Thanks to our new president, I have seen the error of capitalism. I will make do with what I have, and nothing more, and for this I will be richer in many, many ways. And those ways are already paying dividends to my bottom line.
Like most Americans watching the so-called Stimulus Bill weave its way through the pork-laden halls of Congress, I was horrified at the thought of what the Democrats in Congress and the White House were doing to the economy. In the name of "saving jobs" they were killing the very mechanism that created this country's prosperity. Nothing in their package is designed to help the capitalist system recover, and prosper. Instead, it's a thinly-disguised effort to solidify government's control over the very people on whose behalf it is supposed to work, but who will now become a wholly owned subsidiary of organized labor, left-wing interests, and the Democrat Party.
Everything I was taught about free-enterprise, and the risks and rewards of individual initiative, vanished in the single stroke of a pen when President Obama signed the "bi-partisan" (hey, three Liberal Republicans voted for it!) stimulus package. You know, the one that is supposed to stimulate the non-stimulated economy that wasn't actually stimulated by the most recent "Rescue/Bail-Out" package, that didn't actually rescue anything . . . thus prompting the need for a Stimulus Package.
But — and here's where the lights have suddenly come on to re-shape the thinking of my narrow capitalist mind — as I've stood back to survey the wreckage of this socialist takeover of the U.S. economy, I've come to realize that maybe things aren't so bad after all.
No, it isn't that I've come to realize that the Stimulus Package will indeed work as advertised. Even in the dark I can still use my nose to smell a bag of sh*t, so nothing has fundamentally changed in my evaluation. Rather, what has changed is the way I now view myself in relation to the government, the economy, and the public at large. It's this change in perception, brought about by one-too-many "Obama's gonna pay my mortgage" or "Obama's gonna fix my car" bursts of insight from my fellow citizens, that has made me re-think the flaws in my own archaic thinking.
Where before I thought about myself as part of something larger (the country, a fellow American, or just a person who actually practices the acts of private charity that he preaches), I've now come to recognize that none of this really matters any more. If all I am is a walking ATM machine for the government because I happened to spend a lot of time educating myself in an effort to be successful, and spent a lot of my own money taking risks to increase my income (at times successfully, at other times not), then I've come to recognize that I am the problem, not the solution.
If my being well off is a sign of disregard for those who didn't work as hard as I did, or sacrifice as much as I have, then by God I'm quite willing to see the error of my ways. I will no longer participate in a never ending drive to increase my wealth and possessions, but instead will learn to live entirely within my present means. I will, in short, make do with what I have, and nothing more, and for this I will be richer in many, many ways.
And I can think of several right off the bat.
First, by understanding that the government is there to take care of people I was foolishly supporting in the past through my own income, I will be able to save several hundred dollars a month. I have a fairly large commitment to certain charitable organizations like Christian Children's Fund, where I am among their top donors nationally. Those commitments will continue unchanged. But — and here's where the savings come in — there's no need for me to entertain any more "special requests."
By this I mean, instead of writing a one-time check to the Red Cross for flood relief, or dropping some extra change in the round-it-up basket at my supermarket checkout to aid a local food bank, or responding to an appeal to help some family I don't know whose possessions were lost in a fire, I now understand that Obama and the government are there to do it for me. So, while my core charitable commitments will remain because, well, because I want to keep doing this even though it makes no financial sense for me to do so, I will henceforth operate under the "Biden Rule", and give no more money to charity than the Vice President did last year as a percentage of his income. Instead, my "charitable contributions" will take the form of public service work, just like Joe. Where he tirelessly ran for office, I will tirelessly write about people who ran for office. Besides, who needs Phil Jackson when we have FEMA, or HHS, or state or local government which knows how to do these things best anyway?
As you can see, with this new perspective I've already chalked up a hundred dollar a month savings at a minimum, which goes directly to my bottom line. This is increased by another new rule I've imposed on my in-laws and other distant relations that have routinely tapped the BOPJ (Bank of Phil Jackson) to pay for a new water heater, missed a mortgage payment or five, car repairs, medical bills, or any one of an endless number of non-tax deductable requests I've acceded to in the past. Now, when a request for cash has been made (as has happened twice already in the last two weeks), I ask a simple question: "Whom did you vote for?" When the question comes back "Barack Obama" I point them to the nearest social welfare agency. When it comes back "some third party candidate," I point them to the nearest social welfare agency. And, when it comes back "I didn't vote," I point them to the nearest social welfare agency.
Notice the pattern? If these people to whom I am embarrassingly related think Obama or some Losertarian candidate is the best guy to solve this country's problems, then that's the guy they should be soliciting, not me. If they liked the guy who best represented my interests by picking a VP nominee who best represented my interests, but they couldn't quite bring themselves to actually vote for that ticket, then I will support their request in principle, but like them find myself unable to actually put my name on the requisite check or money order. Just averaging the last couple of years of similar requests, I'm looking at a $5-7,000 annual savings. Split the difference and call it $6,000, to which we'll add the $1,200 I mentioned before, and I'm already $7,200 in the black.
