Corporate tax dodges are un-American (Fortune)

By the way, Robert Reich just wrote a piece about Walgreen's plan to do a tax inversion. He noted [emphasis mine]:

It’s true that the official corporate tax rate of 39.1 percent, including state and local taxes, is the highest among members of the Organization for Economic Cooperation and Development.

But the effective rate – what corporations actually pay after all deductions, tax credits, and other maneuvers – is far lower.

Last year, the Government Accountability Office, examined corporate tax returns in detail and found that in 2010, profitable corporations headquartered in the United States paid an effective federal tax rate of 13 percent on their worldwide income, 17 percent including state and local taxes. Some pay no taxes at all.

Now read from a conservative publication like Fortune why these tax dodges by "American" companies have gone way too far....

UPDATE (07/09/2014):  In response to this post my Uncle T. freaked out, saying I was being manipulated by statistics.  For some reason he thought the "effective tax rate" of a company was calculated on income before expense deductions, i.e. gross profit.  

But I pointed out to to him that, according to the GAO report cited by Reich, "The most common measure of income for these estimates has been some variant of pretax net book income."

So the starting point for calculation is net profit before taxes, not gross profit, just in case anybody else shared my uncle's confusion.

Positively un-American tax dodges

By  Allan Sloan

July 7, 2014 | Fortune 

URL: http://fortune.com/2014/07/07/taxes-offshore-dodge/

Eric Liu: Coates is right, we need a study on reparations

Hear, hear!  For those who didn't bother to read Ta-Nehisi Coates' provocative, thought-provoking essay on reparations in The Atlantic,  Eric Liu underscores Coates' main point [emphasis mine]:

Coates is not quite making a case for reparations. He's making a case for a discussion of reparations. He doesn't pretend to spell out all the operational policy choices that would have to be made to put reparations into effect. The closest he comes to a legislative recommendation is to tout a perennially neglected bill that Rep. John Conyers, D-Michigan, introduces every session of Congress, which calls simply for a public study of the possibility of reparations.

This isn't a shortcoming of Coates' argument; it is its purpose. What we need to do is to study the issue in earnest. To have a hearing, in the deepest sense. To listen to the difference between Americanness and whiteness, and to notice the manifold ways that whiteness was (and is) an identity fabricated from the myth of blackness.

To be sure, every ethnic group that's not called white has experienced suffering in American life. But the experience of African-Americans is exceptional in its systematic, multigenerational, reverberating effects.  And it's exceptional in its centrality to the founding and building of our nation.  No experience reveals more than the African-American experience both the hypocrisy and the possibility of our national creed.

I characterized the way most critics have jumped on Coates' essay a case of "leaping from justice to practicalities," as in, some would like to anticipate and dismiss the possible terms of a settlement on reparations, and so doing, dismiss the case for reparations itself.  

Recently on The Colbert Report, Ta-Nehisi Coates half-jokingly told Colbert he would forget about reparations for slavery if the U.S. would seriously study and consider a reckoning for Jim Crow and everything that happened after, including FHA "redlining policies," etc.  Indeed, it's a further injustice to African-Americans to say that the injustices stopped with the emancipation of black slaves. That was just the beginning of a long journey for black equality that continues to this day.

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UPDATE:  My conservative friends and family just couldn't let it go, they immediately asked me, "Well, how much would you be willing to pay?"  That was my Uncle T.  So here's what I wrote him:

Oh, please. You want me to name a dollar figure, as if that's the key issue here? OK, fine.  Seventy-two percent of Americans are of European ancestry, let's say 30% of them are adults, that's more than 68 million white adults.  If each of them was asked to give $200, that would be a fund of almost $14 billion.  Put partially in trust, and partially into targeted scholarships, housing loans, job training programs, etc., that money could do a hell of a lot of good.  And that's just me throwing out a dollar figure, since that seems to matter to you more than anything.

Believe it or not, (you'll choose not to), there are very rich families and companies still living well on the money made from slavery. No less than Bloomberg said it, if you recall: 

http://what-is-is.blogspot.com/2012/01/bloomberg-us-economy-powered-by-slavery.html

So I for one would be in favor of companies that made money off slavery that still exist today paying more than I would as an individual.  

I'm aware that a fund of about $14 billion would break down to a bit over $350 for every African-American alive today. That "small" sum is not an argument against reparations, to my mind; rather -- and this is just my opinion -- I think that money would be better spent pooled and targeted to specific programs over which blacks would have significant or total say-so in how it was spent.

And my Republican buddy Rusty asked me, "Do you agree that the only people who should be required to pay them are the descendants of slave owners?"  

To which I replied: "No, I think we all should pay it, everybody except blacks, but that's just my opinion. You're still jumping from the verdict (=reparations are morally warranted) to the settlement terms (= $$??), and then using that hypothetical settlement to determine the justice of of the verdict, which is not the way American justice should or does work in any kind of class-action suit."

To which I should have added that many Northerners and non-slave owners benefited from slavery, including the Lehman Bros. and JP Morgans, et al, of the financial community, as described by Bloomberg. And to a great extent slaves and Jim Crow-era blacks built this country, and so all citizens of the U.S owe them a debt of gratitude.

Rusty thought the idea of asking Mexicans and Asian-Americans to pay reparations was "truly insulting," but I don't necessarily agree, since all Americans today benefit from the country that slaves and Jim-Crow era second-class citizens built for us.  

Why we need to talk about reparations

By Eric Liu

June 27, 2014 | CNN

URL: http://www.cnn.com/2014/06/27/opinion/liu-reparations-slavery/index.html?hpt=hp_t3

Letter to Uncle T. on BENGHAZI!

Uncle T.,
How can a lawyer say that incompetence (not negligence) is a crime?  Mind you, I'm not accusing anybody of incompetence.  Hindsight is 20/20.

Another good test of whether it's a kooky conspiracy theory or a real scandal is try to avoid using the pronoun "they."  Can you do that when you explain Benghazi?  

The GOP Congress slashed the State Department's diplomatic security budget by $500 million, i.e. Congress appropriated less money than Obama asked for. Hillary warned Boehner back in 2011 that such cuts would hurt national security.  If you want to find fault, start there.

Regarding threats -- duh!  There's a reason DOS personnel in Libya get danger pay... because it's dangerous!  U.S. personnel were in a conflict zone where al Qaeda affiliates were known to operate.  Then again, why did Congress cut DOS's budget?  We also got threats before 9/11 that Rice and Bush apparently ignored. Criminal incompetence... or nothing concrete enough to act on?  Be fair.

Next, the military commanders on the ground -- you know, those guys that politicians are never supposed to question -- decided not to scramble jets or send in FAST commandos from Spain during those 2 days. Was that the right decision? I don't know. But it was their decision. It wasn't a political decision.  Are you saying that SecDef Panetta, General Ham and General Dempsey at AFRICOM should be held accountable for "criminal" incompetence?  Remember Panetta's words: "the basic principle here… is that you don't deploy forces into harm's way without knowing what's going on; without having some real-time information about what's taking place."  They didn't know so they didn't send in commandos.  

