The tax bill is the gift that keeps giving, not least because it exposes the Democrats as the greedy party that thinks all America’s money is theirs.
Given Obama’s years’ long shell game about whether or not Obamacare was a tax, isn’t it lovely to see the Tax Bill spell the end of Obamacare?
On September 20, 2009, Barack Obama had an interview with George Stephanopoulos during the run-up to the vote on the Affordable Care Act (aka “Obamacare”). Stephanopoulos, showing a surprising amount of journalistic integrity, asked Obama to explain how it was possible that the individual mandate was not a tax.
Reading Obama’s subsequent intellectual contortions is embarrassing in the same way that it’s embarrassing to watch someone’s pants fall down in public. You’re seeing something you shouldn’t see — in Obama’s case, that something being the fact that we elected a con man as president. Obama embarked on a convoluted, incoherent explanation about money flowing to the taxpayer in a way that could never be mistaken for a tax. Since we know he’s not an idiot, he was obviously running a con.
Stephanopoulos tried to stem the tide of words with logic, but Obama was relentless. Eventually, Stephanopoulos fell back on the dictionary (perhaps mindful of the fact that Obama, in 2008, snapped, “Don’t tell me that words don’t matter”), to point out that, no matter which way Obama spun things, he was describing a tax. Obama responded as only he could, with snark and lies:
STEPHANOPOULOS: I – I don’t think I’m making it up. Merriam Webster’s Dictionary: Tax – “a charge, usually of money, imposed by authority on persons or property for public purposes.”
OBAMA: George, the fact that you looked up Merriam’s Dictionary, the definition of tax increase, indicates to me that you’re stretching a little bit right now. Otherwise, you wouldn’t have gone to the dictionary to check on the definition. I mean what …
STEPHANOPOULOS: Well, no, but …
OBAMA: … what you’re saying is …
STEPHANOPOULOS: I wanted to check for myself. But your critics say it is a tax increase.
OBAMA: My critics say everything is a tax increase. My critics say that I’m taking over every sector of the economy. You know that. Look, we can have a legitimate debate about whether or not we’re going to have an individual mandate or not, but …
STEPHANOPOULOS: But you reject that it’s a tax increase?
OBAMA: I absolutely reject that notion.
The lovely thing about being a narcissist, whether as an individual or a political party, is that the truth is always defined by the needs of the moment. So it was that, four years later, Team Obama switched sides on the argument when it came time to defending Obamacare before the Supreme Court. The Court was amused at the time, although the last laugh was on Americans: [Read more…]
In a blue county, financial professionals unwittingly reveal that the tax bill is “bad” because California loses its free ride on the back of poorer states.
I was at a party during which I ended up speaking to a CPA and a personal financial adviser. They both assured me that the tax bill was a disaster. Of all the terrible things Trump has done, it is the worst. There is nothing more terrible than this tax bill.
I put on my ingenuous face. “I don’t really know much about it. What’s wrong with it?”
Said the CPA, “Well, I’m retired, so I actually don’t know the details. But it’s right up there with what he’s done to climate change and the national parks.”
“Oh, okay,” I replied. As far as I’m concerned, any intelligent conversation with that person was dead in the water.
I turned to the personal financial adviser, who had begun to offer his two cents.
“It’s a disaster. I mean, it’s what you would expect from Trump and the Republicans. It rewards rich people and hurts poor people.”
“As I said, I haven’t paid attention to the specifics. What does it do?”
“Well, I don’t really know yet, but I know it’s going to hurt poor people in California. It takes away the mortgage tax deduction and it no longer allows us to deduct our state income taxes from taxable income for our federal income taxes. It’s so destructive.”
Further inquiry revealed that, when he said “poor people in California,” he actually meant that it was going to be a problem for him, personally. For laudatory reasons that I won’t divulge here, he’d extended himself financially to live in our middle-class-by-Marin-standards neighborhood, so he has a large mortgage compared to someone in, say, Bakersfield or Abilene. I appreciate his personal problems and the sacrifices he’s making, but his personal financial issues, standing alone, are not a global indictment of a tax policy that simplifies (somewhat) an insanely complicated system and that lowers taxes across the board.
