Taxing Dividends

Posted on December 3, 2012 by alsanblog

The Costco board of directors will borrow $3.5 billion so that the company can pay a significant dividend to shareholders in December, rather than next year, before the looming tax increase on dividend income. This isn’t unusual in itself because corporations need to do what’s right for their shareholders. But it is interesting to see that one of Costco’s board members is Jim Sinegal, co-founder and former CEO of Costco, who actually gave a speech at the Democratic Party convention last summer in support of higher taxes.

The decision to pay the dividend in December instead of next year will save Sinegal $4 million in taxes, and the Costco board (all of whom are shareholders) collectively will save about $8 million. The Wall Street Journal nicely sums it up:

Here we have people at the very top of the top 1% who preach about tax fairness voting to write themselves a huge dividend check to avoid the Obama tax increase they claim it is a public service to impose on middle-class Americans who work for 30 years and finally make $250,000 for a brief window in time. If they had any shame, they’d send their entire windfall to the Treasury.

Well, we know that liberals have no shame, and the hypocrisy is indeed quite incredible. In addition to Sinegal, the Costco board also includes William Gates, Sr. (father of Bill Gates) and Charles Munger (buddy of Warren Buffett), two other high tax proponents.

Liberals often attack those who oppose tax increases by claiming that wage earners pay taxes at a higher rate than rich people such as Mitt Romney. Although the current tax rate on dividend income is 15%, it’s necessary to understand that corporate income is taxed twice:  first on the corporate level at 35% and then again on the individual level at 15%. If these two taxes are combined, we see that the owners of corporations are actually paying 44.75% of their income to the federal government. And this is not a marginal rate that applies to the highest income categories, but a flat rate that applies to all levels of income.

If the rate on dividend income goes up next year as scheduled (in the absence of any action by Congress on the fiscal cliff) to 43.4%, then the combined rate will be 63.2%. This means that the federal government alone (never mind additional state taxes) would be stealing 63.2% of the income of the owners of corporations. Even if the dividend rate were only 30% (the minimum required by the Buffett rule), the combined rate would still be 54.5%. It’s hard to characterize these rates as anything other than confiscatory, and the morality of them is suspect.

Critics sometimes call Obama a socialist and, of course, this generates mockery from the liberal propagandists. A socialist society is one in which the government owns the means of production so, notwithstanding the federal government’s equity interests in GM and AIG, America technically is not socialist. Yet anyone who receives more than half of the profits of a company can reasonably be considered as the “owner” of said company. In view of the tax rates that Obama and liberals are demanding on dividend income (as well as capital gains), the critics may not be so crazy after all.

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Klein Whine

Posted on December 1, 2012 by alsanblog

Among the liberal propagandists who write for publications such as the Washington Post, Slate, and others, Ezra Klein has a soft spot in his heart for an Orwellian approach to language (i.e., distorting the meaning of words). And he’s not above resting arguments on facts that somehow do not include those that are inconvenient to his liberal “vision.” So, it’s especially funny when Klein whines about “obfuscation and misdirection” by proponents of tax reform who reasonably call for broadening the tax base and lowering rates.

Klein argues that broadening the base and lowering rates would mean increases in tax revenues generated mostly through cuts to deductions for charitable donations, home-mortgage interest, and state and local taxes. And according to Klein, whether we want to do this is “the conversation we need to be having.” Well, duh. Of course that should be the conversation, but he’s overstating the case when he claims that Republicans are distracting the audience from the sources of the tax increases. People understand what’s at stake.

It appears that Klein has a significant concern about eliminating the deduction for state and local taxes because it would negatively impact high-tax cities and states (by hitting taxpayers hard), which would make them less attractive places to live. This bothers Klein because these high tax places, not surprisingly, tend to be “disproportionately blue.” But really, eliminating the deduction would actually help expose the tax and spend policies of the politicians in those cities and states for what they are. This is something that Klein, who claims to oppose obfuscation and misdirection, should favor.

Broadening the tax base and lowering rates would give us a tax code designed to efficiently raise revenue rather than conduct social policy, and that would be a good thing. But it would also represent real “change,” which doesn’t go over very well with liberals, who these days are simply reactionaries.

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Kiss Mammograms Good-Bye

Posted on November 28, 2012 by alsanblog

Well, now that the election is over, the authoritarians (a/k/a liberals) can turn their full attention back to healthcare and resume the task of placing 315 million Americans under the thumb of the central government. Liberals are often seen as wanting to turn America into Europe, but that’s not fair to the Europeans:  even the E.U. doesn’t force a centralized healthcare system down the throats of the citizens of its member states; rather, the member states themselves handle healthcare separately from the central government. Wanting to go beyond the European model is a measure of how America’s liberals are losing their grip on reality.

