Category Archives: taxes

The Doomsday Economy

Back in January of 2018 the Bulletin of the Atomic Scientists’ moved what they call the Doomsday Clock two minutes from midnight. The clock represents the hypothetical global catastrophe as “midnight” and this adjustment is the closest the clock has been set since 1953. The countdown clock was design and developed as a warning since the development of nuclear weapons and the threat of nuclear war. Although the clock in 2018 was moved due to the threat of climate change, nuclear war and, the lack of confidence in U.S. leadership; I bring this up because the clock represents a real threat and humanity should be aware of the probability of crisis, but why don’t we have one for the economy?

I have listened to a number of economists that have warned for years since the Great Recession of 2008 and that wages have stagnated despite productivity increasing and the stock market showing record highs and recovery. For example, the minimum wage has not been raised since 2009, and, although a movement has called for a $15.00 an hour, a minimum wage of $21.72 per hour if adjusted with average productivity growth.

Of course there are arguments against raising the minimum wage such as it will create inflation; but inflation is already rising. Those that make more money and have skills, education or trades should not make the same as those who do not, and if a rising tide raises all boats, these skilled laborers would make more money too. Businesses can’t afford a raise in the minimum wage; yet a report by the American Sustainable Business Council showed 61% support for raising the minimum wage with the cost of living by small business owners.

From what I have read the likely threat is to the amount of subsidies the average tax payer has to pay for major corporations to provide low wages. Low wage workers turn to public assistance for help. Medicaid, food stamps, the Earned Income Tax Credit and Temporary Assistance for Needy Families subsidized fast-food workers and their households at $243 billion over four years a paper from UC Berkeley reported. Estimates by Americans for Tax Fairness estimates Walmart costs taxpayers 7.8 billion a year. Amazon’s Jeff Bezos is on the bargain as well.

After the 2008 crash the Federal Reserve responded by bailing out banks and lowering Federal Interest rates to 0.25% in Dec. effectively making the rate 0. These are the mechanisms in place that financial leaders have used to fix the economy and help the people: and they have failed. Bailouts saved the banks and reinforced that deregulation can work as long as a constituency of taxpayers are available to maintain the the institutions that lobby for “free markets”. With Federal Interest rates lowered banks and those that have assets in non-taxing accounts (such as the Cayman Islands) and can borrow money from the Federal Reserve at these low interest rates and buy stocks back and finally cancelling them driving up the cost. Driving up the cost is rewarded buy bonus and higher valued stocks options. The results are in and the mechanisms didn’t work.

Dani Burger wrote an article for Bloomberg titled “Rife with Anxiety, Markets are Churning at the Fastest Rate Since 2008” in the article Nikolaos Panigirtzoglou, a J.P Morgan “strategist”, is quoted as saying “Market turnover tends to be high when uncertainty is high, as institutional investors tend to reshuffle their portfolios,” This is a period Max Keiser has called “smart money selling to dumb money”. My opinion is to watch as much economic news as you can, the battle of propaganda between investors has begun. While trying to convince some that the economy is fine or as John McCain said in 2008 “The fundamentals of economy are strong…” or as CNBC’s Jim Cramer from Mad Money answered in March 2008 whether Bear Stearns was still a safe investment his answer was … Bear Stearns is fine. Do not take your money out.” Bear Stearns investment bank and brokerage firm fails and gets a taxpayer bailout.

Media outlets like Bloomberg are late, too late. The failed policies over the past few decades have eroded the middle class and threatened the system that the 1% praise. The problems of our economic system are deeply rooted and originate in our corporate-captured political system. Attacks on Unions, wages, and the deregulation of the banking industry have crippled labor and the blue collared workers

Going back to the Doomsday Clock, maybe it’s time for an Economic Crisis Clock. We know that the economy cycles in booms and busts, some are honest about the causes of these busts other choose to ignore the contradictions. We need those with insight and foresight that have a wide view of the issues challenging or society and economy.  This board of economic advisors needs to be a group of economists, environmentalists, biologists, botanists, and climatologists.