Here's the Benghazi timeline sent by Panetta to the House Armed Services Committee.

Next, what happened after.  Talking points for a Sunday talk show one week after. OMG, that's important.  I mean, that's like testifying under oath.  And that was when we still didn't know who carried out the attack.  We STILL DON'T KNOW.  Yet it was terribly important for the Right to call it a "terrorist" attack by al-Qaeda.  Why?  I don't know.  What difference does it make?  Apparently it makes all the difference, even though those people will still be dead.  (By the way, how many times did Cheney and Rice go on Sunday talk shows saying Saddam had WMD, ignoring all the evidence that he didn't have any? No crime, no incompetence there? Remind yourself here.)  

Next, there was no cover-up about security. The State Dept. did its own investigation.  Congress has read the partly classified report and has not disputed its findings.  The report did not say the video was the cause of the attack; they said most likely some planning had gone into it, but it was an opportunistic strike.  No cover-up there.

Next, this deputy mission chief Hicks says he is being mistreated for "blowing the whistle," although he still has a job at the same level of pay.  The State Dept. is not allowed to comment on his employment status since it's a personal matter.  So the lawyer in you should wonder what the other side of the story is.  By law, we cannot hear it.  

So, in all the above, tell me who did what wrong and how it rises to the level of a cover-up or even a criminal act. Be specific, counselor!

Here is a liberal take on what the State Dept. & White House did wrong.  

---------------------------------------------------------------------------------------------------

[ I have cleaned up Uncle T's spelling and grammar a bit. - J ] 

My how you play word games. Since when is it not a cover up if only incompetence is involved and not a crime. (The little Democratic soldier marches on, with blinders always in place, no matter what the facts are).

The facts are that there was a specific warning given to the State Dept. (and possibly Secy. of State Hillary Clinton) of increased activity indicating the real possibility of a planned terrorist attack. The State Dept./ Clinton's response was to ignore the warning.

The Benghazi embassy then specifically requested increased security due to the known warnings and known increased terrorist activity.  The State Dept./ Clinton's response was to deny same.

It is overwhelming evidence that you NEVER let the facts get in the way of your opinion when you declare the you "don't get it" because the State Dept. sure "got it " and realized that it's incompetence costs American lives. The Dept's response was to  just plain lie and declare that the attack was an isolated unplanned uprising due to a video. That's a cover up by anyone's but your definition.

Obama sure "got it" as he tried to protect Clinton and his administration and continued the unplanned isolated uprising lie.

Lying about the warning and lying about the denial of requested additional security and then making up non-existent facts in an attempt to deny culpability are facts for which you should be outraged.


UPDATE (05.16.2013): McClatchy is doing some tough reporting on Benghazi that gives the lie to the GOP's insistence on some kind of scandal or cover-up.  Check out these two articles:  "Benghazi emails show CIA deputy did most of editing on talking points," and "Ambassador Stevens twice said no to military offers for more security, U.S. officials say."  

Locke, Hobbes and history v. Gun nuts

Paul Rosenberg is absolutely right in his philosophical argument that lasting liberty is incompatible with individual gun ownership; but he spends most of his time refuting the less deeply held belief of the pro-gun crowd: that freedom-loving individuals need guns for their own security.  

Rather, the gun nuts' main argument against reasonable gun control is that we the people need more and deadlier guns to overthrow our government if it ever becomes tyrannical.  

This is a bad and eristic argument in favor of individuals' unrestricted access to all types of deadly guns. Yet it's difficult to refute using purely inductive logic because something similar has never happened -- especially in the most powerful country in the history of the world with a military of 3 million and all the wizz-bang futuristic weapons you can think of.  For argument's sake, such a nation has never gone from democratic to tyrannical and tried to oppress its own people.

And so we liberals can only make reasonable, rational arguments to the effect that we the people wouldn't stand much of a chance fighting such an evil government. And in the meantime, 30,000 gun deaths a year (including 9,000 gun murders) is a high price to pay for the "freedom" to defend ourselves in such an unlikely what-if scenario. (I actually think flesh-eating zombies taking over is more likely, but that's just me....)

What's more, as I told my Uncle T. (who subscribes to this argument) over Christmas, if the United States government ever did become so murderous and tyrannical, then it would mean there were at least 1,000 lapses in our democratic vigilance leading up that moment that had nothing to do with our weapons or guns. It would mean we the people largely had ourselves to blame for it. *

Apropos, Rosenberg points out that John Locke and the Founding Fathers had no idea how important peaceful protest would become in securing the freedom and civil rights of so many millions of people, starting about 160 years later.  (That's yet another thing they never imagined, in addition to AR-15 semi-automatic rifles in the hands of madmen....). 

And so despite the Founding Fathers' lack of prescience...

... that doesn't mean that Locke's underlying logic has died. To the contrary, the issue of the consent of the governed has never been more alive than it has been in the last few decades. But what's most interesting is that it's taken such a strong turn toward non-violent, unarmed revolution, seen most recently in the peaceful successes of the Arab Spring. Of course these did not succeed everywhere, and violent struggle emerged in several countries, yet it should be remembered that nothing remotely like this was even conceivable at the time that Locke wrote. And yet, the underlying thrust of his logic has been supremely vindicated by the non-violent lineage of Thoreau, Gandhi, King and Mandela - a lineage that stands directly opposite to the gun-crazed vision of the NRA. [Emphasis mine - J]

What I should have added to Uncle T. was that, as Mark Ames recently pointed out, gun ownership actually decreases our democratic vigilance since guns give far too many Americans an unearned sense of complacency, or a sense that the mere act of owning firearms is a "rebellious" thing in and of itself... and meanwhile they sit at home on their couches while the plutocrats corrupt our government and screw the Average Joe's of the country who "cling to their guns and religion," instead of those gun owners being politically active. (And no, being an NRA member does not make somebody politically active.)

... (Sigh) But these are all reasonable things to say to unreasonable people. That's why I'm mostly preaching to the pro-gun control choir here.

* And I added to Uncle T. the unoriginal thought that a better defense of our liberty against government tyranny than the 2nd Amendment is our professional, all-volunteer military and the esprit de corps instilled in our troops who vow to uphold and defend the U.S. Constitution. It's one thing for them to shoot armed baddies overseas; but it's quite another thing for them to obey orders to shoot and kill their fellow citizens at home, armed and unarmed alike. To defend their countrymen is the exact reason most of them sign up in the first place!  And so, this argument in favor of the unrestricted right to bear arms is quite insulting to our U.S. servicemen and women.

Locke and unload: Why the NRA doesn't understand rights

It's the exact inability of guns to secure our freedom that establishes the foundation for our civil government.