But it doesn't stop here. I drive a 6-year-old car. It works perfectly fine, but I was thinking about getting a new one this year. Instead, I just spent $1,800 fixing it up. Since a new car would have cost me about $600/month, that's a net savings of $5,400 a year. True, the local car dealership won't get my business, and that means one less car to keep the unions busy in Detroit, but this isn't my problem. It's Obama's. I just added $5,400 in savings to my previous total of $7,200, which brings me up to $12,600 annually.
But it still doesn't stop here. The kids are all grown up and the wife and I were thinking about downsizing our house. However, I've got a great interest rate on a 30-year mortgage, so maybe we'll just stay put a few more years. If I do, there's no need to fix up my existing house to make it more attractive, no commission I must pay to a real-estate agent on the sale of my existing house, no need to build a new home so no need to hire construction workers or secure building materials, no moving costs for my family, no need to do any of this stuff. Even conservatively speaking, I'm saving at least $15,000 here, which added to the $12,600 now brings me up to $27,600.
But wait, there's more! Because we're not downsizing our house, my wife can still work another couple of years instead of having to retire because we left the area. Her retirement income, at best, would be 60% of her schoolteacher salary. Let's just pick a round number for someone with 30+ years of experience teaching in the South, and say she'll save $30,000 in salary and medical insurance costs by remaining employed. Add that to the aforementioned $27,600 and we're at $57,600. Sure, this is offset by some new teacher who won't get a job to replace my wife, and a school system that will have to pay her twice as much as a new hire, but once again this is not my problem. It's Obama's.
But it gets even better. My business partners and I have invested in at least one new business activity every 18 months for the last 10 years. Some of these efforts have been very successful. Others have cost us a ton of money. In 2006 we invested well over 6 figures in a business that ultimately proved unsuccessful, and again put over $70,000 into a business in 2008 that went down the drain, so there are no guarantees of success. But today, the rules are changing, and rather than selfishly fight it, I will simply acknowledge this. While the government still won't replace my losses (that's my risk gone bad, not theirs), I now understand that anyone making over $250,000, or $200,000, or $180,000, or whatever number the Obama Administration finally settles on will be declared officially "rich." And rich people have an unfair share of the country's resources, so they need to be taxed aggressively.
If my partners and I do things to dramatically increase our current financial position — and by doing this spend our money on goods, services, and to employ other people to help us — even if we succeed, we fail. All we are doing is drawing a bigger target on our backs. So, rather than kick my portion into any such effort, I choose to decline (as have my partners). I'll keep the $10-20,000 or so that could have come out of my own pocket as the junior partner in this enterprise. Let's be conservative and say that only $10,000 would have been at risk, which brings my increased bottom line up to $67,600.
But it's not quite over yet. Finally, the one thing I can do today that I've never done before is actually incorporate as an LLC, instead of operating my business activities as a private consultant. Doing this, my accountant has informed me, could mean another $10,000 savings to my bottom line. I don't pretend to understand the arcane nuances of tax law, but I do know my accountant won't entertain a deduction on my personal forms unless I've got the cancelled check, receipt, or other back-up documentation to substantiate it. So, let's go with the suggestion and assume that forming an LLC in 2009 isn't a corrupt tax dodge but a legitimate tax strategy, and will have the corresponding salutary impact on my taxes that I noted before. This brings the total up to $77,600.
That's $77,600 directly to my bottom line, thanks to President Obama. By letting the government do things for strangers and my relatives that I foolishly assumed as my own obligation in the past, by not flaunting my money on a new car or new home or other consumer items that keep people employed, by not using my own money to grow the economy when the government will do it for me, I've just become Obama-rich! This is real money with real value, until the hyper-inflation comes from simply printing money because Obama's policies have killed the capitalist goose.
But hey, until that time comes, I'll do quite well just taking care of myself and my family. And when it does come, I'll be in a better position to weather that storm because, like most successful people who aren't born Kennedys and have their wealth handed to them, I had to use my wisdom and talents to get this far. I'll use that same wisdom and talent to assess the situation in later years, and take the necessary steps then to protect my income and other resources as I am doing today.
Obama and the Democrats can kill capitalism, and the economy with it. But even in a fiscal cesspool there will be some people closer to the top than others. I didn't get where I am in life by waiting for the government to give me something, and I won't maintain what I have by painting an economic target on my back. So I'll always be okay, relatively speaking, because I'm smart enough to increase my disposable income without increasing my actual income if that's what I need to do to succeed.
And that, my friends, is the calculation shared by small businesses and hard working people everywhere, who may not have the political power to stop this insanity in government, but have no intention of being the ones to pay for it.
Phil
"Christian Children's Fund"
Before you write your next check, please take a look at Dark Star Safari by Paul Theroux. CCF is one of the many logos he saw on the side of white Land Rovers during his trip from Egypt to Cape Town. These vehicles driven by pony-tailed kids from Minneapolis dressed in LL Bean cloths would never give him a ride and sometimes even rolled up the electric window and dove off while he was asking for one. Gee, I wonder if they voted for Coleman or Franken? And, besides, you can roll up some more savings.
Say Phil, would you happen to know who is John Galt? ;)
As a college student graduating this term with a BS in business management, this was a very uplifiting tale for me. Thanks for crapping on my career prospects parade!