Economists such as David Harvey, Richard Wolff, Kate Raworth, Michael Hudson, Stephanie Kelton, Herman Daly, Ann Pettifor and, Nomi Prins have given us warning and solutions to upcoming economic collapse. Suggestions for fixing our economic system have been worker co-ops (like Mondragon), raising minimum the wage, regulating Banks and Wall Street (like the Glass-Steagall Act), instituting a Green New Deal (an economic stimulus package that would invest in renewable energy and resource efficiency while creating new jobs), Framing our understanding of economics within social and planetary boundaries, eliminating college debt, Medicare fore all, or community based cryptocurrencies, all these potential solutions for big problems.

The Bulletin of Atomic Scientists factor in Climate Change in their calculations for the Doomsday Clock, all agree that time is running out (if it hasn’t already) for the nations of the world to respond in a meaningful way to limit the damage that is already predicted. The effects of Climate Change are already making an impact on our planet. 2018 is expected to be the hottest summer on record. Louisiana is losing coastal land to rising sea levels with the lower third of the state expected to be underwater if levels rise 3-5 feet, the islands Laiap and Ros of Micronesia have already lost two-thirds of their land area. The Antarctic is melting three times faster than expect and the largest contributed of rising ocean sea levels. In 2017 an iceberg the size of Delaware was discovered to have broken off from the ice shelf in Antarctica. Our Planet is presenting evidence that we are stressing its’ ability to sustain our living standard, the boundaries are being strained.

Energy Watch Group and The Post Carbon Institute argue that with the largest oil discoveries having been made between the late 1930’s to the late 1970’s new oil discoveries cannot continue to meet the world demand. Not only will these new discoveries be unable to meet current and growing demand these discoveries will not be able to meet the demand that will be need to use this energy for the conversion to renewable, sustainable and more ecological sources of energy. The pursuit of oil as the primary energy resource with coal not far behind has not only made our environment and climate stability tentative but also our economy and our international relations with global nations.

In the meantime industry not only squandering resources that could be used to convert our society to that of a more ecological and sustainable economy. Our financial industry is ruthlessly applying its’ influence and investment to the gain of a few, subsidizing the conspicuous  consumption of the wealthy affluent instead of making investments that could be used to ease, develop and optimize our communities and society.

The effects from our lack of planning and investment will present itself more so than it has in our climate. Our chance of limiting global warming to 1.5 degrees will be used up in four years, the Global Carbon Project the rapidly increasing carbon emissions will push us past the 2 degree limit in only three decades. The small rise in global temperature will not only increase the heat but limit availability to freshwater, slow crop production, rise sea levels, melt ice and permafrost, none of these things are going to be good for the people or the economy.

The rich affluent may horde their paper money and gold but when the earth is your home and your home is unlivable those tokens lose value. Today people are concerned about their livelihood and are worried about the mechanisms and markets that affect them the most that is why the subjects of housing, food, water, healthcare, education keep being brought up. These are the issues that matter. If people could be concerned beyond these they could understand and potentially have an impact on the issues mentioned that will also greatly impact them. The economy is what we use to improve ourselves and the community, deregulation, lack of investment in the development of our infrastructure, suppressed wages are steering us toward another financial collapse.

The economy is cycling toward another crisis and we are two minutes to midnight.

 

Michael DeWitt

CoolCatM   Twitter: @CoolCat0001    Guerrilla Communication Tactics

The Sam Seder Tim Black debate, or the Sam talks over Tim while Michael Brooks makes snarky commentary.

https://i.ytimg.com/vi/iyXhdzgGOSc/maxresdefault.jpg

By Joseph Ballin 6/29/2017 5:37 PM EST

Reader’s note: I am a fan of both Sam Seder’s The Majority Report and The Tim Black Show. I do not hold any hostilities towards either person debating in this piece and am writing this to illustrate how we on the left can find better solutions to our problems. That being said I’m biased toward Tim in this debate.