The same duo also castigated the tax bill because it reduces the corporate tax. I put on my ingenuous face again. “But won’t that help bring more business to the U.S. and create more jobs?”
“No,” both these financial professionals assured me. “It will simply reward Trump and his cronies.”
The party moved on. I would loved to have heard more, but it was not to be.
Ignore the Left’s collective scream about the new tax bill — it will confer a benefit on those who are economically in the lower half of American earners.
I’m not an economist, but I was blessed with a fair amount of common sense. Despite Democrat hysteria, it’s obvious that “the little people” will fare better under the proposed tax bill than they do now — and for a reason the Republicans ought to be speaking about a lot but, because they’re bozos, they are not.
Before getting to the most significant benefit for the less wealthy under the new tax bill, let’s look at life under the current tax laws. First, it’s helpful to define terms and the two terms I want to look at are “progressive” and “regressive”.
A Progressive tax is one that sees tax rates increases proportionately to an individual’s increase in taxable wealth. The first X number of dollars are subject to a low tax rate, the next X+1 dollars are subject to a higher tax rate, and so on for each increase in X dollars. In other words, as you make money, the government demands a bigger and bigger cut. It’s a wealth tax.
The opposite of a Progressive tax is a Regressive tax. That is a tax that places a disproportionate burden on those least able to bear it. Back in the late 14th century, England enacted a poll tax, requiring every person in the kingdom to pay a fixed amount just for being alive. That led to a Peasants’ Revolt, because the amount of the tax placed a vastly disproportionate burden on the poor, to whom a shilling was a fortune, than on the rich, to whom a shilling was negligible.
Currently, America ostensibly does not have a “Regressive” tax system. This is a lie. America’s tax code is highly regressive. This is because we have the highest corporate tax rate in the Western world. Yay, say Lefties. Let’s stick it to the corporations. That sentiment proves that Lefties are either stupid or uninformed. [Read more…]
Every day lately brings some interesting news. This post sums up a few of the top stories, along with my opinions about why they matter.
I’m watching, fascinated, as events unfold in Saudi Arabia. I suspect Trump has a hand in it and I certainly hope the Crown Prince’s modernization push goes well. If it doesn’t, much badness will follow. I wish I had more to offer, but absent more concrete information about arrests, exiles, helicopter crashes, and alleged Lebanese war declarations, I’m in wait-and-see mode.
I haven’t missed the fact that the killer in Texas got his gun because the government — in the form of the Air Force — failed to put his felony conviction into the gun registry databases. The problem with gun control, of course, is that it not only leaves most of the guns with the government, it also puts government in charge of the guns remaining in citizen hands. As best as I can tell, government see-saws between over-zealous and completely incompetent.
The other thing I haven’t missed about the tragedy in Texas is that it was citizens who saved the day. An NRA instructor with an AR-15 attacked the killer, causing him to stop shooting. (I keep telling my Lefty friends that the only way to stop a bad guy with a gun is a good guy with a gun . . . and that it can take a long time before the police show up with their guns.) Then, it was two citizens who chased the killer down, causing him to crash his car. At that point, that human detritus either died from a self-inflicted shot or from an AR-15 bullet. I don’t know and I don’t care.
Incidentally, the heroic citizens who saved the day are Stephen Willeford, the NRA instructor who stopped the madness, and Johnnie Langendorff, the man who gave chase (with Willeford in the car with him). I refuse to name the killer. He deserves to be disparaged anonymously and then forgotten entirely.
I continue to believe what I tell anyone who is willing to listen to my views about the Second Amendment: There is no such thing as perfect safety. When we avoid one danger, we tend to pitch o ourselves headlong into another. Combustion engines were hailed in the early 20th century as the answer to terrible (horse) pollution. Nobody envisioned lead and other toxic emissions. Modern football helmets, were seen as the ultimate head protection. Nobody predicted that (a) players would start to use their heads like battering rams and (b) modern players, instead of being wiry little guys, would be giants.