Amen!
My wife and I have come to exactly the same conclusion. The house is paid for, the car & truck both paid for, we owe next to nothing on our plastic. In the past month we've deflected a plea from my Sister-in-Law to purchase her another car. That would've been the third in the last four years. Ya' know, she's so busy that she doesn't have time to do mundane stuff like GET THE DAMN OIL CHANGED! So eventually these used cars die. The value of one we bought her last year now fluctuates according to how much gas is in the tank.
We've also told our nephew in California that we will no longer be sending him $500 per month so he can pay the property tax on his home in Bakersfield CA. Both him and his mother voted for Obama, let Barack write the check.
My wife's car is 10 years old, but we've decided to keep it. There's no reason to take on a note when we as taxpayers already owe significant amounts because of Federal deficit spending.
We've also cut back significantly on charitable donations. In years past, at tax time, we would often find out that 18% to 20% of our annual income had gone to various charities. We're watching these much closer now and our intention is to ensure we don't exceed 10% of our income. I figure that since our tax bill after all deductions is @ 10.8% of adjusted gross income, that another 10% to the church is still 20% seen as how most of my taxes now go for transfer apyments to people who dont' pay taxews in the first place!
Bottom Line: My wife and I refuse to take part in this recession. We'll adjust our lifesatyle and be just fine. However; those who voted for Obama can wait for him to bail them out personally. My guess is that they will get nothing. After all; Obama will need them as a permanent 'victim group' in oder to sell his next round of socialism to the American People.
Ivan: I've been supporting CCF for 20 years. My money goes directly to families in need, not administrative costs. [I used to work in the non-profit world, and know how these calculations are made.] I've seen the results and am quite pleased, but you're right to be suspicious about a lot of these organizations.
Patrick: No-one, I mean absolutely no one I know who is of retirement age is bailing out this year. Everyone is terrified about Obamanomics. And it's only going to get worse. Wish I could be more positive. [PS: check my website. One of my books was co-authored with "John Galt"]!
milbrat: I got a call yesterday from a social services charity asking for money to "help people with their housing and other vital needs". I told her to go ask Obama because he's taking all my money. She actually laughed and said it's a common response she's getting.
When I repesented the American Heart Association, Cancer Society, Easter Seals and many other national non profits, I found their top management to be great people, wholly dedicated to the task. But their mid to lower management is pure flaming liberal socialist. I have mixed feelings about what this strategy will do to many worthwhile charities, but at the end of the day thanks in part to their votes, it's no longer my problem. It's Obama's.
"…their mid to lower management is pure flaming liberal socialist."
I received a call last week that I was going to be put in "jail" and that I would have to raise bail, with the proceeds going to the March of Dimes.
A little internet investigation revealed that this formerly noble charity has gone the way of leftism. When their ads say that they want every child born to be a healthy child, what they now mean is that they favor genetic testing of fetuses so that the undesirable ones can be aborted.
I think that the socialism can go right to the top of these so-called charities.
Phil
Funny, if it were not for the tragedy of how Obama and socialism responds to guys like you (and me). Once the government and economy are sewn together at the hip, people who feel the impact of all the Jacksons not spreading the "Jack,” will cry to their socialist masters to do something.
That something is taking the "Jack" from Jackson and using it to buy the next four years of socialism. It’s a Ponzi scheme, and thanks to history we all know where it leads. But who bothers to look any further ahead than next week?
We will be facing a decision soon about how to clean up the mess, and it will boil down to the selling jobs by the leftist and the right about economic systems I fear too many people do not or cannot understand. And the socialist will have the advantage, as the worse it gets, the more desperate people there will be. And it is easy to convince a desperate person that they are a deprived person. Then it becomes a matter of selling who it is that is depriving them.
The current sell is that it is capitalism, embodied in Wall Street bankers, oil company execs and Wal Mart – and you and me, Phil. And the left is sweetening that sell with a free chicken for the pot.
The bright spot is there are enough real Americans who know that freedom is “of,” “by” and “for” the people, and that it also goes for economic and market freedom. And the other good thing is that the left is getting so excited at the prospects the current situation affords, and how much their free chickens might buy them, that it is getting carried away and turning up the heat too fast on the cute little amphibian they have simmering on the other burner.
As a result, the slowly boiling frog of freedom can’t help but notice his predicament. When he jumps out of the pot, here’s to hoping he’s really pissed off.
Nick: You are absolutely correct. My only fear is that the Republican party in 2010 will still be too busy pandering for votes rather than providing a principled opposition. The Republicans have allowed the Democrats to define the current mess solely and exclusively as "corporate greed". Unless the truth is spoken about Congress' own culpability, there will be no chance of gaining seats in the Senate in 2010.
The Senate is the only place where a real check can be placed on Obama, until we get another 1994 in the House. But that again requires principled Republican leadership. [Before anyone suggests voting third party, they are not equipped to have a real national impact. Those votes are better directed toward co-opting the Republican party, which has a national infrastructure already in place].
Without a real, organized political opposition to socialism, we'll simply be left with a bunch of pissed off people trying to preserve their cash. Individually it can help, but collectively it doesn't do anything to change the country's dynamics.