What’s the difference between a liberal and a progressive? Personally I don’t care or like these labels. Hillary described herself as a “progressive who can get stuff done.” So I couldn’t care less about those labels, but Tim goes into what I think he meant is between neoliberal corporate shills and people who want change in this country. Yes Sam is correct that the Majority Report does talk about all of the issues that Tim Black listed. So Sam goes to Tim’s youtube page and criticizes him for not covering healthcare enough. However, Sam has not watched Tim’s show and doesn’t know that he’s covered healthcare numerous times on his show. And now Sam goes into the Seth Rich / Kimdotcom territory.

The one thing me and Jimmy Dore have both been very clear on, we want evidence. We want evidence of Russiagate, evidence Assad gassed his own people, evidence for or against the Seth Rich cover up, etc. That’s reality based thinking. That’s why I’m an agnostic atheist, because I can’t prove there isn’t a god/gods, but there is no evidence that they do exist so there is no reason for me to believe in them. In fact, nothing in the universe can be proven. A fact is a statement that is taken to be true based off of evidence. It is something we collectively as a society agree what is real and fake. A theory is a plausible or scientifically acceptable general principle or body of principles offered to explain phenomena.

Ok now that we got that out of the way let’s deconstruct all this shit. There is no verifiable evidence Russia hacked, interfered, or colluded with Donald Trump or his campaign. In fact, as president, US relations with Russia under Trump are at a record low. Trump has repeatedly attacked the government of Bashar Al-Assad and Iranian militias several times, Russia’s allies. Trump signed a treaty expanding NATO to Montenegro, something Russia opposes. He signed the Consolidated Appropriations Act, 2017, which authorized $100 million dollars for the “Countering Russian Influence Fund”, to counter “Russian influence and aggression” and to “support civil society organizations in Europe and Eurasia.” It also included a measure imposing new restrictions and oversight on Russian diplomats in the United State. The Act also includes provisions that no appropriated funds may be used to support the Russian annexation of Crimea and assist Crimea, if such assistance includes the participation of Russian Government officials, or other Russian owned or controlled financial entities. It also states that no funds may be used to support “the Russian occupation of the Georgian territories of Abkhazia and Tskhinvali Region/South Ossetia” or to assist the central governments of other countries that have recognized the two territories’ independence. On top of all that, US has imposes more sanctions on Russia during Trump’ presidency. If Trump’s a Russian puppet, he’s doing a really shitty at it.

Again this is not to say there isn’t business ties Trump has to Russia, like with Deutsche bank and Trump hotels because he’s a billionaire, but he also has business ties to Saudi Arabia, Israel, Turkey, Philippines, Azerbaijan, mafia, etc., but the mainstream media never mentions this. Why does mainstream media never bring up the fact General Flynn was a paid agent of the Turkish government? Why does the mainstream media not bring up the fact Trump appointed all these Goldman Sachs people because of his ties to Israel? Or China provisionally granting Trump 38 trademarks after getting elected? Or the Clinton’s business dealings in Russia? So there is enormous hypocrisy on this issue. Focus on Russia and nothing else. Why you may ask? Because starting a new cold war with Russia ensures defense contractors can make giant profit because now we have a great power enemy again. Also we can’t start a cold war with China because our economies are to tied together. It has less to do with Trump himself and more to do with more spending on the military and strengthening the police state. That’s why you don’t hear anything about getting rid of voting machines or having open, fair, and free elections.

As for the Syria gassing of 2017, the entire thing was brought up so briefly and forgotten about so quick by mainstream media and the Trump administration it really makes you wonder what really did happen in Syria. Why has there been no independent UN investigation into the gassing? There is no evidence Assad ordered the gassing of any civilians. As for the Seth Rich story, I stated on day one when I first heard about the Seth Rich murder that I found it very fishy. I have no idea is Seth Rich was the Wikileaks leaker or who killed him, but I do know a couple things. I do know Assange has hinted, but not confirmed, to Seth Rich being the leaker. Wikileaks, outside of the Garani Massacre Video which they said they would publish, but never did, has been 100% on point. So now that we got all that out of the way, back to the debate.