The  legislation that established ObamaCare covered some 2,000 pages and will generate an unbelievable number of additional pages of regulations. Anyone who hasn’t read this stuff, however, need not bother because the direction America is going in healthcare can be summarized in three easy steps:  1) place everyone under the thumb of the central authority, 2) implement price controls on the various healthcare services, and 3) restrict access to such services. Any government can “control costs” with this formula; the question is what kind of system will we have in the end. With the liberals in charge, we probably shouldn’t expect much, and so perhaps the real question is how much damage will they inflict before all is said and done.

The central government already controls prices for much of the healthcare provided in this country (i.e., Medicare and Medicaid), and private insurers face de facto price controls in the form of rebates if their “medical loss ratio” (percentage of premium dollars spent on medical care) does not meet the minimum standards set by the government (Obama actually boasted about this policy during the presidential campaign). So it’s not surprising that liberals should now focus on restricting access, and sure enough, here comes the Washington Post with not one but two front page articles (here and here) that, in this instance, challenge the efficacy of mammograms.

According to the articles, recent research published in the New England Journal of Medi-cine shows that mammograms lead to overtreatment and do little to curb late-stage breast cancers. As this conveniently comes just as ObamaCare is gearing up, we see the liberals setting the stage to restrict access to mammograms. And of course, this is all presented as solid research. Indeed, in the first of the two articles, the writer made a point of explaining the study was paid for by the study authors’ universities. As if that places the conclusions beyond dispute –  case closed.

Of course, the writer didn’t disclose the ultimate source of the funding, which might very well have been the federal government. And the article contained nothing about the potential conflict for universities even if a study is not funded by the federal government:  a university that backs a study contradicting the liberal healthcare vision might put funding dollars at risk. After all, the Obama administration has already threatened to withhold funds from colleges that raise tuition. But the Post isn’t completely oblivious to objectivity and funding:  the day after the mammogram article, it published yet another front page story questioning the objectivity of studies funded by the drug industry. Yes, of course.

So we see how it works:  the liberals and their propagandists (maybe the Washington Post should change its name to Pravda once and for all and be done with it) working hard to restrict access to healthcare by 315 million people and at the same time demonizing the private aspects of the healthcare industry. How lovely.

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Raising The Retirement Age

Posted on November 24, 2012 by alsanblog

One very reasonable suggestion to help reduce the eventual Social Security shortfall is to raise the retirement age by a year or two. But watch out, liberal propagandists are at work challenging this simple idea, as seen in the latest article on the topic by Alfred E. Newman (a/k/a Ezra Klein of the Washington Post). In the article, we learn that it drives Klein “nuts” when rich guys suggest raising the retirement age to reform Social Security because these rich guys are advocating a cut that Klein claims “they’ll never feel.”

Amazingly enough, Klein is suggesting that a person is not entitled to an opinion if he or she would not be personally affected by the opinion. According to this logic, it would be inappropriate for anyone to suggest, for example, a tax increase on the wealthy unless that person would be subject to the tax. Yet liberals like Klein “bravely advocate” such tax increases all the time, and they never tire of putting forth all kinds of propaganda about healthcare, although most liberals are not chronically or terminally ill.

Klein’s logic about who is entitled to hold opinions on issues is certainly twisted, and it doesn’t get any better when considering the substance of his argument. The retirement age question doesn’t fit into the same category as unemployment compensation, food stamps, or healthcare coverage, each of which applies to those with very low incomes or who have lost their jobs. Because the issue does not implicate the basic social safety net, the authoritarians must come up with something else to make it seem like a safety net issue.

First, Klein argues that most people do not like their jobs because people tend to retire as soon as possible at age 62 (when reduced benefits become available). Second, he claims that low income individuals have a lower life expectancy than higher income individuals. Based on these facts, for which he offers little support, Klein concludes it would be “cruel and regressive” to reform Social Security by increasing the retirement age because it would only concentrate the pain of reform on low income individuals who don’t like their jobs and haven’t enjoyed the increase in life expectancy as much as others.