I think Phil and I were having a similar conversation about backing out of businesses and the effect that we expected on our economy. We have quietly removed ourselves from all except one business which I hope to sell soon. That one was a rescue of my cousin's construction business where we created a new form of remodeling called the "self defense package" which includes kevlar wrap for your McMansion. It is doing rather well now and some fool will buy it. The kevlar wrap was a retread idea from a past life where I built a telecommunications system and our remote communications buildings were wrapped in kevlar to protect against hunters shooting our radios.
So, the bottom line is that we too are saving and fattening our bottom line while reducing taxable reportable and tracable income. Unlike Phil we are also looking at property elsewhere and New Zealand was leading until Rush Limbaugh opened his rather large mouth. Now the choices narrow somewhat to less known locations. Sure wish Argentina had established a solid economy since I love it there.
Regarding the Republicans, I maintain the party is dead and only a new, not a reincarnation, party with a hardnosed philosophy and no career politicians will be able to provide the moral fortitude to dig this country out of this mess. Sadly I have moved from the position of a military veteran proud of his country to one saddened by the drop in public IQ.
Ayn Rand and Huxley were right so I ask who will be the new John Galt?
When you think about it, what Obama is doing now was very predictable. We bailed out the rich on Wall St., we did it hastily and our members of Congress didn’t have a clue as to what they were doing. The credit market bailout hasn’t worked for the banks and the stock market is currently sinking like a rock. Along came the Democrats with their message of “we bailed out the rich, now we must bail out the poor and those middle class folks who are suffering”.
Our remedy for doing something stupid is to do something else even more stupid. And recall that the Democrats’ core appeal is “we’ll give you something for no effort on your part because you deserve it”. By saving the rich, we’re compelled to save the poor as well and the Democrats benefited from a majority of Americans who completely agreed with that sentiment.
CNBC ran a recent television special called “House of Cards” explaining how we landed in this mess; it wasn’t a dry scholarly study, it was meant for popular consumption and loaded with revelations intended to shock the average viewer. The ex-pizza delivery boy who became a highly compensated mortgage loan officer with virtually no training and no license. The Lebanese immigrant who first sold cars, then started a mortgage brokerage; in a few years he was pulling down millions a month in profits, bought himself a million dollar classic Ferrari, found a super-model girlfriend, bankrolled his own Hollywood movie. The small town in Norway, above the arctic circle, which sunk their treasury into something called a CDO courtesy of Wall St. and then watched their funds evaporate.
The securities rating agencies that sold their ratings to the highest bidder. The govt. regulators who turned a blind eye – they even interviewed a retired Alan Greenspan who basically admitted he was unaware as to what was happening and would have been unable to stop it in any case. The Wall St. firms that bought the mortgages, repackaged them into marketable securities and made millions. No one within these firms was ever pestered by nosy govt. regulators and, so, unimpeded by law they went gleefully forward with the rationalization of “if we hadn’t done it, our competitors would have”.
CNBC’s moral of the story was “greed made it happen”. That’s fine for small children and the senile, but we need a better explanation than greed. As a loyal, patriotic Conservative, I’m required to believe in our system of government – but what kind of system is unable to effectively handle a basic human motivation like greed? The answer is a bad system – a system that doesn’t function. With all due respect to our illustrious Founding Fathers, the system doesn’t work anymore. We’ll be individually robbed to pay for the mistakes of others. We believe in free markets but not enough to allow the market to operate and let the chips fall where they may. And whatever we believe individually is easily refuted by the latest opinion polls on Obama’s popularity.
We can take some small comfort in vindictiveness but our individual rebellions won’t amount to much. When it comes to forcing Americans to obey, our political system is highly effective. Whatever small rebellion we mount as individuals is easily countered in Washington and at the local govt. level. If you’re a fan of John Galt, remember Galt didn’t win in the end, he simply escaped. But what if escape isn’t an option?
Pat,
While agreeing with much of your post, I don't think our broken system has much to do with the system the Founders gave us.
What broke was the product of our journey to social democracy. But what the Founders gave us was free market capitalism. When people cheat, lie, and swindle others, that is not capitalism, it is fallen human nature.
Evil men remain, no matter the system. But our present situation allows evil men to flourish, not because of capitalism, but because we have abandoned absolute morality, self control, and personal responsibility.
Rush mentioned this quote from John Adams today: "Our Constitution was made only for a moral and religious people. It is wholly inadequate for the governing of any other."
John Adams was right.
Phil:
Re: "…I'm smart enough to increase my disposable income without increasing my actual income if that's what I need to do to succeed."
In that case, you forgot to include the taxes you will not pay because only income is taxed.
Sona — actually, I'm taking my "savings", and spending the money instead on a SEP applied toward 2008. It will result in a lower tax bill for me in 2008 than I paid in 2007.
My sole goal in life now is to legitimately pay as few taxes as I have to.
Pat, John Galt did not simply escape, instead he migrated to a place $ where the corrupt government could not reach him. More important, however, he and others like him removed their skills from the mix so those receiving "according to their needs" would end up having to depend on others that needed to receive according to their needs rather than those contributing according to their abilities. That translates to a death spiral.