So Sam now brings up whether or not it’s a good thing to promote the Russia fear mongering story to split off three Republican votes in the Senate for healthcare. First of all I won’t advocate a new cold war with Russia over healthcare. Second of all why does Sam think Russia influences how Republican senators vote on healthcare. We’ve already seen the Senate healthcare bill be delayed because of how awful it is. People aren’t thinking about Russia when they think of healthcare, they are thinking of NOT DYING! Plus I would wager all that corporate cash the Republicans senators take is more of an influence than the so called Russia scandal over Trump’s head. The only thing that will force Republicans to change their votes on healthcare is though mass movements.

Now Black brings up the rigged 2016 Democratic primary and the DNC fraud lawsuit. Tim brings up exit polling being used by the US to determine whether an election is legit or bs in foreign countries. I would like to point out that irregularities in exit polling in Ukraine were cited by the US and EU for the fascist coup in Ukraine. And I would also like to point out Sam Seder has had on Greg Palast on Ring of Fire, someone who says the 2016 Democratic primary was rigged. But ok Sam I guess the primary wasn’t “rigged.”

Continuing on Tim brings why Democrats blaming progressives for the lose of Hillary Clinton. So Tim brings up Susan Sarandon and her revolution comment about Trump, stating we are seeing a revolution already taking place under Trump. Ok so I agree and disagree with Tim here. A revolution against Donald Trump hasn’t sustained itself, yet. It needs to be sustained though mass rallies every week and civil disobedience in the streets. And I believe a revolution under Trump can happen if he topples Assad and invades Iran

Michael continues to break into this heated debate to make a funny comment. Now we get back to Seth Rich. So Sam again thinks that it’s crazy to think that politicians won’t murder people to cover up corruption. I agree Tim Black that we need to ask questions. Again I’m an agnostic on Seth Rich, I don’t know who killed Seth Rich.

One of the most damming quotes from the Sam Seder vs Tim Black debate comes right around here. “She (Nancy Pelosi) is a great leader. I would not support a challenge to her” – Sam Seder. Ok so let’s give Sam the benefit of the doubt and say Pelosi wasn’t guilty for the thousands of losses of Democrats in elections over the past decade or so. So why is it Sam doesn’t bring up the fact Pelosi didn’t do shit to bring about real progressive change during her time as speaker from 2007 to 2011? She opposes single payer, she didn’t prosecute GWB, and she didn’t bring up the Employee Free Choice Act.

And finally Sam says Steny Hoyer would be worse than Pelosi. So Sam why not get rid of Hoyer? And if he’s replaced with another corporate Dem get rid of them until we get someone who will at least listen to progressives. That’s what the Republicans did with Eric Cantor and their party is stronger than ever. Tim brings up the fact Sam voted for Hillary Clinton in New York, a blue non-swing state, but he doesn’t blame Hillary for not appointing Bernie Sanders as her VP pick, which everyone agrees would have won her the election. You know why she didn’t do it? Because of spite and corporate greed. She would rather lose to a Republican than give an inch to progressives, and that’s why we have Trump.

National Public Radio, Not Another Penny

This is a call for anyone still giving money to NPR, please stop. If you want to send money to support real journalism, try the Nation, MoJo, Harpers or one of the few remaining progressive radio shows like Jimmy's favorite Seder or Hartmann. Even if you listen to the 18 hours per day of classical music programming on NPR, the following story should be more than enough to provoke you to send those checks elsewhere get an IPOD.

Thursday morning before the House vote on extending the Bush tax cuts, NPR ran non-stop Republican propaganda. Marketplace ran this interview with Republican Representative Dave Camp without any opposing viewpoints, of course, but with lots of cheerleading. The points made in this interview are so unbelievably preposterous, I almost puked up my sausage-egg-and-cheese-on a sesame bagel while driving down Route 1. The points are summarized below:

1. The economy is in terrible shape and we need to change direction. Therefore it is an imperative that we do not change the tax policy that we have been using for the last 8 years. Because it has worked so well. Good point Dave.