Ultimately, what Klein’s argument really boils down to is nothing more than this:  steal more money from higher income individuals so that people who are currently employed, who are earning a living, and are capable of continuing to earn a living, but simply don’t like their job, can avoid having to work a year or two longer. It’s too bad that some people don’t like their job, but Klein fails to make the retirement age a safety net question, and it’s hard to see how Klein’s position can be morally justified. Liberals are simply losing their grip and getting more and more out of control.

Finally, when Klein spoke of the “rich guys” who want to raise the retirement age, he specifically referred to a perfectly reasonable comment made by Lloyd Blankfein, CEO of Goldman Sachs. Klein claims that he’s not picking on Blankfein, but of course he is picking on him. This would be another example of a very despicable strategy to single out, attack, and silence anyone who might disagree with the “vision” embraced by liberals. We know what drives Klein nuts; what drives me nuts are incoherent and nasty liberals.

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Redress Of Grievances

Posted on November 15, 2012 by alsanblog

So we’ve all heard how citizens in a number of states are now petitioning the federal government to peacefully secede from the Union, and several states have reached the 25,000 signature threshold that is supposed to generate a response from the Obama administration. Americans who sign such petitions should rethink the wisdom of their action, however. Secession is not a very good idea (even if only to make a point), and calls for secession open another door for the liberal propagandists to mock anyone who opposes Obama’s policies (more on this later).

Some time ago, John Jay, James Madison, and Alexander Hamilton outlined a number of arguments in favor of the states forming a single union, rather than three, four, or thirteen. Such arguments can be found in the Federalist Papers, nos. 2 through 14, and they make as much sense today as they did 225 years ago. Rather than supporting secession, a better approach would be to characterize the desire for less central government as a right to self-government and self-determination, and that political justice calls for citizens within states to control more of their own affairs.

As mentioned above, a by-product of the petition drive is that it gives liberal propagandists an opportunity to misrepresent and insult people living in red states. For example, although citizens in almost all states have joined the petition drive, that hasn’t stopped Dana Milbank from focusing on red states, most of which are located in the south. He does this so he can call them a “Confederacy of Takers,” in another obvious attempt by a liberal, this time using the word “confederacy,” to insult as racist anyone opposed to Obama’s policies.

The “takers” part of Milbank’s phrase refers to the fact that red states tend to receive more money back from the central government than its citizens pay in taxes. So Milbank here is taking the “free stuff” concept embraced by blue state voters and associating it with red states in an attempt to confuse readers. Actually, the idea that citizens of states pay taxes to the federal government only to have the feds turn around and give the money right back is crazy in the first place, but neither Milbank nor anyone else seems to notice.

Once the federal government sheds itself of the red state takers, Milbank envisions a blue country utopia that “could enjoy lower taxes and the high level of government services typical of the Northeast, the Great Lakes, and the West Coast.” No doubt Milbank’s blue state heaven is like the European utopia, well, except for places like Greece and Spain with their 25% unemployment rates.

And of course, as is true for all liberal propagandists who praise blue states, Milbank never once mentions the fiscal problems of the blue states (e.g., California, Illinois, New York, etc.), and the fact that such states most likely will be asking for federal bailouts. Sounds like there needs to be a “dys” in front of Milbank’s post-secession utopia.

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O Brave New World

Posted on November 13, 2012 by alsanblog

Well, here we have the propagandist Ezra Klein singing a paean to Obama, liberalism, and the changes wrought by liberalism over the last few years. But all the wondrous changes cited by Klein show nothing more than that America is becoming Europe. “O brave new world, That has such liberals in’t.” Of course, nowhere in the article does Klein mention anything about the protests and riots in Greece, Spain, France, and Portugal. And I didn’t see any reference to Spain’s 25% unemployment rate, but never mind all that – we’re living in a moment when things are actually “getting done.” Yeah.

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A Divided Nation

Posted on November 11, 2012 by alsanblog

Two days after the election, a couple of talking heads on one television network lamented the political divide in America today, and both of the heads were at a total loss for an answer to the problem. Well, the answer my friend is not blowin’ in the wind; rather, it’s right in front of our faces and has been there for only about, oh, the last 225 years:  we need to return to a federal government whose powers are, dare I say, “enumerated” and limited. Gee, just like the form of government originally created by the founders during a period of divisiveness.

We all know that the country is fairly evenly divided in governing philosophy with big government supporters giving Obama a 50.4% edge in the popular vote. Liberals seem to think that this razor thin majority gives them the right to impose their will on the rest of us. Of course, they don’t say it like that, preferring instead to talk about “compromise,” which for them means that Republicans should do what liberals demand. Given the intensity of the differences in the country, however, rule by our slim majority would be an example of “tyranny of the majority” or stated more bluntly, mob rule.