Think about a world so corrupt that there is no incentive to do better…hmmm maybe New Zealand is looking better in spite of Limbaugh's large mouth.
Phil:
I modified Ben Franklin's old saying thus:
"A penny earned is a penny taxed. A penny not spent is a penny kept."
P
There you go again. In your last two threads you didn't define "torture", & now you don't define "rich", "economics" & a whole list of words you use. It's important, you know, since the Obama Administration hasn't a, um, clue about what these words mean.
Funny, a TV Talkinghead said the other day that under Bush ordinary people had to work hard for the modest money they got in order to get by & were envious of greedy fat cats who got mega bucks & free airplane rides (he forgot the babes; oh wait that was The Hon Spitzer!)
I just know that he was talking about you.
And BTW, I was screaming at the Talkinghead:
"Where do you get your money from, you space cadet? People think that you don't do any ‘hard work’, so why would you try to separate the Wall St guys from ordinary folks by suggesting that only the ordinary folks do hard work? Do you think that the Wall St guys or the CEOs of manufacturing corporations had found the pot of gold at the end of the rainbow?”
Oh, I forgot the rich stole their riches from the ordinary guys. As you, Phil, probably did. I mean, based on MSM Economics 101, it’s a fact, not an opinion, a proven fact that people like you can't get rich without someone getting poorer!
My wife told me that I had to stop arguing with the TV. I told her that it was hard work!
What is rich? How about $40,000? That was the salary of four time Stanley Cup winner, six time MVP, Gordie Howe in 1967. Of course that was the year I sold a house for $9,500.
Then how about $100,000 for a guy that said "I don't deserve such a salary. I didn't have a good season last year.”? That was Al Kaline in 1972, who had over 3,000 career hits, won the batting crown in 1955 at the age of 20 with a .340 average, and won the World Series in 1968. I bought a house for $25,000 that year.
Be careful when you answer the “What is rich?” question. Better factor in inflation. It won’t be long before millionaires will be getting food stamps.
What is "rich"?
Anyone above median income. Those below don't pay much income taxes.
"Rich" to a Liberal voter is anyone who has more money than you do.
“Rich” to a Liberal politician is anyone who has money, present company exempted.
"Rich" to a Conservative is that condition to which we all aspire, and can get there using our talents and abilities if the government doesn’t hold us back and/or redistribute our income.
sedonaman
Rich = “Anyone above median income. Those below don't pay much income taxes.”
According to the Census Bureau the median family income was about $50,000. The average family had 2.59 people. So that puts the individual median at $19,300. Therefore, anything over $19,300 is rich. Right?
Those that don’t pay much taxes? Could we be talking about Tom Daschle or Tim Geitner?
The last couple elections (not to mention that Bush years overall) have shown that the Democrat politicians define "Rich" thus:
Anyone who got any sort of tax cut during the Bush Administration.
They and their in-house PR folks (NBC, CBS, CNN, ABC, MSNBC etc) used the term "tax cuts for the rich" so much it seemed to be the name of the legislation. The kool-aid drinking liberal voters scream it right along with them. As for myself, it was interesting to find out that I was "rich" being that I drive a 20yr old car and can't afford to buy a house in my area.
In view of the subsequent comments posted regarding the word "rich", especially exercion's, let me amend my definition: If you pay taxes, you are "rich".
Sedonaman
I think I get your point. So if I have $30 million invested in tax free bonds and no earned income then I'm not rich. I feel a little silly, but whatever.:>)
You get my point. We don't tax the poor, and we don't tax wealth; we tax only the rich [by definition, those with an income*]. Your example of a person [ah, shades of Mrs. Horace Dodge] with $30 million in tax-free bonds is not rich, but she is certainly wealthy.
* Leona Helmsley didn't call them rich, she called them "suckers", or some other derogatory name.
It is a pity there is no tea involved. We could have dressed up in indian costumes (oops nativist statement not fitting the messiah's template of descriptive adjectives) and thrown it into the harbor.
Ivan tax free bonds have the disadvantage of being identifiable when the net asset tax is passed. This law will even the playing field by taxing assets like home equity and help pay to provide assets to those that have been so unlucky that they have not earned any.
For those that feel uncomfortable with this idea…tough the Omessiah won!
Mickey G:
With the average senator's wealth hovering around $15 million [http://www.opensecrets.org/pfds/index.php], I wouldn't look for a net asset tax anytime soon.
P
I was making a joke about defining “rich” & “economics” based on the last threads where the guys kept asking you to define “torture” when they probably couldn’t define “rich”, other than, as you say, someone making more than you.
But since some have tried a definition or some income figures, let me share a story of what I might refer to as
“The Hopelessness of Making Rich People Understand The By Any Definition Of Rich vs. Poor, Being In The Top 5% Seems Rich To The Other 95%.”
Seems that the top 5% distinguish between themselves & the über-rich, which group they seem to think includes only CEOs rather than entertainers. BTW, I see that buried in the 2009 Porkulus Act is a special break for über-rich Hollywood producers who all vote mindlessly Liberal. Wait, forget “mindlessly”; they know what they’re doing!
