This paragraph is an example, only. I would check the details if someday I actually have the problem of inheriting a million dollar estate.)
Now going back to the lady's sob story on Rush Pigbow, I don't feel too sorry for her having to pay taxes on an expensive estate. We live in a world of freely available credit. In fact, if the lady wanted to really make some bucks, rather than sell the estate, turn it into a strip mall or apartment complex, and lease and/or rent the land. She'll make a fortune way beyond the value of the property. (Didn't she ever play Monopoly growing up?)
OK, what about those savvy families that have money invested in stocks and other capital gains? Not to sound callous, but if families have money invested in stocks and other capital gains, they have enough money to live on. I make this statement based on the fact that they don't have to use every penny they earn on their survival expenses. I'll add another fact for you, 80% of the stocks owned, are owned by 1-2% of the population.
When the Republicans are talking about helping those families out, who do you think they mean? Gives a new understanding of their "family values" initiatives. They aren't talking about the average American family, they're talking about the Bush's, Rockefeller's, Gates', and other wealthy to super wealthy families. Inherited wealth is not the same as earned or created wealth. Where's the incentive to make more money? Sure a few in the upper middle class will benefit, but what about those in the middle down to those on the bottom?
Eliminate the income tax and replace it with a federal flat tax and federal sales tax. Replace it social services with privatized versions. Sounds great, everyone pays the same percentage of their income, and everyone pays the same percentage of sales tax. Consider this. What percentage is a fair percentage for a flat tax? 15%?
Let's go with 15% as a fair percentage.
You earn $30,000 per year. You pay $4,500 in taxes. You take home $25,500.
You earn $1,000,000 per year. You pay $150,000 in taxes. You take home $850,000.
Do you see a problem with this? We could see a couple off the bat. First millionaires pay more in taxes. $150K is a pretty sizeable sum. Second, the millionaire takes home way more money than their median income earner making $30K.
Now before we shed a tear for the millionaire, consider the following:
If you taxed a millionaire 90% of their income, they still walk away with $100K. Almost four times the amount of the median income earner making $30K. In other words, millionaires can afford to pay a higher percentage of income than a median income family. (I'm not advocating a 90% tax on millionaires income. It's there as an example.) So, using a percentage as a basis for a flat tax, creates an unfairness of tax burden.
For a median income earner, 15% of their income is a lot of money to them. For a millionaire, they would barely feel the pinch. This basis of the graduated income tax was founded in the idea that millionaires and billionaires can afford to pay a higher percentage of their income.
Now, lets add the federal sales tax. Say it's 10%. If you live in Chicago, where sales tax is 9%, you add 10% to the cost in federal sales tax. So, you make a $100 purchase, you pay $119 after taxes. You buy a car for $20,000, you'll pay $23,800 after taxes. See a problem yet? Here it is, the cost of buying things will go up, due to increased taxes on sales.
Who will be effected the most by the increased expense? The rich? The middle class? The poor? What about businesses? Now, businesses can write things off as tax write offs, but they still have to pay for things to make things. The increased expenses will have one to two bad effects; slow job growth and or increased prices of goods/services.
The middle class will feel good at the increase in take home pay, but will cry about the increased cost to buy things. The poor will be hurt the most. The rich, won't feel anything, since they'll have more money than they'll know what to do with.
The ultimate, underlying purpose of all these tax changes is to destroy the power of the federal goverment. A weak federal government cannot go after businesses and trusts engaging in anti-trust activities. It can't go after investors and businesses that engage in fraudulent and deceptive activities. It can't protect consumers who are victims of price gouging. It can't stop manufacturers from making harmful or lethal products. It will be limited in how punitive it can be against multi-national corporations. (Why do you think Bush is geeked about tort reform?)
The worst effect will be the absolute collapse of America's infrastructure. Roads, electricity, schools, police, fire departments, hospitals, a clean environment, will be things only the very wealthy will enjoy.
When Bush talks about "not instituting class warfare," what he means is, anyone who isn't rich should just shut up, go to sleep, and let the wealthy elite have their way.
How do they get away with this? With wedge issues, and a blind and an arrogant mainstream media. Gay marriage, abortions, gun control, are some examples of wedge issues. A wedge issue is an emotionally charged issue, which really has little to no effect on the Average American. It's primary function is to get people charged up to vote Republican so they can be protected from gays, single mothers, and liberal Democrats who want to take away their freedoms. (read guns.)
