Archive for the ‘Taxes’ Category

An Old Dog Learning New Tricks

December 18, 2013 Leave a comment

This week, Bloomberg Politics reported that investor and businessman, Sheldon Adelson, was taking advantage of a loophole in the current tax law to pass assets on to his heirs. Passing new tax laws in 1990–both the House and Senate were Democratic controlled at that time–is what created the loophole initially. It takes advantage of a special trust called a “GRAT” (grantor retained annuity trust), which allows placing assets into an irrevocable trust, where the person creating the trust pays a tax. The trust pays an annuity every year,  and upon expiration, the beneficiaries receive the remaining assets in the trust, tax-free.

Adelson and other businessmen have successfully used this mechanism to pass their assets to others and to avoid paying penalizing government fees and estate taxes to the tune of $100 billion over the past 13 years. Adelson himself has been able to pass $7.9 billion of his money to his heirs. Mark Zuckerberg (of Facebook fortune) and Lloyd Blankfein (of Goldman Sachs Group) have also taken advantage of the loophole.

Proponents of big government seem suddenly to realize the additional billions that they could spend if the loophole were closed, and they bemoan the fact that it’s still available. Adding to that, the fact that there is simply such large amounts of money mentioned, and other’s greed and envy kick in as well. Ironically, the concerns that people utter, reflect the same thinking as Adelson et al., namely that, “I don’t have enough” and “I need a way  to save what I have now for myself and my children”.

Quickly after that, any parallel thinking ends, and arbitrariness kicks in. All too suddenly, a self-concerned commenter engages in the conditioned response of this administration– “Surely those terribly rich men have enough money already? Why shouldn’t I be able to help spend some of that? Those businessmen must have made that money illegally or exploitatively…”

So, let us review: Congress screws up when they rewrite the tax code, Congress continues to refuse to fix the loophole, people are able to save their own money, and give it to their children. And the unavailable money that the government cannot collect is largely the businessmans fault? I am not sure what mental gymnastic enables one to bend logic that far, but it is quite a stretch.

I expect it will be some time before Congress does anything to close this loophole, since the right’s opposition to taxes is well-known, and the left has far too many big donors taking advantage of the loophole to close it. One thing is certain–whenever a government attempts to increasingly micromanage and legislate things, they will always underestimate the ability and ingenuity of the people to find ways to wriggle out of the most awful laws. The people may be dumb enough to vote for the Congressman, but they are smart enough not to follow his laws.

Monopoly Man

Huzzah! Loopholes!


Danger – Cliff Ahead!

December 19, 2012 Leave a comment

Reid/Pelosi, Boehner/McConnell

Another day, another fiscal-cliff deal gone down the drain. John Boehner, already taking heat from the right for his softening stance on raising taxes, has come out with another offer to the president and the left. Called “Plan B”, the plan formerly had the support of Nancy Pelosi. Plan B would set the lower limit for raising taxes at the $1 million level. Plan B is very similar to the same bill that had Senate Democrats’ support in 2010.

For her part, in an interview with Andrea Mitchell, Pelosi now says she only supported the plan to “smoke out the Republicans”, and see at what level they would consider raising taxes. Pelosi was negotiating purely in bad faith, it seems. She did not have anything serious to bring to the discussion, and she was merely wasting time. That, or she is negotiating from the standpoint of “getting an inch, and taking a foot”. Whatever her motive was, it is plain to see how destructive and pointless it was.

Mitch McConnell says he would support the Plan B design, but he would do so with reservations. McConnell would rather have a bill that did not raise taxes on anybody. With Boehner’s support of this newest plan, numerous other House members raised objections to the new tax considerations, but they seem to recognize that without any plan, taxes would greatly rise. The gambit now is to “shield” as many people from the massive tax increases as possible. Sean Duffy, Jim Jordan, and Raul Labrador all seemed lukewarm at best to the prospect of voting for any tax increases, with Labrador refusing to even share his criticisms.

