Tag Archives: occupy-wall-street

43. GOP Tax Nonsense

14 Feb

Republican candidates of 2016 have promoted three main ideas for income tax rule improvement:

1. A lowered tax rate for all, but continuing the current general system.
2. Simplification of income tax code.
3. A single “flat” income tax for all.

Where details on plans have been supplied there are some variations within each plan.  All three ideas are seriously flawed and all three provide great benefits for the wealthy, which is why Republicans propose them. And they provide great benefits to their rich campaign contributors.

1. Any lowered tax rate for very rich people will result in either higher taxes for the non-rich or reduced services for them. Its always a see-saw: reducing one causes increase for the other. People at the lower end of the pay-scale pay little or no taxes at all, and so do not benefit. But lowering general tax rates always makes the rich richer.

2. Republicans always love a really simple tax code because they would avoid all of the rules that prevent them from abusing the system. Ordinary workers with salaries already have a simple code and can finish their returns in a couple of hours; or can pay someone a few bucks to do it for them. On the other hand, rich people usually have complex incomes, expenses, deductions, stock trades, salaries they pay, business entertainment, IRA’s, bonuses, subsidies, etc. Rich people like fewer rules because rules limit what they can get away with. It is similar to their dislike of regulations. The more flexibility they have in preparing their taxes, the easier it is to game (cheat) the system. It takes a lot of code to cover all the possibilities. For example, there are many ways to describe what constitutes a valid “business meal expense”. Buy one of those cheap, tax code summaries and you will see all of the situations that need to be covered. I personally ran two small businesses so I understand why the tax code complexity is needed.

3. Most Republican candidates have advocated a single “flat” income tax with a rate of 10 to 15 percent for all. With that plan, rich people greatly benefit: a reduction of the 35% rate to say, 15 percent. Poor people who can barely survive on what the earn, would pay more than their current zero payment. One Republican candidate said: that’s OK because everyone should have some skin in the game — and this candidate is an avowed Christian.

Finally, why is it wrong to make the wealthy wealthier, and the poor poorer? The main reason is that over the last few decades, as the rich profited, they were more and more able to “bribe” congressmen with contributions, so that they would create tax and subsidy laws to make the wealthy even richer. Another reason is that when extremely rich banks and insurance companies failed, the ordinary tax payers had to bail them out. It is also true that most very rich people use a lot of resources such as extra policing, government services, military protection, etc. And they have accountants and lawyers to help them make even more money. Its Ok to be rich, but when some people are homeless and/or starving, the extremely rich need to give some back.

12. Bain Capitalism

17 May

Bain Capital is headquartered in Boston and Mitt Romney is one of its 1984 founders.  It engages in financial services and  venture capital.  Romney asserts that his experience with Bain prepares him for running a country.  Democrats are critical of this assertion, but they often seem to miss the important point.  The capitalism that Bain engages in is among the worst kind.

The essence of ethical and admirable capitalism, which I heartily endorse, is to work hard and achieve monetary or other success.  You create a product, refine a service, or develop an idea — and you make a good profit.  Non-rich people generally do not resent this.

However, what “capital” companies often do,  is to take over and manipulate a company for massive personal profit.  A determination is made at some point to either:

1.  Build up a promising business with good potential, or

2. Destroy a troubled business and grab all the money you can, while leaving the workers with nothing.

In many instances, the huge amount of profit taken by the capital company could have been used to restore the business, or at least provide support for the fired workers.

There is nothing wrong in making a simple bond or stock investment in a business.    The unethical method is to step in and “manage” a company, which you did not create, and manipulate it for huge personal profit, while the personnel are fired and left with nothing.  I might also mention that there are other types of abuse, such as Wall Street gambling on “derivatives” — often incurring huge losses that require a bailout.  Our goal should be to enhance productive capitalism, and to discourage and regulate unethical monetary and business manipulation.