The answer to America’s political divide is not to insist that those on one side of the divide are entitled to dominate those on the other side, but to eliminate domination in the first place by limiting central government. Of course, this might only shift the problems of mob rule down to the state level, but maybe not, as there seems to be a general consensus on the role of government among citizens of most states. For example, the passions of citizens in many states seem to coalesce around the concept of freedom whereas citizens in other states rally around “free things.”

Liberals, however, have sacralized big government, and worship at its altar. As a result, we find liberals devising ways not to limit centralized government and the power to dominate, but to make it easier for one side to dominate the other in order to bring authoritarian government to all. An example of the liberal strategy is seen in the desire to change the Senate rules to end the filibuster as we know it. Yeah, that’s right, liberals hope to eliminate what is standing between the domination of 315 million people in this country by a majority comprising 50.4% of voters.

Such approaches are arrogant, short-sighted, and overreaching, and will only serve to aggravate an already bad situation. Political justice means returning more power to the states, giving citizens in the states the right to self-government and self-determination.

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Taking Responsibility

Posted on November 10, 2012 by alsanblog

Resigning his position as CIA Director because of an extra-marital affair, David Petraeus show us what taking responsibility means. Liberals and especially Hillary Clinton should take note and use Petraeus’s experience as a, dare I say, “teachable moment.” Petraeus showed that taking responsibility means actually doing something, such as resigning. Clinton thinks taking responsibility means saying you’re taking responsibility and then doing nothing.

The incompetence of Clinton’s department resulted in the murders of four of her “friends and colleagues” in Benghazi, yet initially she did nothing but lie about the cause of their deaths (blaming an anti-Muslim video), even while standing next to their returned caskets. More recently, Clinton has called Chris Stevens, the murdered ambassador, an “American hero” as if that makes up for the lies. She has neither class nor integrity, and the fact that some have praised her conduct and hold her up as a possible presidential candidate for 2016 is very unfortunate.

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Defying The Authoritarians

Posted on November 8, 2012 by alsanblog

Let’s see, the liberals are looking to put 315 million citizens under the thumb of the federal government for just about everything, including healthcare, which is a decidedly local activity (most people go to hospitals and doctors located near their homes). And people evidently are okay with this, bowing meekly to the central authority, no matter how far away or overbearing it is.

But wait, citizens out west are not taking it any longer! The voters in both Colorado and Washington have risen up and are defying authoritarian government by demanding their right to smoke dope. Yep, standing up for dope – apparently this is the best they can do. The founding fathers must be spinning in their graves.

It doesn’t bode well for freedom when citizens of a nation can rouse themselves against the authoritarians only when the topic is smoking dope. The mullahs in Iran are probably rolling on the floor in laughter – subduing the West is going to be much easier than they ever dreamed. This is reminiscent of Huxley’s Brave New World where the population is kept content with its daily dose of soma. Perhaps we should just change the name of marijuana to soma.

Based upon the actions of our soma-loving freedom fighters in Colorado and Washington, we can safely conclude that America has crossed a line:  ideas such as freedom, self-government, and self-determination are now officially on life support in this country. And the prognosis is not at all positive.

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Big Government Mandate

Posted on November 7, 2012 by alsanblog

Obama won just over 50% of the popular vote and sure enough, Jonathan Cohn, one of TNR’s chief propagandists, is claiming that Obama won a mandate. Before expanding on his claim, however, Cohn goes on a detour summarizing some of the political issues over the last few years, and whaddaya know, he somehow never gets back to explaining how Obama’s victory is a mandate as promised. Oops.

Evidently, TNR doesn’t bother to employ editors one of whom might have told Cohn that his post was incoherent. The truth is that when a presidential candidate wins just over 50% of the vote and the opposition party wins a majority in the House of Representatives, there is no mandate. But that won’t stop Cohn and other liberal authoritarians from using the idea of a mandate as they seek to impose their will on the other half of the people in this country through centralized government. The minds of these liberals never seem to include the concepts of decentralization, self-government, and self-determination.

Instead, liberals are too busy clinging to their big government and, like Cohn, proclaiming how authoritarian government gives people “peace of mind” or makes life “more secure.” And let’s not forget Cohn’s claim that his big government creates more opportunities for tens of millions of Americans. Yeah, right – just like the peace of mind that calms the rioters in Greece or the opportunity enjoyed by the 25% of workers unemployed in Spain.

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