Called out for his part (or non-part) in the fiscal-cliff talks was Harry Reid. One Republican adviser said Reid has been on the sidelines for the cliff negotiations. Reid has also claimed that, despite numerous revisions to their positions, and despite the most recent offer, Republicans “…have threatened to abandon serious negotiations”. Perhaps more proof that he is merely running interference for the White House, Reid also claimed that President Obama has not heard from Boehner since Boehner’s new offer on Monday.

President Obama has balked at every offer the Republicans have proposed so far. Threatening a veto of everything has him in the position of a win-win situation. On one hand, if nothing happens, and taxes explode, he can continue to spend, thanks to the new revenues. On the other hand, if the Republicans cave in, he can both claim he negotiated the excellent deal, and privately, he can tell his sycophants he made Boehner and the Republicans submit. White House officials are also now claiming that the President will refuse to negotiate with Republicans out of principle. That of course, will allow President Obama (and Reid) to claim they attempted to negotiate, but were simply prevented from passing any legislation by the blocking Republicans (yet again).

To the left, the worst thing to come of failed fiscal-cliff talks is that President Obama has to postpone leaving for his Christmas vacation. They face: finally getting huge tax increases, yet again, furthering the narrative of a blocking, do-nothing, Republican party, and they get huge military cuts. Merry Christmas, America.

Thank You, America

November 7, 2012 Leave a comment

(This post is written primarily with the goodie-receiving, hook-line-and-sinker, Obama voter. With that being said, I hope the people who didn’t vote for him think differently after reading too.)

Uncle Sam

Uncle Sam has work to do…

Thank you, America. You have made it abundantly clear to this blogger, that the America we read about in books, the “Shining City on a Hill”, is no more. What happened? Well, with last night’s doubling down on the most unprepared, ill-mannered, and financially irresponsible president ever, we as a country, continue to move into uncharted territory. You have sought to receive something for nothing, America, and many of us realize that those positions and beliefs are completely untenable. Everything we receive from government is paid for – usually at an astronomical mark-up. And you would like more.

You simply cannot continuously bleed a source, and government’s been a very sick patient for a while now. You might remember not too long ago, the government needed another debt-ceiling raise. The debt ceiling was raised again, as the Republicans in Congress signed off, rather than risk a government shut down. (The media told us it is for the best) We cannot have the government shut down – soldiers and old people would be placed in bad situations. Is this why you actually believe the right is irresponsible? Is that why you think they politic too much – that they sought to slow or stop the unsustainable growth of government, rather than just keep spending like the left?

In your drive to keep up with the Joneses’ (who live next door, and receive the same goodies and Obama-phones as you do), did you really think that the president gave a damn about you? Didn’t it seem awfully convenient of him to turn the charm on again – after four years of non-stop whining and golf? I know, I know, “he seems like the kind of guy you might have a beer with,” right? I wonder if he also struck you as a guy who would pick your pocket and steal gas from your car?

You have your phones, you have your EBT cards, and now, with the election wins last night, you seem to have it all. I wish you the best of luck with it all. The government is perilously close to a financial cliff, and when the benefits (shiny trinkets) you prize so much stop arriving in the mail – who will you blame? The government of Barack Obama, who promised you the moon? Or, because you are his supporter, and that it could not possibly be him (and you) that made such poor decisions – will you move onto another boogeyman?

The refrain from voters, such as yourselves, is that we will just soak the rich – just tax the hell out of them, and they will happily sit there and take it, right? It’s not like they have the money to pick up and move, right? Your problems are many and your solutions are absent. The solutions that you think you have come up with, will not have much effect at all of keeping your goodie-train rolling. Last evening, you sought fit to abandon the best chance we had at seriously reforming the spending mentality of this government, only to continue with more of the back-breaking regulations and taxing-and-spending of the Obama administration. Basing your vote on your stomach (EBTs), your ears (Obama-phones), or lady-parts (the bogus contraceptives debate), in casting the votes you did last night, you probably did more to end those programs than Mitt Romney ever could have, and you have probably greatly sped it up too. Basing the Obama “goodies-math” on false numbers and projections that are not even close to where actual numbers are right now, will have results that become apparent soon enough.