By Paul Rosenberg

December 27, 2012 | Aljazeera

URL: http://www.aljazeera.com/indepth/opinion/2012/12/20121226104857715225.html

Reply to Uncle T's 'You're nothing but a political hack'

Uncle T,
You can call me a "hack" all you want.  I respond to concrete arguments.  And I do criticize Obama, so you must not be reading what I write.  Let's talk facts and figures:

• $15.5 trillion in lost wealth during the Great Recession;
• $8 trillion in wealth created -- and lost -- during the housing bubble;
• 8.8 million jobs lost in the Great Recession, more than the previous four U.S. recessions combined;
• 24 percent of homes underwater on their mortgages to the tune of $690 billion;
• $1 trillion in student loan debt;
• $1.2 trillion deficit projected for FY 2009 before Obama even took office;
• Growth in government spending under Obama is lower than at any time since President Eisenhower (adjusted for inflation);
• Interest paid on the federal debt as a percentage of annual federal spending is lower under Obama – 6.4 % in 2011 – that at any time since the 1970s;
• Interest paid on federal debt as a percentage of GDP is at its lowest since WWII.
• Under Obama, the national debt has increased $2.88 trillion, or 24 %, over 3 years.
• Under Bush, from 2002 to 2009, the national debt increased $5.88 trillion, or 91 %.
• Only 17 percent of the increase in government debt in 2009 and 2010 was because of discretionary spending of any kind, including the stimulus bill. 
• The U.S. collects less corporate tax relative to the overall economy than almost any other country in the world:  about 1.3 % of GDP in 2010, compared to 5 % in the 1950s.
• Corporate federal taxes paid fell to 12.1 % of profits earned from activities within the U.S. in fiscal 2011, the lowest % since 1972.
• In 2009, the same year the Tea (Taxed Enough Already) Party was born, Americans paid the lowest average federal tax rate (17.4 %) in 30 years.

Talking about what happened under Bush is not about making excuses, it's about showing the HUGE problems that Obama inherited, and putting them in historical perspective, and then asking whether he, or any President, could have done much about these problems.  

Furthermore, one has to ask whether the alternative -- Romney and the GOP -- offers anything concretely, factually better than Obama.  The answer is an easy "No."  Romney wants to cut taxes and increase the deficit $4.8 trillion and increase military spending by $2.1 trillion, but he won't say how he's going to pay for it. Romney wants to repeal Obamacare... except all the popular parts like covering pre-existing conditions (but not really) and letting parents keep their kids on their plans until age 26.  And Romney's formula for economic growth is to drill, mine, pollute and deregulate our way to prosperity, even though the EPA and OHSA didn't get us into our current mess, not by a long shot.  

Obama is not perfect.  In fact, he's not nearly liberal enough.  But compared to the awful alternative, it's an easy choice.  Romney would blow up the deficit and mire millions more people -- including seniors and children -- in poverty.  And he would probably start new wars with Syria and Iran, while committing more troops to Afghanistan and Iraq, with a price tag we cannot even estimate at this time.  The choice then is a no-brainer.

So let me echo Uncle T circa 2008, and ask not why you're against Obama, but why you're for Romney?  Make the case.  Please cite facts, figures and points from Romney's proposals.  Here's a handy link to Romney's site so you can research his positions, because I'm betting you haven't bothered to read them, you're just going to pull the lever GOP, like you always do.

You can call me a political hack, but I come with more facts and research than anybody you know or read, period.  Please reply with facts and not "It's all Obama's fault."  Thank you.

Re: Islamofascism

Uncle T,
(Sigh.) OK. Let's have this stupid argument for the 100th time. You ask, "Where are all the moderate Muslims?" and I repeat the same old things.... There are roughly 1.25 billion Muslims in the world, or 19% of earth's population, and 99.9% of them are not committing any violence or supporting violence. Not billions, not millions, not even thousands of Muslims are sending bin Laden and his ilk checks in the mail for support. Al-Qaeda is largely self-financed, with some large donations from oil sheiks whom the U.S. supports.

The fact that our Western media and think-tank hucksters play up all the scares and violence and none of the everyday life and words of regular Muslims is OUR problem, it's OUR short-sightedness, it's not THEIR problem. After all, what efforts have you made lately to show Muslims in Iraq, Iran, or Afghanistan that you're really a peace-loving guy who doesn't hate Muslims, and doesn't want to make a new Crusade against Islam? None. You haven't done anything. So, don't demand more from others than you're willing to do yourself. You see yourself as the aggrieved party after 9/11 who deserves all manner of apologies and assurances, but if you could just get out of your own skin for 2 seconds, then maybe you would see that Muslims have many more reasons to suspect us and YOU of hating them and wanting to oppress and destroy them. Their suspicions are wrong, (I hope), but they have more bases in fact than your fears about them.

Now read this post from today:

Poll: 93% of Muslims Worldwide Condemn 9/11 Attacks - 0% Approve of Attacks on Religious Grounds

I don't deny there is a small number of very dangerous Islamists out there who are beyond redemption, they just want to kill as many Americans as they can. But I must reject gibberish terms that mean nothing, like "Islamofascism." I'm in agreement with Rush Limbaugh that "words mean things," so let's use words properly. Fascism , or at least its historical characteristics in Germany and Italy, has been well defined, and political scientists and historians are in agreement on that. Putting "Islamo-" in front of a very powerful word is useful for scaring people, unifying them, and mobilizing them behind your cause, but it's callous and deceitful. More generally, I'm against Americans alluding to Nazi Germany and WWII every time we face a national challenge, as if we the people lack the ability to see that threats to peace can come in many shapes and sizes, as if we are so dense that we must be given re-packaged notions of things we already understand in order for our child-like minds to understand new ones. In doing so we distort the meaning of the new and the old thing, simultaneously. In short, words like Islamofascism make us dumber.

On Thu, Sep 11, 2008 at 6:49 PM, < > wrote:

However, to deny that Islamofascism exists, on a however small percentage, is again having blinders on. How many times has Osama Bin Laden , and other radical groups, specifically stated that they desire the world to turn 100% to Islamic faith and that military action and violence is justified to accomplish same . It may be a small percentage of the billions of Muslims who adhere to the action of violence to accomplish the conversion of the world to Islam, (and we have had this discussion before,) but where are the billions of so-called moderate rational Muslims who allegedly believe otherwise and why do not the billions of other Muslins not condemn Bin Laden etc and why do the billions of "moderate Muslins" continue to financially support Bin Laden etc so as to keep the violent part of Islam going. To not acknowledge these facts is again a refusal to open your mind.

Reply to Uncle T: Sarah Palin vs. Obama

No, how naive you are!  "Woulda-shoulda-coulda" counts for squat in politics.  GWB reminded us of that in Florida in 2000.  It's a mean, winner-takes-all sport, so let's use a sports metaphor: Did anybody complain when LeBron James came into the game as a rookie and dunked on a 10-year veteran?  Did that old player who got dunked on cry, "He can't do that, I've got seniority!"  Hell, no!  Obama is LeBron.  He came into the game straight out of high school, went 1-on-8 with the "senior" Democrats, beat them like children, then he finished the game by dunking in Hillary and Bill's faces, thanking them for breaking his landing with their necks, and forcing them to bow to his awesomeness.  "And the crowd goes wild!... "  By contrast, Palin is the college player who graduated and went to Siberia to play ball because she couldn't make the NBA cut.  She's the leading scorer on her plucky club team in Novosibirsk, but... You get the picture.