Take into account that 85% of Americans DO NOT have a college education. Of the 15% that are college grads, only 20-25% of them have any sense about business and economics. Add to that, the fact that the average college graduate reads less than one book a month after graduating. In fact, fewer Americans are reading anything at all.
Most people get their information today from television and radio. TV and radio is primarily controlled and owned by 5-6 multinational corporations. Do you really think that the main function of the mainstream media (tv and radio) is to keep you informed about critical things going on in America?
If you do, let me explain something. CNN is owned by TimeWarner. ABC is owned by Disney. CBS is owned by Viacom. NBC is owned by General Electric. Fox is owned by News Corporation. The last bastion of the mainstream media is PBS, which is heavily subsidized by companies like TimeWarner, Disney, Viacom, General Electric, and other multi-national corporations. Yes, they receive some federal funding, but its not enough. (Why do you think they have those incessant pledge drives.)
The primary function of the mainstream media is not to turn the world into a bastion of liberal elitism as Rush Pigbow, Sean Hannity, Fox News, the Republican Party, and so forth would have you believe. It's primary function is to make money. By law, they have to provide news as a public service, since the airwaves are still the property of the people, but there is no law that says they have to tell you the truth. (Check out bovine growth hormone, BgH, at google.com, for example.)
Let me repeat, their primary purpose and function is to make money. A company that gives you the news is not going to do anything or say anything that will hurt a sponsor. Monsato, for example, makes bovine growth hormone. This is put into dairy cows, which produce the milk people drink and consume. BgH could be a potential carcinogen.
Here's another thing to think about, sugary carbonated soft drinks are terrible for your dental health, and most likely are a major contributor to the obesity epidemic in our country today. I don't want to knock the companies or the products, but could you imagine the scandal that would be caused if Dan Rather or Tom Brokaw read a report that said drinking carbonated beverages contributes to obesity and tooth decay on national television? Coca-Cola and Pepsi would pull their advertising away from the mainstream media so fast the next day you'd hear reports about how Coke and Pepsi cure cancer. Brokaw and Rather might be lucky to have jobs, if they defied their bosses and reported anything that went against the company line.
The media moguls want you and me to be pacified sheep. Keep the sheep fearful and entertained with the programming. Don't let them see anything that goes on "behind the scenes." Ignore that man behind the curtain.
Currently, as of this writing, the verdict of Scott Peterson is the top news story added to the Battle of Fallujah in Iraq. The unreported story is the fact that there was most likely massive vote tampering on the Diebold machines used in states like Florida and Ohio. (Old news and unimportant, as the mainstream media would tell you.) How the hell did George Bush win?
HOW? Americans felt so strongly about gay marriage that they had to have Bush for four more years? They believed that Bush was great on terrorism with Bin Laden still running around freely three years after 9/11? They believed the war in Iraq is justifiable and that we're doing a great job there? They believe that Bush is great for the economy with around 900,000 jobs lost during his first four years in office. The first president to lose jobs since Herbert Hoover. Americans believe that Bush is great with the environment by ignoring all the reports about global warming and rolling back enviromental laws and restrictions, and adding more mercury and other pollutants into the environment?
I could name around a hundred reasons Bush should not be president. He received the most votes against him of any sitting president, and still won. HOW? How in the name of all that's good did he win? The mainstream media has given the most historical election a pass, so we can find out how the Scott Peterson trial came out, and watch the US pound the hell out of poor Iraqis in Fallujah.
Something is terribly wrong in America today. Its going to get a whole hell of a lot worse before it gets better. Things look very dark to those of us that want to live in a free, prosperous, and progressive society. I share the pain of the 55 million that voted against Bush.
We need to take back the media, the government, and create a better educated society. Great societies have been brought down by the greed and lust for power of their societies' elites who were more concerned about themselves than the people in their civilizations.
Unless you want to see America become a Banana Republic...
DON'T MOURN. ORGANIZE!!!
A few links to check out: foxbghsuit.com, thenation.com, mediamatters.org, airamericaradio.com, about the flat tax fiasco, adbusters.org, and thismodernworld.com
We don't have to stand and be bullied by an ignorant media, Flat Earth Christians, or Regressive Republicans. The time to act is now. You can make a difference.
Monday, November 08, 2004
Friday, November 05, 2004
DON'T MOURN. ORGANIZE!