When it comes to guns, the invariably unimaginative Leftists see only that guns kill people. They don’t see that guns save people (as happened with Willeford’s appearance on the scene of what could have been a much more terrible outcome). They don’t see that government is a terribly inefficient engine to protect us from guns.
Most of all, they don’t see (or refuse to see) that the surest way to die on the wrong end of a gun is to leave all guns in government hands. Those who could bear witness to this fact are dead — they’re dead in every land, ghetto, and concentration camp that the Nazis controlled; they’re dead in every land that the Soviets controlled; they’re dead in every place that the Maoists governed; and they’re dead in Cuba, North Korea, vast swathes of Africa and Latin America, and in every place in which Islamofascists gain control.
If I have to accept — as we all must — that there is no such thing as perfect safety, I’d rather put my faith in my fellow Americans than in my government. And yes, only Progressives could be stupid enough to demand government control over guns at the same time that they’re still vociferously claiming that our government is in the hands of a madman. That cognitive dissonance alone shows just how bad their arguments are. (You can read more of my thoughts on the subject here.) [Read more…]
Tesla owners shouldn’t be proud about their “green” machine. Instead, they should be embarrassed about a rich person’s car paid for by poor people’s money.
A friend of mine here in affluent Marin is very excited: He just bought a Tesla yesterday. I was less excited. While I can appreciate the Tesla’s elegant design, powerful electric engine, and innumerable high-tech gadgets, I think the Tesla is a fundamentally immoral car. It is, quite simply, a car for rich people that is paid for by poor people. It’s the 21st century version of the old French ancien régime, and we know how that ended up.
The Tesla is fundamentally a product of crony fascism. Back in 2015, Phil Kerpen detailed the way Elon Musk has gamed the system, and I doubt much has changed since then:
Tesla’s flagship automobile, the Model S, would not only fail to make money in a free market, it would likely bankrupt any company that tried. As the Los Angeles Times reported, Tesla’s “cars themselves aren’t making the company any money.” A Model S with a typical options package sells for more than $100,000, but that is literally tens of thousands of dollars less than it costs to manufacture and sell.
How, then, does Tesla make its money?
Less well-known are the hidden subsidies that flow directly to Tesla, thanks to “zero-emission vehicle” (ZEV) credits. ZEV credits are a mandate dreamed up by the bureaucrats at the California Air Resources Board (CARB), which requires manufacturers to build and dealers to sell an arbitrary number of “zero-emission” vehicles each year. (Note that these vehicles are actually “zero-emission” only in the unlikely event that the electricity used by the car comes from a zero-emission source — which, of course, would also be heavily subsidized.)
Tesla’s Model S generates four credits per unit sold. This means the company can sell $20,000 in ZEV credits to other manufacturers for each Model S sold — a cost borne by purchasers of other cars.
And that amount used to be even higher. Because ZEV law is so arcane, Tesla was able to game the system for additional credits; for example, it was able to generate an additional three credits per vehicle when it demonstrated to CARB that its batteries could theoretically be rapidly swapped. But in fact the battery-swapping pilot program is more than a year late getting started. Nonetheless, those extra credits netted the company an additional $15,000 per car sold — and the company is now trying to get them reinstated.
In 2013, ZEV credits to Tesla totaled $129.8 million — to a company that lost $61.3 million for the year on its actual manufacturing and selling operations.
In 2014, Nevada lavished the company with one of the biggest corporate-welfare packages in history: In exchange for building a battery-manufacturing facility near Reno, Tesla will pay no payroll or property taxes for ten years and no sales taxes for 20 years, and will receive $195 million in cash via “transferable tax credits,” which can be sold to other companies to satisfy their Nevada tax bills. All of this amounts to a $1.3 billion giveaway.
Tesla and its apologists constantly tout the fact that the company paid off its hefty $465 million taxpayer-subsidized loan from the Department of Energy early, but they don’t explain why: Had the loan not been paid early, the U.S. Treasury stood to grab a significant portion of the company’s increased stock price by exercising warrants. Capitalizing on the subsidy-stoked electric-car mania that pumped its stock to record levels, Tesla issued $450 million in new stock to pay the loan early and cancel those warrants. The shrewd deal cost taxpayers about a billion dollars, leading Scott Woolley to conclude: “Tesla is worse than Solyndra.”