"Obama has won.. a national primary -- SO WHAT!!!" you asked.  I'll tell you what: 99% of the politicians in Washington would give their left nut and their firstborn to match that feat, that's what.   John McCain had to wait 77 wrinkly years to do that, 25 of them kissing babies and pretending to like creeps like Jerry Falwell, Pat Roberts, and GW Bush, that's what.  As somebody who favors term limits, (the very point of which is to penalize experience), how can you turn around and deny the power of the political wunderkind, the phenom, the man-child that is Obama? 

So maybe if Palin wins something outside of Siberia, er, I mean Alaska, she'll be close to Obama's league.  Until then, the closest she'll get is watching his highlights on SportsCenter, like the rest of us.  Until then, she's Dan Quayle at best.

If you want to ask me who's the most qualified to be President, hell, I'll give you my list.  But it wouldn't include Palin, McCain, Obama or Biden, I'll tell you that.  But that would be idle chatter, conversation over a beer, not a serious discussion.

Anyway, it's interesting to note that you consider Ernie "Kelly Services" Fletcher, Bob "Cointoss" Taft, and Joe "Your Neighbor" Nienaber, Jr. to be more qualified for U.S. President than Obama.  You're entitled to your own crazy opinion!

On Mon, Sep 8, 2008 at 6:42 PM,  <                 > wrote:

How naïve and biased and prejudiced you are.  Winning a national primary and just showing up and being present (pun intended) with no resume of actual accomplishments makes one more qualified for the Presidency than someone that has run a city (however small) and a state (however short ). That's absurd.

I agree that Palin's resume is too short to be President.

However, Palin's list of accomplishments (she can walk the walk instead of just talking the talk) is twenty-five times longer than Obama's.  Obama has won a national primary and gives a good speech. SO WHAT !!!!!

Again, every time that you question Palin's experience and qualifications (and you may be right), you are destroying Obama's qualification's.

I am getting a sense, from various op-ed articles, who lean Democratic, that they are realizing the same thing.

Whether you like Palin , or not, her pick as a vice Presidential candidate, is a brilliant political strategy. It brings the issue of resume and qualifications to the forefront of the race and has the national media bringing up the issue instead of a bunch of disgruntled Republicans. With Obama having such a short and unqualified resume, McCain starts looking better.

Reply to Uncle T: Taxes under Obama

Uncle T,
Boo-hoo! This article was written for the same rich people sobbing in this article. And for the record, it says nothing about Obama's proposed spending. And don't forget savings of $100 billion (or more) a year after we pull out of Iraq!

Take that New York media executive they quoted who has made over $300 K a year for more than 10 years -- that's over $3 million -- and with only 1 child! Yet he's crying about the cost of living: "We're just dog paddling now." That guy should be smacked upside the head with a bag of quarters! I'd switch places with him in a second. Gimme a break!

Obama's advisor was exactly right: "Income growth in that group has been extremely rapid, while it's been stagnant for everyone else," says Goolsbee. "It's hard to argue they face the same struggle to get by."

I do have some sympathy for higher-income earners making less than, say, $300 K living with children in expensive areas of the country, like New York, Boston, and S. California. (Hmmm... and those happen to be liberal Democrat bastions... Go figure!....) But I have no sypmathy for the top 1 percent. You obviously don't understand the elite group you're talking about. They have plenty of money to fund any shortfalls in the federal budget. Since you won't read Free Lunch or Perfectly Legal by David Cay Johnston, let me break it down for you...

How does the national income pie divide up, then & now? The top 10 percent earned 34.6 percent of U.S. income in 1980, and 48.5 percent in 2005. The top 1 percent of income earners saw their share of all income rise from 10 percent in 1980 to 21.8 percent in 2005. To parse that top percent further: the top 1/10th of 1 percent, or 300,000 Americans, earned 3.4 percent of all income in 1980, but a whopping 10.9 percent in 2005. That's almost as much income as the bottom 150 million Americans.

Let's parse even further: the very wealthiest 30,000 Americans (the top 1/100th of 1 percent) made 1.3 percent of all income in 1980, but just over 5 percent in 2005. They had an average income of $5.2 million in 1980, which rose to $25.7 million in 2005, after adjusting for inflation. To parse even further: in 2000, the top 400 very-highest-income taxpayers, with an average income of $174 million, reported more than 1 percent of all national income. Imagine that!

(And for the record, during Clinton's two terms, the effective income tax rate of these top 400 taxpayers fell from about 30 percent to 22.2 percent. And during an economic boom! Shame on him!)

Those were huge gains even compared to the rich in the 95th to 99th percentiles of income earners, who saw their share of national income grow from 13.2 percent in 1980 to "only" 15.3 percent in 2005. The share of national income of the 90th to 95th percentiles remained almost unchanged: 11.5 percent in 1980 vs. 11.4 percent in 2005.

By contrast, the bottom 50 percent of income earners made $15,464 in 1980; but only $14,149 in 2004, after adjusting for inflation. And the vast majority, the bottom 90 percent of income earners saw their average income peak in 1973 at $33,001; but in 2005 the bottom 90 percent's average income was only $29,000. The bottom 90 percent made 65.3 percent of all U.S. income in 1980, but only 51.7 percent in 2005. That's the lowest it's been since 1928, right before the Depression.

So, what should we do? Obama is right: let's increase taxes on those who have benefitted mightily over the past 30 years from our economy, and lower taxes, while other Americans have not. Let's increase taxes on the 3 million or so rich people who made an average of $359 K in 1975, but who now make an average of $1.11 million, after adjusting for inflation. Let's increase taxes on the top 95% of income earners, and really increase taxes on the top 1%, who have benefitted most of all. Will it bother your conscience or your economic principles to do that? Because it won't bother mine. Not one bit. Just the opposite.

When Reagan took office, the top tax bracket was 70 percent. Now it's 35 percent. Moreover, because of the Bush tax cuts, those earning more than $10 million a year pay a smaller share of their money in income SS, and Medicare taxes than those making between $100 - $200 K. Do you think maybe -- just maybe -- our tax & spending policies have had something to do with rising income inequality and stagnant incomes for the vast majority of Americans (90 percent)? Do you think our tax & spending policies just might possibly have something to do with the fact that 12.3 million U.S. children lived in poverty in 2005, according to the U.S. Census, and the fact the USA ranked 20th (below Portugal) in terms of children's material well being, according to the UN?

Think about it!

On Thu, Jun 12, 2008 at 9:19 AM, <Uncle T> wrote:

This article again brings up the point that "the rich" is always the other guy. I personally make so much less money than the people in the article that I can never be considered "rich" in income. However my house is probably twice as big and the amenities twice as nice as thiers. So who is "rich."

The article also points out that Obama's proposed programs can not be paid for with just increased taxes on "the rich" who only make up 1% to 3% of the population

"Yet limiting tax hikes to the $250,000-and-up set probably won't pump enough money into the U.S. Treasury to pay for new spending programs and deal with the ballooning deficit, even when combined with proposed corporate tax increases."