I cannot say I am really that shocked, that such shallow and self-centered folks would vote this way – after all, who cares about the neighbors, so long as your checks keep coming, right? The easy amused sort do not shock me either – their lack of foresight is no as well. So, go back to your couches (or graves) whichever the case may be, and live in the moment, from goodie to goodie. You have cast the die…

Tuesday’s Gone (or Why the Left Will Lose)

November 4, 2012 2 comments

Tuesday the nation goes to their polling places, and makes the most important decision they have ever made. If that sounds hyperbolic, it should not. The current president has shown himself more than willing to accrue bills and pass them on to future generations than any other president. This president has shown more wanton disregard for American life and liberty than any other as well. Obama, more than any other president, has sought to insert differences were there are none, incite hatred where there was none, and prevent the normal activities of Americans from occurring.

Stephanie Cutter

Obama campaign manager, Stephanie Cutter

The left wasted any chances that they had winning a presidential re-election a few years ago. The people represented by Democrats, took a backseat to the left’s dream of massive healthcare overhaul, and the passing of Obamacare, with numerous legislative tricks, near-bribes, and threats. After the Democrat-controlled Congress forced Obamacare through, they held “town hall” meetings that scared them, as many of the taxpayers slowly began to learn of the implications of Obamacare: new, massive government oversight, huge new tax bills, mandatory compliance, just to name a few.

As if ignoring some of their most loyal voters was not enough, Democrats seemed to find all new special interests to kowtow to, with the Obama inauguration. The country saw massive amounts of money given to unstable businesses under the guise of support of “green energy”. Later the country learned of the owners’ and CEOs’ ties to the Obama administration. Big campaign bundlers saw money thrown at their businesses, even after it was known that the business models were completely unfeasible.

Seeing the old supporters’ devotion die away, Obama seems to have decided to build new coalitions – all with their own price tags, of course, but none  paid by Obama, himself. Why would he spend his own capital when he has a massive taxpayer base to draw from? The green lobby, the illegal immigrant communities, and the newly built (and reliant) throngs of welfare and food stamp recipients. Threaten them with the loss of their goodies, and you have a reliant, reliable, voting base. If you can create more of them, than supporters that you have lost as a result of the welfare costs, it works out – it is a wonderful, government, pyramid scheme.

The left’s standard-bearers are often surly, abrasive, and falsely aggrieved. Harry Reid is happy to share rumors from nameless sources to smear Mitt Romney. Nancy Pelosi sponsors and supports legislation with unknown contents. Asked tough questions, both Stephanie Cutter and Debbie Wasserman-Shultz keep straight faces while spewing lies and feigning ignorance. Jay Carney parrots the same talking points he is given, usually not even attempting to answer the questions asked of him.

The president formerly campaigned on the transparency he would usher in – the most transparent administration ever, he promised. Asked questions about the most recent scandals, Obama tells us frequently, “It’s being investigated, and I cannot speak on it…” Then he sends proxies, like Jay Carney, out to the podium to say nothing to the press pool. The president has repeatedly balked at providing details on scandals, like Fast & Furious and the Benghazi slaughter. Instead of telling the American people any details, everything is an ongoing investigation, or that the records are “sensitive.”

If the country had a true, fourth estate, instead of a complicit puppet of the administration, we might expect some forced answers. Instead, many reporters seem perfectly happy to tow a party line for Obama, asking the lightest and most worthless of questions. The reporters want to retain their access to the White House, so it is best not to ask any tough questions that may endanger that (worthless) access.

Finally, the left plays a dangerous game with Americans when it comes to disaster relief. Obama visited Joplin, Missouri, but it was after a trip to Europe, six days later. When the BP oil disaster occurred, it showed the administration’s true colors. We saw the Obama response, finally, after 14 days of nothing. Just in the last week, we have seen the president’s response to hurricane Sandy. FEMA runs out of water, citizens are using hallways and stairwells as latrines, others in New York are rummaging through garbage for food, and Obama campaigns. For a president that espouses and so willfully uses the power of the federal government, to NOT do so in this situation is inexcusable.