As someone said: Liberals have dumb downed a 21st Century economy to Rich CEOs & Dickensian underfed, uneducated urchins. Oh & by the way, the rich CEOs hate women and minorities.
I was at a party just before Election 2000 & a hubby & wife, two NYC Public School principals, making $104,000 apiece, were crying poverty & robotically saying that if Bush were elected he’s “give tax cuts (or breaks, doesn’t matter) to the ‘Rich’ ” . I pointed out that, their salaries being public, I would note that they were in the top 1% of all wage earners. (Note to Economics PhDs, I lumped their salaries; never checked if that was correct, but my larger point that they were “Rich” as far as the rest of the world was concerned was valid.)
Seems that they’d just sold their house on L.I., their kids all having left the nest & had bought a co-op on NYC’s Upper West Side & a “cottage” in the Hamptons. They talked to me in monosyllables, as one does to a child outside Lake Woebegone, explaining how expensive it was to live on the UWS, food & Met Opera tix being what they were, & The Hamptons & getting there? Fuhgedaboudit!
In NYC “Rich” is anyone making $1 more than the guy claiming victim status, like cops & firemen (OOPS persons), or, here, PS Principals.
Interesting article in WaPo about two yrs ago:
"That's Rich — But Maybe Not for Someone Else; Issue of Who's Really Wealthy Can Also Affect Political Debate"
http://www.washingtonpost.com/wp-dyn/content/article/2007/11/25/AR2007112501450.html?nav=rss_nation
It quoted a NYU Econ Prof who thought that the middle class in a major city then included people in households with incomes from $40,000 to $100,000. From there, up to $200,000, people are "upper middle class." People making $200,000 to $350,000, he said, could be considered rich, but they still have to slog to work every day. To be really rich, in the Prof’s scholarly (no sniggering, please!) judgment, you needed not only an income upwards of $350,000 a year — which happened to be right about the point where today's top marginal income tax rate of 35% kicks in — you also needed at least $10 million in accumulated wealth.
H/T Tax Prof Blog
My PS Principals, showing the results of a NYC Public School education, failed to see that if we taxed all those earning over $350M with accumulated wealth of $10MM @ a 100% tax rate, we'd only get a few dollars more, not even enough for a downpayment on the Porkulus Act, even if these people didn't find tax dodges as the über rich always do.
I suspect, Dr. Jackson, that you wouldn't be quite so bellicose if all your businesses tanked and the institutions that hold your investments went belly-up, leaving you unable to make a mortgage payment.
My wife is in the mortgage counseling field, and right now forclosure counseling is a growth industry. It's no longer the convenience store clerks who were sold sub-prime mortgages for properties that they could never possibly afford by unscrupulous middle men who made obscene commissions that are getting in trouble, but rather real middle class people who played the game by the rules and are decades into reasonable, fixed-rate mortgages, but find themselves laid off and unable to make payments. The more of these people that default, the deeper we all slide into the effluent.
If nobody does anything, we are in for a real 1930's style ride. Are you suggesting that this is the way to go? If not, what would you have the government do?
As for higher taxes, count yourself lucky that the marginal tax rates of the mid-twentieth century are still something of a political third rail. 70% was good enough for Nixon, or wasn't he conservative enough for you?
Looks like this thread is going to go for 100+ posts since we have feel good Kilovolt posting again.
What would I have the government do? Get out of the way on the economy and do the job of federal government which the latest bunch are trying ways to abrogate the responsibility for. Focus? Get rid of illegal entrants, national defense, and the very small list of enumerated powers. Let's move back to the representative republic we are supposed to be from the brink of the dependent socialism currently the rage in Washington and the media.
>If nobody does anything, we are in for a real 1930's style ride. Are you suggesting that this is the way to go?
It only took a week for the first non-serious comment.
There is a problem. Person A proposes an incredibly stupid solution. Person B objects to the incredibly stupid solution. Person A then accuses Person B of “not wanting to do anything”, because of course opposing what is proposed means opposing everything.
Mark-to-market, and the Clinton Administration’s “affordable housing” program which insisted that banks give mortgages to otherwise unqualified loan applicants, coupled with Acorn’s threats against banks who did not divert community investment funds to unqualified applicants, coupled with speculators who sought to make a profit by flipping houses, produced the present “crisis” — in 5 states: Nevada, Michigan, Florida, California, Arizona.
You fix the problem by first identifying the real problem. But this takes actual effort, when political rhetoric is so much easier.
And it’s always nice to have someone whose marginal tax rate is around 15% (if they pay any taxes at all) tell me how “lucky” I am to pay the top marginal rate. Take some real risks in life, lose a lot of money before you make some real money, then tell me how I should feel about using my money to pay for pet political projects.
Phil:
"Mark-to-market, and the Clinton Administration’s “affordable housing” program which insisted that banks give mortgages to otherwise unqualified loan applicants, coupled with Acorn’s threats …" etc.
Last week, PBS's "Frontline" ran an hour program called "Inside the Meltdown". It started out with the comment, "It all started in Sept., 2008." Not one word about its actual cause was said. In fact, I don't recall the words "Clinton", “Carter”, “CRA”, or "ACORN" even being mentioned.
Real objective reporting.
Sedona: You've now identified DrK's news source.