So now will you be forwarding articles about how Obama is lying, deceiving and misleading the general public about paying for his new programs that won't cost 97% of the general public a dime.

http://biz.yahoo.com/bizwk/080606/0824b4088081624555.html?.v=1&.pf=taxes

Reply to Uncle T.: Who's for the Little Guy?

Uncle T.,

OK, so you do know how the other half lives. Yet in your arguments you never speak to their risks and troubles, only to the risks and interests of owners, entrepreneurs, and managers. Why?

You say you want an "ownership society" for everybody, including the "little guy," but how is the little guy supposed to save and invest when his real wages have been going down for the past 30 years (although he's working more hours than his father did), prices are always going up, and as a result he (and his family) are living hand to mouth?

I consider myself and my family extremely fortunate to have a decent income and (knock on wood) no expensive health problems or emergencies. But even I find it very hard to save much money. I really can't imagine how a family with less income and more children could save anything, much less risk their meager savings in investments like stocks or real estate, which they don't understand or have the time or resources to investigate.

Example 1: My colleague has several hundred thousand $ in various investments, including stocks; and now that the markets are going up and down, he's on the phone or e-mail with his financial adviser every day; and he's reading financial news and doing research every day. But he has the time and luxury to do all that because he's single, has zero expenses, and can afford expensive financial advice.

Example 2: A lot of smart people, and many not-so-smart people like myself, lost a lot of money when the dot-com bubble burst. We can surmise that if every little guy had also invested in the market in the 90s, he would have followed the herd and bought tech stocks or mutual funds heavily tech-invested, and then lost 50-100% of his initial investment.

I've never heard your "ownership society" theories address the risks and economic realities related to imperfect and unequal information.

Then there's entrepreneurship, the riskiest investment of all. More than half of small business startups are doomed to failure. (To be sure, there's a big difference between venture capital-funded entrepreneurs, who play with other people's money, and small entrepreneurs, who risk their and their relatives' money). Anyway, the little guy probably won't even try to start up a business because he has no collateral to get a startup loan; and/or his credit history sucks because he lives hand to mouth and his credit cards are maxed out.

So, how the hell is the little guy supposed to get ahead in life with all this stacked against him? I'm not saying little guys don't beat the odds and achieve success, but if you look at statistics, you'll see that wages and average household income (adjusted for inflation) are falling for the little guy. Yet -- let's face it -- you think this system is basically OK. With a few minor tweaks, you basically support the status quo, and believe that success in life depends on one's personal responsibility and gumption. Basically, you say to the little guy: "It's all up to you, Little Guy! If you're not lazy, America is your oyster!"

Meanwhile, thanks to conservatives, he has a government that could afford to give his family health insurance, a real alternative to expensive cars, and a decent K-12 and college education, etc., yet that gov't chooses to spend its money on guns and wars. Meanwhile, he has a gov't that gives tax breaks to big companies that outsource little guys' jobs to Asia.

I know, I know: you'll always come back to Social Security taxes and "Ponzi schemes." But people like my mom and [name deleted] are now depending on SS for a large part of their retirement income. And they are not lazy or stupid; they tried to plan ahead. Millions of Republicans like my mom, and my rich boss who will soon retire, won't send their SS checks back to the gov't out of their conservative principles. So, even in that sense, the system is stacked against the little guy, because he's funding the supplemental income of millions of people who don't need it; meanwhile, his benefits when he's old will probably be less than that of seniors today.

But let's say, for argument's sake, the gov't did not take that 7-8% of FICA from the little guy's paycheck. What would he do with that extra $2,000 - $5,000 per year? Would he start up a small business and become wealthy? Probably not. Would he invest it wisely in the markets, year after year, and make his 10% over the long run? Maybe. Would he use his FICA money to buy decent health insurance, and a private school or college education for his kids? Uh-uh, no way, FICA doesn't even begin to cover those expenses.

Rather, you know and I know that, more than likely, he would spend that FICA money. He wouldn't save or invest it, he would consume. Because that's what little guys really do with their money. (This, after all, is the underlying assumption of the "stimulus plan," which Democrats and Republicans seem to agree on.)

Some people define insanity as repeating the same thing over and over and expecting a different result. The status quo in America for the little guy, which you defend, is insane, because politicians and guys with money tell the little guy, "Keep working, keep plugging away, and you'll come out ahead," even though experience shows this is not the result. Maybe it was true up until the 70s, but not anymore.

So please tell me, besides in your heart and your admirable charitable work, how you can be for the little guy, when you defend a system that doesn't support him?

J

Mysterious overseas contracts worth $ billions in Iraq, Afghanistan

Uncle T.:
Ha! I knew you'd say that!

You get to have it both ways, you lucky dog! On the one hand, big gov't spending is bad and wasteful, and the private sector can do a better job; but when big gov't decides to outsource its functions to the private sector to increase efficiency, you're "not shocked" when that money is wasted, because it's still "big gov't" doing the spending.

Come on, that's not fair, or intellectually honest. You can't have it both ways.

As I've said before, if you want America to act like an empire and spend $ billions on nation-building in corrupt and conflict-ridden countries thousands of miles away, then you'd better expect there to be a big price tag. There's no getting around it. And the bigger the price tag, and the farther away it is, the more waste, fraud and abuse you can expect. You should expect even more waste, fraud, and abuse if "big gov't" fails to make the necessary investments in contracting oversight to ensure that contractors deliver what they were supposed to, on time and at cost. (Same as you wouldn't hire a contractor to build your house and then never check on him to make sure it was done right.) Oversight demands TIME and MONEY, which you must understand. It's not simply a matter of the gov't writing a check to some contractor to perform some task, and having dumb "faith in the market" to be honest and effective ("big government conservatism," in a nutshell).
______________________________

Uncle T. replied:

Although I am not shocked because I know that it is govt doing the spending, I am truly disillusioned and angry

___________________________________________

This is shocking to read:

"Over the three years studied, more than $20 billion in contracts [in Afghanistan and Iraq] went to foreign companies whose identities—at least so far—are impossible to determine."

If you care about fiscal responsibility and government accountability, read this:


http://www.publicintegrity.org/WOWII/

Re: to Uncle T.: Edwards not perfect, but...

Uncle T.,

Edwards obviously doesn't agree with you, and doesn't equate corporate lobbying with labor union lobbying. I can't think of any liberal or progressive who does agree with you on that. So you can't accuse him of "playing politics" just because he has an ideological disagreement with you.

If you believe that unions have the same lobbying power as corporations, you've definitely been drinking the Republican kool-aid.

There is a big difference between corporate lobbying and labor unions lobbying. First, the corporations have way more money to spend on lobbying -- money that comes directly from the wealth created by the workers and the corporation. Labor unions depend on working-class folks contributing their salaries to the union. By contrast, executives don't pass the hat around; they don't pay for the corporation's lobbying out of their own pockets.

Second, the labor unions are dependent on one party, the Dems, to support their interests, hence their influence is severely limited, esp. when the Dems aren't in power. Supporting unions is considered "liberal" and the GOP takes every opportunity to hurt the unions and discourage membership. By contrast, corporations donate liberally to both parties, and supporting Big Business is considered "bi-partisan."