Tesla has effectively socialized its costs through subsidized loans, tax credits, abatements, and regulatory schemes while privatizing its gains by canceling the warrants owned by taxpayers.
All those who are so smug about fuel efficiency ought to be ashamed because they gain that efficiency on the backs of those who cannot afford Teslas. [Read more…]
I received the following email from a friend. I really can’t add anything to it:
I just read the most ungodly economically ignorant article I have ever read. . . . It even beats out the $15 an hour minimum wage arguments, which at least are based on rational fantasy. [Bookworm here: Or maybe not so rational.]
Let me set this up: Bernie goes to Brooklyn, where he rails against all of the evil businesses he means to destroy, starting with Verizon. Bernie claims that Verizon has paid nothing in taxes, and that it is time for Verizon to pay its “fair share.” (I am starting to become violent every time I hear the word “fair” at this point.)
Sayeth the Bern, “[Verizon] is just another major American corporation trying to destroy the lives of working Americans.”
Verizon’s CEO responds calling Bernie an economic idiot in none too veiled language: “The senator’s uninformed views are, in a word, contemptible.”
After laying out all the facts, including the pivotal fact that, while an NY subsidiary lost money and paid no taxes, the parent company paid over $15.6 billion in taxes in just the past two years, the CEO states, “Nostalgia for the rotary phone era won’t save American jobs, any more than ignoring the global forces reshaping the auto industry saved the Detroit auto makers.”
Wonderful stuff. The CEO’s letter is worth a full read.
Without diving into the details, there are two central flaws with this poster that negate everything it advocates: It assumes (1) that the money Bernie wants to spend belongs to the government, not the taxpayers, and (2) that the government will spend that money better under Bernie’s aegis than you would spend it for your own benefit or that past governments have spent it for the “public good.” One needs only to look at the history of socialism everywhere to realize that, when it comes to managing money (your money, that you earned), the government (which simply took it at gunpoint) does a lousy job and that individuals make smarter decisions.
Let me turn the rostrum over to Milton Friedman:
My college-age child introduced me to a website called I Like Bernie, But… which is particularly appealing to young voters. The website offers short answers to concerns pro-Bernie voters might still be harboring about his policies and his ability to win. With few exceptions, these answers are just plain wrong. You can see my rebuttals at a website I set up as a counterweight (I Don’t Like Bernie, Because…). I’ve republished those same articles here, at my own blog, addressing Bernie’s socialism, his tax plans, and his Second Amendment stance. Today I’m tackling everything that’s wrong with Bernie’s plan to socialize American medicine.
The I Like Bernie site imagines a worried Progressive voter exclaiming “I heard he wants to get rid of Obamacare!” Not to worry , says I Like Bernie. In fact, Bernie wants to make Obamacare even better by putting our entire medical system into government hands:
This promise — that everyone will get high-quality, free medical care, thereby saving American families thousands of dollars a year, while keeping them healthier — is false. There is no way Bernie can do this. The numbers don’t add up, and both the Obamacare experience in America and the socialized medicine experience in Europe show that the free market, not government, is the only way to bring costs down, making quality medical care available to everyone. If you have the patience, this post will walk you through the analysis, using what I hope is clear, simple language, making learning about the economics of medical care a relatively painless process. (Or, as the doctor with the big needle aimed at your arm always says, “This won’t hurt a bit.”)
I. What Bernie promises
Bernie’s campaign, in its ongoing effort to pretend that Bernie is not a socialist (he is, and that’s a bad thing), has titled his plan “Medicare for all.” When he talks about his plan, though, Bernie skips that cute Medicare euphemism and goes for the kill: “The only long-term solution to America’s health care crisis is a single-payer national health care program.”
The “single payer” to whom Bernie refers is the government. That’s a euphemism too. The government isn’t really paying for anything at all, because the government doesn’t have money of its own. It never earns money, it takes money. Thus, all of the money in its bank account is actually taken from every American who pays taxes.