For liberals, history begins this morning.
Well, if it was good enough for Nixon, it's good enough fo me. Yes, this great hero of conservatism, whose name even to this day is uttered only with reverence and hushed voice.
Dr Kilovolt is back and wowing us with the force of his intellect.
Nixon was a conservative because he was against issuing credit cards with unlimited dollar amounts, and backed by the U.S. Treasury, to "poor" Americans.
Sedonaman,
Nixon was hardly a conservative simply because he did some things conservatives might agree with. For the most part, Nixon was not conservative.
From Wikipedia: "Under Nixon, direct payments from the federal government to individual American citizens in government benefits (including Social Security and Medicare) rose from 6.3% of the Gross National Product (GNP) to 8.9%. Food aid and public assistance also rose, beginning at $6.6 billion and escalating to $9.1 billion. Defense spending decreased from 9.1% to 5.8% of the GNP. The revenue sharing program pioneered by Nixon delivered $80 billion to individual states and municipalities.
Nixon announced new economic policies on August 15, 1971 in a televised speech to the nation. The Democratic Congress passed the Economic Stabilization Act of 1970, giving Nixon power to set wages and prices; it did not believe he would use it and felt this would make him look indecisive. While opposed to permanent wage and price controls, Nixon imposed the controls on a temporary basis in a 90 day wage and price freeze. The controls (enforced for large corporations, voluntary for others) were the largest since World War II; they were relaxed after the initial 90 days, although unemployment did not decrease. A Pay Board set wage controls limiting increases to 5.5% per year, and the Price Commission set a 2.5% annual limit on price increases. The limits did help to control wages, but not inflation. Overall, however, the controls were viewed as successful in the short term and were popular with the public, who felt Nixon was rescuing them from price-gougers and from a foreign-caused exchange crisis. The next day, the Dow Jones measured a then-record one day increase.
Nixon was worried about the effects of increasing inflation and accelerating unemployment, so he indexed Social Security for inflation, and created Supplemental Security Income (SSI). In 1969, he had presented the only balanced budget between 1961 and 1998. However, despite speeches declaring an opposition to the idea, he decided to offer Congress a budget with deficit spending to reduce unemployment and declared, "Now I am a Keynesian." He also explored creating a universal minimum income and universal health care, but was not able to realize either."
MM:
I know all that. I was just being facetious.
It hard to type facetiously.
Doctor J, if you have comprehensively defined the current economic problem and proposed a solution to it that you feel is superior to the approach of the Obama administration, then by all means please point me to your writing on the subject. I haven't been around for a while and must have missed it.
I didn't see the Frontline episode, but a large influence over my understanding of the origins of the subprime mortgage crisis comes from a well reputed episode of the radio show This American Life called The Giant Pool of Money. It is a highly entertaining and informative listen:
http://www.thislife.org/radio_episode.aspx?episode=355
Also available as a transcript in PDF format:
http://www.thislife.org/extras/radio/355_transcript.pdf
Some of you folks might learn a thing or two about causes of the crises that don't involve your favorite villians, those damned liberals. Don't take my word for it. Google the episode title and look at some of what people have written about about it. Read or listen before you deride.
Hey Mountain Man, I thought that only liberals cite Wikipedia and conservatives dismiss it. Does this mean that you folks finally accept it as a valid resource?
Kilo,
Wikipedia accurately presented the case that Nixon wasn't conservative. I've never said anything about its validity. I read the entry, saw it was accurate, and used it. It refutes you point, in case you hadn't noticed.
Regarding your link, one of the guys is from NPR, a far left organization. So, viola, it is a far left analysis. Nothing but someone's opinion.
And not a very good one. All I learned is that events presented through the prism of "damned liberals" makes as much sense as you do, Kilo. It just doen't add up.
By the way, when leftists are the villains, they are the villains. And they are the villains in the financial crisis.
Anything to do with money, and the leftists in government will screw it up. Screw it up they did. Because they start with a faulty premise: that the government can better spend someone else's money than those it actually belongs to. And somehow it ends up in their pockets.
Leftists are what's wrong with America today.
Dr.K
Now you understand the disadvantage of basing your view on a multi-faceted and complex financial problem of which you know absolutely nothing on the musings of radio personalities working for Chicago state-sponsored radio instead of actually examining an issue for yourself based on trivialities like facts, figures, statistics, and that sort of mumbo jumbo (and before you recite from rote a clever Rush Limbaugh retort you once hear on Olbermann, let me pre-emptively counter-retort by saying that I don't listen to talk radio – conservative or otherwise). You might learn a thing or two from the Sean Hannity radio program too, but I'd cite you a hundred other more objective and scholarly sources before I pointed you to a transcript of his show when seriously discussing an issue like mortgage lending and banking. Great to have you back.
MM and Sedona:
It's just another drive by comment from DrK. If you don't accept the way he and his wife frame the issue, you want no solution at all. You can't take the guy seriously.
Remember, he has a history of spouting off about things he doesn't understand, and when challenged, runs away.
He makes a stupid statement about the Vietnam War. Bob Stapler spanks him, and he runs away.
He makes a stupid statement about Bush outing Plame. I spank him, and he runs away.