He's not a corporation, but Cincinnati's own Carl Lindner, one of the biggest individual donors in the U.S., is the epitome of Big Business' attitude: he usually gives 50/50 to the GOP and Dems. He has no interest in ideology, only in buying influence.

Lobbying, per se, is not evil. In fact it's vital to democracy -- unless you believe that the populace's job is done when it votes a politician into office, i.e. we should trust politicians to make all the right decisions for 2-6 years, without hearing our opinion. That is George W. and Dick Cheney's philosophy of governing: "You voted for us, now shut up and do what we say until we're not in power anymore."

Again, there's a huge difference between pressure groups which represent large voting blocs -- like the NRA, NOW, AARP, NAACP -- and lobbying groups which simply represent large financial interests. The former groups' power is not in the amount of money they can donate, but in the number of votes and good/bad publicity they can bring. Mothers Against Drunk Driving, for example, is not rolling in cash, but they're a pretty powerful lobby in the sense that no politician wants to be on their bad side: "What, you're in FAVOR of drunken driving?!"

Finally, unions in general represent a broad class of people -- working class -- and not some narrow, selfish business interest. Similarly, pressure groups like the AARP represent millions of people from all over the country of different political persuasions.

None of this is new in your lifetime. And progressives of the Progressive Era were the first to decry Big Business' undue influence on our political process. It goes in waves. And I think people are once again worried that the fox (big business) is in charge of the hen house (government). But just because these things aren't new doesn't mean they are inevitable. Edwards is right to try and change things, just like Teddy Roosevelt and Grover Cleveland were right to rein in the corporations. But even if Edwards is not a true believer but simply a political opportunist, i.e. he's trying to ride a wave of progressive anti-corporate sentiment, so what?? Why should we progressives care, as long as we get somebody in office who will enact needed reforms?

On Nov 21, 2007 9:21 PM, Uncle T. wrote:

I don't disagree with the sound bite, per-se: I disagree with the implication that this is something new and different and is limited to big corporations. It's called lobbyism. The labor Unions are the king of the lobbyist. We also know how strong the NRA is, along with AARP ,NAACP and NOW. There are probably all kinds of strong and influential lobbying groups out there that I know nothing about. I whole heartedly acknowledge that the big corporations are doing this and are influential. But please tell me something new that hasn't been going on during my entire lifetime.

What I would totally disagree with is the impact. Today's communication revolution has made lobbyism less significant. I think that big corporations influence is less today than it was previously when information wasn't so readily available and when there weren't so many exposes. Yes, money still buys power and influence and is still significant and does get legislation passed. I just think that it is less today than it was in previous years when there were even more secrets and even more behind closed doors negotiations.

I also think that John Edwards is campaigning on this issue, not because it is the greatest issue of our time ( or he would have to include all of the "progressive" lobbying groups in his rants and he would also have to campaign on election reform to take the big money out of the picture) but is simply putting an issue out there in which to rally his base. (He's telling them what they want to hear) If he would include all lobbying groups and get the big money out of elections, then I'd be for him.

At the moment, all he is doing is playing the game of politics.

---

From: Jay
Sent: 11/21/2007 11:19 AM

Subject: Edwards not perfect, but he gets the 'central issue' of our time

Thought you might like this comment by progressive writer David Sirota, with a link to a short film clip of John Edwards:

Letter to Uncle T. on 'liberal' v. 'progressive'

Uncle T,

Substitute the word "liberal" for progressive, I don't care. I'm proud to be liberal. But just so you know, liberal politicians use the word "progressive" because it has a positive historical antecedent in U.S. politics -- the Progressive movement from 1901-1912 and the National Progressive Republican League, a splinter from the GOP.

Progressives were alarmed at the growth of monopolies and accumulation of wealth at the top during the so-called Gilded Age, and they decided that laissez-faire policy wasn't working anymore. They didn't want to revert to socialism, which was becoming popular in Europe at the time, and taking root in America via European immigrants; the Progressives wanted to purify capitalism, not replace it with socialism.

Progressives wanted government to take action against rising economic inequality, discrimination against freed blacks, child labor, squalid living conditions and "slumlords," price discrimination and monopolies; high protective tariffs; and in general, gov't serving Big Business.

Progressive reforms included: breaking up trusts and interlocking directorates; new food safety standards (Meat Inspection Act and Pure Food and Drug Act); sanitation codes for sweatshops; reform of "reform" schools and prisons; workmen's compensation laws; use of the political referendum; direct election of U.S. Senators via the 17th Amendment (they called the Senate the "Millionaires Club" even back then!); regulation of the railroads through the 1903 Elkins Act and local public utilities commissions; and state corrupt-practices acts. They also campaigned for women's suffrage, the 8-hour workday, and prohibition, but weren't successful until the 1920s.

Republican progressive reformer Teddy Roosevelt urged Congress to create the Department of Labor and Commerce in 1903, which included the Bureau of Corporations, which was authorized to probe businesses doing interstate commerce. This, and expansion of the Interstate Commerce Commission, paved the way for "trust-busting" and ending price discrimination. TR is known as the "Trust Buster," but actually president W.H. Taft brought 90 anti-trust cases to court in 4 years vs. 44 cases in TR's 7.5 years, including Taft's successful bid to break up the powerful Rockefellers' Standard Oil Company, and U.S. Steel.

The Progressive era also saw the first significant national conservation legislation: the Newlands Act of 1902, which let Washington collect taxes from the sale of public lands in the West for irrigation projects; and TR set aside 125 million acres of forest reserves.

Progressives' main weapon was muckraking journalism and raising public awareness: books like Wealth Against Commonwealth, The Theory of the Leisure Class, How the Other Half Lives, The Jungle, The Financier, Following the Color Line, and The Bitter Cry of the Children.

In 1910, TR split the Republican Party in two with his campaign for "New Nationalism," i.e. increasing gov't power to remedy economic and social abuses. The Republicans lost the House to the Democrats.

So, I consider the moniker "Progressive" to hearken back to a proud list of accomplishments, and an optimistic, can-do attitude that capitalism needs government reform and oversight, not extermination. Hillary Clinton, by the way, alluded to this history in the Dem You-Tube debates. Although I admit I was ashamed when no Democrat would stand up and say "I'm a liberal" when asked directly. It's not the dirty, four-letter word our media have made it out to be.

You need to brush up on your high school U.S. history. You seem to think that all of the good things we have today just happened spontaneously, like food and drug testing, overtime pay, health and safety standards, anti-trust laws, etc. It took liberal-progressive reforms to make it happen, while Big Business cried and protested the whole way. Some things never change.

Reply to Uncle T.: Bush 'duped' by CIA on Iraq aftermath?

Uncle T.,
Hooray for whose side? I'm rooting for America, and I hope you believe that anyone who wants us to get out of Iraq feels that way because he thinks it's best for our country.