David Axelrod

Senior Adviser to the President, David Axelrod

If it is still unclear, my point is this: the American left is morally, and monetarily bankrupt. In their hurry to jump over each another to make their sound-bytes, and to score points against their “enemies” on the right, the left either sold or lost their souls. To gain the support of their new, special-interest friends, they abandoned their old supporters, the people who made up their fathers’ Democratic Party. The new, more progressive left, clashes with a pragmatic America, that would rather have jobs and income than welfare and hand-outs. The new left abandoned their old ideals, and seemed to become a fully Keynesian, tax-and-spend monster, whose appetite for “goodies” could never be sated. The left is now more excuse, than execution.

After Tuesday’s landslide, the left will face two choices: continue with their big government planning and spending (which they have attempted and seen wholly rejected by Americans, since 2010), or reject the past few years, and once again embrace some sort of pragmatic and realistic reforms that help the country as a whole, not just their friends and sycophants. Given THIS sort of rhetoric, I fear the left still has not learned its lesson.

Leadership for Dummies

May 27, 2012 1 comment

I was recently reading a book by British author, economist, and historian, Niall Ferguson, called “Colossus“, where he compared the British Empire to the American pseudo-empire. Ferguson made it very clear that the American version was far differing in its outcomes than the British, which had numerous factors working in its favor. One of the most glaring differences was that British citizens were far more willing to move to colonies and conquered areas, both to build and develop a British-style administration and to improve infrastructure over decades, where American citizens would rather simply stay put.

David Landes

David Landes

There were a number of factors Ferguson cited, in a list by historian David Landes, that are tactics that second- and third-world countries’ economies and legal systems should use to improve and grow. Upon reading this list, I grew dumbfounded as many of the things enumerated within that list, are the polar opposite of the policies of President Obama and his administration, in the last three years in the United States. Instead of moving “Forward” (if you will forgive the use of the already hackneyed campaign slogan of Obama’s), the president acts in ways that are completely contrary to common sense and pro-American beliefs. I post the list below (also posted in one of Ferguson’s previous works, “Empire“) along with my thoughts as I read the tactics:

1. secure rights of private property, the better to encourage saving and 

This item put me in mind of the egregious Gibson guitar raids in the summer of 2011. Secure rights of private property? Hardly – the U.S. government twice raided the Gibson factory, citing a law from  1900 (more commonly known as the Lacey Act, found here with amended text), that was originally written to protect the trade of feathers for hats. Amended and broadened in 2008, the law now includes plants. Despite legal sales, approved by Indian and Malagasy authorities, the U.S. Feds raided and seized Gibson wood stocks anyway.

2. secure rights of personal liberty...against both the abuses of tyranny
and...crime and corruption

Can we honestly say the administration has done this? My mind goes to the loss of Brian Terry’s life, as a result of the “Fast & Furious” scandal, a flawed, illegal, haphazardly executed gun selling operation. Refusing to apologize to Terry’s family, A.G. Holder still balks at producing the papers Congress is requesting from his D.O.J. Another example that is also connected to this program, is the ongoing scuttlebutt that the program’s design was to negatively effect the power of the 2nd Amendment.

3. enforce rights of contract;

I do not feel like there is much more to say than bringing up the government take over of the student loan program, and its take over of healthcare in the country. The government came in, and while promising one thing, delivered everything but.

4. provide stable government...governed by publicly known rules;

Have we seen a good example of this from Democrats? Between their “deemed to have passed” legislation, and a completely “tabled” Senate (also led by Harry Reid and Democrats) – can we honestly call this a “stable government”? With state Congresses fleeing the states to prevent votes on hotly contested legislation, who needs rules and stability? There are plenty of easily understood rules, but if the people in charge choose to ignore them, what do we have?