2. The pre-Bush era tax rate above an income level of $250,000 is devastating for small businesses, because “half” of such income comes from small businesses. Of course, as you know from previous posts and this direct reporting done back in July no more than 3% of small businesses are impacted by the rate above $250,000.

This numbers game reminded me of a classic line in the Naked Gun about Nordberg's chances of surviving after getting shot like 40 times. Its about 1/3 of the way into this clip, which I just had to post in honor of the passing of Leslie Nielsen this week.

So “small business” is half of the reported income above $250k, but that's only pertains to 3% of small businesses. Just like Nordberg has a 50/50 chance of surviving, but there's only a 10% chance of that. Makes you think of the old saying: lies, damned lies, and statistics.

Of course, I do not expect anyone on NPR to ask questions about the source of stats quoted or how they were arrived at. (They used to, like 10 years ago, which is the last time I sent them a check, though I still get a letter from them monthly asking for cash.) But what happened next was what really stunned me. The very next segment at the top of the hour led off with a reference to 'Mitch McConnell's confidence that the senate will extend tax cuts for all Americans'. There was no rational discussion of the facts, just that statement, straight from the Republican's message machine. I felt like I was listening to Fox Radio.

Poor little rich boys

We can't let the people who've been hit the hardest by this recession, and who need to create the jobs that will get us out of it, foot the bill for the Democrats' two-year adventure in expanded government.” – Senate Minority Leader, Mitch McConnell (R-KY)

Can't go to bed without pointing out the jackassedness of this comment by the ranking GOP Senator.  He is of course referring to the expiration of the Bush tax cuts for fools earning over $250,000 a year.  Just let that sink in… “the people who've been hit the hardest by this recession“…

That's right, asshole.  Them rich folk done been hit so hard they can barely afford to pay the MARGINAL TAX ON ALL DOLLARS EARNED OVER $250,000.  Meanwhile, in the real world

Forty-four million people in the United States, or one in seven residents, lived in poverty in 2009, an increase of 4 million from the year before, the Census Bureau reported on Thursday.

The poverty rate climbed to 14.3 percent — the highest since 1994 — from 13.2 percent in 2008.

Over the past two years these scumbag Senators have managed to thoroughly crush any delusions I once had about the possibility of national crisis giving birth to transformative change in this country. And I mean the good kind of change, not the teabag variety that is currently suffocating the last vestiges of moderation in the Republican party.  [Note to you Mainers – Olympia is next].

What I'm trying to say is, the expiration of the Bush tax cuts are the only thing I care about politically these days.  There's really nothing else on the horizon that's going to elicit more than indifference or disgust out of me.  The class divide gets greater every day and it's completely unsustainable for a healthy society.  I'll have to dazzle you with charts and graphs some other time, but for now I'll just say, NO MORE TAX CUTS FOR YOU RICH MOTHERFUCKERS.

Who am I kidding, here's a chart

What this says to me is, if the Democrats really feel the need to be total pussies about this, then they better at least give me a new marginal tax bracket at $500,000, which is where the real highway robbery begins to kick in.  Otherwise I don't want to hear any more bullshit about “deficit reduction”.

More Class Warfare Please

Oregon voters pass tax increasing measures by big margin

Oregon voters bucked decades of anti-tax and anti-Salem sentiment Tuesday, raising taxes on corporations and the wealthy to prevent further erosion of public schools and other state services.

The tax measures passed easily, with late returns showing a 54 percent to 46 percent ratio. Measure 66 raises taxes on households with taxable income above $250,000, and Measure 67 sets higher minimum taxes on corporations and increases the tax rate on upper-level profits.

This kind of thing needs more attention.  It’s true, after all, that some people are a drain on society.  And those people are called “fat cats”, draining the average citizen of their hard-earned dollars.  We’re long past due as a society to level the playing field.  It’s shocking how much more responsible Oregon is compared to their dysfunctional neighbors, California, where they require 2/3 majority in the state legislature to approve tax increases (making the senate filibuster rules seem sane by comparison).  Guess who bears the brunt there?