So what Bernie really means when he talks about single-payer nationalized medicine is that he wants “taxpayer-funded” health care. He envisions using taxpayers to fund his grandiose plan of setting up a system in which the government takes those taxpayer funds and, after siphoning off vast funds for administrative salaries, waste, and graft, takes what’s left to pay for doctors, nurses, physician’s assistants, hospitals (everything from janitors to floor clerks to surgeons), and pharmaceuticals. It will impose these prices from the top down, bullying doctors and nurses who spent years, or even decades, perfecting their skills; hospitals that have invested millions in infrastructure to provide patient care; and pharmaceutical companies that routinely invest millions in research that usually comes up dry, in the hopes of hitting it big with the odd medicine here and there.
Here’s the truth: Even if you love Bernie’s plan, it can’t work. The numbers won’t add up, just as they haven’t been adding up in Europe or in America (with Obamacare). In the rest of this post, I’ll explain why.
My daughter introduced me to a pro-Bernie site called I Like Bernie, But…. There, in response to various concerns voters might have about Bernie (e.g., he’s a socialist or a taxer), the website provides short, pithy, and entirely inaccurate responses aimed at setting those fears to rest.
Because I know that the website appeals strongly to young voters, I created a website called I Don’t Like Bernie, Because… that challenges the misinformation. Today I challenged the pro-Bernie’ website’s breezy promise that higher taxes on the rich will easily fund Bernie’s spending plans, leaving tons of money left over for everyone else. Here’s that post:
The new website I Like Bernie, But… tries to calm people’s fears about Bernie Sander’s socialist extremism. It states questions reflecting concerns that people might have about Bernie, and then provides pithy little answers refuting those fears.
In a previous post, I addressed the myriad falsehoods, omissions, and misconceptions in the website’s assurance that Bernie isn’t a dangerous socialist, he’s a good socialist. This post addresses the misleading answer to a concern that “I heard he [Bernie] wants to raise taxes.”
Here’s what I Like Bernie, But…. has to say about Bernie and taxes:
That’s simply false. Here’s the truth:
Nevada puts education power back in parents’ hands
People who oppose the power of the teachers’ unions and who believe in parents’ rights to educate their children as they, not the government, see fit, should keep an eye on Nevada, which makes it possible for all Nevadans to opt out of the public school system:
I haven’t quite reconciled myself to the fact that today is Wednesday. I feel as if I’m caught in a perpetual Monday loop. Between work emergencies and Mom’s doctor appointments time, as Steve Miller said, “keeps on slippin’, slippin’, slippin’ into the future.”
I’ve got a backlog of articles that friends have sent me, so I’m quickly going to bring them to your attention, because I bet you’ll find them interesting. For speed’s sake (I’ve got a ton to do today), I’m going to present this Instapundit style, with just a sentence or two. This exercise in brevity will be a good discipline for me.
Climate scientists keep being proven wrong. When will they ‘fess up, rather than digging their hole even deeper?
People in porn videos tend to end up splashed with a lot of fluids — so California wants them to wear eye protection. I see a new fetish being born.
I’ve always said that the reason democracy building worked in Japan and Germany was because we totally destroyed their pre-existing societies. Slowly, slowly, others are figuring out that our failure to smash Iraq is where we went wrong with democracy building there.
We can’t tell whether we’re as solvent as oil-rich Norway or as broke as profligate Greece because our government financial numbers are lies.
All the good liberals in Marin are up in arms at the way local and regional governments are forcing our spacious suburb to become a crowded urb. I wonder when they’ll start realizing that this is not an accident. If Marinites want to see the future, they should look at Minneapolis.
An excellent rebuttal to Bernie Sanders demand for fully-subsidized college educations.
It’s always amazed people that Europe could go from the superior engineering feats of the Romans (especially water transport) to the primitive engineering of the early Dark Ages. Now you don’t need to wonder anymore about the journey from a relative enlightenment to a new dark age — you can see it happening in real time in America.
A cool granny: she flew Spitfires for the British during WWII.
Not all viruses have to be bad — here’s a clever idea for virus engineering in an era characterized by a growing number of antibiotic resistant bacteria.