5. provide responsible government;

Responsible government? Again, I’d like to bring up “Fast & Furious”. Eric Holder continues to serve as Attorney General, and the threat of contempt of Congress does not seem to phase him. Another thought is the numerous, unanswerable czars of the president’s and the regulatory agencies (think: E.P.A.) that are using their power (with little, if any) oversight and accountability.

6. provide honest government...[with] no rents to favour and position;

How could I not think of the Solyndra mess? Loaning millions of dollars to the business, only to saw it wasted, as the company blew through it, at its (well-known and purposely overlooked) high burn-rate, and where it was later revealed that a big investor was George Kaiser, one of President Obama’s campaign bundlers. As far as no favor to position – how about the benefit of being a Congressional member? Access to a legal way to get in on nearly impossible-to-join IPOs and investments, that normal Americans were held out of?

7. provide moderate, efficient, ungreedy hold taxes down
[and] reduce the government's claim on the social surplus

While the cry of the left is “Well, Bush did it too!”, when they defend Obama’s questionable actions, whatever Bush may have done does not hold a candle to the extent of Obama’s odious actions. Obama has expanded the deficit more than any other president in history. How would he and his party seek to pay for their bills? Taxes, of course. Create some new ones, and expand the old ones – simply tax, tax, tax, then they can spend, spend, spend. The administration raided Medicare Advantage funds to help pay for Obamacare (to the tune of $204 billion).

So, if the list contains directions for a well-maintained and least troublesome government, why would the president do anything otherwise? If I were a cynic, I might offer Rahm Emmanuel’s quip, “Never let a crisis go to waste.” Create a crisis, and then ride in to save the day. The only problem is that there are far too many crises, and too many unaccountable people, following their own rules, in Washington.

No Plans, No Problem!

April 5, 2012 1 comment

So, our dear leader warns us that once again, those crazy Republicans want to drive this country into the ground – by stealing money from everyone of us, who are struggling to break even, and then generously give it to people that hardly need it (their filthy rich buddies – the 1%). He neglects to mention that the fact so many of us are struggling to break even may have something to do with his still-failing economic policies – but that is ok, since, as he has promised us for three years now, happy days are just ahead (thanks to him). The GOP just wants to cut and cut, like a mad lumberjack in a forest, not caring what they strike, so long as the ax connects, the president would have us believe. Obama even went so far as to claim Republicans’ mentality as being “…driven by our ideological vision about how government should be” and he went even further, claiming the Republicans were sticking with the same types of economic decisions that drove the country into the Great Depression.

The Senate, having not given the country a budget in the past three years, has not deterred Republicans from trying their hands at writing one in the House, but Paul Ryan’s most recent effort was met with the usual scatterbrained excuses and rhetoric. Obama tells us children will starve and Medicare patients will be without their medicines (never mind his own cutting of $528 billion from the Medicare roles, via Obamacare), and finally, that he is not the extreme progressive that he is painted. Indeed, he even went so far as to invoke the names of two outstanding Republicans to compare himself to – Abraham Lincoln (yes, again) and Ronald Reagan. By talking of the Reagan-era, Obama attempted to point out how far right the GOP has moved, and claims Reagan could not win a primary now. For their parts, Republican leaders took the most natural response: they snickered and asked what Obama’s policies would do to help the country. After stumbling, and realizing how much his words were parsed these days, he sauntered off.

I find it odd, that the man who thought it would be brilliant to sign into law, legislation that no one had read, and who continues to defend his administration’s $535 million boondoggle loan to a solar company that “needed” talking robots, would be criticizing anybody’s plans. The president who has created more debt and higher deficits than any other president in history – wants to criticize others’ efforts to try to fix the mess? On the administration’s face, it has been do-little as a matter of course. When it has actually done anything, it seems to be with negative outcomes, or so completely, horribly wrong, one has to wonder if anyone is awake at the wheel. In Iran, with the promising “Green Revolution”, he did nothing as people were beaten in the streets – now he wants to punish some of the same people with crippling sanctions. The president wanted to help Libyan rebels – but violated the War Powers Act to do so. He wanted to help and support the Egyptian uprising – but he stalled for so long, now it appears the Muslim Brotherhood is licking its lips at a presidential election run. In Syria now, where civilians are being fired on, and bombed by the military? The president decides it is better to let the region solve that problem on its own. Our ally in the region, Israel recently had intelligence on their own allies leaked as well. Former Ambassador John Bolton points his finger at the administration…