Now, let us imagine how Mr. Romney can use his Bain Capital experience in running our country.  A “capital” company is primarily concerned with profits for the company (and any investors), and has little regard for the business it is managing.  So we can expect him to manipulate our government for the benefit of himself and his wealthy supporters.  The rest of us are pretty much irrelevant, like the workers who are fired when one of his managed companies is destroyed. Rich Republicans are desperately trying to hold onto their low tax rates, giant tax loopholes and corporate subsidies.  If this is unclear to you, then remember that all Republican congressmen endorsed the Norquist tax pledge, which includes opposition to closing tax loopholes.

I must add a final word. The general public needs an increased awareness of the distortion of a great system — our form of capitalism.   Our citizens and lawmakers need to support those who advocate necessary regulation to rid us of the wealthy manipulators who will ultimately destroy the middle class.  Throughout history, we have seen revolution  when a few wealthy people run a country, rob its citizens, and produce massive poverty.  The “Tea Party” and “Occupy” movements are the first signs of a potential serious revolution.  (Unfortunately, the Tea Party was blown off course by a misunderstanding of “basic causes” and by the influence of insidious rich manipulators.)

2. VOTERS BEWARE

16 Mar

The principles of biological evolution can have a broad range of application to many areas. In future blogs I will talk much more about its application to powerful social groups.  What follows below, is a political application, and a “basic cause” for certain politics.

Any entity (definition: a thing with distinct and independent existence), such as a cohesive group, if sufficiently capable (or fit) will tend to increase in size and power. Groups of people, are governed by the same rules as biological species: survival of the fitist.  Very rich people form such a group and through their collective money and intelligence can increase the group wealth and power.  Remember, it  is likely in most cases that the very rich do have a burning desire (and often an obsession) to accumulate wealth.  And like most people, their personal desires may obscure the needs of others.

((Before continuing, I want to make clear that many very rich people have admirable goals and make positive contributions to society. I believe in responsible American-type Capitalism, and only find fault with extremes, and unethical manipulations of money and power.))

Lets look at an example of how the very-rich-group increases it wealth: Suppose you are running for office, and want to promote legislation beneficial to rich people, such as lowered high-end income and inheritance taxes and protection of subsidies for already wealthy corporations.

Would you tell the voters:  hey, I am rich, vote for me because I will promote rich values and ignore the rest of you.  Ordinary people would laugh at this.  To get votes from non-rich people, you need to divert and mislead them. The diversion usually takes the form of:

1. Vote for me because my party and I have higher moral values.
2. Give more money to the rich people so they can hire more workers.
3. Give more money to rich people so they can spend more and improve the economy for everyone.
4. Don’t increase tax for the “job creators”, because they will not be able to increase hiring.

Lets look at the basis for these arguements.
1. Many politicians say that they have higher moral values but in fact have just as many affairs and divorces, and corruption as others. To experience higher morality, one can turn to other sources, such as religious institutions.  They want you to think about morality, instead of what government really should provide: primarily, a strong economy with fairness and stability; safety and military protection. Morality is a diversion from what is important for you.

2. In the last 30 years, rich people have become more and more wealthy while the non-rich have stayed at a steady low level. The difference between the very rich and the rest of us has more than tripled. If making already very rich people richer would lead to higher employment we should currently have 100% employment.

3. There is no evidence that giving already very rich people more money, will cause them to spend enough more to make any difference.

4. Tax rates for the “job creators” are at a long term low.   So why don’t we have huge amounts of hiring?  It is also overlooked that most of the rich, so-called “job-creators”, don’t do hiring. Why should we indiscriminately give all rich people more money so that only a portion of them might increase hiring.   What makes more sense is to directly provide more money to people who actually do more hiring.

Finally, I would like to speak to governmental fairness, and its benefit to all persons. There is only so much money in a country. If rich people are getting far to much, then it is inevitable that the rest of us will get less: poorer services, less police protection, decreased Medicare coverage, higher taxes, etc. If you look at the proposed budgets of the Republicans, you can see that they DO shift more to the very rich through tax code changes.

When you create a large class of poor people, crime rates increase and the final effect is revolution. This can be seen in the Arab spring revolutions and the U.S. Occupy Wall Street movement.