Then of course there is South Carolina, where the Lt. Governor recently said this:

My grandmother was not a highly educated woman, but she told me as a small child to quit feeding stray animals. You know why? Because they breed. You’re facilitating the problem if you give an animal or a person ample food supply. They will reproduce, especially ones that don’t think too much further than that. And so what you’ve got to do is you’ve got to curtail that type of behavior. They don’t know any better

You stay classy, South Carolina!

Franken v. Thune

Here is some quality Senatorialization on the part of Al Franken today….  As you watch this, keep in mind that Sen. Thune is being groomed as the Republican Obama of 2012 – the young, handsome senator with no record and no baggage, on whose persona the teabaggers of America can project all their hopes and dreams…

Republican congressmen are worthless.  Smack ’em down!

(H/T TPM)

Rich Man Step On My Poor Head

Professor Krugles brings us this nice graph chronicling the rise of our corporate masters:

What you’re seeing is the percentage of total income as earned captured by the richest 0.01% of the population.  The ridiculous jumps in income inquality of recent years have clear parallels with the run up to the Great Depression.  Interestingly, the data only runs through 2007, so does not yet reflect last year’s market crash.

Unlike the correction that happened in the 30’s, I have absolutely zero expectation that the astronomical earnings percentages of recent years will collapse back down to reasonable levels.  So far the government has shown no willingness to rein in the bankers, having spent trillions of dollars propping up their criminal enterprise, while the bankers rub our collective noses in it for the trouble. Meanwhile, the bankers are able to pocket all that loot, because the top marginal tax bracket is pathetically low by historical standards.  (Not just the tax rate itself, but, more importantly, the income threshold).  Check this graph out:

Note that all dollar amounts have been adjusted for inflation.  And yes, the spread from the highs of the 1940’s (upwards of $70 million!) to today’s threshold ($372,951+) is so outlandish that the y-axis has to be represented in logarithmic form in order that the graph be legible.  The top marginal tax rates in those days were nothing to sneeze at either:

Make no mistake, these were taxes on the super-wealthy.  We haven’t had a proper tax on millionaires since roughly 1970, at which point those marginal millions were being taxed at a 70% rate. (Bear in mind, the marginal rate means that only those dollars over and above the threshold are being taxed at the highest rate.  That first $50 grand, etc, is being taxed at the same rate as everyone else.  Not everyone understands this.)

Getting back to the present reality, the failure to obtain proper warrants for all the bailout money, or even to enact the most minimal of financial reforms (much less tax reform), is truly enfuriating. The one big reform so far has actually been a step backward: relaxing shitcanning mark-to-market accounting rules that previously forced an honest valuation of company assets.  Suddenly – magically! – toxic assets are not so toxic, the stock market is up, and the crisis is over!  (Oh, wait…)

I obviously know nothing about high finance.  But all the financial regulation in the world means precisely squat if no one enforces it.

Most former and current SEC officials spoke on condition of anonymity because they were discussing confidential legal matters or were not authorized by the agency to comment. But in a report last month, the Government Accountability Office, after interviewing many enforcement lawyers, concluded that the SEC penalty policies in 2006 and 2007 “led to less vigorous pursuit of corporate penalties, may have made penalties less punitive in nature and could have compromised the quality of settlements.”

During Cox’s tenure, penalties imposed on companies fell 84 percent, from $1.59 billion in 2005 to $256 million in 2008.

For a long time now, rich folks have been wringing money out of this country like sweat from ONE’s teeshirt after hoops in the summer.  (Or hoops in the winter…  Or a brisk walk…  Or a short nap…) And just like ONE’s sweat, by the time everything is over, it’s all on our backs.  (Ugh, this metaphor is making me ill, wrap it up…)

I have no faith that government regulators can ever truly curtail Wall Street shenanigans, which is why the only practical solution is to re-institute some new top marginal tax brackets.  Currently the cutoff for the top bracket is $372,951, with a rate of 35% (set to revert to 39.6% when the Bush tax cuts expire at the end of this year).  I hereby propose an additional tax of 50% on all dollars earned annually over and above… (cue Dr. Evil)… one million dollars.  By historic standards, that’s downright modest.