Looking at Sidney Blumenthal’s disgraceful antics on Hillary’s behalf, and the pass the MSM media is giving Hillary and all of her cronies, it’s worthwhile to remember how the media disgracefully smeared Scooter Libby, who ended up in prison thanks to the media witch hunt.
Anyone surprised that the IRS paid billions in fraudulent refunds?
It’s gotten to the point where much of what passes for “science” is fraud, ignorance, propaganda, and plain-ole’ lies.
Because Californians don’t suffer enough economically, gas taxes are probably going up. I used to believe that I would live out my days in California. I don’t anymore. I’m already planning an exit strategy.
This is a VERY simple way to understand the tax laws. Read on — it does make you think!!
Let’s put tax cuts in terms everyone can understand. Suppose that every day, ten men go out for dinner. The bill for all ten comes to $100. If they paid their bill the way we pay our taxes, it would go something like this:
The first four men — the poorest — would pay nothing; the fifth would pay $1, the sixth would pay $3, the seventh $7, the eighth $12, the ninth $18, and the tenth man — the richest — would pay $59.
That’s what they decided to do. The ten men ate dinner in the restaurant every day and seemed quite happy with the arrangement — until one day, the owner threw them a curve (in tax language a tax cut).
“Since you are all such good customers,” he said, “I’m going to reduce the cost of your daily meal by $20.” So now dinner for the ten only cost $80.00.
The group still wanted to pay their bill the way we pay our taxes. So the first four men were unaffected. They would still eat for free. But what about the other six — the paying customers? How could they divvy up the $20 windfall so that everyone would get his “fair share?”
The six men realized that $20 divided by six is $3.33. But if they subtracted that from everybody’s share, then the fifth man and the sixth man would end up being PAID to eat their meal. So the restaurant owner suggested that it would be fair to reduce each man’s bill by roughly the same amount, and he proceeded to work out the amounts each should pay.
And so the fifth man paid nothing, the sixth pitched in $2, the seventh paid $5, the eighth paid $9, the ninth paid $12, leaving the tenth man with a bill of $52 instead of his earlier $59. Each of the six was better off than before. And the first four continued to eat for free.
But once outside the restaurant, the men began to compare their savings. “I only got a dollar out of the $20,” declared the sixth man who pointed to the tenth. “But he got $7!”
“Yeah, that’s right,” exclaimed the fifth man, “I only saved a dollar, too … It’s unfair that he got seven times more than me!”.
“That’s true!” shouted the seventh man, “why should he get $7 back when I got only $2? The wealthy get all the breaks!”
“Wait a minute,” yelled the first four men in unison, “We didn’t get anything at all. The system exploits the poor!”
The nine men surrounded the tenth and beat him up. The next night he didn’t show up for dinner, so the nine sat down and ate without him. But when it came time to pay the bill, they discovered, a little late what was very important. They were FIFTY-TWO DOLLARS short of paying the bill! Imagine that!
And that, boys and girls, journalists and college instructors, is how the tax system works. The people who pay the highest taxes get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just may not show up at the table anymore.
Where would that leave the rest? Unfortunately, most taxing authorities anywhere cannot seem to grasp this rather straightforward logic!
Professor of Accounting & Chair,
Division of Accounting and Business Law
The University of South Dakota
School of Business
Another excellent Prager University video, this time about America’s tax code, which is fair if you believe (a) in income redistribution and (b) that one can still have good government if almost half of America’s people, because they pay no taxes, have no skin in the game when it comes to government spending.
At a lawyer level, this has been a somewhat frustrating day, with me struggling to fit my facts (always true and honest ones) to the law (which sometimes refuses to cooperate), capped by a power outage that lost me an hour of time. Add to that the usual cries for attention from family, and I’m feeling a little . . . ummm, stressed. Still, I have stuff I want to share with you, so let me whip through it:
Chilling look into the near future at what the next school attack might look like
Mike McDaniel, who blogs at Stately McDaniel Manor, has looked at past school shootings, both at home and abroad, and come up with a possible scenario for the next assault on an American school. I don’t doubt that he’s accurately predicting a possible American future unless we take steps now to head it off.