He makes a stupid statement about counting ballots. Patrick spanks him, and he runs away.
Now he wants to tell us all about the underpinnings of the “mortgage crisis”.
People like DrK aren't interested in, or capable of, legitimate debate and discussion. The best they can do is offer a platitude or two, draw some line of moral equivalency, then run away when confronted because they can't actually sustain an intelligent conversation.
The only time DK actually backed away from a stupid remark he made was when he thought the remark was being construed as politically incorrect. He didn't want to be tagged with being a bad liberal, so he apologized for having said something that could be construed as insensitive and offensive. After that it was back to his inane non sequiturs.
The only mystery is why anyone takes him seriously instead of simply ignoring him.
The bills that Congress has been passing are completely useless in restoring our economy. It has to crash in order to get back on the road to prosperity. However, these bills are only delaying the inevitable. The only difference between us crashing now and later is the debt we'll be in when it does happen. If Washington would have let the economy work itself out, like capitalism is supposed to do, I believe we would have already seen the worst of this downturn. Instead the government involvement is placing in an almost endless hole. Now when we do crash there will be a mutli-trillion dollar deficit to deal with as well.
By the way has anyone else noticed everytime Barack Obama gives a speech the stock market goes down about 200 points. Coincidence? I think not.
RiR — Dead on! I think it's down around 2000 points since election day.
Sorry for the delay in all the fun. I have been ill for a few days.
Ignore me if you will, Dr. Jackson. But that doesn't this statement any less valid: to date all I have heard from "conservatives" about the economic crisis is how liberals supposedly caused it (despite not being in power while its seeds were being sown and germinated through deregulation, lax enforcement of existing laws, and short-sighted fiscal policy), and how liberals are doing all the wrong things to fix it. I have heard no suggestions from "conservatives" on what the correct thing(s) might be, except for yet more tax cuts for the rich, aka more of the same failed policy of the Bush administration that got us into this mess.
I asked you to point me to where you have offered a solution, and instead of offering any kind of answer you, not for the first time, instead dismissed me and my "stupid statements." For all your pretenses of "intellectual conservativism," you, Dr Jackson, have repeatedly treated me rather boorishly.
So I ask you one more time: if you have better ideas on how to handle the economic crisis, then please present them. And while you are at it, you might explain why Krugman is wrong about the stimulus as an appropriate, if undersized response. And if you cannot produce any better ideas, then stop bellyaching about how the current administration is handling it.
>Leftists are what's wrong with America today.
Despite the fact that we have been out of power pretty much since Johnson. That is quite a remarkable thing to say, MM.
>By the way has anyone else noticed everytime Barack Obama gives a speech the stock market goes down about 200 points. Coincidence? I think not.
Conversely, if I am not mistaken, his approval ratings have risen, RiR and DrJ. Eat your hearts out.
DK: When you finish the discussions you ran away from eariler by addressing the issues that were presented, or admitting you're wrong, I'll take you seriously. Until then, it's just another aimless drive-by comment. My resolution for Lent is to only engage in serious discussions with serious people.
So you will cite tit-for-tat as an excuse to deprive all of us of a chance to see you use your intellect and education to do something more than complain about the status quo with well-read irony. You are the one who makes pretenses at knowing more than the rest of us and knowing better how things should be done, not me. I am very disappointed, Dr. Jackson.
Enjoy your Lent. And beware the occasional, well-deserved drive-by.
Dr K,
I'm glad you put "conservatives" in quotes in discussing Bush. He is not a fiscal conservative.
Do you think that repeating talking points equals a thoughtful, principled argument? "Tax cuts for the rich" is a vapid talking point. I, and everyone I know, got a check for $600 from the Bush tax cut.
You must know that 86% of all income taxes are paid by the top 25% of earners. Any across the board tax cut (which I deem as fair) will shift towards those who pay the most.
A tax cut for those who pay no taxes (bottom 46% of earners) is a welfare check.
Republicans have presented alternatives. Just because you have not heard them from the leftist MSM only means you're ignorant.
And by the way, the conservative answer and the Republican answer are not the same thing. Please stop conflating the two.
"…out of power since Johnson…" That is the most amazing thing I have ever read from you. Except from 1995 to 2006, Democrats have controlled the purse strings. Conservatives in particular have not been in power for more than a century.
The government we have is the government you leftists have wanted. I am flabbergasted that you think that this is a problem created by anyone else.
What would conservatives do? I can only speak for myself.
1) Disband all government departments that are not mentioned in the Constitution.
2) Repeal the tax code.
3) Repeal the 16th amendment.
We at least we have established that we are on completely opposites sides of the political spectrum, MM.
Republican alternatives that I am aware of amount to tax cuts and spending cuts to bring the deficit under control. Since tax cuts demonstrated themselves throughout the Bush administration as having negligible stimulative effect, this amounts to a response not much different from Hoover. And just why should we trust Republicans to be fiscally responsible now, after watching them rack up obscene deficits when they controlled Congress and the White House?
If I have missed any conservative-but-not-Republican responses the current economic crisis that differ substantially, please educate me. Otherwise, I respectfully thank you and them for the suggestion, but I'll take my chances with the Keynesians.