You've basically adopted the line that Bush was "duped" by bad intelligence and a CIA itching for war with Saddam, because that helps you feel better about your President and your party. And it helps you feel better about giving up on the Iraq war now. So be it.

But the facts of recent history don't support your view. There was plenty of uncertainty about Iraq, and what would happen after a U.S. invasion. According to the Senate Select Committee on Intelligence, two intelligence assessments before the Iraq invasion accurately predicted that toppling Saddam could lead to a dangerous period of internal violence and provide a boost to terrorists.

In January 2003, two months before the invasion, the U.S.National Intelligence Council warned that after Saddam was toppled, there was "a significant chance that domestic groups would engage in violent conflict with each other and that rogue Saddam loyalists would wage guerilla warfare either by themselves or in alliance with terrorists."

Former CIA Director George Tenet (whom Bush awarded a Medal of Freedom) included in his book the CIA's warning to the Administration dated August 13, 2002, six months before the invasion:

"The United States will face negative consequences with Iraq, the region and beyond which would include:

* Anarchy and the territorial breakup of Iraq;
* Region-threatening instability in key Arab states;
* A surge of global terrorism against US interests fueled by (militant) Islamism;
* Major oil supply disruptions and severe strains in the Atlantic Alliance."

Wrote William Harlow, part of Tenet's senior intelligence staff and co-author with Tenet on his book: "Although the intelligence got the WMD case in Iraq wrong, it got the dangers of a post-invasion Iraq quite right. They raised serious questions about what would face U.S. troops in a post invasion Iraq. The intelligence laid out a number of issues of concern. It's unclear if administration officials paid any attention to those concerns."

Even retired CIA analysts were so concerned, they spoke out in an open letter in February 2003 before Bush's imminent invasion of Iraq. Amazingly prescient, they wrote:

"Indeed, it is our view that an invasion of Iraq would ensure overflowing recruitment centers for terrorists into the indefinite future. Far from eliminating the threat it would enhance it exponentially.

"As recent events around the world attest, terrorism is like malaria. You don't eliminate malaria by killing the flies. Rather you must drain the swamp. With an invasion of Iraq, the world can expect to be inundated with swamps breeding terrorists. In human terms, your daughters are unlikely to be able to travel abroad in future years without a large phalanx of security personnel.

"We recommend you re-read the CIA assessment of last fall that pointed out that 'the forces fueling hatred of the US and fueling al Qaeda recruiting are not being addressed,' and that 'the underlying causes that drive terrorists will persist.'"

Bush either ignored these warnings, or his pro-invasion cabal refused to present them to the President. They all (including Colin Powell) chose to believe the rosiest of all possible scenarios, that we would be " greeted as liberators" in Iraq.

Barely 5 hours (!) after the plane hit the Pentagon, Rumsfeld was telling aides to come up with plans to attack Iraq. He refused at first to believe al Qaeda attacked us, he was so focused on Iraq, even though the CIA had intercepted a phone call that morning from an al Qaeda operative in Afghanistan to another in Georgia (former USSR) talking about the "good news" and more to come -- indicating he knew that the plane over Pennsylvania was yet to crash. Rumsfeld was told by the "bumbling" CIA that they had connections to the USS Cole bombing. Rumsfeld replied the evidence was "vague" and "might not mean something." Later that same day, Rumsfeld noted: "best info fast. Judge whether info good enough to hit S.H." -- meaning Saddam Hussein -- "at same time. Not only UBL" -- Usama bin Laden.

Retired Gen. Wesley Clark said on Meet the Press that the White House called him on 9/11 -- while he on CNN -- telling him 'You got to say this is connected. This is state-sponsored terrorism. This has to be connected to Saddam Hussein.' Clark asked them for evidence, but never received any.

Even as Bush said he preferred diplomacy, disarmament and the UN route, the Iraq invasion was being planned all throughout 2002. Former Bush Treasury Sec. Paul O'Neil said invading Iraq was " topic A" 10 days after Bush's inauguration!

Former Bush Admin. official Richard Clarke wrote this amazing insider's revelation:

"I expected to go back to a round of meetings [after September 11] examining what the next attacks could be, what our vulnerabilities were, what we could do about them in the short term. Instead, I walked into a series of discussions about Iraq. At first I was incredulous that we were talking about something other than getting Al Qaeda. Then I realized with almost a sharp physical pain that Rumsfeld and Wolfowitz were going to try to take advantage of this national tragedy to promote their agenda about Iraq. Since the beginning of the administration, indeed well before, they had been pressing for a war with Iraq."

Richard Clark wrote further:

"By the afternoon on Wednesday [after Sept. 11], Secretary Rumsfeld was talking about broadening the objectives of our response and "getting Iraq." Secretary Powell pushed back, urging a focus on al Qaeda. Relieved to have some support, I thanked Colin Powell. "I thought I was missing something here," I vented. "Having been attacked by al Qaeda, for us now to go bombing Iraq in response would be like our invading Mexico after the Japanese attacked us at Pearl Harbor."

On 9/13, ex-CIA chief, prominent neocon, and outspoken advocate of invading Iraq even before 9/11, James Woolsey published an op-ed urging an attack on Iraq, writing famously: "absence of evidence [of Iraq's involvement in 9/11] is not evidence of absence," (a line that both Cheney and Rumsfeld would borrow months later, this time when no WMD could be found in Iraq). In October 2001, Woolsey met with the Iraqi National Congress in London at the request of Wolfowitz. Bush had also asked Woolsey to lead the investigation into any possible links between Iraq, 9/11, and the DC anthrax attacks (which are still unsolved). Woolsey commented that there were "substantial and growing indications" that a state was behind the attacks." Commenting on the tenuous nature of Iraq's connection to al Qaeda (via Mohammed Atta in Prague) he said: "Hearsay is not admissible as evidence and almost all intelligence is hearsay. Evidentiary standards are the wrong standards. I would talk about indications, information." Woolsey added: "The United States has not yet decided it is at war with Saddam Hussein but Saddam Hussein may have decided he is at war with the United States."

On Sept. 15, Bush and his advisers met at Camp David. According to Bob Woodward's 2002 book, Bush at War, Wolfowitz advocated an attack on Iraq, perhaps even before an attack on Afghanistan. There was a 10 to 50 percent chance that Iraq had been involved in 9/11, he argued, concluding that Saddam's "brittle, oppressive regime" might succumb easily to an American attack -- in contrast to the difficulties involved in prosecuting war in the mountains of Afghanistan. Powell asked to focus on Afghanistan, not Iraq, and Bush agreed. But later at Camp David, Bush told his neocon advisor Richard Perle that once Afghanistan had been dealt with, it would be Iraq's turn.

The next day Rumsfeld asked again, "Is it now time to attack Iraq?" despite no evidence that Iraq was involved.

On Sept. 17 Bush issued a TOP SECRET directive to the Pentagon to plan for an attack on Afghanistan. Without any evidence that Iraq was involved in 9/11, Bush wrote a footnote asking them to start planning an Iraq attack as well. Plans to attack Iraq took on a momentum of their own, so much so that State Dept. officials were out of the loop, therefore they could not help plan for a post-invasion strategy.