Obama’s record is so anemic and is full of massive failures. He cannot kowtow to his base of environmentalists, without having the rest of America howling about oil prices. He cannot stretch the military much further than he already has. And he cannot do anything but tear down others, to even make it seem as though he has accomplished anything (I call that “maximizing by minimizing”). At this point, I would rather have a coin in the Oval Office – after all, you can count on it to make a right decision 1/2 of the time.


" can only hide it for so long..."

Political Machination and the Middle Class

December 29, 2011 2 comments

When I mention the “Middle Class”, I would suspect most Americans immediately think, “Hey, that’s me!”, and they pay attention. However, it is an over-used, hackneyed phrase in politics. Whenever a politician wants instantly to grab attention of the American populace, they bring up the “Middle Class”. Since it is usually used by politicians in a “threatened-species” manner, the Middle Class members sit up straight, and listen intently. The Upper Class pays attention, because they are out numbered by the Middle Class (and despite what some people claim, more votes certainly do still count). The Lower Class pays attention because they see the Middle Class as the destination that they are struggling to earn their way into. Politicians, belonging to a class all their own, notice these behavioral tendencies of the three main groups, and smell opportunity.

Something for everyone?

The government is NOT Robin Hood!

For the politicians to use the knee-jerk reaction of the Lower Class, I find their methods very insidious. Usually, what the politicians will do is tell the L.C. that their “gravy train”, their government-granted entitlements, or any other government-dolled goodies are in dire jeopardy because of the actions of the filthy rich. While this will not cause as large a reaction, because the L.C. is less mobile and likely to show up at their Congressman’s office. Anytime someone is given something, and then they are told it is threatened – watch the anger at losing that entitlement explode.

For the politicians to use the reaction of the Upper Class, they can threaten that the M.C. will push for higher wages or take a larger part of the Uppers Class’s wealth in any other number of ways. The U.C., then finding themselves threatened may decide to react by using their money and friendships in Washington to affect change in their favors. Most recently, I think that the more common method of trying to keep goodwill is for the constituents to offer to pay higher taxes (knowing that it will never come to that).  I find it interesting to think that a class so often seen as miserly and “above-it-all”, still seems to be so easily swayed by this type of rhetoric.

The dirty trick is, according to where the politicians put their measuring sticks, the Middle Class could be made to be any group. From an income of $30,000 up to $120,000? You are Middle Class. From $28,000 to $150,000? Boom – you are Middle Class. It is all about political expediency. The politicians constantly play fast and loose with rules, regulations, and our money, so why should their rhetoric be any different? If there is a political point to be made, or some “points” to be earned for their next election, they will paint you in any shade that they need to, to make their point (or to engage fully in their fear-mongering). The Middle Class has to be the most bandied-about segment of America.

These methods of politicians to get various classes to argue and fight with one another, while the politicians get away with murder, creates this huge positive feedback loop. Costs increase with every promise and entitlement given. While it seems to have been this way as long as this blogger can remember, I do not expect it to change (especially since blowing that class-dog-whistle works so well). The government has given goodies to pry support from certain groups, and now it is nearly impossible to reduce it. They need constantly to keep money flowing, while others, seeing these sweet deals, want their “fair share” too. Ever-increasing funds are needed as more and more people join the rolls. Where is it supposed to all come from? Sometimes, I wonder how much a little critical thought is worth – well politicians are attempting to figure that out for us all.

(This post took me forever, due primarily to the fact I started Tweeting, and that’s like Internet crack. I told those responsible that they’d be noted as my distractions): @tamale102280, @iteabellsingers, and @apologyispolicy
They’re good people – follow ’em if you don’t already!