It goes on and on like this, from 9/11/2001 all the way to 3/19/2003, when we invaded Iraq. 9/11 was just a pretext. Bush, and especially his neocon circle of advisers, were never interested in evidence or intel.

Bush, Cheney, Rumsfeld, Wolfowitz, Libby, and a cabal of others inside and linked to the Bush Admin. saw 9/11 as an opportunity to take care of unfinished business and spread democracy in the Mideast; they did not believe that Iraq presented a clear and present danger to America.

Do you really believe that all the testimony from Administration insiders, and inside journalists like Bob Woodward and Seymour Hersh is because they're all partisan hacks with an axe to grind? With all the information that's out there about what REALLY happened, can you still seriously trust that Bush, et all were just innocent victims of the incompetent CIA?

I seriously doubt you'd be willing to believe the very best about Bill Clinton's intentions if he had done the exact same things as George W. Bush.

On 7/18/07, Uncle T. wrote:

So is this US intelligence better than the US intelligence that got us into the war in the first place or is it just a wild ass guess. My belief is that it is the latter . It may be true or it may be wholeheartedly wrong. Anyone who declares otherwise simply has blinders on. Hence this is another example of an article that says nothing other than "hooray for my side."

Reply to Uncle T. on Bush tax cuts and deficits

Uncle T.,

I've also ready many articles which say the same thing, but with no quantitative analysis to back up their claims. (Neil Cavuto of FOX and Larry Kudlow of WSJ are the two biggest offenders in the so-called "business press"). In the business press, whose paying audience is investors, tax cuts are favored because they put more money into the individual investor's pocket. The business press just assumes the best and salves investors' conscience by saying what's good for them is good for everybody.

My question to you and other supply-siders is: If tax cuts always grow the economy and thereby increase tax revenue, why did the 90's economic boom happen amid Clinton's "largest peacetime tax increase in U.S. history"? And why did America have unprecendented prosperity after WWII (1946-63) when the highest tax bracket was 88%?

To maintain our integrity, at the very least we have to admit that other factors must be at work beside tax rates -- factors that can mask or even counteract the effect of tax rates. Something else is going on here.

Perhaps the most honest conservative, pro-supply-side appraisal I have read is this by Donald Luskin in National Review Online.

But then read this quote from the article “Claim That Tax Cuts ‘Pay for Themselves’ Is Too Good To Be True,” from the Center on Budget and Policy Priorities:

"In 1981, Congress approved very large supply-side tax cuts, dramatically lowering marginal income-tax rates. In 1990 and 1993, by contrast, Congress raised marginal income-tax rates on the well off. Despite the very different tax policies followed during these two decades, there was virtually no difference in real per-person economic growth in the 1980s and 1990s. Real per-person revenues, however, grew about twice as quickly in the 1990s, when taxes were increased, as in the 1980s, when taxes were cut."

So yes, the whole article below hinges on that word "apparently," because by sticking that tricky word in there, the journalist can spend the other 289 words giving you, the reader, the false impression that the link is proven, but at the same time cover his own journalistic ass by admitting there is still a fair amount of uncertainty, i.e. stealthily admitting the issue is by no means decided. But when enough pundits repeat, by implication, this myth enough times, then people start to believe it.

I, on the other hand have forwarded you articles, and do so again (see below), that show there is no proof of a link between increased gov't revenue and tax cuts. And we must agree that, even if there is indeed such a link, it can only take effect after several years, while all of these new businesses are being created and business growth is taking place, because this won't happen overnight. So, even if you believe that tax cuts increase tax revenues, you must admit that tax cuts will cause deficits in the short term, because investment doesn't show a return overnight.

Furthermore, you should hopefully agree that it was irresponsible of Bush not to repeal his tax cuts after 2001 and 2003, knowing they would create deficits (at least in the short-term), at the same that he started 2 wars, which could have raised the price of oil, or otherwise harmed our economy unpredictably.

Must read:

http://www.nytimes.com/2007/07/12/washington/12bush.html

http://www.slate.com/id/2146868/

http://www.brendan-nyhan.com/blog/2006/10/wp_factchecks_b.html

--> Includes great quotes from Bush Admin. officials saying tax cuts don't increase revenue!

http://pages.stern.nyu.edu/~nroubini/SUPPLY.HTM

http://www.washingtonmonthly.com/archives/individual/2004_12/005340.php

http://www.huppi.com/kangaroo/4Inequality.htm

http://www.washingtonpost.com/wp-dyn/content/article/2007/02/06/AR2007020601529.html

http://www.nytimes.com/2007/01/08/washington/08tax.html?ex=1325912400&en=e1dc82f54ac7eacb&ei=5090

07/13/2007 11:56 PM
To: <>
From:

Subject: RE: US budget deficit shrinking

I’m not sure that I understand your point. My interpretation of the article is that tax cuts so stimulate the economy that the govt tax revenue actually increases with tax cuts. ( the same thing happened with the Reagan tax cuts). You take one word out the whole article, ie: “apparently” and declare (or imply) that there is no basis that tax cuts stimulate the economy and a strong economy increases govt tax revenue. Although I cannot immediately forward you a scientific study verifying same, I can represent that I have read numerous articles that have said exactly what the below article emphatically says.

From: Jay
Sent: 07/13/2007 3:46 AM
Subject: Fw: US budget deficit shrinking

You'll love this!

U.S. Budget Deficit: The Incredible Shrinking Twin
By J. Christoph Amberger

The U.S. budget deficit will narrow to about $205 billion in 2007, the Bush administration announced. That’s quite a bit lower than the $244 billion that the government had forecast in February, and down 17% over last year's shortfall.

The original 2007 budget had forecast a decline in the U.S. household deficit to $354 billion, which was estimated to be 2.6% of United States GDP. The current estimate thus is coming in 42% lower than the original conjecture, which would reduce the percentage of GDP borrowed to 1.5% -- well below the 40-year historical average deficit.

But the thing about the Bush administration’s new debt numbers is that for the past four years, they have been sandbagging. Typically, their projected new debt has come in not only far below the original budget, but also far below their consecutive updates.

Accordingly, the consensus estimate of Wall Street economists comes in even lower. The median estimate of 40 economists in a Bloomberg News survey places the actual deficit this year at $170 billion -- less than 1% of GDP.

That is far below the new debt levels of the supposed paragons of economic virtue… like Germany, Japan or even China.

Of course, perma-bears never tire to point out that new debt as a percentage of GDP declines if economic growth takes place. New federal debt also says nothing about existing debt levels of states and municipalities.

What they usually leave out is that new debt also declines when tax receipts increase, also as a consequence of a growing economy. Apparently, the Bush tax cuts have not just worked wonders in turning the near recession of 2001 into an economic boom; they’re also generating higher tax revenues by virtue of charging taxpayers less.

[I like that word "Apparently." To be honest, you have to say "apparently" and not "certainly" because no one that I know of has bothered to study the real effects of Bush's high-income tax cuts and capital gains tax cuts on economic growth. – J]